Payment innovation in the retail industry is rapidly changing, driven by consumer adoption of mobile smart devices. Because of recent well-publicized data breaches and payment card fraud, retailers have turned their attention to the dual challenges of data security and fraud prevention, even as they try to keep up with the demands of digitally enabled consumers.
Retail Systems Research (RSR) recently released its findings from its 2015 Benchmark Report, Retail Payments: Consumer Control and the Need for Speed.
RSR last took the pulse of retailer payment strategies in 2013. At that time, retailers were
cautiously optimistic about what the future would hold. While they felt uncertain about which players would ultimately dominate the payments landscape – Telecom companies, Traditional payment networks or Tech giants – retailers did hold firm to the idea that whatever the future held, first and foremost they would follow their customers’ lead.
Fast forward to today, and times have changed significantly. As digital channels
proliferate, so too the ways retailers can accept payments. It’s a two-way street, with digital forms of payment also having an impact on retailer offerings, from gift cards and coupons to other discounting strategies.
In fact, at least a third of all retail respondents to this year’s survey accept as many as six different payment types, including digital gift cards and mobile wallets. They must also support “card not present” transactions and the even trickier cross-border payment.
“Retailers are very excited about mobile payments and most especially Apple Pay,” comments Nikki Baird, managing partner at RSR Research and co-author of the report. “A majority of respondents to our survey indicated that making it easier for consumers to pay with mobile is a top operational challenge.”
Key Findings include:
- Retail optimism over mobile payments is high, but their timeline is long-term.
- Over half of retail respondents say that making it easier for consumers to pay with mobile is a top operational challenge
- Retailers rate Apple, VISA, MC, and Paypal as payments thought leaders today, and report that card issuers need to do more to drive thought leadership in payments
“Retailers are looking for strong leadership from the payments industry, as they navigate a rapidly evolving market,” continues Brian Kilcourse, managing partner at RSR Research and co-author of the report. “In addition to the card issuers, retailers are looking to payment networks in particular to give them guidance on a path forward.”
The research is available for free here: Retail Payments: Consumer Control and the Need for Speed