With shoppers favoring card and contactless transactions, has COVID-19 determined that card payments have finally become the only way to pay? Does this watershed moment mean that providing payment solutions that resonate with the customer plays a key part in brand loyalty as behaviors change? How does providing the right technology, in the right place, convert shoppers into buyers?
Has cash finally gone out of fashion?
A change in payment habits towards card usage over cash has been underway in North and South America for some time. A significant shift towards card transactions became apparent since 2019. For the first time, card payments in 2019 accounted for over half (51%) of all transactions and although it remains the second most favored, payments by cash fell by 15%. According to the New York Times article, “Our Cash-Free Future Is Getting Closer,” Visa reported a surge in contactless payments for basic items in Britain after limits there were lifted and a 100 percent increase from a year ago in the United States; In the United States, 40 million customers went online for groceries in April. In Italy, where cash has always been king, the volume of e-commerce transactions has surged more than 80 percent, according to McKinsey & Company. In April 2020, Link, the UK’s biggest network of ATMs, reported that cash usage in Britain has halved as consumers pursue alternative payment methods during COVID-19.
Has this trend helped shoppers to better cope
during the pandemic?
“It’s clear that the ‘new normal’ for businesses of all sizes are defined in part by a shift in consumer preference for e-commerce and contactless payments, which can help limit consumer exposure and promote social distancing during the pandemic,” Jodie Kelley, the chief executive of the Electronic Transactions Association.
The rise in the number of transactions following the increase in the contactless limit across the globe provides a basis for that argument. Since April 1st the contactless limit increased in the US (the amount depends on the individual credit card company) and by £45 in the UK. As consumers make use of touchless payment options with increasing frequency, the value of contactless transactions in the U.S. is expected to increase from $178 billion in 2020 to $1.5 trillion in 2024. Those who use touchless payment methods use them frequently, with as much as 50% of consumers responding to a PaymentSource study indicating they’d made contactless payments at least four times in the prior month. And most plan to continue using the technology over the long term, with 85% of mobile wallet users predicting they’ll still be making payments this way two years from now.
The Retail And Hospitality Sectors Need To Be Focused
On Staff And Customer Safety And Hygiene To Hold Onto Brand Loyalty
The move to contactless is a significant change in behavior, which has been accentuated by COVID-19 and it’s unlikely it will revert. It is certainly true that essential retailers and petrol forecourts are requesting their customers to use contactless for obvious reasons. Understandably, customers and store assistants no longer want to handle cash, and using contactless means that they don’t have to.
It is clear that with this significant change in behavior, we have reached a watershed moment.
Does this mean we are now at a watershed moment in transaction interactions, for retail, hospitality, and small businesses? It certainly looks that way.
Reflecting changes in customer behavior has always been an important element in ensuring that any retail or hospitality organization remains relevant. This is true now more than ever and includes the safeguarding and well-being for both staff and customers. So, what can businesses do to ensure that customers can execute transactions with confidence, and keep coming back?
The solution is to optimize the right use of technology that reflects, and answers, these concerns.
Technology offers the solution
Post coronavirus, and with retail and hospitality businesses re-opening, the increased use of frictionless payments combined with hygiene awareness must remain at the top of the agenda. An environment which makes both customer and staff feel that their welfare is important will help to keep that relevance and bolster brand loyalty.
One key solution is to provide as few physical touchpoints between staff and customer, or customer and technology. Self-scanning is a proven way to speed up that entire checkout process. By providing a bar code scanner at the point of sale, customers can quickly scan their smartphone or card for a frictionless way to add or spend loyalty points, or access their store accounts – hygienically and touch-free.
Optimizing contactless terminal mounting
and protecting equipment
A payment terminal that is mounted is far less likely to suffer from the particle or liquid ingress with the transaction taking place in a more hygienic manner. A mounted terminal requires less physical interaction than one that is simply placed on the counter top. Mounting the terminal also reduces the chances of accidental drops and cable damage.
Queue Busting technology for quick & easy transactions
In addition to using technology to reduce queues, mPOS (mobile point of sale) solutions such as the SpacePole Duo™ sled now plays an important part in ensuring that they do not materialize in the first place. With the Duo, payment transactions are fast, frictionless, and without physical contact.
Staff can be employed upstream from the static point of sale with Duo. This solution means the shopper can make their purchase in a place of their choosing, when they want to, safely. It takes the transaction away from the traditional point of sale, helps the customer flow, and reduces the chances of queuing while promoting social distancing. Several cities are enforcing social distancing policies by mandating that everyone must wear a mask, such as in Atlanta, Georgia.
The SpacePole Duo allows a flexible point of sale for in-store transactions, and table service in hospitality environments. It is lightweight and comes complete with a range of accessories for ergonomic everyday use. The sled pictured pairs the Honeywell CT40 with a range of payment devices and is complete with ergonomic accessories.
Cash is no longer king, and contactless, aided and abetted by recent events, is how customers prefer to make that transaction. All business sectors are facing challenges that require a new set of rules and a change in approach.
Whether static or mobile, SpacePole payment mounts provide a solution that matches the requirements of today’s consumer as we all adjust to the new normal.
Discover how to make lasting changes that solve these new problems, support customer brand loyalty, and foster a safe and secure shopping experience.
SpacePole, Inc. is an Ergonomic Solutions Company, which is a leading supplier of innovative and ergonomically designed mPOS and mobile technology mounting solutions that enable frictionless transactions with less personal contact.
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