Last year, we discussed how payment methods in the ecommerce world were evolving with payment by selfie and talk to pay. With the development of VR, contactless and pocket payment systems, this week we’re taking a look at the payment methods to watch out for in 2017.
A report by Forrester revealed that smartphones will continue to play a big role in payments, with mobile transactions in Western Europe set to increase from €52 billion in 2016 to €148 billion by 2021. This is an unsurprising statistic, as it was revealed that 25% of leading mobile retailers saw 50% of their sales from mobile. Mobile applications are surging as Criteo reveals that apps deliver double the new user retention power compared to mobile browser. The study also revealed that the UK is now selling more via mobile than through desktop and that the Brits come out second in the world for the highest mobile conversions, just behind Japan. These figures are testament to the fact that consumers are constantly looking for new ways to make their buying journeys as convenient as possible, while maintaining a strong level of security. Companies are responding to this trend by coming up with innovative ways to carry out payments and create a seamless, efficient and secure buying journey.
Virtual Reality seems to be the big trend in 2017, with VR seemingly being integrated into every aspect of our lives. So why not use Virtual Reality to carry out transactions? This is what Worldpay is testing out, through their prototype that enables shoppers to make secure payments within a VR application.
Similar to contactless payments, the VR payment method uses a HCE system to bring the payment process to life and with EMV technology, shoppers can carry out a transaction for £30 and under. If a consumer wants to make a purchase over £30, the VR headset displays a range of numbers and using a remote, the user inputs their pin number. Fintextra reports that the payment tool is to be marketed to companies that create VR games and brands such as Ikea and Asos who are experimenting with Virtual Reality based shopping environments. The development of this payment system means that in the future we could be seeing customers carrying out their full buying journey through VR, from product research right through to completing their purchases.
According to a study conducted by Visa Contactless, British consumers queue for an average of almost 7 minutes per week and just under 90% of customers have left a shop or business as a result of excessive queuing. The study reveals that nearly 50% of people felt that the length of queues was due to slow payment options and other customers using cash instead of quicker methods like contactless. Without doubt, long queues while waiting to pay are often seen as the bane of the overall shopping experience.
To tackle this problem, Barclaycard are trialing a new Grab+Go app that gives shoppers the opportunity to transform their smartphones into a till. No need for queues, customers simply have to scan the products that they’re purchasing using the app, finalise their purchase with a single click (their payment details are previously input into the app), and simply walk out of the store with their digital receipt accessible straight from the app. Retailers are therefore given the opportunity to replicate Amazon’s cashless store, without the high costs of kitting out their shop with the advanced shopping technology.
Although not a new innovation, the use of mobile wallets for payments and loyalty schemes is on the rise. Research from Urban Airship revealed that over 50 percent of UK and US consumers have previously used a mobile wallet, while over 4/5 Millenials are more likely to use mobile payments if loyalty rewards, discounts and other promotional offers were applied. Apple Pay transaction volume has increased by 450% over the past year, according to CEO Tim Cook, meanwhile Samsung has recently launched it’s version of the payment system in the UK, with Samsung Pay. Along with Android Pay, mobile wallets are now seeing widespread use, offering consumers a simple, seamless and contactless payment solution. UK retailers are now also accepting Apple Pay for transactions over £30, meaning the payment method now has an advantage over contactless cards which are still capped.
As businesses continue to come up with innovative payment solutions to help create the best customer buying journey possible, it is important to take into account the fact that payment methods vary from one country to the next. From bank cards, to international e-payments, understanding your market and which payment methods they prefer to use is essential when it comes to selling on an international scale. We have a handy guide that helps you discover the preferred online payment methods across the globe.