As part of our yearly tradition, we step back to reflect and look forward to what the New Year will bring to ecommerce and multichannel retailers. Here, we hear from contributors across the industry about the upcoming trends they believe will sweep the world of retail.
Retailers will keep up with evolving payments to stay relevant
Dave Glaser is chief product officer, global e-commerce, at Worldly
“The UK is a highly-developed e-commerce market, with a population of over 66m – 95% of whom have access to the Internet. As a result, consumers are comfortable with making a wide variety of purchases online via multiple devices and payment methods. The predicted rise in both e-commerce and m-commerce is a strong vote of confidence in the security and convenience of the UK’s digital payments infrastructure.
“UK consumers are among the world’s earliest adopters of new technologies, including new payment methods, so retailers need to stay on top of technological and regulatory developments. For example, mobile’s share of eCommerce is set to increase to nearly 50% in the next five years, while smartphones will outpace tablets in the same timeframe. Merchants should, therefore, invest in developing their own apps to build a seamless shopping and checkout experience for all users, across every device, and support the most popular payment methods.”
Payment services will become more frictionless
Jose Diaz is a director of payments strategy at Thales eSecurity
“Heightened consumer confidence, a rise in proximity payments adoption and ongoing developments in biometrics have collectively resulted in the payments industry’s continued digital transformation in 2017. As we look to 2018 however, we are increasingly likely to see big data playing a leading role in how retail sales and payments are being tailored to individual consumer’s preferences, with providers adopting and integrating smarter, more efficient ways of completing the path-to-purchase.
Unsurprisingly, consumer convenience will also remain front and centre in 2018. The payments landscape over the next 12 months will be driven and shaped by consumers – for consumers. In practice, this means that we are likely to witness a decline in consumers having to take an active role in authenticating transactions with more secure, and behind the scenes, technological methods taking its place. With payment processing as a whole becoming a more back-end piece of technology, not only will the customer experience become more simplified, but fraud will also become easier to spot thanks to more tailored background analytics – a real win-win for everyone involved.
Second, the next 12 months are likely to see the emergence of more sources of innovation from around the globe. Tech-savvy millennials that value both convenience and time are helping shape the future of transactions, although consumers outside of this demographic tend to lack trust in mobile payment technologies. In 2018 global payment providers will likely be focusing on tokenisation and encouraging the uselessness of data should it happen to fall into the wrong hands. We should also see an increase in the propensity for smaller markets to innovate further, free of the shackles of the restrictions experienced by industry players.
Finally, as vicious and extremely damaging cyber-attacks continue to hit organisations across every industry, it’s never been more important for payment providers to prioritise security. This will unquestionably also give rise to an increased emphasis on protecting payment card account numbers as well as personal consumer information in 2018.”
Merchants will use more diverse data streams to their advantage (i.e. bolstering loyalty programs)
Joe Daly is chief operating officer for North America payment processing at Paysafe
Earlier this year, it was reported that loyalty program growth had slowed to 15% from 26%. Retailers need to tap into more diverse data streams in order to create the highly personalized experiences that customers have come to crave. In 2018, merchants will boost their loyalty programs by leveraging a unified view of transactions and analytics to enable a more customized experience than ever before.
Merchants will begin to identify ways to scale biometric infrastructure at a retail level
With this year’s launch of Apple’s ?? Face ID in the iPhoneX, the reality of biometric payments that surpass fingerprint verification is front and centre. 2018 will be the year that consumers begin to encounter biometrics in stores, and, according to the Biometrics Research Group, by 2020, 700 million users will make $750 billion in annual transactions with mobile devices, driven by the improved customer experience and security provided by biometrics.
Security measures will become closely coupled with technologies of convenience.
Merchants enter 2018 in a landscape where 49% of American consumers expect to experience fraud while shopping online and 58% of Americans report being willing to partake in any necessary security measure to avoid fraud, but where adoption of frictionless payments methods continues to grow. Next year, merchants will leverage new technologies to strike a balance between delivering the frictionless, streamlined payments experience that consumers crave while also ensuring rigorous security measures are in place.
Traditional organizational structure and roles will crack. it’s difficult to collaborate on and deliver a cohesive customer experience if your organization is siloed. These boundaries impede your operational agility and perpetuate the situation where data remains siloed rather than broadly accessible to yield deeper cross-functional insights and, therefore, better customer experiences. Cio/CMO collaboration will evolve further, but there still won’t be enough of these crucial partnerships in place without strong CEO support. toll this gap, retailers will use the chief digital of cer (CDo) and/or chief customer of cer (CCo) role as a bridge to dovetail internal agendas, priorities, and practices, while acting as a facilitator to more deeply transform the business.
Customer-obsessed, data-driven retailers will thrive
Forrester, an American market research company
Organize for the maturity level to which you aspire, not where you are today your organization falls into one of four digital maturity segments — Skeptics, adopters, Collaborators, and Differentiators. Skeptics have the most decentralized digital organizational structure of the four. train your C-suite executives to understand digital transformation so that they truly lead it, and start by defining the crucial “why” that links culture change to business success. the lead time for cultural change is long: Former Popeyes CEO Cheryl Bachelder spent 18 months getting just her senior leadership team committed to the purpose of the organization (but then could roll out change more broadly much faster).
To compete for the best talent, retailers will pay, partner, and get creative. the retail industry is cultivating (even outright poaching) digitally fluent senior-level talent — but there’s still not enough of it in the C-suite and other leadership levels to create true, deep-seated digital business transformation. and the best technology talent still rocks to companies they see as cutting-edge — which don’t always include retailers.
Tackle scarce talent and skill sets head-on with training and partnering. Nurture your company’s digital chops with meaningful training and by partnering with other teams to exchange and decide on ideas. Start simply: Every Shiseido employee participates in training via the Digital academy to learn digital as a common language, regardless of job title or function. Smart retailers know they can’t compete for a solo for scarce talent, and they will craft acquisitions and smart partnerships to secure and augment their teams with scarce (and rapidly evolving) skill sets. Knowing that it could appear less cutting-edge than some tech companies, Uniqlo parent Fast retailing teamed up with Softbank in July 2017 to recruit top-notch engineers.
Picture credit: kathayut (Fotolia)