How can retailers make the most of new payment technologies?

//How can retailers make the most of new payment technologies?

Adoption Requires Simple, Efficient, Value-Added Payment Methods

The simpler retailers make it for customers to complete a transaction, the more readily new payment technologies will be adopted by both the sales associate and the customer. Retail staff needs to be trained on how to facilitate payment, and customers need to be incentivized to use the new technology. If payment methods are simple, render staff more efficient, and provide value to the customer, ROI will be a natural bi-product.

Fragmentation of the Payment Market Creates Opportunity for Retailers

While it would seem that the global surge in smartphone use would lead to mass adoption of new payment technologies, there are some factors that are inhibiting their acceptance on a larger scale. One such factor is a fragmentation of the payment market, whereby standards still need to be developed and consumers need to be educated on the methodology behind those standards. This fragmentation includes the ongoing struggle between conventional payment processors such as Visa, MasterCard and AMEX, and mobile vendors who are eager to capitalize on emerging technologies. This competitive landscape leads to reduced transaction costs for retailers, which could then be passed on to customers in the form of rewards for using the new technology. Opt-in promotions could be used to incentivize those customers who allow certain identifiers to be tagged at the point of purchase. This would break down the barrier to adoption until mass adoption is achieved, while permitting retailers to obtain additional customer profile information from willing participants.

Better Safe than Sorry

Security is another rampant concern surrounding new payment technologies. Customers need to be reassured that the payment methods they are being encouraged to use are secure, and that their personal information will not be misallocated. Retailers that address this concern in a clever way and guarantee that customer information will be treated with respect are infinitely more likely to see an upswing in the willingness by customers to accept new technology.

Twice as many high-income shoppers ($150k+) as lower-income shoppers (less than $25k) would use a digital wallet via mobile phone

According to a June 2012 study from Carlisle & Gallagher Consulting Group (CGC), if PayPal offered a mobile wallet, 4 in 5 consumers would be open to using it.Another study conducted by RIS News indicated that twice as many high-income shoppers ($150k+) as lower-income shoppers (less than $25k) would use a digital wallet via mobile phone.These are powerful statistics. They reveal that customers, especially customers with more disposable income, are open-minded to embracing new payment technologies if the reasons to do so are well presented and the result is a better overall customer experience.

New mobile technologies must provide ROI for retailers and value to customers if they are to be readily adopted. Educating both store associates and customers on the benefits of using new payment technologies is critical to deriving maximum return from the deployment. Store associates must view the payment methods as useful assistants that facilitate their jobs, and be taught how to help customers embrace them. Conversely, customers have to be instructed as to what the payment methods offer, why they should be using them, and why they should continue to use them. Without proper endorsement from management all the way through to the customer, long-term adoption will be hindered.

2013-03-27T01:01:00+00:00 March 27th, 2013|Articles|