If you’re reading this post and live or work in Europe, chances are I don’t have to tell you that contactless payments are on the rise – you’ll have already embraced the technology yourself, to some extent.
The convenience of ‘touch and go’ transactions for low value purchases is completely transforming not just the way shoppers pay for goods, but their general behaviour patterns.
For example, making the transition from cash to card relieves consumers from the restriction of only being able to spend the change in their pocket, increasing the likelihood they’ll make impulse purchases.
Equally, contactless transactions are incredibly quick, which is decreasing customers’ already low patience levels!
So why should this matter to retailers, and why now?
Quite simply, we’re in the early stages of a payments revolution – which will change how retailers and shoppers interact.
According to MasterCard, European contactless usage grew 174% in the last quarter of 2014 alone, while the average number of contactless transactions per person rose by 20%.
More importantly, MasterCard predicts that the ever-growing contactless market will lead shoppers to more readily embrace other next generation payment methods, such as mobile wallets.
For retailers, this won’t just mean installing new equipment to offer consumers numerous ways to pay. It has the potential to redefine the role of all technology along the journey to purchase.
Let’s consider the store. Though we talk about creating flexible encounters within the bricks-and-mortar environment, the truth is that most retailers still rely on fixed terminals in the majority of their stores.
A major reason for this is that consumers are comfortable with this technology; they may become disheartened standing in a long queue during busy periods, but fundamentally they like what they know, and therefore they’re willing to forgive fixed POS’ shortcomings.
However, as convenience further penetrates the payments market, and these shoppers begin to experiment with the likes of contactless and mobile payments, they are unlikely to remain so forgiving.
Instead, they will look to forward-thinking retailers who both offer these methods of payment, and who use similarly convenient technology as part of the wider store experience.
As I mentioned in a recent blog post, 6 ways clienteling can win customers’ hearts (and wallets), retailers today have an opportunity to bring digital tools into the physical shopping environment, which improve customer encounters in a controlled manner.
Mobile POS in particular will play an important role, as it enables sales associates to create guided journeys using the device that is rapidly dominating consumer retail interactions: a smartphone.
By the time mobile payments gather momentum, the European mCommerce market will have matured significantly; almost 30% of UK online sales are expected to come from mobiles by the end of this year alone, closely followed by Germany and Sweden, both of whom should break the 25% barrier.
With shoppers using their smartphones to buy online and pay in person, mobile POS is the final link in the chain to providing a truly connected retail experience – the kind that builds closer, more profitable customer relationships.