Driving a seamless and rewarding retail customer experience today includes offering a flawless purchase experience. This can be achieved through mobile wallets that have already gone mainstream for consumers. The trend is being consolidated as many merchants are equally playing the game by offering various services and modes of payment related to the mobile wallet. In this vein, e-commerce and mobile transactions are absorbing a bigger and bigger part of the expenditure of consumers, and retailers who have not adopted the mobile wallet should seriously consider integrating this powerful tool into their business strategy to stay competitive.
Analysts forecast that by the end of 2018, 4.77 billion people around the planet will use mobile phones and by 2021, approximately 664 million of those consumers will choose mobile payments over other modes of payment. Today’s tech-savvy shopper is using mobile devices not only for communicating but gathering information and comparing products before purchase. At the same time, they are increasingly being influenced by social media channels. Statistics show that 81% of shoppers go online first before shopping.It is, thus, incumbent for businesses to include it as part of their smart payments strategy. Visa Europe projects that 60% of UK shoppers will use mobile payments at least once a week by 2020 while Africa is also witnessing a boom in mobile adoption. In the APAC region and China, the opportunities to connect with consumers through mobile payments are becoming even more abundant.
Blending convenience with security features is vital
Several mid-market and large enterprise businesses have adopted a “wait and see” approach to implementing mobile payment platforms. However, the demand for this type of payment is spreading like wildfire and those who are still waiting and pondering whether to offer it or not may see themselves at risk of losing their clientele and collapsing.
Every retailer is different. As a result, they need to propose a wallet that is totally tailored to meet the needs of their customers. The deployment can be done at one go or can be expanded through a phased approach. Customers meticulously look for two things when paying online: convenience and security. The right mobile payment option is often at the crossroads of these two critical considerations. Whether it is for booking a taxi, purchasing tickets, or reserving a last-minute hotel room, a user-friendly payment experience boosts customer satisfaction and loyalty. Consumers are definitely attracted to the consumer-centric nature of brands and this aspect urges them to become repeat customers. Even more when the brand proposes a proven secure payment experience.
Main reasons retailers should adopt the mobile wallet
Apart from enhancing customer experience, the mobile wallet presents some major advantages for the retailers themselves. To stay competitive on the market, even brick-and-mortar retailers must seriously rethink their approach because e-commerce channels continue to consume a larger portion of consumer spending. Experts recommend that retailers should see this as an opportunity. About 80% of merchants do indeed now view payments as a key part of their business strategy. 92% are also considering maintaining or increasing investment in that area over the next 12 to 18 months.
Whereas mostly a concept only really understood by early adopter and tech enthusiasts a few years ago, these days mobile wallets have gone mainstream enough to feel a bit commonplace to consumers. Most people have at least heard of mobile wallets at this point — driven in part to the ever-lengthening list of retailers that are offering them in some form or other.
Reducing overall costs and improving security levels
As goes digital commerce, so goes fraud. It is a fact that as digital commerce expands itself, the types of fraud swells on a parallel note. Data breaches are common and can entail massive costs for the retailer. Figures show that the average data breach may cost around $ 4M for the concerned retailer. The age of the mobile wallet, nonetheless, gives retailers a fresh opportunity to bring payments in-house and in-app to reduce or avoid grim experiences and expenses.
Adopting the mobile wallet is a boon in terms of both costs and security for the retailers. The latter can bring payments in-house and in-app. Theft of customer payment credentials, of identities as well as of transaction histories can be avoided. Retailers can layer security methods according to their own requirements while maintaining the payment system highly convenient for consumers. These layers are the rapidly evolving in the digital payments marketplace today in the form of app security, device authentication, biometric authentication, and tokenization, just to name a few.
Retailers do not have to be security experts as there are multiple platforms available allowing a combination of various layers of security. In the same breath, choosing their own platform will give them the opportunity to rely on a system that can be maintained and updated by experts as and when needed, aligned to evolving security standards. They can choose the appropriate platform for their own specific needs by combining various layers of security to strike the right balance between usability and security. Such a platform will also be a reliable system that can be constantly maintained and updated by security experts to safeguard from latest threats.
While most security upgrades demand a budget, mobile payments actually have the power to reduce overall costs as retailers can allow their customers to connect and interact with them within a store-controlled closed loop. For instance, fewer transactions may be subject to fees. By incentivizing the use of the in-store digital wallet through in-app discounts or other rewards, brand engagement and loyalty will be enhanced.
The mobile wallet is a means to offer added value
At the end of the day, however, payments alone are not enough to get most consumers really excited. Instead, the experience should be one that actually speaks to the customers’ needs by bringing added value. A great example of such an app is the Starbucks app which is possibly the most successful mobile wallet to date. The reason is that they have made their customers’ lives easier with added value through multiple features like ordering ahead and simplistic payments.
Essentially, people need a reason to do something, and payment is not strong enough to change habits and even more when it requires them to keep downloading multiple payment apps on their mobile device again and again. It might be a concern that consumers, bombarded with multiple mobile wallet offerings from merchants, might simply start turning out. After all, the memory of any mobile device is rather limited and certain clients may easily feel like rolling out of the overwhelming digital experience. But this scenario may represent a great opportunity for retailers who can use it in their favor.
A great example is Starbucks that can be viewed as the most successful mobile wallet currently. The reason behind this success is that they use the wallet to offer added value to their clients who can order ahead, for example. The payment system in itself is very simplistic and user-friendly. Retailers can implement the same strategy and offer vouchers or discounts for using the app as well as personalized deals. Digitizing receipts is convenient for customers and retailers themselves as it implies cutting cost on paper and plastic. Plastic cards, cardboard coupons, and paper receipts do entail have an environmental impact and for retailers, a mobile wallet is considerably more cost-effective and sustainable means of payment. Other commerce features such as store locators, price comparison option, shopping lists and wishes lists can equally be integrated to urge consumer adoption.
Mobile wallets guarantee fewer checkouts
Customers do not like waiting in queues at the checkout. Mobile wallets have the power to fix this retail pain. Mobile payment options should serve consumers wherever they are; whether they are stocking up on supplies online or ordering food ahead for pick up in-store, they demand rapidity, convenience, and security.
Adopting the mobile wallet furthermore presents an advantage to retailers themselves who can save by reducing infrastructure and maintenance costs related to check-out points. A faster check out also implies fewer cart abandonment and more happy customers who are sure to be back. Customers can register their choices as they go along, pay for their goods once they are done and head for the exit. This will be translated into a big saving comes from reduced infrastructure as checkouts cost money to install and maintain. Fewer checkouts also imply that staff can be redeployed in-store to support customers.
Instead, retailers may include mobile point-of-sale (mPOS) systems making it possible for customers to pay from wherever they are in the store rather than waiting in line. While some merchants might think that fraud will go up because the notion of self-checkout seems may urge shoplifting, this issue may be solved and dissuaded through simple door-checking practices. Such an enhanced customer experience can certainly be a boosting factor in driving purchases and ensuring the loyalty of satisfied clients.
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