Mobile payments can redefine the customer experience for unattended retail
Editor's note:This article originally appeared in Kiosk Marketplace, a Mobile Payments Today sister publication.
Improving the customer experience has become a key focus of all astute retailers. For providers of convenience services, much of the focus rests on integrating frictionless point-of-sale payment. Hence, one of the best-attended educational sessions at the recent National Automatic Merchandising Association show at the Las Vegas Convention Center focused on how payment technology innovations — namely mobile payments — are impacting customer expectations.
Michael Kasavana, Ph.D., endowed professor emeritus of the National Automatic Merchandising Association, moderated the session.
The speakers agreed that mobile technology is redefining customer expectations for their shopping experiences.
Defining the customer journey
Paresh Patel, founder and CEO of PayRange, a mobile solutions provider for self-service equipment, honed in on the "customer journey," which he described as everything that happens to the customer before, during and after making a purchase.
The convenience services industry has focused on saving costs and lifting sales, he said, but the important question is what it has done to improve the customer journey.
If you focus on costs or sales, you can lose sight of the customer journey, Patel said. Blockbuster made this mistake when it incorrectly assumed that customers wanted to visit and walk around its stores, he said. Redbox and Netflix eventually changed the DVD customer's journey.
A convenience service customer's journey can be divided into three phases: pre-purchase; purchase; and post-purchase, Patel said. He encouraged his listeners to view their business activities — route management, customization, relevant marketing, payment and post-service customer contact — within these three areas.
Because technology is changing, the service provider has to use the correct technology to communicate to the customer, Patel said. The millennial customer, for example, will not pick up the phone to call the service provider about an issue with their service. They will use social media messaging.
"You're going to be in a difficult situation if you're still waiting on calls," Patel said. "This is all about the journey, not about the machine. Mobile is the gateway to improving the customer's journey."
"You can leverage technology to deliver the right message to the right person at the right time," Patel said. "Experience is the new convenience."
E-commerce changes behavior
Yair Nechmad, CEO of Nayax, an IoT platform for unattended payments, telemetry and management tools, said that e-commerce is changing the way consumers shop. As e-commerce expands, consumers are getting into the habit of surfing the web, searching websites, then making their transactions on websites. As a result, consumers are favoring mobile transactions over using payment cards.
In today's environment, unattended retail venues need to accept all forms of cashless payment, Nechmad said. These technologies include card swipe transactions, contactless near field communication, Bluetooth, QR codes, biometric-supported personal recognition and messaging platforms.
Technology that allows unattended retailers to market at the point of sale supports customer discounts, promotions and more opportunities for customer engagement, he said.
Nechmad noted that the micro market — an unattended retail concept offering consumers open product shelving and cashless payment — has emerged as a tool to better engage the consumer. Micro market software provides sales tracking, coupons and loyalty programs, and the ability to track purchase behavior, he said.
Customer expectations keep changing
"The one constant is [that] the consumer will evolve," said Mike Lawlor, chief services officer at USA Technologies Inc., a payment technology service provider of integrated cashless and mobile transactions for unattended retail equipment. "They expect a simplified experience that leverages technology."
Service providers need to recognize that today's consumer cares about how the products they buy are being sourced, Lawlor said, and that they want the product when they want it.
"The new consumer is not about the transaction; it's about the experience," he said. "They would rather text you than talk to you."
Consumers today actually value digital experiences — such as virtual reality and augmented reality — more than real experiences, he said.
Today's consumer feels good about a company that resolves an issue for them without having to talk to customer service, Lawlor said.
Mobile apps to dominate future commerce
In time, mobile apps will eliminate the need for some kiosks, he said.
Starbucks is leading the app experience with its mobile order-ahead feature. Lawlor said that Starbucks mobile order and pay represented 7 percent of its store transactions in the fourth quarter of 2016, compared with 3 percent the prior year.
The presenters were noncommittal when asked which technology — mobile apps or mobile wallets — will eventually dominate mobile payments.
"Either way, it will be some form of mobility," Lawlor said. "We're sitting on this great consumer trend."
Gamification — the application of game principles and design elements in nongame contexts — will also play a role in convenience services, Patel said in response to a question from the audience.
Elliot Maras is the editor of KioskMarketplace.com and FoodTruckOperator.com.