As smartphones increasingly become the center of our lives, it‘s only natural that they‘re also transforming the way we pay for purchases. Mobile wallets like Google Pay and Samsung Pay offer a convenient, secure, and contactless way to check out at many of our favorite retailers. But what about Sam‘s Club? Does the popular warehouse club accept these digital payment methods? Let‘s dive in and find out.
Understanding Sam‘s Club‘s Payment Policies
To cut to the chase, here‘s the current breakdown of Sam‘s Club‘s acceptance of Google Pay and Samsung Pay:
- Samsung Pay: Accepted at all Sam‘s Club locations nationwide for in-store purchases.
- Google Pay: Not accepted in-store or online, but can be used for Sam‘s Club purchases made through Instacart.
This policy puts Sam‘s Club in an interesting middle ground when it comes to contactless payments. The company has clearly embraced some mobile wallet technology, but has stopped short of going all-in on every platform.
So what‘s behind this selective approach? While Sam‘s Club hasn‘t publicly disclosed its reasoning, we can make some educated guesses based on industry trends and insider knowledge.
The MasterCard Connection
One likely factor at play is Sam‘s Club‘s partnership with MasterCard. As of 2019, the companies announced an expanded collaboration that made MasterCard Sam‘s Club‘s "Preferred Payments Network" through 2023. The move built on a longstanding co-branded credit card relationship between the two companies.
As part of the agreement, Sam‘s Club vowed to "collaborate with MasterCard to support and promote joint marketing initiatives, including innovation in digital payments" and "leverage MasterCard‘s merchant programs and data services to create insight-led solutions."
Reading between the lines, it‘s not a stretch to imagine that some behind-the-scenes negotiations may have led to Sam‘s Club prioritizing MasterCard-branded contactless payment options over rivals like Google Pay. After all, MasterCard has its own mobile wallet offering in MasterPass.
This type of strategic partnership is not uncommon in the world of retail and finance. Companies often jockey for positioning and exclusive deals that give them an edge over the competition. For shoppers, it can mean having to navigate a sometimes confusing patchwork of payment options that vary from store to store.
The Cost of Contactless
Another potential roadblock to Sam‘s Club accepting Google Pay could come down to dollars and cents. While tapping a phone is unquestionably easy for shoppers, there are backend costs involved for retailers to upgrade payment terminals and process mobile payments.
As a members-only warehouse club, Sam‘s Club‘s business model depends on driving down costs and passing the savings along to shoppers. With razor-thin margins on bulk goods, the company may be hesitant to take on additional fees associated with certain mobile wallet platforms.
Interchange fees, which are charged by card issuers and payment networks for processing transactions, can vary significantly between different types of payments. According to industry insiders, fees for contactless payments tend to be higher than for traditional swipe or chip transactions.
In 2020, Visa actually lowered its interchange fees for merchants who process contactless payments under $25 – but only if 95% of the merchant‘s transactions originate from contactless-enabled terminals. For a massive nationwide chain like Sam‘s Club, meeting that threshold would be a heavy lift.
Of course, Sam‘s Club already absorbs interchange fees for the mobile wallet transactions it does accept. But with its emphasis on cutting costs, the company seems to be treading carefully and selectively when it comes to which contactless options make the cut.
The State of Contactless Payments
To put Sam‘s Club‘s approach in context, it‘s worth zooming out and looking at the broader retail landscape. While some shoppers may see contactless payments as cutting-edge technology, the reality is that adoption has been relatively gradual.
According to data from eMarketer, an estimated 92.3 million U.S. consumers (roughly 30% of the population) used proximity-based mobile payments in 2020 – a figure that‘s projected to reach 125 million by 2025. However, that still trails other countries like China, where mobile payments are far more ubiquitous.
Even among those who have tried contactless payments, old habits die hard. A 2021 survey by the National Retail Federation found that just 19% of shoppers used mobile payments for in-person purchases on a regular basis, compared to 82% who used cash and 83% who used debit or credit cards at least occasionally.
Generational differences also come into play. Younger shoppers tend to be more enthusiastic about mobile wallets, with 36% of consumers aged 18-34 using them regularly versus just 6% of those aged 65+.
All of this points to contactless payments being far from a make-or-break feature for most shoppers. While they‘re certainly appreciated by some, retailers like Sam‘s Club may not feel intense pressure to accept every last mobile wallet on the market.
The Scan & Go Alternative
It‘s also worth noting that Sam‘s Club has invested in its own digital payment solution that allows members to bypass the checkout line. The company‘s Scan & Go feature within its app lets users scan items as they shop and pay from their phone when they‘re done.
While not quite as seamless as a true contactless payment experience, the Scan & Go process offers some similar benefits. Users can still avoid crowded checkout lanes and complete their shopping trip with just a few taps on their phone.
Sam‘s Club has touted Scan & Go as a major success, with more than 90% of members who try it becoming repeat users. The company has also experimented with making the feature available to guests who aren‘t members – potentially enticing them to sign up for a paid membership.
Given the resources Sam‘s Club has poured into developing and promoting Scan & Go, it‘s easy to see why accepting third-party contactless payment apps may not be a top priority. The company likely sees more long-term value in driving adoption of its own digital ecosystem.
The Costco Comparison
No analysis of Sam‘s Club‘s payment policies would be complete without a look at its chief rival, Costco. The two warehouse clubs have a long history of trying to one-up each other with lower prices and better perks for members.
When it comes to mobile wallets, Costco also has a somewhat selective approach. The retailer accepts Apple Pay for online purchases and Samsung Pay at its in-store checkouts – but Google Pay is notably absent from the list of accepted digital payment methods.
Like Sam‘s Club, Costco has an exclusive co-branded credit card deal that likely influences its payment policies. The company unveiled its Costco Anywhere Visa card with Citi in 2016, ending a longstanding arrangement with American Express.
In the world of warehouse clubs, member retention and loyalty are everything. By aligning with particular payment networks and offering generous rewards on co-branded credit cards, both Sam‘s Club and Costco aim to keep their customers coming back month after month, year after year. That stickiness is key to their business models.
The Future of Retail Payments
Looking ahead, it seems clear that the trend towards contactless and digital payments will only accelerate. The COVID-19 pandemic dramatically sped up adoption of touch-free payment methods, and many experts believe the shift will be a lasting one.
"We‘ve seen a massive acceleration in mobile payments that we believe will sustain beyond the pandemic," said Barclay‘s analyst Ramsey El-Assal in an interview with CNBC.
Industry analysts project that the global mobile payment market will reach a staggering $12.06 trillion by 2027 – a nearly five-fold increase from $2.47 trillion in 2020. Adoption is expected to be particularly swift in emerging economies, where many consumers are leapfrogging traditional banking relationships and going straight to mobile finance solutions.
In the U.S., the government is also throwing its weight behind contactless payments. In late 2020, the IRS issued new rules requiring most merchants to accept some form of contactless payment tech beginning in 2023 or face hefty fines.
All of this points to a future in which paying with a tap will be more rule than exception. For retailers who have been hesitant to jump on the contactless bandwagon, evolving consumer expectations and potential regulatory pressures may force their hand.
Even Sam‘s Club, with its careful and deliberate approach to digital payments, will likely expand its contactless offerings in the years to come as the technology becomes more ubiquitous. The company has shown a willingness to embrace new retail innovations, from self-checkout apps to curbside pickup for online orders.
As more shoppers come to expect the speed, convenience and germ-free benefits of mobile wallets and contactless cards, retailers of all sizes will face a choice: Adapt to the changing payments landscape or risk being left behind by more nimble competitors.
Final Thoughts
So what‘s the bottom line for Sam‘s Club shoppers looking to pay with their phone? If you‘re a Samsung Pay user, you‘re in luck – the warehouse club has embraced that particular mobile wallet platform for in-store purchases.
For Google Pay devotees, the situation is a bit more complex. While Sam‘s Club doesn‘t directly accept Google‘s mobile wallet, you can still use it to fund purchases made through Instacart‘s same-day delivery platform.
Like many things in the world of retail, Sam‘s Club‘s approach to contactless payments is driven by a mix of financial partnerships, calculated bets on emerging technologies, and careful attention to the shifting winds of consumer behavior.
As one of America‘s most successful and influential retailers, Sam‘s Club both shapes and responds to the rapidly changing payments landscape with each passing year. The company‘s unique blend of value-oriented bulk shopping and members-only perks means it can afford to be selective in an increasingly crowded field of digital payment options.
But make no mistake: The march towards a contactless future continues. With each new tap, shoppers are slowly but surely redefining their expectations for the checkout experience. While Sam‘s Club may not be an early adopter of every mobile wallet, its history of innovation suggests it won‘t let the digital payments revolution pass it by.
