The payment industry is in the midst of change at a breakneck pace that shows no sign of slowing. With a new disruptor around every corner, regulations running to keep up, and users clamoring for a faster and simpler solution, legacy payment providers face a new and uncertain world.
So what trends are reshaping the business?
Customer Experience Is the New Black
As payments get faster and more competitors enter the scene, the X factor that’s going to separate the leaders from the followers is customer experience. You have their attention, you’re taking their money—now you need to listen to what they want: a simple, fast, human interaction.
How important is this? Eighty-six percent of customers will pay more for the same product or service if they have a better experience while doing so. Give them a good time, and they’ll be far more likely to come back and recommend you to friends.
Wave, Tap, Speak
There are far more answers to the question, “How will you be paying for that?” than ever before.
When it comes to speed, contactless is the Porsche Spyder to every other payment method’s Honda Civic. Simply wave your smartphone near a payment terminal or tap it quickly and walk out the door.
Although this tech has been slow to roll out in the U.S. (only 3 percent of cards are contactless) versus internationally (64 percent in the U.K. and 96 percent in South Korea), the market is ready for major growth—70 percent of terminals in stores already accept contactless.
Another growing trend is paying by smart speaker. Thirty-five percent of Americans and Western Europeans have shopped and paid on their speaker, and 32 percent have ordered takeout or transferred money.
Mobile Finds Its Footing
The fiercest battle for customers is happening in mobile. 2019 is on track to break records for mobile payments, and the sector as a whole is expected to hit $503 billion by 2020, a massive surge from $75 billion in 2016, representing a compound annual growth rate (CAGR) of 80 percent.
And mobile is poised to move full steam ahead into digital wallets. These are nothing new, but consumers by and large have yet to adopt them. Just 28 percent of shoppers use them, compared to 38 percent who use Apple/Google/Samsung Pay and 39 percent who use merchant wallets.
Gen Z Has Arrived
America’s youngest generation is the future of payments—by 2020, they will be a full 40 percent of U.S. consumers. The Googles and Apples of the world have always been a part of these consumers’ lives, and they trust these corporations with their money.
For Gen Z, mobile is king—69 percent use banking apps every week or every day, compared to 17 percent of boomers. When mobile wallets gain a foothold, it will start with Gen Z.
Rewards, Rewards, Rewards
People want perks for their purchases, and they will play the field to get them. Modern payment solutions allow companies to give them these rewards in an instant. And that’s good because a full 76 percent of consumers want you to know who they are and what they’ve bought in the past, and to give them a deal when they swipe or tap at the counter.
A modern smart terminal solution includes apps that let you easily incorporate a robust rewards program into your daily operations and provide remarkable customer service.
Payments Accepted Everywhere
It has become easy and affordable enough for the smallest businesses and solo entrepreneurs to accept payments that now any connected device can turn into a business growth tool. Where customers used to have to line up in one place at one store, now any employee with a phone or tablet can become a cash register, be it at the counter, in the aisle, or outside in the parking lot.
Customers and merchants alike are well down the path toward universal acceptance of this new payment ecosystem, and innovations such as contactless are expected to be more widely adopted, closing the current gap between the number of cards and the establishments that will take them.
Credit card companies and banks both stand to benefit greatly from these developments. Institutions that welcome these innovations will open themselves up to new customers and markets that can only grow over time.
And it all starts with a payment solution that’s built to evolve and embrace change. Poynt’s state-of-the-art open commerce platform gives your business a powerful blend of hardware, software, and apps for unlimited growth.