When a consumer uses a debit card at their local retailer, they likely have no idea what happens behind the scenes to make that transaction possible.
For the last two years, the retail industry has been in flux. Supply chain issues, labor shortages, surging inflation, and the war in Ukraine continue to disrupt the marketplace. Yet, at the same time, consumers’ expectations are growing, and the path to purchase is expected to be as convenient and personal as possible. So, what is a retailer supposed to do?
For the most part, people are patient, but some experiences create frustration for virtually everyone. A customer transaction company Omnico Group found that most people are willing to wait just up to eight minutes in a checkout line before abandoning their cart. Time standing in line leads to reconsidering the purchase. If you think about holiday shopping or even a Saturday morning grocery line, you can imagine how many lonely carts there are and how many dollars are lost from items not purchased. According to Parcel Pending, that number is $38 billion.
One of the key benefits virtually every industry has seen as a result of the pandemic is the increased adoption of digital services and solutions to streamline processes and make businesses more efficient. We’ve certainly seen it within the retail industry as merchants looked to make new fulfilment options available to customers, like buy online pick up in-store (BOPIS) and curb side pick up options. And while these eCommerce-centric options provided peace of mind for consumers during the pandemic, new data from ChaseDesign shows that BOPIS purchases are declining compared to 2020 and 2021.
When you think about an ideal smart home, it probably includes smart appliances like a fridge or a stove, your thermostat, light bulbs, a sound system, security system, etc. And while having all these connected devices can certainly make managing your home easier, it’s likely that that most devices come from different service providers. This means the need for multiple apps to manage all of your services, which for anyone is less than ideal if you’re trying to do multiple tasks at once – like changing your lights, audio system and thermostat to turn on when you get home. Now imagine being able control all these systems from one app – wouldn’t that make your life a lot easier? You could make changes for multiple devices at once or even allow them to send data to each other to improve your experience.
While it may feel like an odd question to ask, the parallels between dating and retaining customers make a lot of sense. You’re trying to attract them with the hopes of building a long-term mutually beneficial relationship. And, just like in dating, it’s important to know the boundaries of the relationship and what’s appropriate. Recent data from the MARKINBLOG shows that the probability of selling to an existing customer is typically 60-70% while new prospects hover in the 5-20% range, highlighting the importance of building the existing relationships with your customer base. Additionally, it costs up to seven times the amount to acquire a new customer as it does to retain an existing one. Not only is retaining a customer more valuable than acquiring one, having happy customers can also help bridge the gap finding new ones.
Whether we like it or not, the evolution and use of consumer technology continues to impact how consumers engage with brands and make purchases. Think about your smartphone, for example, who would have thought 15 years ago that we’d be using it to make both online and in-store purchases? While much of the technology consumers use every day was destined for the retail world eventually, the COVID-19 pandemic played a critical role in catalyzing the use of many technologies.
One thing that has come up in conversations a lot about lately is the convergence of the digital and physical worlds, especially when it comes to commerce. Whether it’s enabling buy online pick-up in store (BOPIS), accepting crypto, buy now pay later (BNPL) or even leveraging more data and analytics in-store, the use of digital services for in-person commerce is continuing to rise.
If you needed evidence of the rise of cryptocurrency, you only have to look at the 2022 Super Bowl’s advertising. Of the many cryptocurrency-centric ads, Coinbase’s was so popular, it crashed its app within seconds. With crypto’s growing popularity, I’ve received a lot of questions on how it might impact retail, and in particular, the in-store payment experience.
In a lot of our recent blogs, we’ve talked a lot about the growing shift in customer expectations and the role that technology can play in managing them. One of the most interesting shifts for customers is the premium that is being put on convenience. For example, NRF’s recent Convenience and the Customer report found that over 90% of consumers are more likely to choose a retailer based on convenience, with 83% of consumers highlighting that convenience was a stronger factor than it was for them five years ago. The report found that this was due to people not wanting to dedicate as much energy or time to shopping to focus on other aspects of their life.
During the pandemic many merchants, especially SMBs, made ad hoc adjustments to provide a safer customer experience. Often this was done on their own, with some businesses even going as far as putting bags over their payment terminals or even attaching them to hockey sticks for effective social distancing. While we can certainly applaud their creativity, had they worked with their technology partner they would have been able to leverage more permanent solutions. This is also why it’s so important for independent software vendors (ISVs) and other technology providers to have more consistent communication with their merchant customers. Not only does it create better opportunities to generate additional revenue, but it also provides an opportunity to solidify the relationship with your customer.
While NRF 2022: Retail’s Big Show was very different this year due to COVID, it was still a show filled with meaningful conversations and strong display of innovation across the exhibit hall.
One thing that always excites me about NRF is that there are Ingenico solutions across the area. Whether in the dining and check-in facilities of the venue, my hotel or even on the train from Boston to NYC, it was great to see our solutions being used across a variety of use cases.
As we close out 2021 and begin 2022, we see a retail landscape that’s very different than it was two years ago. The global COVID pandemic served as a catalyst for the evolution of how consumers prefer to shop. For example, Accenture predicts an increase of 169% in online purchases from new and low-frequency users. This is just one example of how consumers have pushed toward the convenience of digital services to fulfil their shopping needs.
If you’re like me, your shopping habits have changed over the course of the pandemic. Whether that means you now pay with contactless, buy online and pick up in store or just shop online more, most people have leaned into new ways to shop. One trend that is continuing to gain a lot of traction with consumers is Buy Now Pay Later (BNPL). With 7% of consumers planning to use BNPL during this holiday season, according to a recent survey. And while that might seem low now, its use is expected to rise over time.
As an ISV, you know that the restaurant business is extremely competitive. It is one of the key reasons why adopting new technology in this space is very slow. Restaurants need to work hard and establish their popularity in the community in addition to sustaining business on a day-to-day basis. This means that consumer-facing technology including payments often takes a backseat for restaurants. However, the COVID-19 pandemic changed how restaurants approach this all together. At the peak of the health crisis, many restaurants scrambled to offer services such as online ordering, delivery via third-party apps and even accepting contactless payments to put their customers at ease. Since then, restaurants have adapted quickly and effectively to the new normal and are continuing to offer enhanced services to their customers.
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