Looking Ahead: Payment trends and predictions for global retailers
According to The Forrester Wave: Global Merchant Payment Providers, Q4 2018, implementing new emerging digital and mobile payment types will be one of the top payment-related initiatives for retailers in the next 18 months.
And they’re making these investments for good reason – mobile wallet adoption is on the rise. Worldwide mobile payment revenue in 2015 was $450 billion, and it is expected to surpass $1 trillion by next year. If you’re not following suit and implementing technologies that allow your customers to pay how they want, you may be putting your brand at risk in the already-competitive retail industry.
Separately, navigating the plethora of payment methods available around the world can be a challenge for retailers in and of itself. While some payment methods are known and used everywhere, mostly it’s a jigsaw puzzle of localized payment types in each region. And on top of the global considerations, new payment methods and technologies regularly come on the scene.
If retailers want to capture more global sales in 2019 and beyond, they must give customers everywhere the payment choices they want. This means increasing support for eWallets as well as considering local payment methods and currencies in the payment experience.
A Crash Course in Mobile Payments
With more people using these quick and easy payment methods, e-commerce businesses should prioritize implementing the most-impactful mobile-payment methods. Here are the mobile payment technologies you should be aware of:
• SMS payments: Payment via text message, usually for person-to-person payments.
• Near field communication (NFC) payments: The transfer of payment information when a phone and a point-of-sale device come in close contact, such as when using Apple Pay in stores.
• Mobile wallets: Also called digital wallets or eWallets, where payment information is stored in an application for easier checkout online or in-app.
The mobile payment type that matters most for retailers is mobile wallets. Shoppers can pay with a mobile wallet like Apple Pay in store, in-app and on e-commerce websites. These will continue to close the gap between e-commerce and retail and retailers who accept mobile wallets at the point-of-sale will offer their customers a more-streamlined checkout experience.
However, to strategize your eWallet offerings properly, you need to know the differences in the types of wallets and customize your options to suit your customers. Here are three wallets that will be widely adopted in 2019:
1. Mobile-first wallets: Mobile-first wallets, like Apple Pay and Google Pay, are those that were designed for mobile browser and in-app purchases. Customers can add their favorite credit or debit cards to these wallets and pay using whichever one they choose. Payment is quick and easy—boiled down to a single click and identity confirmation.
2. Browser-oriented eWallets: Other mobile wallets, like Visa Checkout and Masterpass, were designed for the browser checkout experience regardless of device. They reduce the steps involved in checkout, shortening the process to just a few clicks.
3. Stored-balance & credit card eWallets: Some eWallets, like PayPal and Alipay, offer users the ability to keep a balance of funds stored in the mobile wallet itself, unattached to a credit or debit card. They can also link the eWallet to any preferred credit or debit card as well.
As digital wallet usage continues to grow, retailers would be smart to prioritize these new technologies. However, prioritizing mobile will not help you capture every shopper in 2019. Retailers must also think about their international shoppers’ payment experience.
Payment Preferences Across the Globe
A one-size-fits-all approach to payments doesn’t work on a global scale. If your payment setup isn’t localized, you’re creating unnecessary friction for your global customer’s payment experience.
Here are three ways you can ensure your global payment experience is appealing to international visitors:
1. Present your website in their native language: Shoppers want to be able to read the checkout page; if they can’t, comfort levels plummet. Ensure your payment technology can detect a shopper’s IP and serve up the payment page in the appropriate language.
2. Present the “total cost” in their local currency: When the local currency is unavailable, it makes shoppers uncertain of the final cost. To avoid losing sales, your checkout page should automatically adjust purchase prices to the correct currency based on a shopper’s URL.
3. Offer the locally-preferred payment option: Shoppers will abandon their purchase if they don’t see a local payment option they prefer. Outside the U.S., most sales are done using other payment methods, anything from cash vouchers to bank transfers. Make sure your transaction experience supports all of these.
Navigating the plethora of payment methods available around the world can be a challenge for retailers because of the complex landscape of localized payment types. And on top of the global considerations, new payment methods and technologies regularly come on the scene.
To keep up with the rising trend of mobile-based global e-commerce, retailers need the right pieces in place to convert the maximum number of sales, and that requires increasing support for eWallets as well as local payment methods and currencies.
Ralph Dangelmaier is CEO of BlueSnap, an e-commerce payment services provider.
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