Alipay "exclusively" promotes "Tap to Pay". Is it targeting the future entry point of mobile payments?

Alipay's "Tap to Pay" feature, launched last year, swept across the country like a storm in the second half of this year.

According to the official definition, Alipay's "Tap to Pay" is a brand - new payment experience based on Alipay's payment code and NFC communication technology.

If an Alipay user's mobile phone supports NFC and the function is enabled, then in the unlocked and screen - on state (no need to open the Alipay app), simply touch the merchant's "Tap to Pay" cashier device to complete the payment.

Compared with the currently still mainstream QR code payment, "Tap to Pay" allows users to complete the payment more quickly and easily.

Official data shows that the number of users of Alipay's "Tap to Pay" exceeded 100 million 321 days after its launch. From May to September this year, the number of "Tap to Pay" users increased from 100 million to 200 million. In addition, as of September this year, nearly 100 million users have experienced multiple "Tap to Pay" services. When both "scan" and "tap" options are provided, "80% of users prefer 'Tap to Pay'."

What exactly happened behind the accelerated expansion of Alipay's "Tap to Pay" in recent months?

Alipay Unleashes Five Strategies to Promote "Tap to Pay"

According to Leikeji's observation, to strongly promote "Tap to Pay", Alipay has at least unleashed the following strategies.

1. Continuously distribute red envelopes to users.

When it comes to cultivating users' behavioral awareness and usage habits, nothing is more effective than continuously distributing red envelopes or subsidies.

The "Tap to Pay" red envelopes distributed by Alipay include "Daily Discounts" (triggered every time of use), "Collect Cards for Rewards" (the more times of use, the larger the amount of the exchanged red envelope), and red envelopes for specific merchants. If you use "Tap to Pay" every day, you can accumulate at least one or two yuan in red envelopes in a week.

(Screenshot source: Leikeji)

There is no other way to achieve immediate market promotion results in the short term.

2. Promote NFC hardware in the form of "stickers".

NFC is not a new technology. One of the main reasons it has been difficult to truly promote over the years is that the cost of cashier devices supporting NFC technology is relatively high, making it difficult for small shops and individual businesses to adopt.

In addition to the common large - store machine model, Alipay also provides sticker - style "Tap to Pay" tools in many small shops.

(Image source: @ENCR Lanyu, Xiaohongshu)

By promoting NFC hardware in the form of low - cost (even extremely low - cost) stickers, small shops and individual businesses have finally caught up with the new wave of NFC payment. For different environmental scenarios and merchants' preferences, Alipay also provides more forms of NFC hardware, such as standing signs, bosses, and integrated hanging bosses.

Official data shows that currently, tens of millions of merchants across the country support Alipay's "Tap to Pay", and more than 1000 scenarios support "Tap to Pay".

3. Expand the application scope of "Tap to Pay".

Can NFC technology and the "Tap to Pay" experience only be used in payment scenarios? Obviously, Alipay doesn't think so. Even in the payment scenario, "Tap to Pay" has derived new gameplay such as "ordering food".

Tap to unlock a shared bike quickly; tap when picking up a courier without needing a pickup code; tap when checking into a hotel without an ID; tap when a delivery rider enters a community for identity verification without registration; tap when using a computer in an Internet cafe to surf the Internet without an ID, log in without entering a card password, and even order food when hungry...

(Image source: Alipay)

Based on the "user identity verification" system, Alipay has brought a series of new usage scenarios and gameplay for "Tap to Pay".

4. Collaborate with merchants and ecological partners for joint promotion and mutual benefits.

If only Alipay, Ant Group, or Alibaba - affiliated companies were promoting it, the market expansion speed of "Tap to Pay" this year would not be so fast.

In recent months, Ant Group has been actively collaborating with major merchants and ecological partners to jointly promote Alipay's "Tap to Pay".

(Image source: Leikeji)

For example, many Focus Media billboards in residential elevators have quietly installed Alipay's "Tap to Pay" terminals. Simply take out your phone and tap it to receive red envelope discounts from nearby merchants. While local merchants increase their presence and conduct marketing, they can also drive users to their stores for consumption, and at the same time cultivate users' habit of "Tap to Pay", which is a win - win situation for all parties.

After the number of Alipay's "Tap to Pay" users exceeded 200 million, Ant Group is still actively collaborating with more partners to participate in the construction of the "Tap to Pay" ecosystem.

(Image source: Alipay)

In the past month, Ant Group has successively signed or reached ecological cooperation and promotion agreements regarding "Tap to Pay" with mobile phone manufacturer OPPO, smart glasses manufacturer Rokid, Beijing Municipal Transportation Card, and GAC Energy.

Among them, OPPO phones will support Alipay's "Tap to Pay" whether the screen is on or off. Alipay will also increase the opening of its "Tap to Pay" ecological capabilities to OPPO, enabling its new phones to realize functions such as sending red envelopes through "Tap to Pay" for the first time among domestic mobile phones. Users can complete identity verification and payment by bringing their phones close to the NFC induction area of GAC Energy's charging piles, without the need to scan a QR code throughout the process. It's truly "Tap your phone to start charging".

5. Launch a payment security guarantee of "Tap with Confidence, We'll Compensate".

Compared with the "visible and tangible" QR code payment, NFC technologies such as "Tap to Pay" bring a "seamless" payment experience.

To alleviate some people's concerns about "seamless payment", Alipay has launched a payment security guarantee of "Tap with Confidence, We'll Compensate". If a user suffers a fund loss due to account theft or during the payment process, Alipay will fully compensate after verification. In addition, each "Tap to Pay" transaction generates an independent encrypted token to prevent information from being intercepted and reused, and Alipay's risk control system also provides behind - the - scenes protection.

Based on the above points, Alipay's "Tap to Pay" has achieved immediate promotion and application results in recent months.

Develop "Tap to Pay" in the Way of "Scan to Pay"

Interestingly, Alipay's "Tap to Pay" currently follows the same underlying application logic as "Scan to Pay", which plays a crucial role in accelerating user education and market penetration.

In traditional NFC technology applications, such as the most typical electronic bank cards/bus cards (Apple Pay and other Pay applications), the mobile phone is "simulated" as a bank card or bus card, and the corresponding NFC cashier device reads the information of this "simulated" bank card or bus card after the touch.

Alipay's "Tap to Pay" essentially provides an alternative interaction method for "Scan to Pay", with fewer operation steps and easier use.

Scan to Pay: Unlock the phone, open the Alipay app, bring up the "payment code", and finally aim at the scanning device (the user actively opens the Alipay app).

Tap to Pay: Unlock the phone and touch the cashier device (the system calls the Alipay app in the background).

Previously, users could only pay by "scanning", but now they can also pay by "tapping". It's still the same payment function, and the underlying app is still Alipay, but the operation steps are significantly simplified, and the interaction is more natural. Such a new payment paradigm only needs time to explode and become popular in the market.

(Image source: Alipay)

To quickly develop the "Tap to Pay" market, Alipay has been targeting specific user groups that "Scan to Pay" cannot serve well since the birth of this tool.

Data from the first half of this year shows that among Alipay's "Tap to Pay" users, 50% are young people who pursue efficiency, 30% are the elderly and visually impaired, and 20% are inbound tourists.

Notice something? Positioning "Tap to Pay" as a new application that can better replace "Scan to Pay" among specific user groups is the key to reaching the first 100 million users. Moreover, for inbound tourists, the elderly, and the visually impaired, the 'operation threshold' of QR code payment is undoubtedly higher, which has become a breakthrough point for the NFC payment application market.

Since this year, along the line of inbound tourists, Alipay has also joined hands with partners to launch new services such as "Tap to Refund Tax" in many popular tourist destinations for international tourists in China, further expanding the application scenarios of "Tap to Pay".

NFC is the Future of Payment, but Alipay is Leading Alone

The market structure of offline mobile payment in China has been solidified over the years: Alipay and WeChat Pay dominate the market, and neither can completely defeat the other. QR code payment has long occupied the dominant position in the market.

In this context, Alipay, which started from mobile payment, clearly has more motivation to lead the promotion of the new round of technology and scenario applications to break this "stagnant" market structure. Many years ago, it was Alipay that took the lead, and WeChat Pay followed strategically, jointly pushing "Scan to Pay" to the top of the domestic offline mobile payment system.

The new wave of "Tap to Pay" that Alipay is currently leading, although mainly in the payment scenario at present, has far greater functional plasticity and scenario expandability than "Scan to Pay". The currently vigorously promoted and expanded "user identity verification" system application is a prime example. More importantly, "Tap to Pay" is naturally a technology application paradigm that is closer to users' natural interaction and instinctive habits than "Scan to Pay".

(Image source: Alipay)

The new round of competition in the offline mobile payment market has begun, from meeting users' basic payment functions to providing better and more diverse payment experiences.

Neither the face - scanning payment that Alipay is trying to promote nor the palm - scanning payment that WeChat is trying to promote can be compared with NFC payment styles like "Tap to Pay" in terms of user acceptance and market recognition.

Industry data shows that the penetration rate of NFC functions in domestic smartphones has reached 70%. The mobile devices of the vast majority of domestic users already support NFC technology. On the merchant side, with the "stickerization" of NFC hardware and Alipay's strong promotion, the full - coverage process of the offline market is accelerating, and the day of popularization is not far away.

In terms of the update of NFC technology standards, an earlier article on Leikeji introduced the "historic breakthrough" of expanding the NFC hardware reading distance from 5mm to 20mm. In the future, NFC payment and other scenario applications may not require actual touching to complete relevant operations, and the application scenarios and target audiences will become even broader.

Alipay launched "Tap to Pay" last year and started to strongly promote it this year, which is just in time.

After overcoming many practical obstacles, NFC technology should gain a higher profile and greater influence in the offline mobile payment and more scenario application markets.

After Alipay, it is expected that more manufacturers and platforms (such as WeChat Pay) will follow this new wave of offline payment and application to jointly accelerate and achieve the popularization of NFC technology applications in the Chinese market earlier.

This article is from "Leikeji" and is published by 36Kr with permission.