By Raj Sond, General Manager at First Data
We recently commissioned a consumer survey about payment acceptance and what emerged was that businesses are at risk of losing almost one in every two (43%) customers if they do not offer alternative payment methods to cash. Rather than seek an ATM, they would either not make a purchase or go elsewhere. However, worryingly, almost two-thirds (63%) of customers said some, or none, of the independent retailers they visit offer card payments.
Understanding the needs and demands of customers is critical to the success of any business, and it is in their interest to consider the benefits of offering multiple payment methods. This plays a huge part in the overall shopping experience for a consumer, as the results of our survey suggest.Taking digital payments also opens up a whole host of opportunities for businesses to use the data that they accumulate to get themselves ahead of competitors.
Delve into data to offer a superior service
Businesses should be making the most of the information that is available to them. This allows them to offer a more convenient service and also get closer to their customers. The rising use of cards and the evolution of technology has enabled businesses of all sizes to collect and access customer data, including; previous purchases, transactional history, online orders and contact information.
Having this insightful data to hand will enable an in-depth understanding of customers’ demands and provide business owners with the information they need to shape the personalised experience that customers have come to expect. This could be in the form of specifically tailored offers based on their spending behaviours, invitations to VIP events or even reminders of upcoming anniversaries or birthdays.
Offering a personalised service means that you are exceeding the expectations of your customer, and these refined additional touches encourage a loyal customer base by anticipating customer needs requirements at every stage of a purchasing decision.
Unlock opportunities by offering multiple payment options
There are numerous shopping options online and on the high street, with customers’ having become accustomed to a quick and user-friendly experience. It is easy for them to take their business elsewhere;therefore, it is wise for retailers not to make assumptions about customers’ payment preferences.
Our research shows that security and speed were among the top concerns for busy shoppers. Almost all (98%) of those who prefer paying with contactless cards do so because it is faster, followed by those who prefer the convenience of not having to remember a PIN. This is an undeniable statistic!
According to analysis carried out for UK Payments Markets 2017, this preference is only set to rise. It is predicted that debit cards will become the most used payment method by late 2018, three years earlier than previously estimated. Convenience is vital and a smooth payments system is imperative to providing a convenient service.
The perceived ‘cost’ of card acceptance
While many large businesses usually offer multiple payment options, it has long been the case that smaller, independent retailers have been put off by the perceived costs of card acceptance. However, once you consider the cost of handling cash, giving change, banking, counterfeit prevention and most importantly the cost of lost sales – card acceptance is not the expensive prohibitive option it once was.
With the rise in popularity of alternative methods such as Apple and AndroidPay, the competition in the payments and retail landscapes is continuing to grow. In light of this, the question that retailers must ask themselves is can we afford not to accept card payments?
A considered approach to payments acceptance should be made regardless of whether you are a small or medium sized business. Identifying and meeting the changing needs of your customers is an essential element to the sustainable growth of your business. Payment is a crucial part of the customer journey and should not be prioritised in the quest for business growth and customer loyalty.