On mobile payments, retail uncertainty tied to customer adoption
By Jay Keller
How do you prefer to pay for merchandise while shopping online at your favorite retailer? For most of us, using our trusty debit or credit card is the primary means to pay for merchandise, both in the store and at online hubs.
Some of you, however, may be longing for the days of alternative digital-payment technologies like services offered by companies like PayPal, Braintree or Google Checkout.
Retailers expect that sometime over the next three years mobile and digital payments will become a major component to how customers pay for merchandise, according to a recent study published by Denver-based Retail Systems Research.
That would be a huge leap from 2013 where credit and debit cards dominate payment processing in retail and other forms are just not supported.
The answer, according to the RSR findings, won’t come from traditional payment partners like Visa and MasterCard, for example, but instead retailers expect their customers will dictate how payment options will be presented in the future.
The study revealed that “uncertainty about the technical future of payments” remains the top challenge for most retailers and that “next-generation payment processing needs to be moved near the top of the corporate ‘to-do’ list.”
Additionally, 38 percent of the retailers surveyed agree that they are “stuck until some solution to rising processing fees is presented.”
At least 60 percent of all retailers surveyed said that customer adoption of technology dictates which payment types they would support, no matter the cost to implement new technology.
The retailers also agree that the primary focus remains on “what is right for the customer” and that should always be a priority over the cost of implementing a consolidated payment processing capability across all selling channels.
In the meantime, amid the uncertainty that retailers feel about the future direction that payments will take, RSR says “absolutely no payment technology’s value translates into budgeted plans for the future.”
“Payment processing is still ‘the moment of truth’ and handling payments properly is critical to providing a satisfying customer experience,” say the authors of the RSR report.
In the meantime, retailers will need to do whatever they must to accept any form of payment the customer presents at the time of purchase.