The coronavirus pandemic has forced brands to transform their businesses in several ways that are expected to endure.
Not only has it accelerated digitization, but it is also aimed at customers who value the experience and brand values ââas much as the quality of the product or service they buy. ABS recently came out retail figures, point to signs of post-pandemic recovery in the industry, and with heightened awareness of hygiene, data security and quality of service, the integration of digital payments and related trends will play a critical role to help the retail industry rebound.
The payment trends of 2021 are being shaped by this evolving consumer, as well as the lasting impact of COVID-19. Businesses can’t myopically assume that their digital customers are limited to younger, tech-savvy buyers. COVID-19 has changed that for good, with each generation moving online in some ways.
To attract and retain these customers in 2021 and beyond, brands and retailers need to pay close attention to four key payment trends:
1. Consumers will drive demand for unified commerce
The companies that have consistently performed well throughout 2020 have been the ones that combined their physical and digital worlds to create a fluid, channel-independent experience that put the customer first. With payments from all of their channels feeding into the same system, this practice – known as Unified Commerce – allows merchants to act with greater agility. With everything connected, they were able to identify and support new customer journeys quickly and more..
In recent years, savvy pioneers in retail have taught consumers to expect seamless integration of offline and online service delivery. Other traders have rushed to catch up, but the pandemic has increased that need tenfold. With the closure of physical stores, offline and online merging has become a survival issue for businesses, which have quickly pivoted to making virtual curbside pickups, delivery, and experiences a reality.
Despite the reopening of stores, consumer demand for this digital infrastructure remains. Buyers prefer the convenience and experience it offers, and retailers build better relationships with their customers through the rich data generated by digital transactions. This demand will become even stronger in 2021. 74% of Australians expect companies to maintain the flexibility they have shown in selling across multiple channels during the pandemic, independent research for Adyen’s shows Agility report.
2. Contactless will expand its reach to every corner of the retail industry
The pandemic has also increased the demand for contactless payments. Consumers want to shop without worrying about their safety, and they expect businesses to meet minimum hygiene standards. Contactless payments are now the method of choice for half of Australians polled in Adyen’s Agility report, and most want retailers to use the technology to reduce person-to-person contact.
As an alternative to handing over cards, touching keyboards and handling cash; digital wallets, tap-n-go and QR codes have become more prominent payment solutions. Over the past year, data from the Adyen platform shows that the use of services like Apple Pay and Google Pay has increased dramatically, with shoppers choosing to pay with their phones rather than their wallets. The pandemic simultaneously proved the The value of QR codes in anchoring a fluid and often pleasant experience, not only at the point of sale, but at several points in the customer journey, such as the display of menus and the placing of orders.
Payment links are also becoming more important. In Australia, brands like Michael Hill and Incu have used Pay by Link technology to generate and send personalized payment links to customers in emails, in video calls and through social media and chat functions on the website.
3. Payments will become a daily means of payment
The twin forces of increased convenience and tighter household budgets have made installment payment options widespread, a trend that is further strengthening in 2021.
Carried by millennial consumers, this modernized version of layby offers alluring simplicity compared to credit cards. For small and medium items, buyers know that instead of paying $ 100 now, they will pay $ 25 bi-weekly for two months. This kind of transparency makes it easier for buyers to engage on the close, attracting traders hoping to avoid the dreaded abandoned cart.
The providers of ‘buy now, pay later’ options themselves will begin to diverge, with some focusing on high-end multi-year agreements, while others are looking to come up with installment plans for shopping carts. no minimum expenses â. For households increasingly used to paying monthly for everything from streaming services to food delivery, installment plans are starting to look like subscriptions that have a fixed end date.
4. Loyalty must not be assumed, it must be earned
The coronavirus pandemic has encouraged consumers to reassess their priorities, with many choosing to shop closer to home and from merchants they have previously purchased from. But it has also made consumers more demanding. Adyen’s Agility Report study shows that 72% of Australians won’t return to a retailer if they’ve had a bad experience, either in-store or online.
Throughout 2021, retailers must pay renewed attention to loyalty. Two-thirds of Agility report respondents say marketers need to improve the way they reward buyers – a sentiment that is reflected across all age groups as well. Australians want loyalty programs to be automatically linked to their payment card, and many prefer retailers who remember their preferences to create a more personalized shopping experience.
Additionally, retailers need to optimize the entire customer journey to ensure a high-quality experience at every touchpoint. Letting Australian shoppers buy an out-of-stock item in store and have it delivered to their doorstep, or buying items online and returning them to store builds brand loyalty.
This is where unified commerce can really pay dividends for retailers. With transparent links between channels, retailers can open up new shopping experiences that have been proven to build loyalty and create new avenues for rewarding repeat customers.
Michel van Aalten is Country Manager ANZ Adyen.