Apple’s launch of the new iPad’s yesterday is a timely reminder of the role and influence of tablets on the retail purchase experience. Research suggests that in the next two years, the web will influence $2 Trillion of retail spend in the US, or about half of all retail transactions. At the same time, mobile payments security remains a top concern for retailers and consumers. This month's Vantiv Tracker examines how some players, like Apple with its TouchID security feature and more, are addressing this concern across all channels, and how others have a long way to go in implementing the right security measures to help drive omnicommerce further.
The report highlights the fact that while retailers today are bullish on using customer data to capture and store information, driving more engagement and in turn upping their sales across all channels, security still remains a concern among merchants and consumers – how do they keep all of this accumulated data from new breeds of hackers on the prowl? The report examines how omnicommerce players are (or aren’t) addressing this issue, especially as Apple Pay (and possibly mobile payments as a whole) ignite.
Vantiv research shows that most chip card owners (about 63 percent) believe that their chip cards are more secure than those without chips when swiping it at any terminal in a U.S. store. Nonetheless, recent hacks like the Home Depot data breach, which compromised about 56 million cards, suggest that new breeds of hackers are no match for today’s banks and retailers. Retailers, said Hytrust president and co-founder Eric Chiu, aren’t being proactive or even reactive when it comes to putting the necessary safeguards in place. At the same time, 38 percent of consumers think about payment security at every transaction as a result of past security issues, says Vantiv.
The report also indicates that consumers believe more “tried and true” payment methods are safer than mobile payment methods. Yet industry experts believe mobile payments to be opportunities to increase payment security. Apple Pay, for example, involves the use of a Secure Element in the iPhone to tokenize and protect cardholder data at all stages of the transaction. While Apple Pay could prove to significantly boost mobile payments security, only time will tell just how much of an impact it will have on changing the minds of consumers and igniting mobile payments as a whole.
Key insights from Vantiv indicate the following:
1) To engage customers, many retailers are bullish on using data they can capture and store about their customers to drive more engagement and sales across channels, but consumers are fearful to provide this data as a result of high-profile security breaches.
2) To enable customers, merchants are implementing mobile payment solutions and many industry experts believe that this offers an opportunity for increased payment security. Consumers, however, believe that more tried and true payment tenders are the safer way to pay.
3) To serve customers, Apple Pay has clearly put forth the idea of using mobile as a way to enhance the shopping experience. Surprisingly, consumers don’t rate security at the top of the list when it comes to motivating their shift away from traditional plastic.
Players implementing security measures into their omnicommerce strategies this month include:
1) To engage customers, retailers are finding more ways to collect consumer data to enhance and personalize the customer shopping experience, but recent hacks that have hit players like Target, Home Depot, and JP Morgan suggest that new breeds of hackers are no match for banks and retailers – and provoke a more serious focus on the next steps to amp up security.
2) To enable customers, Apple announced the release of Apple Pay, an NFC-driven mobile payment method paired with a Secure Element embedded in the iPhone, which tokenizes and protects cardholder data.
3) To serve customers, U.S. Retail Data Systems deployed the first ever end-to-end encryption tokenization with EMV-ready devices on the NCR Aloha POS at RedRossa Napoli Pizza in Iowa, using First Data’s security solution Transarmor.
For more on the developments across the omnicommerce ecosystem, download the full version of this month’s report by clicking the button below.
This report will, on a monthly basis, document the moves these progressive retailers are making to enable omnichannel across three critical lenses:
Engage the Customer: Strategies merchants are enacting to drive customers into their store or online including loyalty programs, contextually relevant offers, and leveraging data to make relevant product recommendations.
Enable the Customer: Tools merchants are deploying to arm customers with the ability to shop and buy whenever and wherever they want including apps, enabling payment within the app, location-based services, and the ability to shop and fulfill purchases regardless of channel.
Serve the Customer: Ways in which merchants are stepping out from behind the counter to deliver enhanced shopping experiences such as mobile-point-of-sale, ability to check inventory in real-time, etc.
The report will also feature industry-spanning statistics and factoids curated by Vantiv, whose solutions help merchants more easily make that transition. These statistics and factoids will help to arm retailers (and those who power them) with data to make smarter decisions when considering various options for enabling omnicommerce.