Want To Win Consumer Mind (And Wallet) Share? Think Context

The holidays are a time for both hyper-vigilance and hopes. Many consumers must watch their spending so they don’t exceed their credit card limits or empty too much money from their bank accounts. Merchants and issuers must be on close watch for fraud, while also doing whatever it takes to please existing customers and win over new ones.

Anything that can provide deeper looks into customer behavior, preferences, spending potential and willingness can prove to be a valuable tool indeed.

That brings us to a new PYMNTS interview with Bharghavan Vaduvur, CEO of Ondot Systems, which uses transaction information, along with contextual and locational data signals, to essentially create a conversation with the consumer as they shop.


The idea, as explained to Karen Webster, is to boost customer acquisition and spending, and reduce fraud, but mostly to keep real-time track of what customers’ payment cards are doing at a given moment. This can lead to more purchases, reduced service calls to issuers and less chance for criminals to successfully execute fraud (and the holidays are a busy and lucrative time for fraudsters, too, of course).

Transactional Data

Transactional data is nothing new. It has been around since the process was dominated by paper documentation, and featured a relatively high level of guesswork — gut feeling, perhaps — on the part of merchants and payments service providers (PSPs).

What’s different as 2019 approaches is the growing use of mobile devices — and multiple types of computers — by consumers when browsing, shopping and buying. More data means more truth — a clearer picture, something with the clarity of a photo-realistic image rather than the fuzziness of an impressionistic painting. That’s working to the benefit of companies such as Ondot, and their financial, payments and retail clients.

In what Vaduvur called a “fragmented space” for transactional data providers, clean and clear data enables the various organizations servicing the consumer to “look at spending patterns down to the individual merchant,” he said. “Over time, [that leads] to different types of analytics to understand consumer behavior.”

Local Discounts

Think about it: A consumer’s mobile device can  in one of the simplest uses of such technology  determine that one is walking toward their favorite grocery store in the neighborhood that this consumer calls home. Maybe the technology tosses out a 10 percent discount offering, delivered to the consumer’s mobile device.

The idea is to “combine real-time transactional information and real-time user information, and near real-time consumer feedback” to arrive at a picture that puts the consumer into a payments and commerce context. This approach enables not only discounts, such as the example mentioned above, but a reduced chance of fraud and a set of alerts that can caution a consumer when they are nearing a particular card’s limit  or even offer an increase of that limit because it’s the holiday season, and because that consumer has solid income and, otherwise, presents a good credit risk.

As Vaduvur told Webster during the PYMNTS interview, the concept of “feedback” in this contextual process involves making sure the data is indeed accurate and that the consumer location is correct, and determining as quickly as possible whether, and even why, a particular consumer used a discount or offer, or rejected it. That produces an interactive feedback loop that can lead to more context and clearer pictures when it comes to the behavior, preferences and predicted actions of a consumer — which, in turn, stand as lessons that can guide future offers and alerts from merchants and issuers.

Gaining Mindshare

The technology is meant to provide a deeper, better form of consumer engagement. The key to success is not only the reliability of the data, but the balance of conversing with the consumer without making them feel nagged, hassled or controlled.

“You find out what consumers do, and also what they don’t do,” he said. “You can anticipate and guide users, and it allows us to string together meaningful end-to-end journeys.”

Once that level of engagement is gained, companies can win the trust and loyalty of consumers.

“Gaining mindshare is the best way to gain wallet share,” Vaduvur said.

Ondot’s figures show that such engagement can lead to a more than 20 percent increase in card use, along with a 40 percent reduction in fraud. Having a deeper knowledge of the consumer transaction’s context also leads to fewer false declines (16 percent) and support calls from customers (26 percent). That all serves to save money and boost revenue.

Context and location — always important in retail — are gaining much more prominence, and providing much more opportunity, thanks to the spread of the digital economy and the ever-increasing use of mobile (and other) devices to shop. That will certainly continue into the new year as merchants, issuers and other players in the digital ecosystem strive to build new ways to engage with consumers.