In 2018, the UK’s retail and hospitality sectors suffered a difficult year. This year, they will fight back. Fintech, and payments technology will improve customer experiences forming the cornerstone of retail’s renaissance.
Retailers unlock the full potential of unified commerce:
In the new payments world, unified commerce is king. Rather than a source of competition for investment, retailers will finally start to manage their stores and online channels as a single unified channel.
Key to this is understanding the power of payments data that can unlock new revenue. Data consolidated from all sales channels enables retailers to create a clearer picture of their customers and build more compelling loyalty offers or personalised shopping
programmes. For example, using unified payments data, retailers can find customers that haven’t shopped with them for a while and apply the right initiatives to entice them back.
That’s not all. Payments data can also help retailers understand their loyal customers’ channel preference, average transaction value and shopping frequency, helping to optimise retargeting efforts.
Hospitality goes big on tech
With the rise of challenger brands and food delivery companies that offer restaurant quality food for people in the comfort of their own homes, the hospitality and quick service restaurant (QSR) sectors have had their own challenges. This will only continue
The race is now on for businesses in these markets to introduce new innovations that cut waiting times, but which still cater to consumers who are hungry for a seamless, high-quality service.
Against this backdrop, there are a lot of exciting innovations emerging in the QSR industry to make the dining experience better than ever. For example, chatbots will allow customers to pay at the table at their convenience, without having to wait for a
waiter, a card machine or their change.
Wahaca piloted a chatbot payment programme in 2018 –the restaurant chain said this method accounted for 14.5% of its payments and at one point its conversion rate was almost 70 percent. Burger chain Byron is rolling out similar technology and we expect
this payment experience will boom in the coming months.
Open Banking creates new customer experiences
As more sections of the European Union’s Payment Service Directive 2 come into effect, the Open Banking movement will start to take hold. Open Banking is one of the biggest shake ups in the banking sector for a generation, and the rest of the world is watching
to see what they can learn.
New developments will give individuals and organisations the opportunity to securely share their financial data with registered third parties, giving consumers better insights into spending habits, regular payments and companies they spend with. By providing
permission to use their data, consumers are also given access to better products, services and prices, aimed at improving their experience and making providers work harder to attract their custom.
This also enables completely new customer journeys and payment methods based on more intelligent use of data.
Innovation makes fraud prevention more customer-friendly
Adyen’s research shows that fraud is on the rise, with 60% of retailers experiencing an increase in fraudulent activity in the past year. Previously, some security measures such as 3D Secure (3DS) have not been consumer-friendly, but that will change for
the better in 2019. 3DS 2.0, which will be implemented widely in the coming months, will help improve both fraud prevention and customer experience.
Thanks to new APIs created under PSD2, payment providers will be able to run fraud checks in the background as customers complete their purchase, creating a seamless payment experience. Transactions that require strong authentication will be streamlined,
so customers can confirm their purchase using biometrics such as fingerprint recognition, voice recognition or facial scans, as well as SMS-delivered two-factor authentication.
Experience is everything in retail. Regardless of the channel, the shopping process needs to be slick and well thought out. Customers don’t want to queue to pay, they don’t want to go through laborious processes to return goods they’ve bought online, and
they want to pay using a wide variety of methods or devices. Fintech is the driving force that enables these experiences and will be central to the retail fightback in 2019.