The Future Of Payments: 2020 And Beyond
Chris Kronenthal, FreedomPay: Businesses that have implemented a strategic plan to solve the payment data and digital infrastructure challenges will be the most successful in 2020 and beyond
Customers are pushing the boundaries of technology. Demand for more innovative, easier and faster ways to pay for goods and services is a daily challenge, which means that the biggest issue over the next decade is how businesses upgrade and sync complex legacy payment tech systems to stay relevant and ahead of the competition. In other words, merchants must futureproof their payment technology to enable growth.
Sleek apps and digitally-enabled tools are standard for any business that wants to get ahead, but most of them are focused on front-of-house services. If the legacy systems that companies are using behind these glossy facades are not up to scratch, then too often the customer experience is poor and frustrating.
The danger is that legacy systems – which may have been acquired and developed over a number of years, especially for older businesses that have been through mergers and have a large number of disparate systems as a result – are not up to the job of delivering the payment services now needed. The patchwork of tech created as a result can mean glitches that prevent the smooth service every tech-savvy business and customer wants and needs.
Added to that, some departments within the business may have an affinity for a certain system, which can make it difficult to get everyone on board with the need to make necessary changes. But without addressing these differences, it is impossible to create a fully integrated payment ecosystem that provides for the needs of both the customer and the business.
Cost is also a major factor, as upgrading and even replacing legacy systems can be a step too far. But if merchants want to compete in 2020 and beyond, something has to be done. Customers simply won’t accept second best and, as data becomes ever more valuable and integral to the way customers pay, there is no time to waste on systems that are not fully integrated to collect and use this data. This is where a strong payments platform that can integrate a variety of legacy systems can solve the problem.
Data collection is now essential
For many years, data collection was not the intention when customers interacted with a business. Moreover, the technology to undertake the data collection simply didn’t exist. But things have changed and now data collection cannot be ignored.
Not only it is now possible to collect and collate this data from customers with the right partner, merchants can also integrate a wide variety of legacy systems so they will work in harmony to assist both merchants and their customers to get the best service. This includes detailed, granular analysis of data collected to enable merchants to provide offers, loyalty bonuses and discounts to their best customers, and to understand what stock is moving well and at what time. All these make any business more efficient, more enticing to customers, and more profitable.
Focus on the customer
However, while the technology is there to help companies make these changes to their business, a company-wide approach needs to be adopted to maximise the benefit of upgrades and integration with the best payment platforms. The key is to focus on the outcome you want to achieve – happy customers – rather than the process to integrate the various tech. This will dictate how successful the outcome is.
There is no place for fragmentation when it comes to the way your payment services work, and while we are not talking about ripping and replacing digital infrastructure as the cost would be monumental, if not entirely impossible, but surround and expanding legacy systems to stay competitive.
Thus, to be most effective, everyone from the chief executive to the most junior members of the team should understand and appreciate what the new payment platform will do for customers, as they should be the focus at all levels.
Effective communication between staff is essential to ensure everyone understands what is being done and why. All issues must be properly dealt with. Patching various systems together rather than understating how they work or the benefits they offer is not a sensible approach. Moreover, rivalries between different departments within the same business need to be addressed so demarcation between different business sections is eradicated.
A holistic approach to payments
Customer service has to be put front and centre for a fully holistic approach to be achieved across the business no matter how a customer interacts – on your property, online or by phone. Even those departments who do not have a customer-facing role, such as IT, must understand that all activities are aimed at improving the customer experience. That it is their responsibility as much as it is the front-of-house staff who interact directly with your customers.
Take it step-by-step
Merchants that want to provide the best services to customers need to do a number of things:
- Find out what services are available – see which is the most effective payment system that can work with all your various legacy systems. What may not have been possible when you were looking to update your systems a few years ago may be relatively simple to achieve today.
- Understand what your customers want and how your competitors are attracting them – you want to offer as many payment options as possible – Apple Pay, Samsung Pay, contactless, using wearable tech and so on.
- Work with a provider that handles all the latest security requirements – as security considerations ramp up, merchants don’t want to be taking a chance that they are at risk of paying out for fraudulent transactions.
- Make sure your platform provider is futureproof – new payment methods come into play all the time. You need to be sure you will always be at the cutting edge, so your customers see you as highly engaged and professional.
- Choose a service that provides excellent data analysis and capture – data will be key in the next five to ten years, and if your provider can’t help you use this in the most effective way within GDPR legislation, you are likely to lose out.
You need to use advanced technology, a fully integrated cultural approach to payment services for customers across the business and identify the primary ways your customers want to interact with you. Those businesses that have implemented a solid and consistent plan to solve the data and digital infrastructure challenges will be the ones to see success in 2020 and beyond.
For more information about FreedomPay, read the whitepaper ‘Hospitality 2020+ – The Reasons Why We Talk About Data Driven Commerce’.