The future of payments – last impressions count

Many retailers understand the importance of customer experience and have focused on 'browse' and 'select' moments in the purchase path. But customers are now demanding more from the final step.

If the payment process is painful and slow, this can form a lasting impression with customers. And sometimes it is the last, rather than the first, impressions that count.

The first mechanical cash register was patented in 1883, and although the technology is now more sophisticated, other elements of the purchase path have not advanced.

For most retailers, customers still go to a fixed point in store and exchange cash or a piece of plastic to secure payment for goods they wish to purchase.

As the payments industry, technology and customer trends continue to evolve at pace, retailers are embracing the opportunities

But what if customers could pay where they wanted and how they wanted, negating the need to queue ever again?

The payments revolution

Changes in payment processes are being driven by three factors:

Uberfication of payments: With services such as Amazon 1-Click and Uber driving enhanced experience and convenience, consumers expect payments to feel seamless or non-existent.

In fact, 64% of consumers indicated a desire to use mobile wallets by 2020 – up from 46% who currently use them today, according to the Accenture 2017 North America Consumer Payments Pulse survey.

Changes in payment regulation: New European regulation is creating opportunities for service providers and merchants to bypass the card issuers and develop new ways to pay – and there is an opportunity to gain first mover advantage by acting now.

The same survey confirms that in the US, 68% of Gen Z customers are interested in instant person-to-person payments.

Digital everything: The advancement in Near Field Communication (NFC) mobile wallets, as well as the move towards microservices and API-based architecture, means it is now easier than ever for retailers to build and offer new ways to pay and shop.

What does it mean to your business to deliver a frictionless customer experience across channels?

As the payments industry, technology and customer trends continue to evolve at pace, retailers are embracing the opportunities.

Sainsbury’s, for example, has just launched till-free shopping using its smartshop app and Apple Pay, allowing customers to scan, pay and go – without visiting a checkout.

Combining digital and physical

To leverage these opportunities, retailers need to:

1. Define the 'North Star': What is your strategic vision, your purpose and your role in customers’ lives? What is guiding you as you design your customer interaction points? What does it mean to your business to deliver a frictionless customer experience across channels?

2. Define your technology and architecture strategy: Are you fit to flex? Do you have an architectural and integration approach that can enable decoupled and flexible solutions and agility?

3. Ensure your organisation is agile and customer-led across all functions: Are you able to adopt an agile mindset to respond and change as technology changes and customers demand more?

The opportunity to lead the revolution in payments is there for the taking. Now is the time for retailers to innovate, challenge the status quo, and combine digital with physical.