A year into the Google Wallet launch with Jenny Cheng

One of the things I appreciate about Google’s approach to finding the right products and services in financial services and fintech to offer its users is that it’s playing the long game. A year ago, Jenny Cheng and her team launched Google Wallet, which combines the payment capabilities of Google Pay with the convenience of storing things digitally that you would normally carry in a real world wallet, like a drivers license or a health insurance card.

Jenny joins us on the podcast to discuss the market for mobile wallets and how she and Google wanted to stand out from the growing choices consumers have. She shares some demographic information about who uses digital wallets and who doesn’t, homing in on the ability to truly free a user from the constraints of a digital wallet as a potential avenue to get the over 40 year old set to finally adopt wallets.

Jenny also describes the power of an ecosystem approach that Google has built around Google Wallet, servicing merchants and consumers, yes, but also third parties that are needed to create a more expansive offering.

Jenny Cheng is my guest today on the Tearsheet Podcast.

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The following excerpts were edited for clarity.

I'm Jenny Cheng, VP, General Manager of Google Wallet at Google. I have the privilege and pleasure of leading the team that launched Google Wallet over this last year. In fact, we're hitting our one year anniversary later this month.

Growing number of wallet choices for consumers

I think there are fabulous choices out there for mobile wallets as a whole. Over the last seven to eight years, I think we've had some major shifts happening. One of them is just around digital and the generational shifts happening there. I'm the mom of two Gen Zers, and I thought, Gosh, I grew up in the era of the internet. We're very fortunate over the last 25-30 years now where we shifted from an overall technology perspective.

Young people use wallets -- older folks not that much

It's fascinating to just look at some of the metrics that are happening out there. There's a big division at about age 40 In the US -- over the age 40, there's a lot less adoption around mobile wallet usage. The numbers are relatively low: they're in the mid 35% to 38% perspective. And then when you look at that next generation, their usage is really high, as expected. And that's true in the US and that's true globally. They're just more willing and expecting to be able to use their mobile phone to access everything. And that includes being able to pay and to be able to access their kind of day to day needs via their mobile phone.

So when you think about that shift and where people are going, and then globally -- even when you think about the fact that most people have a phone, but not everyone has a laptop or computer -- the importance of the phone has really risen, and related to that, digital wallets have really become a place where people expect to be able to get to things they need, whether it's payments or other items that are critical for their day to day aspect.

Wallets focus on safety and security

When you think about mobile wallets, and what's important related to that, I think a lot of it is about the safety and security and the accessibility you get from having a mobile wallet on your phone.

And with Google Wallet, we're really excited, as you can imagine, because this has been a long journey in terms of being able to be thoughtful about bringing an app to market that not only gives you access to payments, but all the non payment pieces that you would expect. So that is your identity, your health insurance cards -- things you would normally put in your physical wallet. I like to say my goal here is to be able to leave your physical wallet at home and be able to leave the house and get in the car just with your phone, be able to do a lot of things there, and feel safe and secure about it without having to worry.

I have an entire purse full of things that I have to get through to find my car keys. So to be able to leave that all behind will definitely save my shoulder and my back from from at least five to 10 pounds of stuff that I need to carry around.

Google Wallet includes identity docs

When you think about all the things you need to have access to when you're traveling, I just went on a vacation. And to think about a point where we can get to: where your boarding passes are on your mobile wallet. We just launched mobile drivers licences with Maryland, for example. So you could actually use your Google Wallet then to go through TSA, use that to show your ID to validate going through. And then when you board, show your boarding pass. I think that is so convenient.

I'm a big fan of the convenience aspect rather than having a lot of paper or potentially misplacing your drivers licence when you pull it out. And then you're busy trying to put all your stuff together to get through security, misplacing it, dropping it -- I think there's an aspect that just makes your life simpler if you can just have it all on one device, easily accessible.

How Google Wallet and Google Pay play together

We've been on a journey here at Google. Google Pay is really the payment service and the payment mark overall. We also have a Google Pay-related app that really focuses on all the things you can do around your financial health and being able to clearly access your transaction history, things that you may want to look at related to your payment.

Now, the Google Wallet really is about bringing this all together. So all forms of payments. We just recently announced QR in Brazil, for example, so you can actually use a QR code to make a payment, because it isn't just about being able to tap and pay in every country -- the needs and the type of payments vary widely based on where you are across the globe.

So to be able to access all forms of payment, but then also all those non payment areas that I mentioned. Looking at everything you would normally put in your physical wallet -- how do we enable that to go digital? We offer digital car keys. We just announced were getting to the point where you can actually put your corporate badge on your Google Wallet as well. So to be able to badge through our buildings here at Google, to be able to badge through that with your mobile wallet is a big change from having to dig through all your stuff to be able to get to other things you may need to access.

I think we're at the point where the majority of us have our phone in our hand, for better or worse, all the time. And so to be able to make it very accessible and very helpful is a key part of Google Wallet as a whole.

Will future growth come from going deeper with younger consumers or convincing older folks?

I think it's both because when you look at why people, regardless of age, are not using a mobile wallet, it's usually related to two things. One is just a lack of awareness to the fact that they could actually tap and pay for example, and not have to reach out for a credit card. That's one aspect. The second aspect is just making sure that we're focused on all things related to trust. So you know that you can actually leave your physical wallet at home because you have everything you need on your mobile phone and you can use it where you go. So there has to be an acceptance as well of being able to use a digital wallet.

The second part of that is also feeling secure -- it's absolutely critical that you feel like you can trust the security related to your mobile wallet. And so with Google Wallet, we're really focused on the fact that we have enabled a lot of security both at the user level, but also at what we call the passes -- the non payment aspect. We have this concept of private passes, so that when you save your health insurance card to Google Wallet, you have to re-authenticate. We've added an additional step to make sure that there are different ways you can enable your passes that are more sensitive to be safer behind another level of security.

Where does the market head with so many choices? 

I think there's a couple of things. One is, there has just been a big shift in commerce. I think a lot to my own experience, and the experiences of my family, we have really moved into this omni channel world where people are shopping and browsing both online and in person. And you may start in person and then go online to finish that experience. And in that sense, I think really thinking about what are the best ways we can bring that consumer experience together, both in person and online, in a really seamless way -- it's absolutely critical to where the overall industry is moving.

For Google, in particular, we really think about the fact that we want to be able to give that consumer as much accessibility as possible. And when I think about that, it's really about different ways to make payments and just be able to surface the right kind of payment at the right time -- it's a key part of that thinking. And so when you see that shift in the industry, I think a lot of the consumer side, as well as the business side, is really thinking about how do we do that overall?

And how do we enable that both from the merchant side of the house, but especially from the consumer side of the house, so we can bring that experience together and offer the best ability for consumers to actually convert, because ultimately, the consumer wants to purchase something and buy something. And then the merchant, of course, wants to be able to capitalize on that from a payment perspective.

Ecosystem creating around Google Wallet

One of the reasons I love this opportunity that we're doing with Google Wallet is because we're bringing the ecosystem together. I'm a big believer in making sure that we have a platform. And that's Google Wallet -- it's essentially an ability to put a lot of different services into your wallet. So we talked about Gpay from a payment perspective, or talking about being able to put your boarding passes. These are all kinds of services and abilities that you could put into your Google Wallet in order to enable your experience to be as simple as possible across the board. So that ecosystem is absolutely critical, both from the developer and the partner perspective.

Experiences at PayPal, Google

I would say the reason I'm in fintech is because I'm a big believer in making all things financial more accessible to everyone out there, regardless of your socioeconomic background. And regardless of whether or not you've got a phone that's $1,000 or $100. And when you think about that, one of the areas that I love about Google is the fact that we think about that from an Android ecosystem perspective as being open to all.

I think you're very aware that NFC, and the ability to tap and pay, is really available only to high end phones. And as it's become more and more prevalent over the last couple of years, we still have a world out there where a lot of people do not have that type of technology readily available. And so a big part of what I get excited about around Google Wallet is thinking about how do we make sure that consumers everywhere, globally, as well as locally, have access to payments, to the things to make their lives easier?

A good example of this is looking at the big shift that's happened in Brazil, especially post COVID, with the introduction of PIX, and how the government is playing a big part in really bringing the entire Brazilian population forward in terms of looking at what can we do to enable digital payments as a whole. So I'm super excited that Google Wallet, we're really a big part of thinking about that from an overall ecosystem perspective, in terms of what are all the things that we need to do to enable Google Wallet to be accessible for everyone and every type of phone and at every level.

And then second, ecosystem is absolutely key. You know, we don't only have a consumer app, we really do have to bring along the merchant and partner ecosystem in order to enable that access, so that you have what you need on your phone, and you can actually use it in the store and online as well.

Big goals left for 2023

Oh, I have so many. I know the one I'll really focus on is around thinking about how we enable mobile drivers licenses. How do we move that into a broader aspect of what you need in your Google Wallet? I'd love to get to the point where the aspects that I think of when you need your wallet has to do with not just payments, but identity as well as those non payment aspects I mentioned -- health insurance cards and transit things you use every day, and then things you use on occasion. So I'm really excited about that from an overall kind of focus and where we're going globally.