By: Peter O’Halloran, Vice President, Head of Digital Commerce EMEA, Fiserv
The Covid-19 pandemic accelerated the evolution of consumer behaviour and amplified the role of technology in the retail environment. With an increase in digital and contactless transactions, digital commerce has seen greater and more widespread adoption, and new and different payment methods have proliferated. Now that they have been exposed to new ways to shop, consumers will increasingly expect a choice of channels – whether physical, digital, or a blend of both – to interact with retailers. Retailers have access to more technology solutions and in turn more customer data, and an opportunity to provide more seamless, secure, and tailored experiences to customers.
Consolidating omnichannel experiences post-pandemic
The pandemic has driven the need for physical and digital retail experiences to work together. Even when consumers do choose to shop in physical spaces, channels are increasingly blurred, with many retailers offering digital experiences in store. Consumers now expect an omnichannel experience, with numerous purchase channels and payment methods packaged into a single journey. Retailers that implement these will offer a wider variety and greater flexibility to consumers, with the potential to drive greater satisfaction. In addition, they can provide a seamless, consistent user experience across physical and digital environments, helping to retain that all-important customer loyalty.
Technology is playing a key role in making these experiences a reality. The use of geolocation capabilities to direct offers to consumers is growing in popularity as retailers seek alternative ways to engage with customers following the pandemic-driven lockdowns. Technologies such as localisation platforms can provide retailers with the ability to dynamically feature relevant content and updates on their websites and apps based on the consumer’s location, proximity to the retailer’s physical location, markets, or places of interest. There has also been a rise in voice-enabled commerce and in apps that allow customers to order and pay for food in advance or book time slots for in-person services. These are merely some examples of how businesses will continue to connect the physical and digital environments and adapt to new customer requirements in the retail landscape.
The power of data
Transactions – both online and in-store – provide a wealth of real-time insights into consumer behaviour. With consumer permission, retailers can leverage customer data to provide more personalised offers and services promptly. Enabling smooth transitions between online and in-store sales and predicting consumer behaviour work hand in hand. For example, data will show which customers are more likely to take advantage of BOPIS – the ability to buy online and pick up in store.
Data can also be used to become smarter and more clued-up on customer behaviour. For example, retailers can analyse data to understand which customers are more likely to make a return, where, and how, and then take steps to minimize that likelihood, such as offering a purchase bonus that is forfeited in the event of a return. Predicting consumer behaviour streamlines processes and can improve efficiencies.
In addition, technology will continue to gain relevance to cleanse, structure, store and manage data in a compliant and profitable way in accordance with GDPR, PSD2 and other applicable regulations.
The future of retail
The popularity of innovations that enable a touchless and secure purchasing experience for both consumers and service providers will continue as we move beyond the pandemic. Consumers have become comfortable with these safer and more sanitary experiences, and have even developed a preference for fully digital transactions. It has been reported that cross-border business-to-consumer digital commerce will exceed US$1 trillion by 2021, with an annual growth rate of nearly 27%. As a result, we will likely see an increase in the use of proximity payments, such as mobile payments, NFC payments, and QR codes across a wide range of services and retail sectors.
Of course, as more payment activity moves into the digital realm, security is more vital than ever. The pandemic saw a proliferation in online scams and fraud, such as phishing emails on relief funds or health information. Fraud and identity management solutions can help ensure that businesses and consumers are protected.
Smart payment solutions bring a host of benefits such as efficiency, convenience, and security. The shift to digital channels and payments can seem like an overwhelming task, however, a willingness to drive innovation has never been more important. As retailers embrace technology, create omnichannel purchasing schemes that blend the physical with the digital world, and leverage data, it will prove transformative. They will be able to provide customer service that is faster, integrated, and streamlined. By becoming smarter, retailers will be delivering an improved and secure customer experience that is targeted and better meets evolved customers’ demands.