Insights Technology

Apple Pay: From Skepticism to Success

Apple Pay: From Skepticism to Success

Eight years ago, when Apple launched its contactless payment system, Apple Pay, the response from consumers and retailers was largely skeptical. At the time, CEO Tim Cook was asked about reports that some big-name US retailers were refusing to accept Apple Pay, to which Cook replied,

We’ve got a lot more to go. We’ve got a lot of merchants to sign up. We’ve got a lot more banks to sign up. And we have the whole rest of the world. We’re only in the US right now. And so we’re just getting started.


Despite the initial slow adoption, Cook’s positive outlook has finally come to pass. Today, Apple Pay has become a ubiquitous service, with an activation rate of around 75% on iPhones.

Apple Pay

In 2014, when Apple Pay was first introduced, only 10% of iPhones had activated the service. By 2017, that number had risen to 20%, and it wasn’t until 2020, three years after Cook’s optimistic outlook, that the activation rate of Apple Pay doubled and hit 50%.

So, how did Apple manage to turn things around? Here are some of the key factors that led to the success of Apple Pay:

  1. Pestering: Apple was very persistent in trying to get consumers to adopt Apple Pay. For a while, if you had not activated Apple Pay, you would see a little red bubble on your iPhone that was hard to ignore. Many people started adding their credit cards and debit cards to the Apple Wallet just so they would have a cleaner iPhone to look at.
  2. Technological infrastructure: At the time of Apple Pay’s launch, only 3% of retailers and stores in the US had the technological infrastructure for contactless payments. As more and more stores upgraded their systems, the adoption rate of Apple Pay gradually increased. Apple says that number is now 90%.
  3. Human behavior: The rest of the world, especially Europe, was several years ahead of the US in terms of using contactless payments, giving Apple confidence that Americans were not so different from the rest of the world and that it would just take a little time to catch up. The pandemic further accelerated this shift, as more people preferred to use contactless payment methods rather than handing over their credit cards to cashiers or sticking their cards into terminals.
  4. Long game: Apple is trying to make the physical wallet obsolete, and wants your phone to replace the wallet. This means putting credit cards, driver’s licenses, ID, and insurance cards on your phone. Apple’s ability to stick with Apple Pay and wait for it to reach its potential is a testament to the company’s patience and persistence.
  5. Making the iPhone more useful: Apple’s goal was not just about changing the way we spend money in restaurants or stores but to make the iPhone more useful and more valuable. There is research that suggests that people would rather leave home without their wallets than without their phones. By offering a service like Apple Pay, Apple made the iPhone a more valuable and essential tool in consumers’ lives.

Apple Pay’s journey from skepticism to success teaches the tech world valuable lessons about patience, persistence, and the importance of a long-term vision. Apple’s ability to stick with Apple Pay, despite initial slow adoption, and wait for the rest of the world to catch up to its vision, has paid off in a big way.

Apple Pay

Today, Apple Pay is a ubiquitous service, with an activation rate of around 75% on iPhones, and it continues to be a key part of Apple’s strategy to keep customers engaged and connected with their devices. Apple Pay’s security and ease of use have been major selling points for users and it has become a popular alternative to traditional credit cards and cash.

Additionally, the ability to use the service across multiple devices and platforms has made it even more appealing. However, there is still room for growth and improvement, especially as competition in the mobile payment space increases.

Apple is likely to continue to add new features and expand its partnerships with merchants and banks to further increase the popularity and adoption of Apple Pay. Despite some challenges, it’s clear that the future looks bright for Apple Pay as it continues to be an important player in the ever-evolving mobile payment landscape.