Critical Success Factor of Noble Payment System: Multiple Case Studies

새로운 결제서비스의 성공요인: 다중사례연구

  • Received : 2014.08.06
  • Accepted : 2014.10.02
  • Published : 2014.12.30


In MIS field, the researches on payment services are focused on adoption factors of payment service using behavior theories such as TRA(Theory of Reasoned Action), TAM(Technology Acceptance Model), and TPB (Theory of Planned Behavior). The previous researches presented various adoption factors according to types of payment service, nations, culture and so on even though adoption factors of identical payment service were presented differently by researchers. The payment service industry relatively has strong path dependency to the existing payment methods so that the research results on the identical payment service are different due to payment culture of nation. This paper aims to suggest a successful adoption factor of noble payment service regardless of nation's culture and characteristics of payment and prove it. In previous researches, common adoption factors of payment service are convenience, ease of use, security, convenience, speed etc. But real cases prove the fact that adoption factors that the previous researches present are not always critical to success to penetrate a market. For example, PayByPhone, NFC based parking payment service, successfully has penetrated to early market and grown. In contrast, Google Wallet service failed to be adopted to users despite NFC based payment method which provides convenience, security, ease of use. As shown in upper case, there remains an unexplained aspect. Therefore, the present research question emerged from the question: "What is the more essential and fundamental factor that should takes precedence over factors such as provides convenience, security, ease of use for successful penetration to market". With these cases, this paper analyzes four cases predicted on the following hypothesis and demonstrates it. "To successfully penetrate a market and sustainably grow, new payment service should find non-customer of the existing payment service and provide noble payment method so that they can use payment method". We give plausible explanations for the hypothesis using multiple case studies. Diners club, Danal, PayPal, Square were selected as a typical and successful cases in each category of payment service. The discussion on cases is primarily non-customer analysis that noble payment service targets on to find the most crucial factor in the early market, we does not attempt to consider factors for business growth. We clarified three-tier non-customer of the payment method that new payment service targets on and elaborated how new payment service satisfy them. In case of credit card, this payment service target first tier of non-customer who can't pay for because they don't have any cash temporarily but they have regular income. So credit card provides an opportunity which they can do economic activities by delaying the date of payment. In a result of wireless phone payment's case study, this service targets on second of non-customer who can't use online payment because they concern about security or have to take a complex process and learn how to use online payment method. Therefore, wireless phone payment provides very convenient payment method. Especially, it made group of young pay for a little money without a credit card. Case study result of PayPal, online payment service, shows that it targets on second tier of non-customer who reject to use online payment service because of concern about sensitive information leaks such as passwords and credit card details. Accordingly, PayPal service allows users to pay online without a provision of sensitive information. Final Square case result, Mobile POS -based payment service, also shows that it targets on second tier of non-customer who can't individually transact offline because of cash's shortness. Hence, Square provides dongle which function as POS by putting dongle in earphone terminal. As a result, four cases made non-customer their customer so that they could penetrate early market and had been extended their market share. Consequently, all cases supported the hypothesis and it is highly probable according to 'analytic generation' that case study methodology suggests. We present for judging the quality of research designs the following. Construct validity, internal validity, external validity, reliability are common to all social science methods, these have been summarized in numerous textbooks(Yin, 2014). In case study methodology, these also have served as a framework for assessing a large group of case studies (Gibbert, Ruigrok & Wicki, 2008). Construct validity is to identify correct operational measures for the concepts being studied. To satisfy construct validity, we use multiple sources of evidence such as the academic journals, magazine and articles etc. Internal validity is to seek to establish a causal relationship, whereby certain conditions are believed to lead to other conditions, as distinguished from spurious relationships. To satisfy internal validity, we do explanation building through four cases analysis. External validity is to define the domain to which a study's findings can be generalized. To satisfy this, replication logic in multiple case studies is used. Reliability is to demonstrate that the operations of a study -such as the data collection procedures- can be repeated, with the same results. To satisfy this, we use case study protocol. In Korea, the competition among stakeholders over mobile payment industry is intensifying. Not only main three Telecom Companies but also Smartphone companies and service provider like KakaoTalk announced that they would enter into mobile payment industry. Mobile payment industry is getting competitive. But it doesn't still have momentum effect notwithstanding positive presumptions that will grow very fast. Mobile payment services are categorized into various technology based payment service such as IC mobile card and Application payment service of cloud based, NFC, sound wave, BLE(Bluetooth Low Energy), Biometric recognition technology etc. Especially, mobile payment service is discontinuous innovations that users should change their behavior and noble infrastructure should be installed. These require users to learn how to use it and cause infra-installation cost to shopkeepers. Additionally, payment industry has the strong path dependency. In spite of these obstacles, mobile payment service which should provide dramatically improved value as a products and service of discontinuous innovations is focusing on convenience and security, convenience and so on. We suggest the following to success mobile payment service. First, non-customers of the existing payment service need to be identified. Second, needs of them should be taken. Then, noble payment service provides non-customer who can't pay by the previous payment method to payment method. In conclusion, mobile payment service can create new market and will result in extension of payment market.


Supported by : BK21


  1. Ahn, J. H., S. W. Yoon, and M. Y. Lee, "Studying Business Strategies in a Total Payment Service Market through Mobilians Case," Journal of Digital Convergence, Vol.4, No.2(2006), 127-142.
  2. Amin. H., "An analysis of mobile credit card usage intentions," Information Management & Computer Security, Vol. 15, No. 4(2007), 260-269.
  3. Baily, C. M., The Mobile Moment: Barriers and Opportunities for mobile wallet, CMBinfo, 2013. Available at (Downloaded 4 January , 2014).
  4. Lee, D. G., Mobile Payment Development Status and Issues, The Bank of Korea, 2013. Available at (Downloaded 11 December, 2013).
  5. Chau, P. Y. K. and S. Poon, "Octopus: An E-cash Payment System Success Story," Communications of the ACM, Vol.46, No.9(2003), 129-133.
  6. Clemons, E. K., D. C. Croson, and B. W. Weber, "Reengineering Money: The Mondex Stored Value Card and beyond," Proceedings of the twenty-ninth Hawaii International Conference on System Sciences, (1996), 254-261.
  7. Jacobs, A., Digital Wallet Road Map 2013, comScore, 2013. Available at (Downloaded 10 January, 2014).
  8. DMC Media MUD, Mobile Payment Market Growth Forecast Report, Digital Media Convergence Company, 2013. Available at (Downloaded 23 October, 2013)
  9. Eisenhardt, K. M. and M. E. Graebner, "Theory Building from Cases: Opportunities and Challenges," Academy of Management Journal, Vol.50, No.1(2007), 25-32.
  10. eMarketer, Consolidation of Mobile Payments Landscape will Drive Uptake, eMarketer, 2013, Available at (Downloaded 17 October, 2013).
  11. Gartner, 44% Increase in Mobile Payments in Just 1 Year, Gartner, 2014. Available at (Downloaded 22 September, 2013).
  12. Heijden, H. V., "Factors Affecting the Successful Introduction of Mobile Payment Systems," Proceedings of 15th Bled Electronic commerce Conference eReality: Constructing the eEconomy, (2002), 430-443.
  13. Jang, B. W., The Current Use Status and Prospect of Card-Based Payment Means, Payment and Information Technology, 2006.
  14. Jang, J. S., Retrospect of Payment Systems: A Bit Different Perspective of Computerization, Institute for Financial Settlement, 2012.
  15. Jeong, S. H., D. Lee, and Y. S. Ju, The Cases of New Global Online Financial Services and Implications, Hana Institute of Finance, Vol.31, 2008.
  16. Kim, W. C. and R. Mauborgne, Blue Ocean Strategy: How to Create uncontested Market Space and Make Competition Irrelevant, Harvard Business School Press, Boston, 2005.
  17. Kim, N. K., What Business Should I Do Tomorrow? 'Danal' Flies with Spirit of Never-Ending Challenge, Dong Biz, Vol.61, 2010.
  18. Kim, S. B. and B. W. Lee, Understanding of Credit Card, Chongmok Publishing, 2010.
  19. Lee, K. J., M. J. Jeong, and J.-I. Ju, "Seamlessness and Privacy enhanced Ubiquitous Payment," Proceedings of the 7th International Conference on E-Commerce and Web Technologies, (2006), 142-151.
  20. Lee, K. J., M, H. Choi, and S. H. Kwon, "Current Status and Future of Mobile Payment Business Models," Journal of payment and settlement, Vol.5, No.2(2011), 63-83.
  21. Park, A. and K. J. Lee, "Case Study on Critical Success Factor of Noble Payment Service," Proceedings of the Fall Conference of Korea Intelligent Information Systems Society, (2013).
  22. Park, J. S., Mobilians Support European Mobile Phone Billing, Digital Times, 2011, Available at (Downloaded 20 September, 2013).
  23. Park, J. S., Danal Occupies US Mobile Payment Market, Digital Times, 2011, Available at (Downloaded 20 September, 2013).
  24. Seawright, J. and. J. Gerring, "Case Selection Techniques in Case Study Research: A Menu of Qualitative and Quantitative Options," Political Research Quarterly, Vol.61, No.2(2008), 294-308.
  25. Shin, D.-H., "Towards an Understanding of the Consumer Acceptance of Mobile Wallet," Computers in Human Behavior, Vol.25, No.6(2009), 1343-1354.
  26. Shon, T.-H. and P. M. C. Swatman, "Identifying Effectiveness Criteria for Internet Payment Systems," Internet Research, Vol.8, No.3 (1998), 202-218.
  27. Simon, H. A., "Rational Decision Making In Business Organization," The American Economic Review, Vol.69, No.4(1979), 493-513.
  28. Strabase. Sudden Rise Proximity Technology such as Apple 'iBeacon', Qualcomm 'Gimbal', Strabase, 2013, Available at (Downloaded 12 August, 2013).
  29. Sung, M. H., Success Strategy of Square: Making Commerce Easy, KT Economic Management Institute, 2013.
  30. Sung, M. H., The New wave of Mobile Payment Market, Square Style, KT Economic Management Institute, 2012.
  31. Treiblmaier, H., A. Pinterits, and A. Floh, "Success Factors of Internet Payment Systems", International Journal of Electronic Business, Vol.6, No.4(2008), 369-385.
  32. Whi, J. H., "A Study on the Formation Mechanism of South Korea's Online Game Industry: Analysis of the Facilitating Process for the Formation of a New Industry," Gaming Industry Journal, (2002), 1-21.
  33. Yang, S., Y. Lu, S. Gupta, Y. Cao, and R. Zhang, "Mobile Payment Services Adoption across Time: An Empirical Study of the Effects of Behavioral Beliefs, Social Influences, and Personal Traits", Computers in Human Behavior, Vol.28, No.1(2002), 129-142.
  34. Yin, R. K., Applications of Case Study Research, 3rd ed., Sage, US, 2012.