The payment market has undergone major changes in recent years. What are consumers’ demands for payments today? And how can retailers keep up with the technology and meet consumer expectations?
The change in payment methods
The payment landscape is experiencing major changes these years – and the technology is fast evolving. Payment by cash is not as widespread as it used to be. Only 23% of Danish households’ payments in physical stores are made by cash. A 2016 Gallup poll also found that far fewer Americans are using cash than five years previously. Only 10 percent reported using cash for all their purchases, down from 19 percent in 2011. Card payments have undergone a development from payment with a magnetic stripe, to card with a chip, to contactless cards. At the same time, the payments have moved into the mobile phone with e.g. Apple Pay.
The future of payments will not only be by card. Biometric payment methods have also found their way to consumers. Fingerprints, blood vessel scanning, and facial recognition are no longer future scenarios. For instance, Copenhagen Business School has introduced vein scanning of fingers as a permanent payment solution on university canteens. See the solution in the video below.
Watch a video of vein scanning at Copenhagen Business School.
Globalization sets new standards for payment
Today, consumers shop more from foreign companies than we have seen previously. Along with the increased tourism, this creates new conditions for the payment market. As a retailer, this means, more specifically, that it is important to be able to supply the payment methods that customers prefer – even when they are traveling. Therefore, make sure your POS system or web shop supports foreign payment methods. Local currency payment offers for card payments are a way to accommodate your foreign customers. In addition, foreign mobile payments such as AliPay and WeChat have found their way to Europe.
Payments should be easy and user-friendly
Consumer expectations for payments vary depending on the channel. In physical stores, contactless payment and self-service are a matter of course, although it has not existed for very long. Payments are part of the overall evaluation of the customer experience. If you meet customer expectations, they will not only revisit but also recommend your business to others.
Do you want to make sure your customers do not experience long queues or limited payment options? Then it is important to keep up with the technological development of the payment solutions that customers prefer and value in their everyday lives. At the same time, you can consider how your buying experience can become even better for your customers when they visit your business.
Focus on unified commerce and customer journey
In the future of retail, it is essential to have customers’ expectations in the center of the business. It is required that retail owners have a deep insight and understanding of the data that is involved in the customer journey. Unified commerce ensures that customers are presented with the same offer and service across all platforms. This also includes payment methods. With one unified business solution, you can create a more personalized customer journey by merging information from store and e-commerce.
If you want to reap the benefits of unified commerce, you need to offer the same smooth payment experience across physical stores and web stores. With a unified solution, it will also make it easier to expand internationally, where the web and POS are connected through the credit card.