Since the start of the Covid-19 pandemic, retailers, business leaders and consumers have all had more questions of than answers to what the “new normal” might look like. But as we approach the holiday shopping season with an unprecedented level of uncertainty, one thing rings true for the future of payments: businesses and consumers alike need to prepare for the continuing, swift shift to online and mobile payment models.
During the 2020 holiday period and beyond, the brands that excel will be those that actively look for ways to overcome new challenges by creating enjoyable, seamless experiences to engage customers across the channels they find most valuable. This includes prioritising a truly seamless experience and choices such as curbside pickup, no-contact delivery and expedited shipping at no additional cost.
Digital wallets have well and truly arrived
According to a recent survey from Blackhawk Network, 88 per cent of shoppers surveyed across eight countries use a digital wallet of some kind. In the US, before the pandemic hit fewer than 38 per cent of Americans surveyed said they were using digital wallets to make purchases more or as often as the year before. As the economy began to reopen, that number has jumped to 55 per cent.
As Covid-19 reshapes our perception of digital payments, it won’t be enough for mobile wallets to merely store payment credentials. From cash to rewards and gift cards, mobile wallets must transition to host additional useable payment options across technology, retailers and buying experiences. Retailers and consumers alike are looking for more ways to unlock the value of the mobile payment experience to spend across a variety of situations, and redeem points and gift cards seamlessly across the shopping experience.
Changing consumer habits
But getting consumers to use their mobile wallets is just the first step, and in a post-pandemic world, our role is to continue to innovate. We must drive additional options across the payment, coupons, rebates and incentives spectrum into the mobile wallet to create the best experience for consumers. And we must do so in a way that does not overtask retailers’ existing operations. The biggest winners in the next phase of the payments race will be those able to best achieve the balance of providing choice and seamless experiences to consumers, while making it effortless for retailers.
Streamlining the purchasing process for digital and mobile shopping has become a must for retailers. One-click checkouts, incorporating technology to pre-populate shipping and payment information, will greatly reduce cart abandonment. Consumers value a checkout process that’s fast and easy.
“Gifting” will still have a major impact
Online and mobile shopping habits spread quickly when social distancing was introduced, and digital gifting emerged as a multigenerational lifeline – evident by unprecedented growth in recent months. For instance, based on Blackhawk Network’s partners’ sales data, gift cards sold directly from a restaurant or merchant’s own website since mid-March are up 92 per cent from 2019. And with US e-commerce sales expected to climb by 18 per cent this year, the rapid adoption of digital gift cards, or eGifts, is here to stay.
With mobile payments on the rise, it’s not just about consumers finding easy gift card options, it’s also about ensuring your brand is ready for those contactless payment opportunities, integrating gift card redemption and purchase into mobile wallets and online ordering in a seamless way.
At the start of the pandemic, omni-commerce solutions were a new thing for millions of consumers and businesses (especially small businesses). The pandemic has rapidly shifted people’s mindsets, needs and adoption habits in a way that experts were once predicting would take years. With many consumers trying omni-commerce solutions for the first time, they still maintain their existing expectations of the highest levels of service and functionality.
By Brett Narlinger, head of global commerce at Blackhawk Network