Consumers want three main things from mobile payments

 
July 10, 2014 | by Kristen Gramigna

Customers say they want convenient payment options, but how do you get them on board with making mobile payments? Make it a value-added benefit that simplifies and improves their retail experience. Here are the three main things customers want from mobile payments, and how to deliver them.

Lighten their load. According to a recent Accenture study on mobile payments, customers are far more likely to convert to regular mobile payment use once they’ve made that first transaction. How do you get them to give it a shot? Give them a reason to believe that mobile payment transactions offer a benefit traditional methods of payment cannot. For example, Starbucks, one of the leaders in the mobile payment revolution, has given customers tangible reasons to use the mobile app: It eliminated the need to take anything to the coffee shop except for a smartphone, and provided a better method than traditional swiping. Because the point of sale register (not the user) “scans” the barcode associated with the mobile payer to complete the purchase, a behavior (handing a card or cash to the person behind the register) hasn’t just been replaced — but eliminated. Whether that process is actually faster is unknown, but because Starbucks has provided a value-added convenience with its mobile payment apps, it’s emerged a leader in the technology, and consumer adoption of it.

Reward them in a meaningful way. Credit cards have done a great job incentivizing customers to use their products more frequently to pay for everyday purchases by offering rewards for use. Perhaps even more importantly, they’ve made it simple to redeem those rewards for things the customer actually wants, in their preferred format — allowing the choice of a statement credit, a paper check, a gift card or cash deposited to a bank account. Retailers can leverage the appeal of mobile payments by piggybacking on that notion, and giving users the opportunity to earn rewards, track their earning progress and redeem rewards seamlessly, without the need for additional “loyalty program” elements like a keychain card or punch card. Further, the message of the retail rewards value must be communicated overtly to create a perception of advantage: When customers use mobile payments (which may be connected to an existing rewards credit card), for example, they can maximize the earning power of their transactions.

Make them feel confident. Consumers have come to expect certain things from the checkout experience: presenting payment at the point of sale, signing a receipt, and at the end of the transaction being offered a proof of purchase, via hard-copy receipt or email. Because the Accenture study revealed that security and privacy issues associated with mobile payments remain a major barrier (45 percent of respondents to the survey said they don’t use mobile payments because of security concerns), the mobile payment process should feel familiar and non-threatening — especially to new users.

Retail brand-specific mobile apps that coincide with the mobile payment experience should feature an easy-to-navigate interface that communicates a perception of security. Every POS terminal in store should be equipped to process a mobile payment transaction and supported with signage that promotes the mobile payment option, and walks novice users through the experience without making them feel vulnerable. Similarly, in-store associates at the point of sale should be trained in asking customers if they wish to pay via mobile, be well-versed in how to use the technology, and know basic troubleshooting in case of technical errors.

Though consumers in North America have been slower to adopt mobile payments compared to some other nations, IDC Financial Insights estimates that such technology represents an opportunity that could be worth $296 billion by 2017. Given that data indicates that the biggest challenge in convincing customers to use mobile payments is giving them tangible reasons to believe that it can improve their customer experience, the future leader of retail mobile payments may be a title that is up for the taking.

Photo courtesy of Jason Tester Guerrilla Futures.


Topics: In-App Payments, Loyalty Programs, Mobile/Digital Wallet, POS, Restaurants, Retail, Trends / Statistics


Kristen Gramigna / Kristen Gramigna is Chief Marketing Officer for BluePay, providing retail payment processing solutions for merchants of all sizes. She brings more than 15 years of experience in the bankcard industry in direct sales, sales management, and marketing to the company and also serves on its Board of Directors.
wwwView Kristen Gramigna's profile on LinkedIn

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