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Visa: Payments Innovation Spans The Point Of Sale Continuum

Innovating on the point of sale (POS) for consumers isn’t a one-shot deal.

Visa North America Senior Vice President and Head of Product Brian Cole told Karen Webster that when the topic is POS innovation in late 2020, innovation spans an entire continuum from card-not-present to card-present transactions and everyplace in between. Because over the last six months, the consumer commerce journey has changed quite widely.

A digital shift was thrust upon consumers when the pandemic broke out globally in March. The physical world was by and large closed for business, making online channels pretty much the only game in town for consumers and businesses worldwide looking to stay engaged in commerce.

But a funny thing happened between the spring and summer. PYMNTS/Visa’s latest edition of the How We Will Pay consumer survey revealed that in the intervening few months, consumers had become very comfortably connected in their home to devices and apps that made their commerce journeys more streamlined. Consumers were not staying digital because it was the only game in town. They were staying digital because it was looking like the better game in town and one that consumers were actually enjoying enough to stick with.

Because, as Cole noted, even in his own life, many of the changes made in the switch to digital were definite upgrades.

“I don’t know that my family will ever buy paper towels in a store again,” he said. “We have a recurring payment set up with our green merchant that makes paper towels that aren’t wrapped in plastic, so it arrives, you know, at our doorstep once a month. We’re good on paper towels.”

And that evolution is part of continual digitization of the commerce lives of customers, an evolution that merchants — even small ones — are now pushing to be a part of. The challenge, Cole said, is that there is no single right solution for every merchant, but there are right solutions for any merchant that really understands the customer base and their needs. Solutions, he said, that Visa believes it can help them figure out and connect to while they still have the chance.

Meeting The Multitasking Consumer

A quick glance at the latest PYMNTS/Visa research indicates that consumers aren’t just changing the how of their shopping habits or the where, but also, perhaps most surprisingly, the when. Consumers whose commerce habits used to be locked in on weekends have widened their temporal horizons.

Grocery shopping is no longer a weekend thing; it can happen any of the week, Webster noted, because consumers are now much more likely to make orders from home to either pick up later or have delivered to their door, or because many consumers are doing what Cole is and putting as much of their pantry on subscription as possible.

Consumers were once shopping for certain goods on weekends not because they didn’t need them during the week, but because time didn’t allow for it. Now, he said, when consumers are able to shop by tapping or clicking on a “virtual button,” shopping for these items and buying them is really a thing of the past. What is happening now in consumers’ lives is they are simply paying for them while engaging in doing other things throughout their day — and arranging to either quickly pick them up or have them delivered directly.

It’s not just about the paper towels, Cole said, it’s about the shift of the entire shopping journey for the customer and the various ways they are undertaking it across multiple channels.

And that shifting journey is good news and an opportunity for a lot of players within the commerce ecosystem. For merchants selling goods, and card issuers, those subscriptions are something like locking up an annuity that offers them a little bit of money and a lot of certainty about incoming revenue.

It’s also great news for the development of the voice ecosystem, which Cole forecasts is on the forefront of a what “will be a massive year of growth.” Consumers of all demographics, he noted, are getting increasingly used to talking with voice assistants and seeking their guidance, setting the state of a massive explosion in usage. The channels for conversing with consumers and capturing conversion, Cole said, are expanding rapidly.

The challenge for merchants of all kinds now in meeting the digital shift is being on the right channel at the right time to actually meet those consumers as they move through their journey.

The Evolution Forward

When it comes to how merchants should structure and place their digital pivots, the question becomes a little bit complicated because there are no real right or wrong answers for every type of business. The goal, he said, isn’t about picking a winner when it comes to digital channels — because evolution isn’t a binary process of either-or. It’s not voice versus in-app interactions, or POS innovation versus online checkout innovation. The goal isn’t to figure out what innovations to favor or not, he said; the goal at this phase of the game is to embrace as many innovations as possible.

And some use cases will work better than others. Consumers have different channel preferences in different contexts, he noted.

Making that pivot and taking on that broad embrace of innovation will be very challenging, particularly for smaller merchants who don’t have a lot of scale.

But challenges or not, merchants who want to make it to the other end of the pandemic have to start embracing the new ways consumers want to shop and pay because the changes they’ve embraced means things are never going back to the way they were before.

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