The primary focus for Retail Winners today is the customer, according to a Retail Systems Research (RSR) payments study, titled: Retail Payments: When The Future Becomes Now. Winning retailers consider cost of transactions important, but secondary to the customer experience. They also believe consumers — rather than retailers and solution providers — will dictate how payments will be presented in the future.
RSR identifies Retail Winners as those averaging at least 5% growth in year-over-year comparable store/channel sales, according to the report, and maintain those results “by thinking differently, and doing things differently.”
Key findings from the 2013 benchmark report include:
- Store operations seems to be the largest sticking point for payment innovations;
- The value of payment technology does not translate into budgeted plans for the future; and
- Uncertainty about the technical future of payments trumps all, even for Retail Winners.
Retail Winners And Payment Methods
“Retail Winners have been on a relentless drive to reduce their exposure to the most expensive transactions — credit cards,” the report indicated. “Winners are less reliant on credit cards today — having shifted purchases more towards debit cards than [their] peers.”
Winners pursue the move from credit card transactions as cost containment and customer experience strategies: “Retail Winners consider every interaction a piece of the customer journey, and payment is no exception,” according to the study. “If they can save some money and introduce some efficiencies while they’re at it — so much the better. Their peers might state the same goals, but the reality is that [Winners’] actions reflect a completely different priority.”
The RSR study revealed, by revenue, the top three organizational inhibitors to implementing payment options
- Different payment tools are required for the different channels;
- The technology is changing too quickly; and
- The industry is still fighting for dominant players.
To overcome these challenges, RSR found that retailers should invest in more comprehensive payment technologies that enable merchants to consolidate payments; solutions that reduce PCI requirements without reducing services to consumers; and a more collaborative payment association that includes all plays — from processors to retailers.