Apple Pay is partnering with Fandango for movie ticket discounts (AAPL)

BI Intelligence

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Apple is partnering with movie ticketing company Fandango to offer a $5 discount to consumers using Apple Pay to buy tickets on Fandango's app or website, according to Phone Arena. 

This offering follows Apple's recent promotion with Postmates Unlimited, a delivery subscription service, in which it offered a free trial of the service to consumers who signed up using Apple Pay.

Apple Pay can use promotions and discounts as an onboarding tool for new customers. 

• Rewards can be an effective catalyst for wallet usage. In the US, Apple Pay adoption has stagnated around 25% of eligible users, which means the wallet needs to find better ways to onboard new customers. Rewards offerings can be one such tool — 44% percent of wallet nonusers would adopt a wallet if given access to wallet-specific rewards, and merchant-specific rewards and loyalty offerings are among the top demanded features for wallet usage. That's proven true for Samsung Pay, which saw a 49% user increase in the first year after it introduced its Samsung Rewards program. By incentivizing consumers to load their card into Apple Pay, Apple could help recruit new users to the wallet and, in turn, give them a reason to test the product. 
• And this promotion can help Apple Pay highlight its various use cases. Rather than pushing users to try Apple Pay at the in-store point-of-sale (POS), this promotion demonstrates Apple Pay's app- and browser-based functionality, which might be more appealing to users because it can help reduce friction associated with checking out on mobile due to small screens and slow connection speeds. If customers like the Apple Pay experience in Fandango, they might continue to turn to the product, therefore increasing not just adoption but also engagement via habit formation, in turn helping the wallet grow its loyal user base.

Jaime Toplin, research analyst for BI Intelligence, Business Insider's premium research service, has written a detailed report on mobile payments that:

• Sizes the US in-store mobile payments market and examines growth drivers.
• Analyzes headwinds that have suppressed adoption.
• Identifies three strategic changes providers can make to improve their results.
• Evaluates pockets of success in the market.
• Provides actionable insights that providers can implement to improve results.

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