Here’s an exercise that may come off as too academic – like a debate over how many angels fit on a pinhead – but is really among the most vital for not only PYMNTS readers, but pretty much any other business operators: What is the perfect payments experience?
That question formed a hook for a recent PYMNTS discussion between Karen Webster and Kurt Bilafer, executive vice president and chief revenue officer at Yapstone. The company, like so many others, is essentially living that question, as it powers electronic payments for sharing economy marketplaces such as HomeAway and VRBO, as well as travel and other platforms.
The answer to that question can mean the difference between success and failure for any payments or commerce operation – the difference between consumer churn and abandonment, and lucrative, long-term loyalty. The ideal, most would likely say, is a payment experience that requires a consumer to basically do nothing, to take no hard steps to complete a transaction once a purchase is decided upon.
“That’s the desired experience,” Bilafer said during an interview that dug into the issues of trust and technical know-how, and disruption (past and ongoing), and how to build a successful, consumer-first operation when it comes to payment. Those topics are vital as payments continue their relatively recent transformation from relatively mundane, all-but-forgettable tasks to all-important mechanisms of the overall consumer experience.
The story of that transformation almost always starts with Uber, and for good reason. It disrupted payments when it “came out with its first mobile app,” which in turn began to quickly train consumers that they did not have to take out their wallets or purses to buy a ride. “That changed expectations,” Bilafer noted.
But that’s only the beginning of the story – one that is not only reshaping commerce and payments, but will no doubt end up changing culture in more than a few ways, some of which are unforeseen at this moment in 2019. That story is being shaped not only by consumer activity on digital marketplaces, but also via online retail operations, mobile banking apps and other places. And a vital part of that story is how to design what amounts to a perfect payments experience.
In Bilafer’s telling during the wide-ranging PYMNTS interview, he told Webster that “you start with the end consumer and work your way back.” When it comes to payments, he said, an organization must ask itself, “What is the bare minimum of where you have to insert yourself? How do you make this as simple as possible?”
One Size – Not!
Designing the perfect payments experience also requires an acknowledgement that, in Bilafer’s description, “one size fits all doesn’t really fit anybody” – which can prove especially true with online marketplaces, where sellers and buyers come in a variety of forms and sizes. “High-end and low-end transactions are differing experiences,” and that impacts payments, for instance. What you really want to do, according to Bilafer, is “start with customers and build customer personas, and create highly curated, bespoke experiences.” Not only that, but organizations selling and servicing customers online must recognize that payments is not only part of a transaction, but also a way to engage with consumers, he added.
That may seem obvious, even trite. But getting to that goal is much easier said than done. Achieving such progress – arriving at the payment experience that is as perfect as possible for a particular consumer persona, marketplace or retail outlet, and transaction type – requires the establishment of a “long-term relationship with your customers,” Bilafer said. “You need a constant feedback loop. Customer advisory boards are becoming critical to getting real-time feedback.”
Trust, security and consistency are also key to creating that perfect – or nearly perfect –experience. For the onboarding process, for instance, “it’s really important to ask the minimum of questions” so as not to introduce unnecessary friction into the process.
With fraudsters becoming sharper and smarter, it’s also important to keep up with behaviors that can indicate fraud, and to have the ability to detect potential patterns of fraud so prevention can be proactive instead of reactive. “Make sure you are doing everything you can to protect your end user,” Bilafer said, circling back to that basic but vital theme. That requires hard questions about “who really needs access to what data,” he told Webster. “The best practice is to have a really strong moral compass” – though technologies such as machine learning and artificial intelligence can certainly help keep online criminals outside the digital gates.
It’s not only criminals that can stand in the way of crafting and maintaining that perfect payment experience. Hardware – specifically, legacy gear – can stand as a big hurdle. “All that legacy hardware has to be upgraded,” Bilafer said, pointing how long the EMV compliance effort has taken. And that speaks to another truth of achieving those top payment experiences: It just takes time. “Look at how it’s been for EMV, even with all those financial incentives.”
The ground is shifting. Payments has taken on more importance, and consumers are demanding more from their transactions, and are willing to go elsewhere if they don’t get it. But Amazon and other operators in the digital and payments world have shown what happens when you put the customer first – when you design around the end user – and that seems to be the best strategy of them all.