Despite the retail industry’s ambition to move to an Omni-Channel payments strategy, only a minority of retailers have completed an omni-channel payments program, according to a survey of nearly 100 retailers by PCM Research and ACI Worldwide.
The research, titled Omni-Channel Payments for Merchants: Myth or Reality?, reveals that retailers
face multiple challenges when it comes to implementing omni-channel payments programs—with incompatible systems, data integration and the inability to track customers noted as the top challenges. Fraud prevention and payment security capabilities also remain an issue for many retailers.
Key findings:
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Only 21 percent of merchants surveyed have completed an omni-channel payments program.
This includes primarily large grocery and department store operators. Notable and concerning is that 46 percent have no plans for an omni-channel payments program within the next 12 months.
- When asked about the organisation’s ability to innovate, 50 percent responded that they are in the ‘early’ or ‘innovators’ stages. The other half categorized themselves as ‘technology followers.’ Asked why they are not moving faster into an omni-channel retailing environment, two reasons were prevalent: finding the business case and business sponsorship for the necessary funding to implement.
- Alternative payments, mobile and tokenization lead the way in desired omni-channel payments and tools. 63 percent of retailers surveyed said they are interested in Alternative Payments and 53 percent in Mobile POS (mPOS) and Wallet.
- Fraud prevention and security remain major issues for many retailers. Asked whether they have a common set of fraud prevention capabilities across all channels, the majority of respondents (53%) said no, 39 percent yes and 8 percent were unsure. 42 percent of respondents said they have no common set of payment security capabilities across all channels today, 9 percent were unsure and 49 percent of retailers indicated they had these capabilities.
“The path to omni-channel payments is complex and can seem daunting, and merchants are at a crossroads with the number of technology options. However, those that embrace these types of disruptive opportunities to serve today’s anytime, anywhere consumers will come out ahead,” said Andrew Quartermaine, Head of Merchant Retail EMEA, ACI Worldwide. “A frictionless payment experience for the consumer in any channel should be the goal of retailers and merchants.”
The survey also shows that the preferred implementation strategy for omni-channel payments has moved from an in-house (on-premise) model to a hosted SaaS model. Increased payments complexity and PCI compliance are likely to be the biggest drivers for this move in delivery/consumption model.
“This survey and its findings shed light on the disparities in the retailer marketplace when it comes to omni-channel payments,” said Alex Rolfe, Managing Director, PCM Research. “Although a good number of merchants are firmly entrenched in their strategies, there is still work to be done for many others—not to mention opportunities for the payment technology vendors that support them.”
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