In a time of increasing change for retailers and consumers, retail trends have been accelerating at a much quicker pace than previously envisioned. However, one thing still rings true: consumers need a reason to change ingrained behaviours.
But almost overnight, the pandemic and the great digital shift brought with them the forceful push that mobile payments needed. Consumers were in many ways forced to figure out how to use digital wallets for their everyday needs, such as groceries or food deliveries. QR code scanning, which didn’t have much traction in the US, is suddenly popping up everywhere. Merchants are also aggressively promoting the use of digital wallets and touchless checkouts to promote a safer shopping environment.
As we look ahead to the future of omnichannel retail, education, marketing and customer experience will be key drivers of adoption.
Capturing the new customer
The near-overnight transition of the digitally minded consumer has been the biggest and perhaps trickiest thing for retailers to adapt to in recent months. What consumers want, and how they want it, is changing in front of our eyes. In terms of penetration, we know that 68 per cent of consumers are shopping digitally more often – and using mobile wallets more often to do it1.
We’ve seen during the pandemic a shift from out-of-home spending on things such as entertainment, dining and shopping, to home improvement, home entertainment such as video streaming or gaming, and food delivery.
Meanwhile, demand for digital gift cards has been steadily growing, and we’ve seen it accelerate due to the pandemic. In addition, we’re seeing consumer interaction with retail apps consistently rising – about 61 per cent of US consumers now make purchases within retailer apps, a significant jump from the 21 per cent who did so pre-pandemic. Meanwhile, the number of consumers who’ve never used a retailer app has dropped significantly, from 32 per cent pre-pandemic to only 13 per cent today.
It remains to be seen which of these shifts remain long-term, but our research indicates that 78 per cent of consumers will expect permanent changes to their shopping experience, and that 44 per cent are unlikely to return to the way they used to shop1.
And if those customers aren’t going to go back to pre-pandemic habits, then merchants who wish to serve them have no choice but to forge a more digitally enabled path.
The future is omnichannel
It’s no surprise that in today’s difficult times, consumers are concerned with budgets, but perhaps even more concerned with choice and control when it comes to how and where they spend. Increasingly, those factors determine where customers choose to conduct commerce. For example, payments with points are up 29 per cent among consumers Blackhawk surveyed.
The actual payment process is becoming more invisible, clearing a path for a more controlled and dynamic customer experience. We need to continue to make it easy for consumers to pay and move on with their day, removing barriers such as having to remember card or account information, and streamlining the credential and authorisation process to further minimise those pain points that may send a consumer elsewhere.
In large part, this is why the entire retail and payment ecosystem needs to start thinking differently. We see immense opportunity to offer true omnichannel retail experiences, and programmes that increase the capacity to accept new payment resources such as barcode-based “cash payments” are making physical purchases for digital goods even easier for consumers.
Brands that are thriving are those actively looking for ways to overcome new challenges by creating fresh, seamless experiences to engage customers across the channels they find most valuable. It will be key for retailers to invest in their digital platform, expand and ensure payment option parity across their physical and digital channels as well as deliver a seamless, truly omnichannel experience.
Learn more about Blackhawk’s capabilities by visiting our website.
By Helena Mao, VP, Global Product Strategy, Blackhawk Network
 “BrandedPay: How People and Brands Connect Through Payments” is based on the findings of an internet-based survey conducted by Leger on behalf of Blackhawk Network between February 12 and March 17, 2020. The sample size included over 12,000 respondents in eight countries.
 The “COVID U.S. Consumer Preferences” study is based on findings of an internet-based survey conducted by SurveyMonkey on behalf of Blackhawk Network on May 22, 2020. The sample size included 1,019 U.S. respondents.