Payments in retail can support personalised experience

24 September 2019 Consultancy.eu

The retail and grocery sectors are bracing themselves for the next wave of the payments revolution. While the first wave was all about getting people to pay contactless, the next one will centre around blending next-level payments into checkout solutions with a better experience for customers.

Back in the old days, consumers spent their wallet at counters of a retail store or supermarket. Gone are those days, and it’s all thanks to digital. Today, electronic payments have taken over the scene. Across Europe, the share of cash payments at counters of retailers and supermarkets has dropped to below 50%, and in front running contactless payment countries such as the Netherlands, this number now stands at below 40%. 

Ward Hagenaar, a partner at Connective Payments, describes contactless payments as “convenient and secure at the same time”, and as a result, they have now become “the new normal” for consumers. “Consumers enjoy less friction when settling the purchasing process, and they experience benefits in terms of safety, loyalty and financial transparency.”

Meanwhile, at the other side of the table, retailers are looking to push digital, including payments, much further. Enter for example cashierless counters. Straightforward for the consumer – they autonomously scan their own items at digital counters – and strikingly convenient for retailers. Their presence is on the rise – large chains such as Auchan, Carrefour, Amazon Go and Albert Heijn are now operating cashierless counters. The reason? “Efficiency. It allows for fewer staff, and that saves costs, which then can be swayed towards other technology investments.” Payments in retail can support personalised experience

Automated stores

Yet according to Hagenaar, the near future will see retailers embrace an even bolder option. Fully automated stores, including cashierless counters. “This requires consumers to check-in with a card, wearable or app. Consumers pick the product from the shelf while sensors and cameras register what’s in the basket. Technology in essence registers everything in their shopping baskets. Then, at the counter, consumers have no hassle at all, they simply walk out of the store. Digitisation deals with the full payment process. Exactly the user experience we are familiar with online, with our favourite ecommerce brands that hold our profile.” 

Retailers are now piloting this technology across the globe, because unknown is how well the process runs, and “how consumers react to all the cameras.” However, while much attention (rightly so) goes to privacy, research by Accenture shows that there remains a large untapped potential. “Many consumers are willing to exchange their data to get more convenience, personalised recommendations, time-saving solutions and logistical services, loyalty rewards and offers.” 

This coincides with mounting interest for catering to a better user experience. Against a backdrop of a 24/7 service economy and digitisation making the impossible possible, consumers in all sectors are upping their expectations on the services they receive. For retailers, this means that they should seek ways to combine their technology-driven efficiency push with design principles that ultimately make consumers happy. 

“The technology is there to support and stretch a retailer’s abilities. Remote ordering (what used to be called e-com) is evolving into a new method to attract customers into the store. Not only via ‘buy online pick up in store’ (BOPIS) but also via remote and in store app and kiosk purchases.”

To this end, retailers are starting to smarten their in-store product portfolio, leveraging customer intelligence capabilities known from online experiences. Sneaker giant Nike for instance provides the ability to pre-check availability in the nearest store and reserve an item.

Apps on smartphones share location and more, and consumers are willing to share such personal data in exchange for faster service, vouchers, exclusive deals and loyalty points. “This opens a range of possibilities for retailers, including accurate opt-in data, location-based behaviour profiles, and segmenting based on actual shopping behaviour.”

Concluding, Hagenaar said; “New in-store user experiences must be highly personal and lead to differentiated in-shop experiences. An account-based consumer profile and stored payment credentials, clearly with explicit consumer consent, makes this possible. It will be interesting to see what this highly data-driven retail experience will mean for competition in physical retail.”


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