Payments trends for 2022 Center on Omnichannel

If the past 20+ months have taught us anything, it’s to expect technological change to be faster and deeper than before, with payments connecting almost everything in some way. other.

It’s getting harder and harder to remember, but the technological change before the pandemic took place over a longer period of time, and the forms it took were less about consumer experience than pure utility.

In an interview, Nikhil “Nik” Sathe, CTO at Blackhawk Network, called it “a story of two different parts of the economy, where online payments have gone digital very quickly,” providing plenty of choice and enabling seamless or unobstructed experiences. He added that physical retail has not moved so quickly, lagging behind in adopting many of these approaches.

The advantage that e-commerce enjoyed over physical retail during the most restrictive part of the lockdown did not last, just as the physical did the digital shift. As Sathe put it, “in the payments industry, or really in the retail industry more broadly, there has been a much faster rise in [the past one year than in any period I can remember], where everyone had to embrace these omnichannel experiences.

“[Businesses] stopped trying to justify: “Is it worth investing in these,” Sathe said. “It was necessary for their survival as confinements [went into effect] around the world [and how people shopped changed overnight]. “

This paved the way for further adoption of the technology which in many cases is already available, but for various reasons adoption was slow until a global health crisis created a need.

See also: Inventory shortages could make 2021 holidays the year of the gift card

Omnichannel steals the show

As Sathe said, the move to omnichannel is one of the areas of immense influence right now and has even bigger implications going forward.

“Omnichannel experiences are probably going to be the biggest long-term impact,” of the pandemic era, Sathe said. “The same kinds of capabilities that users expect in the digital world now permeate both the digital and the physical and truly connect the two in a seamless payment and shopping experience. “

There are some technologies that stand out as having made pandemic payments possible, and for Sathe, the QR code not only fits that description, but has additional potential for digital payments as well.

“QR was definitely an area where technology has been reused in some way or another to bridge that divide between the digital world, your phone, and the physical world,” he said.

Buy Now, Pay Later (BNPL) is also on Sathe’s list of transformational technologies for the period 2020-2021, and he said he sees his next step as more store-focused than e-commerce. .

“A lot of those who buy now, pay later are trying to figure out how they become more relevant in the physical world, not just in the digital world. [where they got their start]. Physical retailing and groceries are more typical day-to-day expenses, again helping these vendors build credibility and loyalty, and deepen relationships with consumers.

Sathe said that from QR codes to BNPL to gift cards, the forms digital payments take will be key to improving the consumer experience.

Read also: In-store checkout ready to drive growth in immediate purchases and subsequent payments

Loyalty, partnerships and esoteric technology

On the more exotic side of money, Sathe said he is watching the cryptocurrency industry with interest, thinking about how it might even impact Blackhawk’s business down the road.

“Previously, rewards were characterized in terms of discounts, cash back, or points that you could use for other things,” he said. “I think one of the things we’re seeing is the emergence of digital assets… like NFTs.”

Calling non-fungible tokens (NFTs) “technically esoteric,” Sathe said he sees their business value.

“You can think of them as a unique digital experience that you can get from a brand,” he said. He noted such experiences by Roblox, Nike and Louis Vuitton.

“For me, this is sort of the next evolution in loyalty, which gives your best customers unique capabilities, as opposed to just cash discounts,” he said. “I think the cash discounts [also continue to evolve, with] people who innovate in new ways to earn and burn reward points or other forms of stored value.

Also, on the evolutionary track with BNPL and NFT, there are digital currencies, which Sathe says are reaching the top of the “hype cycle” and may soon shift from speculative investment status to one that people will actually spend.

“Now it all kind of comes together, with the economic need for people to fund things or spread their payments over time, combined with mobile payment technologies, and companies like Blackhawk that enable those cases. of use to become a reality in physical retail. “

As always, the choice of partners will count.

“I think [as an industry], we need to standardize and simplify [integrations] because if every retailer now has to figure out how to fit in with all of these digital wallets, all of these buy now, pay vendors later and all these potential alternative currencies, i think that’s just going to create more cost and less money. traction. Companies like Blackhawk have the opportunity – and almost a mandate – to step in and help integrate all of these use cases and make things easier for brands.

See also: Blackhawk Network and Magstar Offer Expanded Digital Payment Acceptance to Retailers

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Elaine R. Knight