INVISIBLE PAYMENT FOR HIGH-VALUE SERVICES IN THE RETAIL CUSTOMER JOURNEY
A good customer service and a fluent system of payment are necessary to engage consumers. Retailers must think about improving their offers to generate loyalty from their targets.
New Open Banking Opportunities for Retail Payments
Open banking is a huge new topic. Open innovation is the only way to progress but there is also a new regulation constraint. Banks are now obliged to construct API to open their data. That could make the online payments and retail payments diverge significantly.
Banks are opening their data and all the big players like Apple or Alipay will connect to this payment data. They will give the opportunity for the final customers to have invisible payments. For online payment, there will no longer be use of the plastic card. For the physical point of sale, behaviours are slower to adapt, and customer will probably use their card longer.
As impact for final customers, we should observe a decrease of credit card freezes because of the direct connection. For merchants, intermediaries will not be useful anymore and they will have the opportunity to choose new kind of partnership with new kinds of intermediaries. And for the intermediaries themselves, they will probably experience a decline in volume and a lack of online business.
Some big merchants will combine retailing app with payment app, using instant payments and open banking, which provide opportunities to better understand customer behaviours and develop new value services. Who will be the biggest winner because of the new opportunity to connect to every kind of service provider? We have already seen in China two great huge platforms (Alipay and WeChat pay), but will we see this one-of-a-kind app in Europe considering the differences of culture?
Challenges & Strategies for Frictionless Payment at Gas Station
Around the world, Total represents 14,000 gas stations in 80 countries, mostly in Europe but also in Africa, Asia and America including Mexico and Brazil. It’s the second network in the world with a strong presence in Europe and Africa, and more than 8 million customers per day.
The group wants to grow and perform in its main activity, but also wants to clearly deliver affordable and new energies (not only fuels but also electricity, gas, prepare the energy transition and propose to customer diversified energies), focus on customer and develop mobility as a service.
The main objective for retailers, is for their customers to use their favorite payment methods. There are cash, bank cards, and new payment methods. In Europe, there is a large part of bank card acceptance, a decreasing part for cash, a very few parts of new way of payments (it is difficult to implement it). A very big part of the volumes is paid with the Total’s closed loop cards.
Payment is a pain point for the customer, and this pain point is challenged by newcomers, like Amazon Go or Alibaba which impose to the traditional retailers to think about the future and to improve their customer journey. To do that, there are merchant wallets which propose to the customer a tool in which he must enrol. He also can access to a new customer journey with dedicated services. The goal is to simplify user experience, integrate payment and propose real time offers and customized functionalities.
Retailers must have a better acknowledgement of their customer and interact with him proposing a fluent customer journey with an integrated payment. The final objective is to build loyalty through the service.
Total has an issue with payment: Today it is necessary to ask for the customer an authorization when a payment is done with a card in the shop or via an OPT. But now Total will have to open the delivery of the product without knowing what the customer can pay at the end.
With the generalisation of smartphone, connected cards give new perspectives of new customer journey easier. Total can manage its own network and propose a dedicated customer journey which gives services to both customers and drivers. The issue is to be able to have fluent enrolment and payment.
How to Implement Trust in Payment Journey
Retailers want to use the new channels and technologies to increase sales. They want to have a more active role to control their risk policy and manage it by themselves. The implementation of a straight customer authentication is far from obvious, and difficult, but necessary. In order to be retailer centric, they need:
- The ability to identify the offer of personalization to the customer
- Terminals that enable to accept any of the new payments with no friction either in physical or online experience
- Optimization of the certification of security of any facility under the control of the retailer, that contains customer sensitive data.
- New interfaces
- Guaranteed payments
- Liability chief policy
To succeed being retailer centric and provide a good customer journey, technical solutions and new technologies must be proposed by the market. Those solutions must allow the following points:
- Customer reach,
- Secured, fast and easy check out
- Controlling of the level of security
- Offering multiple payments instruments
The new protocol provided by the industry is to capture customer data in real time at the initiation of the purchases and use it as a first information proving that the person who tries to purchase is trustable.