The shopping payment landscape is set to change
The manner in which consumers shop has changed dramatically over the past few decades.
Where once, people’s only option when shopping was to visit the physical store, queue to purchase their goods and pay at the cash register, the entire process been revolutionised with the advent of the internet.
When shopping for clothes, more and more consumers are accustomed to following their favourite brands on social media; viewing items online; and even trying them on in a virtual changing room. They can then pay at the click of a button and have their new garments delivered, often the very same day.
The changes have impacted almost every aspect of the consumer shopping experience to a greater or lesser degree. While some consumers have already adapted to online shopping when purchasing their groceries, most of us still continue to use the ‘old-fashioned’ route of checking the fridge and cupboards, writing a shopping list, and visiting the supermarket to choose the required products. However, as the Internet of Things develops, smart fridges are becoming increasingly popular. These refrigerators are able to automatically check supply levels at any one time, send their owner an alert about which products are running low and create a suggested shopping list. Once this list has been approved, the home owner simply has to pay (via an app), choose a preferred pick-up location and then visit the selected supermarket where their goods will be awaiting collection. The days of trawling round the shelves and queuing to pay are numbered.
As consumer habits evolve, so too must the payment processes behind each transaction in order to keep up with demand and technological enhancements. In today’s environment, consumers are only able to pay at one end point, they are often only offered a small selection of payment methods and many providers simply cannot integrate with third party systems – potentially resulting in a frustrated consumer and an increase in payment drop-offs.
However, the world is changing. In the next five years I expect payment providers to not only provide the option of paying at any moment throughout the shopping experience, and across a wide variety of methods, but to be seamlessly linked with third parties, identifying the appropriate channel and service to provide a streamlined shopping experience. As well as the obvious benefits to the consumer, the new processes will reduce the number of drop-offs during the payment process and enable a better understanding of the value chain for merchants’ use.
These new providers will have an enhanced architecture in order to continuously evolve and adapt to new requirements as the payment landscape and consumer habits broaden. This includes integration with new third parties, enhancing communications with merchants and consumers and developing robust channels to ensure payments are manged across all mediums.
As opposed to the established infrastructure, whereby payment providers amend their systems as new concepts are launched, in the new world, providers will engage directly with innovators who are developing new products. These partnerships will allow new forms of co-creation and support innovation within the payments market – ultimately creating a faster evolution process, with consumer demand, lead innovators and a facilitating payment process working in tandem.
In the next five years or so, the payment providers which can offer a streamlined, faster process for consumers across a variety of transaction types, will not only become the public’s provider of choice, but with the additional benefits they can offer to merchants, including capabilities to adapt to new launches, these providers will also succeed at this end of the transaction process.
Today’s consumers are continually seeking smarter, quicker and easier options and it looks like the payment landscape just might have the answers.