Consumers are interacting more frequently and engaging deeper with digital payment experiences. That was the conclusion of the McKinsey annual Digital Payments Consumer Survey that indicates what consumers value most from their payment experience: simplicity.[1]
Seamless payment experiences are becoming table stakes for all brands, especially via digital methods. In fact, data suggests just one and three consumers will abandon an online transaction if the wait becomes too long, as most will abandon the purchase in less than 30 seconds.[2] This is why industry data suggest a correlation between a frictionless checkout and a company’s bottom line.[3]
Not only does a customer experience impact how a consumer feels about a brand, but the checkout experience is also a key driver of satisfaction — especially when it comes to interacting online or via mobile. These simple online/mobile checkout experiences, however, also mean that brick-and-mortar brands must deliver the same type of quick and simple interaction.
Research also indicates 60% of consumers have higher expectations of digital experiences than before the COVID-19 pandemic.[4] As payments become embedded deeper into digital experiences, making those interactions seamless matters more than ever. Additionally, 79% of customers report that a negative checkout experience makes them less likely to return.[5] On the contrary, when seamless payment capabilities are integrated into a brands’ digital payment experience, businesses can produce higher consumer engagement.
What’s important for businesses to know as they carve out their customer engagement strategies is where and how payments fit into the equation. Whether it’s sending money to family and friends, paying bills or moving wages, consumers expect this process to be seamless and secure. All brands, regardless of who their customer is, must follow this rubric. The evolution of money movement presents key opportunities for brands to better understand how to leverage payments tools and technology to better drive consumer engagement and create long-lasting customer relationships.
Engaging Consumers Deeper with Better Payment Experiences
Consumers today don’t want to think about the payment process — regardless of why or how they are making a payment. A seamless, safe and convenient experience is all they care about; the technology behind the transaction is irrelevant to the average consumer. But what they do expect is to have interactions with brands that emulate much of what’s happening in the rest of their lives for everyday tasks: seamless, digital experiences.
Consumers today also expect payment choice that aligns with how they want to pay. Delivering payment choice that matches what consumers want is tied in with the customer experience and is a key loyalty driver. In fact, an Inmar Intelligence report indicated that 36% of consumers’ loyalty has changed because of online payments’ capabilities and having the choice to control how they wanted to pay.[6] Particularly during the pandemic, digital aligns with how consumers are interacting with brands, and payments have now become a core motivator in the customer experience equation.
How consumers are interacting with digital is also transforming. Take, for example, the P2P payment experiences that have transformed how money is exchanged. Consumers are already interacting on the go to send or receive money to and from friends and family. For businesses looking to deepen consumer engagement, seamless digital payment experiences that allow consumers to quickly move funds, or make a transaction, on their terms checks that box.
The same case rings true for how consumers are interacting with brands. Consumers today only care about the outcome of a payment, which is why the transaction itself must be invisible. Again, consumers care about the end goal of the transaction; not the method itself. There’s a reason the share of consumers using two or more digital payments methods jumped 13% in one year to reach 58%.[7] Consumers are already interacting on their devices to conduct virtually all aspects of their lives — payments are the next natural extension of that lifestyle.
Creating deeper customer engagements matter for boosting loyalty, which also correlates to more sales. One report suggests that when a customer is loyal to a brand, 86% of those will recommend that company to someone else, and 46% will remain loyal even after a bad experience.[8] As the data above indicates, seamless payment experiences are a key component of establishing deeper connections with brands.
It’s clear that deeper digital engagement presents more opportunities for brands to own the payment experience. This is a critical piece in deciphering how to achieve higher customer satisfaction that deepens loyalty and increases sales. Payments technology is creating invisible payment experiences where consumers don’t have to consider the payment mechanism, leaving more opportunities for brands to focus on delivering an end-to-end customer experience. Once that goal is achieved, brands can focus on what really matters in these engagements: secure, simple and speedy connections.
Derek Tanis is the Senior Vice President leading Netspend’s Consumer Partnerships team, where he is responsible for a wide variety of strategic partnerships including PayPal, Western Union, ACE, Samsung, 7-11, HEB, The Austin Football Club and Albertsons as well as all of the brick and mortar distribution partnerships across the country. Derek leads a sales team where they are responsible for selling the company's innovative suite of payment solutions including embedded finance, prepaid & bank accounts and program management services.
Tanis holds a Bachelor of Arts degree from the University of North Carolina at Chapel Hill and a JD from the University of Colorado School of Law in Boulder.
