Merchants have traditionally viewed payments as a utility.
As Dustin Young, senior vice president of acquirer solutions at Cybersource, told PYMNTS CEO Karen Webster, that long-held view is giving way to a new mindset, where payments can be — and should be — viewed as a strategic advantage.
That shift comes as the great reopening is blending offline and online interactions.
This summer, despite the pandemic’s stubbornness and despite inflation, many consumers are getting out and about. And in a microcosm of that blending, consider the experience of dining out after so many of us, for so long, stayed at home and cooked or ordered in.
At a restaurant, consumers can scan a QR code, view a menu and pay with an app. Beyond the improved customer experience, there are advantages to the eatery, too. Servers are more efficient, tables “turn” faster and revenues increase.
And the movement towards combining the physical and digital realms is not, and will not be, limited to three meals a day.
“We see this dynamic — the blend between what used to be in-person experiences and what are now digital experiences — everywhere,” Young said.
Along the way, consumers get what they want when they want it, without having to worry about, say, the cost of getting things delivered to their doorsteps. Meeting that demand is critical, said Young, because if a merchant is unable do so, they’ll lose the customer relationship entirely.
Looking ahead, he said that we will probably see a resurgence in people getting back out in the world. However, we’ll also see more digital payment experiences creeping into what was previously confined to only in-person and card-present interactions.
“It will be a fascinating evolution,” Young predicted.
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To help speed that evolution, to draw companies and consumers ever closer together — after all, a good customer experience cements loyalty — payments themselves need a bit of a refresh. That refresh will have seismic implications for the ways in which merchants interact with their payments providers.
Gone are the days where enterprises would just phone up their banks or traditional acquirers to simply get basic payments functionalities in place, Young said. Now these same companies are looking for innovation, and are examining what FinTechs can provide.
The payments ecosystem — the acquirers, the independent software vendors (ISVs), the payment facilitators (PayFacs) — are taking notice. The past two years have shown that omnichannel commerce is no longer a novelty: Omnichannel is table stakes for many companies.
Innovation has spurred a range of new behaviors, including buying online and picking up in store, using mobile devices to scan inventory in store and paying at the table. The checkout experience is streamlined and secured through tokenization and card on file.
As merchants engage with their provider (and the providers, including ISVs, engage with Visa), Young said, “They’re having a different conversation with us at Visa than they were previously … now they’re asking what value-added services can be used to help them enable new customer experiences.”
Smaller merchants, especially, are keenly aware of the ways in which third-party providers can help them reach their goals. Visa/Cybersource, he said, has been busy enabling those ISVs to operate as PayFacs and embed payments into their enterprise clients’ operations.
“In this way, we’re empowering the next generation of small business that is ‘growing up’ in the digital world,” Young said.
Payments Choice, Too
Payments choice is also a key consideration for companies, Young said. PYMNTS’ own data show that around the globe, consumers value being able to choose the payment options that best align with their expectations.
As Young noted, with the rise of alternative payment methods and of domestic networks, Visa and others must strive to give consumers as broad a range of payment options as possible. Most immediately, guest checkout represents a key way to make sure that consumer loyalty remains firmly in place.
“If you create a flawless experience the first time a consumer is in your digital store front, you’ll be able to capture that card on file,” he said, “and incentivize repeat purchases.”
In the brick-and-mortar setting, he said, being able to check out in the aisle, without queuing in line at the register, can increase sales conversions, unshackled from the terminal. The consumer becomes the point of sale, he said, using the mobile phone (or even a connected car!) as the payments device.
Looking ahead, the aspirational goal is to have the “invisible checkout firmly in place,” where people pay where they want to and can continue to move through digital and physical channels in seamless fashion as they shop, eat, live and work.
Young told Webster the blend of online and instore commerce, always on and marked by consumer choice, “is here to stay.”
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