When Apple introduced its mobile payment system in 2014, the company was looking to leverage the popularity of its iPhone by adding more functionality and convenience for millions of customers. With Apple Pay, iPhone owners and Apple Watch wearers first enter their credit- or debit-card information, which Apple confirms with the banks. Once this information is on file, Apple creates a digital “token” that will be electronically transmitted to the retailer when an iPhone owner pays for something. To complete a purchase, the customer simply waves the phone or taps it at the checkout, uses the iPhone’s Touch or Face ID security to activate Apple Pay, and the phone instantly transfers the token as payment.
Even though Apple Pay offers consumers the benefits of convenience and security, Apple knew it wouldn’t succeed without a large network of retailers, restaurants, and other businesses agreeing to accept its mobile payments. Among the earliest businesses to sign up with Apple was McDonald’s, which agreed to honor Apple Pay in its 14,000 U.S. restaurants and drive-through locations. “We serve 27 million customers every day. This is a clear and compelling business opportunity for us,” explained McDonald’s chief information officer. Compared with cash transactions, Apple Pay transactions cost McDonald’s a few pennies more to process because of bank fees. Yet the fast-food giant was willing to sign on because it saw competitive advantage and profit potential in wooing iPhone users interested in speedy checkout.
Another early business supporter was Walgreens, the nationwide drug-store chain with 85 million customers enrolled in its frequent-buyer rewards program. Walgreens sells snacks, household products, and health and beauty items in addition to health-care products. Not only did Walgreens agree to accept Apple Pay at its checkout counters, but it was also the first U.S. retailer to add its rewards program to Apple Pay’s easy sign-on system. As a result, Walgreens’ customers tap twice at the checkout, once to activate the rewards account and display their savings, the second time to process the actual payment. By deciding to honor Apple Pay, Walgreens said it was “enabling a simple and convenient customer experience.”
Several hundred thousand businesses had signed on to participate by the time Apple Pay launched in October 2014. Apple’s ongoing efforts to increase business participation paid off: Eighteen months later, the network of participating businesses topped 2 million, and major companies like Starbucks, Domino’s, and Crate & Barrel were preparing to participate. Eyeing international expansion, Apple also initiated talks with banks in China to bring Apple Pay to millions of iPhone users there. Today, Apple Pay is accepted at more than 50 percent of all U.S. retail locations and in many retail stores in twenty countries.
Even though more consumers are making more mobile payments year after year, not every U.S. retailer is willing or able to work with Apple Pay. Some aren’t satisfied with the amount of consumer information that Apple Pay shares with participating merchants. Others would have to upgrade to new checkout technology for Apple Pay. Still others are locked into exclusive mobile payment deals with competing services.
Today, mobile payments represent a small fraction of all purchase transactions, dwarfed by cash as well as by credit and debit payments. And Apple Pay faces strong competition from Google, Samsung, and others operating in the mobile-payment market. To remain a leader, Apple will have to keep signing more participating businesses and showing consumers the benefits of paying by iPhone or Apple Watch whenever they make a purchase.
Which of the four categories of business markets is Apple Pay best suited for, and why?

Want to see the full answer?
Check out a sample textbook solution
- An example of Possession processing Question 4Select one: a. Hairstylist b. Car repair c. Education d. Consultingarrow_forwardIntangibility means Question 2Select one: a. When production and consumption are simultaneous b. Services cannot be touched, seen, tasted, heard, or felt in the same way as goods c. Services depend on their employees for quality, which makes consistency difficult to achieve d. Services cannot be saved, and it is challenging to synchronize supply and demand.arrow_forwardOne of the key steps in the selling process is assessing customer needs. Needs assessments will help develop solutions and will help handling objections. For each of the following scenarios, provide questions you would ask your customer to probe for customer needs. Product being Sold Question 1 Question 2 Question 3 Purchasing a sleep number bed Cost - $8.600 Purchasing a new vehicle. Cost – $25,000 Purchasing a jacket Cost - $45 Purchasing an Apple Watch Series 2 Cost- $399 Purchasing a pair of shoes Cost - $85arrow_forward
- Choose a product and explore its competitive advantage. Provide the following What are the competitive advantages of your product? How will you use informative promotion? How will you use Persuasive promotion? How will you use reminder information? How are you going to use connection to promote your product? What tools from the promotional mix will you use? Finally provide a video link or a picture of a print ad for your product, keeping competitive advantage in mind.arrow_forwardIdentifying Product Benefits Assignment 4.7 Provide an example of a product attribute Provide an example of a product benefit In your own words tell me what is the difference between a product attribute and product benefit. Explore advertising appeals. Please provide an example of an advertisement that represents each appeal. Advertisement can be a commercial, print Ad picture, etc. Refer to the figure below to assist you with advertising appeals and their goals towards a target market. Profit Health Convenience Environmental consciousnessarrow_forwardDescription of variables: • Converted = 1 if they bought • Amount = how much they paid for the bag if they bought it • Margin = amount - $50 • Got search ad = 1 if the search ad was displayed as the user was searching for handbags on Google • Clicked on search ad = 1 if they clicked • Got email = 1 if they got an email with a 20% discount from the handbag seller ($100 instead of $125). Some users got both the search ad and email • Clicked on email = 1 if clicked (though it doesn't mean they converted) • Clicked ad & email = 1 if clicked on both the search ad and the email • Campaign = 1 if got any ad Some more data from the handbag seller: • The search ad CPT = $9 (cost per thousand impressions) • Email CPT = $12 (cost per thousand emails sent out) • The costs associated with each sold bag = $50 (the margin depends on the price customers pay)arrow_forward
- The success achieved by firms when they take their inventions to market is referred to as formation-ability. homologation. consultation. conversion-ability. liquidation.arrow_forwardYour portfolio project consisted of an international marketing plan developed during the previous weeks of the course. Assume you are in a marketing role for the company and you will need to present your critical findings to the board of directors. Select the three most important results from your portfolio project and record a video of yourself presenting these findings. Be creative and use effective communication skills.arrow_forwardMarketing Communication Assignment 4.5 Identify AIDA and how it correlates with the promotional mix A I D A Provide a visual example of AIDA being used in advertising. ( you can provide an AD print or link to a commercial. In your own words define Push strategy and Pull strategy provide an example of both. Push Pull Definition: Definition: Example: Example:arrow_forward
- Provide the following Describe the importance of retailing? What are examples of future developments in retail management? What is retail channel omnification? Provide an example of different types of retail operations, include the type of marketing that would work best with this type of retailer? Retailer Example Marketing Strategy Department Store (Example) Macys Product assortment Specialty Store Drugstore Supermarkets Convenience Store Discount Store NONSTORE RETAILER Example : Direct retailer Avon Direct marketing 1. 2.arrow_forwardA firm has developed a new roofing material that also produces electricity from sunlight. This material is very light and inexpensive. Besides roofing, it could also provide an inexpensive carport covering for open-air parking lots. The firm has hired me as a consultant for the successful national launch of this product. I am are required to present a report to the senior management describing when and where this product should be launched. Identify different segments of the market for launching this product. Recommend which segments of the product should be targeted first for maximum returns to the firm and support recommendation.arrow_forwardGive some thought to your management information system (MIS), which you’ll need to gather, process, and present data about marketing, finance, operations, administration, and human resources for decision-making purposes. What kinds of databases will be most vital to your management of this startup firm? What limitations should you be aware of when planning your MIS? Write a few sentences summarizing your use of MIS in the new business.arrow_forward
- MarketingMarketingISBN:9780357033791Author:Pride, William MPublisher:South Western Educational PublishingFoundations of Business - Standalone book (MindTa...MarketingISBN:9781285193946Author:William M. Pride, Robert J. Hughes, Jack R. KapoorPublisher:Cengage LearningFoundations of Business (MindTap Course List)MarketingISBN:9781337386920Author:William M. Pride, Robert J. Hughes, Jack R. KapoorPublisher:Cengage Learning
- Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,Contemporary MarketingMarketingISBN:9780357033777Author:Louis E. Boone, David L. KurtzPublisher:Cengage Learning



