What do today’s retail customers desire? Mohamed Dabo takes an objective look into what consumers are thinking when it comes time to pay in retail stores and what technologies merchants are implementing to enable their customers to check out quickly.
Notable advances in technology have not ended customer frustration at checkout. Indeed, more than half of shoppers have experience a technical issue at checkout at some point. There remains a notable disconnect between merchants’ efforts and shoppers’ actual experience.
Those are some of the findings from a major study conducted by payments management solutions company FreedomPay.
The data uncovered in the research reveal opportunities for retailers to build loyalty with their increasingly-digital consumer base. Merchants can seize the moment by offering customers the security and ease-of-use they require in payment method, paired with the digital capabilities they prefer for tracking purchases and rewards.
The key findings include:
2020 will finally be the year of contactless, and age is a factor
- Age is a huge factor in driving contactless adoption: Gen-Z (70%) and millennials (75%) report satisfaction with contactless payments and 65% of Gen-Z consider it a “must have” of merchants.
- Consumers are satisfied with contactless: 72% say it is easy to learn and 74% say it is convenient.
- About a third of consumers under 35 predict that merchants will become 100% cashless in the next five years.
- 84% of businesses accept debit or credit card EMV contactless payments, but only 37% of consumers are aware of the option.
- Ease of use could be a large contributing factor for adoption, particularly for transactions under $25, 80% of which are currently made with cash.
Loyalty: Give shoppers rewards on everything
- The most important aspect of loyalty programs for consumers is earning rewards on everything they purchase.
- 70% of consumers want to earn or redeem rewards without providing sensitive information.
- About half of consumers have reported experiencing challenges such as too many restrictions on spending rewards.
Conflicting privacy response: Consumers and merchants require security, yet shoppers want to be tracked
- 87% of consumers and merchants identify security as the top attribute when choosing a payment method.
- Younger consumers that are digital natives
The report gives a clear warning to retailers to remain focused on using the latest payment technologies to build the most customer-centric experience they can and best-in-class commerce capabilities.
Experience beyond purchasing
Today’s shoppers don’t just want to buy and great product or service; they also want to the overall purchase experience to be enjoyable, and are often willing to pay for this.
However, “even as shoppers are becoming savvier with technology today, the majority don’t necessarily know what to expect when they arrive at checkout because it’s not the same experience everywhere they go,” said Mark Bunney, director of go-to-market strategy, Ingenico Group, North America.
There’s a widening information gap between customers and store employees. Consumers often work into a store armed with reviews, ratings, price comparisons and detailed product information. By contrast, only 35% of retailers provide store staff with in-store access to this information.
“Retailers are battling a series of information gaps with their consumers, as they try to offer them the latest capabilities for contactless cards and mobile wallets while also correcting the perceptions they’re developing about security and ease-of-use for these technologies.”
Keeping up with technology
Advances in technology, artificial intelligence, machine learning, and robotics, are creating a workplace that needs to be increasingly more intelligent. Whether it’s a simple point-of-sale system that tracks purchases or a sophisticate network that links people and places around the globe, having practices and message that keep pace with the technology is important.
“Consumers in the U.S are growing increasingly frustrated at the slow progress that has been made in addressing the acceleration of technology at the point of sale,” said Chris Kronenthal, CTO and president of FreedomPay.
“Whether it be unclear or inconsistent messaging (e.g., contactless), disjointed back-end systems, rapidly evolving and expanding payment options, or a continued lack of properly-implemented payment security solutions – consumers do not appreciate, and will not remain loyal to, ‘the friction,’” Kronenthal, added.
Ultimately customer experience is integral aspect of the retailer’s product. And it’s an aspect that is becoming more and more important. The experience the retailer gives the customer will determine whether he or she order again, whether the business prospers or not.