The year was 1995.
Emails were occasional. The internet was limited to academia.
While they couldn’t predict the explosion that would happen later that year when the internet grew from 10,000 to 100,000 dot-coms, Don Peppers and Martha Rogers did see a trend that would provide the ultimate synergy for the ultimate media. Their first book, “The One to One Future,” laid the groundwork for the kind of individual sales, marketing and operations that companies thrive on today.
Personalization? Table stakes now, but an innovation in 1995.
As Stax Payments CEO Paulette Rowe told Karen Webster, the cost associated with achieving a true one-to-one experience often outweighed the perceived benefits, making it difficult to justify the investment.
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But now we’re in an age of hyper-personalized customer experiences delivered directly by software companies and independent software vendors (ISVs). Part of that experience involves embedded payments. By 2030, Rowe predicted, embedded payments are poised to evolve from mere infrastructure or add-on revenue into a core operational feature. This shift will see payments deeply embedded into software platforms.
“There’s so much for software companies to get their arms around because everything’s becoming so much more vertically tailored,” she said. “…Partnering with payment providers,” including Stax, “will be the most successful model for SaaS companies” as they embrace new payments use cases, listening to customer feedback while simultaneously anticipating the needs and opportunities that those customers might not yet fully articulate or even foresee.
A key example can be found from Rowe’s previous stint with Barclays, where she helped usher in contactless payments for use in public transport in London. Initially, users expressed satisfaction with existing payment methods, questioning the necessity of new solutions. But contactless payments now facilitate up to 60% of journeys.
To that end, Stax is bringing customers together through initiatives like upcoming joint hackathons to co-create solutions and explore new use cases, moving beyond traditional survey-based product development.
Owning the End-to-End Experience
The stage is set for those collaborative efforts. Roughly a decade ago, banks largely controlled payments through their extensive infrastructure and distribution channels. However, the rise of eCommerce and mobile commerce exposed the inability of these legacy systems to pivot quickly enough, creating an opening for new payment providers that could seamlessly integrate online and in-person experiences, Rowe said.
Stax, which counts small businesses among its clientele, as well as software-as-a-service (SaaS)/ISV players in the bid to embed payments, believes that controlling the end-to-end payment experience, from front-end customer interactions to the underlying back-end technology, ensures superior performance and responsiveness, she said. That control addresses customer frustrations stemming from legacy third-party dependencies that often lead to constraints and delays. Owning its rails means Stax has direct, real-time access to data, which is crucial for training artificial intelligence models, unlike traditional batch reports from third parties.
“We own the critical parts of the technology, which means that our ability to adapt, pivot and to learn and experiment are unparalleled,” Rowe said. “And that’s our moat.”
Forging these new front-end and back-end processes, especially with AI agents making decisions, requires an immense amount of trust from customers. Trust is earned through transparency, consistent delivery on promises and having the right people in place throughout the company to ensure data privacy and compliance amid the innovation, she said.
Stax’s Own AI Adoption
Internally, Stax is integrating AI across its operations to enhance efficiency and customer experience.
Stax’s internal AI adoption is highlighted by “Benji,” an AI agent deployed in customer support, which now handles nearly 70% of customer queries and can communicate in 17 languages. The ongoing effort to increase Benji’s accuracy and query resolution rate to 90% is entirely data-driven, Rowe said. Stax also uses AI to improve customer research, enhance risk tools and streamline engineering and testing processes.
For software companies, becoming payment specialists is often not a top priority given the complexities of AI and vertical tailoring across various industries. Stax focuses on specific verticals such as professional services, field services and specialty healthcare that allow the company to personalize solutions and integrate payments invisibly within the software, Rowe said.
Stax isn’t aspiring to be all things to all SaaS companies, she said. The company will choose verticals where it has strong leadership and compelling solution sets. But Stax also has “beachheads” in some verticals that it may develop depending on client relationships and innovative go-to-market strategies.
“AI agents are going to change the relationships of payment providers and SaaS companies,” Rowe said. “It cements a critical core intelligence layer that integrates fully into the software that these companies are creating to optimize not just payments, but to optimize their platform. They’re going to need the data that we can provide as a payments technology company to help them in all parts of their business.”
