Merchant Innovation

Subway And PayPal Serve Up Fresh Digital Experiences

While Subway’s mobile and Web presence have been available to customers for some time now, the company has embarked on a new path to offer enhanced payment options through its various channels. MPD CEO Karen Webster sat down with Subway’s Director of Global Payments and Emerging Commerce, Ken Moy, and Paydiant Co-Founder Chris Gardner to discuss how a healthy lifestyle and a digital lifestyle are coming together for the benefit of Subway customers.

While Subway’s mobile and Web presence have been available to customers for some time now, the company has embarked on a new path to offer enhanced payment options through its various channels. MPD CEO Karen Webster sat down with Subway’s Director of Global Payments and Emerging Commerce, Ken Moy, and Paydiant Co-Founder Chris Gardner to discuss how a healthy lifestyle and a digital lifestyle are coming together for the benefit of Subway customers.

Subway’s recent launch of new payment options within its mobile app and Web presence, including an upcoming integration with PayPal, is about more than making payment and ordering easy.

The company’s latest move to accelerate mobile usage among customers is actually part of a greater focus on expanding and merging experiences.

“It’s the coming together of the healthy lifestyle Subway is known for with the digital lifestyle that consumers expect,” Moy said in anticipation of the company’s official announcement of its expanded mobile and in-store payment options.

“Generally speaking, there’s a recognition that with the advent of mobile devices we are expected to deliver a beautiful customer and digital experience to our customers. As we mature as a company and as an industry to understand what that really means, we are going to need to be able to be flexible and continue to add on feature-functionality and other services to fulfill that digital promise to our customers,” Moy added.

Yesterday (July 29), the restaurant chain shared the news that a range of payment selections will now be available within the Subway mobile app as well as online through order.subway.com, enabling customers to order and pay for their sandwiches with less friction and more convenience, the company confirmed.

The addition of PayPal on the list of Subway’s future payment offerings, which is slated to take place before the end of the year, also positions a growing number of users to purchase a meal at Subway’s more than 27,000 locations across the U.S.

PayPal’s acquisition of cloud-based mobile wallet platform company Paydiant, which powers Subway’s mobile app, provided the opportunity to land a joint customer like Subway as it looked to expand its digital capabilities. The milestone is a meaningful one for both companies, explained Gardner, with the forthcoming PayPal integration within Subway’s available payment options representing the ease in which “it all fits together.”

“Our worlds are colliding, but it wasn’t necessarily a collision that happened for any other reason than it just makes sense. It makes sense for the business and it makes sense for us,” Gardner added.

According to Gardner, one of the most impressive parts of the launch of Subway’s new mobile and in-store payment options was the ability to overcome the operational challenges that come with rolling out new payment technologies to nearly 30,000 stores, stores that are not owned and operated by Subway, but franchise owners.

Since the formal launch of Subway’s mobile and online capabilities earlier this year, owner operators have begun to see increased store traffic, which translates to incremental sales, Moy confirmed. As marketing and advertising of the new payment capabilities increase, Moy said he hopes that even more benefits will be realized.

From Gardner’s perspective, the ability to offer customers digital payment, access to loyalty and rewards and benefits and online ordering prior to arriving to the restaurant location opens the door to benefits that are “so obvious,” Gardner explained.

While the company may be banking on the concept that innovation in ordering and payment functionality will boost the frequency of customer visits – currently at a couple of times a month going, Moy hopes, to a couple of times a week — it has not lost sight of the important role loyalty and rewards benefits play in an enhanced customer experience.

No matter which payment option a customer chooses to pay for their meal, whether it’s with Apple Pay or their MasterCard, if they have a Subway loyalty card stored in the digital wallet, the purchase automatically becomes loyalty-enabled.

Subway’s collaboration with PayPal remains focused on making the customer experience as convenient as possible, while also supporting an efficient and secure payment choice.

“In many ways, PayPal’s customer segmentation is very complementary to the customer segments we are interested in too, and so we are looking forward to being able to deliver each and every one of Subway’s 169 million users a sandwich along the way and hopefully they will come to our stores in a frequent kind of a way,” Moy explained.

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