Everything You Should Know About Mobile Payments (But Probably Don’t)

And yet mobile is just one huge aspect of an even bigger trend of retail payment systems transformations.

Why mobile payments are not a trend to disregard

Consumer behaviour follows the evolution of technology, and what was a bonus feature yesterday, quickly becomes standard expectations in the eyes of the consumer. According to Zynstra’s research, while the most in-demand new technology for retailers is mobile payment (65%), self-checkout is not far behind, with 49% of the surveyed considering it a priority for retail modernisations. In line with this trend, recent surveys show that more than half of consumers prefer unattended vending systems that accept both cash and cards to cash-only ones, and for low-cost items, almost one half prefers using their cards, unless there’s an additional fee. The reason is that customers opt for simpler and more convenient ways of making purchases, and it looks like, for a growing number of customers, cards are the simplest way to go. If you’re in retail, this must come as no surprise: to compete with rivals offering the same services or products, retailers need to make theirs available more conveniently, including more user-friendly payment methods embedded in their retail software. So, one way to meet customer expectations is implementing cashless payments through unattended terminals. Ignoring the shift towards cashless options may cost a retailer a lot of money in the nearest future, as cashless payments are inexorably taking over in one retail segment after another. Mobile payments, in turn, come in different forms. For many, it seems, an app is a more convenient choice, and coincidentally, removing cash-only machines can also save the retailer money. Some of the industries’ major players are already working on high-tech solutions for mobile shopping: integrating cutting-edge technologies such as fingerprint authentication for payments making shopping from mobile devices so much quicker and easier for the customer. And the customer tends to choose the fastest and smoothest shopping options; indeed, why would anyone want to spend more time on a purchase than they have to? Retailers are starting to indulge. According to Boston Retail Partners’ research, Apple’s contactless payment solution, Apple Pay, is accepted by over 36% percent of all sellers in the U.S. And if 36% seems like a reassuringly small number, think about it this way: it’s up by 20% (!) since last year, which is an overwhelming growth rate. Now, 22% of the surveyed retailers plan to accept Apple Pay within the next year, and another 11% aim to do so within the next one to three years. If these plans come to fruition, Apple Pay might be implemented by 58% of the sellers next year, and within three years, we might be looking at around a 70% acceptance rate for Apple Pay. Forward-thinking companies like Visa and Samsung are already collaborating on similar solutions, so add Samsung Pay’s possible 30% acceptance (by 2018).

Still doubting whether you need to embrace the change?

Generally, involving third-party solutions in one’s own retail modernisations seems to be a thing, even for major players like Samsung, Apple, AT&T, Aeropostale etc. Not only does going mobile and collaborating raise a retailer’s chances in attracting local customers, but as InComm and WeChat Pay’s partnership shows, global payment methods are more convenient for travelers. Working with that audience, in turn, brings additional value for retailers, and can potentially influence other industries in the country. For example, it can increase the tourism rate by making purchases more readily available for incoming visitors. For the retailer that would mean an increase in the number of customers. On top of that, integrated point-of-sale systems and mobile shopping solutions allow retailers to utilise many marketing and sales opportunities: offering prepaid products, paying bills, real-time discounts on membership cards, digital gifting, enhanced loyalty programs, to name just a few.   With in-store purchases made through mobile devices passing the 4-billion-dollar mark, businesses should start thinking of ways to embrace the POS Mobile Payments. According to Forrester Research, already as many as 56% of users are willing to use their mobile devices in the payment process.