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Digital-first retailers cannot overlook payments

Despite the retail industry being worth £366bn to the UK in 2017, the traditional high street has struggled this year.

Chancellor Philip Hammond announced a financial package that includes £900m in business rates relief for nearly 500,000 small businesses, and a pot of £650m to rejuvenate high streets. But in order to survive in the long-term, it’s about more than just money in the bank.

As shopping moves increasingly online, many retailers have struggled to adapt to the developing digital economy, and many still haven’t made the transition from offline to online. Social media has also become a driving force behind online shopping; according to The Influencer Index, a quarter of Instagram users in the UK have made a purchase because of the social network, either buying directly from the app or in store at a later date.

Consumers are firmly in the driving seat for change. But Deloitte’s ‘Retail Trends 2018’ believe this is a time of evolution; retailers that innovate will thrive in the changing retail sector.

Fast, friction-free customer experience

E-commerce is no longer a like-to-have, it’s a must-have. Retailers need to be aligned in both their online and offline offering to deliver a seamless, frictionless experience across all channels.

A great example of a brand that did just this is online mattress retailer, Casper. To create a better purchasing experience, the company opened a physical shop in New York City for consumers to test the mattress before they made a purchase online.

Payments done properly

To improve customer experience, retailers are striving to innovate, improve efficiencies and reduce costs. But an area that often gets overlooked – and one of the most important aspects of the shopping evolution – is payments.

According to research by Worldpay, contactless payments are now more popular than chip and pin card transactions for UK shoppers, with usage jumping by around 30% in stores between June 2017 and June 2018.

Consumers are also increasingly using mobile wallet payments such as Apple Pay and Google Pay as it offers them a quick, convenient and easy way to pay. If customers don’t have access to these kind of services, they simply shop elsewhere.

Marks and Spencer proves to be a brand that is innovating with customer expectations to gain that competitive edge. It has recently announced plans to launch a checkout-free mobile payment service in selected stores in 2019. ‘Mobile, Pay, Go’ will be a feature within the M&S iPhone app. Customers will be able to scan products on the go and pay from their device using Apple Pay or a saved card on their M&S online account – without ever having to visit a till.

The global opportunity

There are huge opportunities for retail businesses to thrive in this globally connected and digitally evolving world. But too often international customers have their transactions declined or cancelled while they struggle to use e-commerce platforms that aren’t suited to their local markets. Customers expect to be able to pay anywhere, whenever they want. And if they can’t, they will shop elsewhere.

There is however a reason that many businesses haven’t been able to deliver what customers expect – the payments ecosystem has traditionally been too difficult for merchants to navigate.

But modern technology enables merchants to confidently explore the global payments market so they can streamline costs and offer hassle-free payments to their customers.

Merchants can integrate with multiple acquirers, automatically routing any payments through the best acquirer to fit their specific needs. Everyone is a winner as checkout processes are faster and more efficient, conversion rates are increased and retailers can access lower payments processing costs. As a result, sales are increased by passing on lower costs to happy customers, while profit margins are unaffected.

As customer expectations continue to evolve, there will be more and more competition for their spending and loyalty. Retailers that innovate and adapt with the changing landscape will reap the rewards, while those that don’t are likely to become relegated to the history books.


Peter Keenan is the CEO of payments service platform APEXX.

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