Merchants are looking at the increasingly affordable prospect of developing custom-branded mobile payment apps as an alternative to plastic and cash payments.

But despite the explosion of super-popular mobile ordering apps from franchises such as Starbucks and Dunkin Donuts, some question how much room there is on any one phone for an app from every retailer a shopper visits. Sooner or later, shoppers are going to have to choose which apps to keep and which to delete or hide, making it all the more important that retailers develop an app that's worthy of repeated use.

“It is going to become a case where the customers are saying ‘of course it does payments, but what else does it do,’” Sanjay Malhotra, chief technology officer of Ontario, Canada-based app developer Clear Bridge Mobile. “The trick is going to be making an app that is compelling in all the little things that lead up to the payment.”

Malhorta said that Clear Bridge has done a few privately branded mobile payment apps already, and he predicts that it will continue to be a trend moving forward.

The trick for making that trend catch on with consumers seems to be moving beyond being just a loyalty-card-on-your-phone. Tomorrow’s payment apps need to focus on changing the customer experience altogether — they need to focus on becoming the next Uber.

From a technology standpoint, the infrastructure for robust, game-changing apps is already in place.

“The beacons are there. Location-based services are becoming more prevalent. Secure credit card processing is being done en masse by Uber and Lift,” Malhotra said.

By handling all aspects of the transaction, the merchant retains all the transactional data and ties it to particular customers, opening the door for hyper-customized marketing. In addition, if merchants are in control of the transactions, they can steer them to the payment method that is least expensive for them to process.

“Custom apps have become so cheap and easy to build, retailers are finding them much more tempting,” said Michael Moeser, director of payments for Pleasanton, California-based Javelin Strategy & Research.

Javelin recently released a report projecting that branded mobile payment apps will capture $92 billion in transactions by 2019.

The differentiators might be how the customer and the employees interact, or it might be an artificial intelligence engine making recommendations and delivering customized offers and discounts based on past choices, or it may be gamification of the transaction — or something else entirely.

Still, even with the most cutting-edge apps, there is sure to be a saturation point.

“The typical person won’t have 99 apps on their phone. They are typically going to have a handful of apps, and the trick for the merchants is going to be getting access,” Moeser said.

The key is going to be offering real value for the consumer and a clear value proposition that makes it worth the consumer’s while to download it and keep it, and most crucially, to use it.

“Convenience is one thing, but there has to be something else the consumer gets out of it,” Malhotra said.

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