Inside the mind of the modern consumer

Understanding customers is no easy job for retailers today. What consumers want is changing all the time, as is the technology that they rely on as part of their shopping trip. It’s no wonder that many businesses are struggling to keep up!

It doesn’t help that retailers are inundated with headlines that profess the latest insights into consumer habits; which ones can they actually trust? Here, we’ve detailed the most recent retail research that retailers – online and off – should factor into their customer experience strategy.

“They are impatient” – Vodat International

5 minutes; that’s how long a customer will wait for their query to be answered in-store. That doesn’t leave much time for a staff member to gather the information they’re unsure of, before that shopper abandons their journey completely.

How to respond

Ensure that your workforce receives regular training regarding your product offering – especially if new items are added. For an extra helping hand, why not implement tablets in stores so that answers are always at staff’s fingertips?

“They expect personalisation” – iVend Retail

A third of shoppers think they get personalised offers online, but not in-store. Perhaps this is one of the key reasons why ecommerce seems to gaining its sales share of channel.

How to respond

Yes, online has automated capabilities that allow loyal customers to receive information that is specific to them – but there is something the store can do better.  The ability to see, touch and try products cannot be replicated online, and even better, the presence of staff means that shoppers can get even more insight into the products they’re interested in. There’s nothing more personable than face-to-face interaction, so encourage conversation to give staff the opportunity to upsell products that might compliment a customer’s purchase.

“They tap-to-pay” – Visa

The number of contactless transactions made in the UK last year increased by 250%, according to the payments specialist. It’s suggested that this is largely due to the spending limit rise in September, which saw consumers able to pay for goods of up to £30, as opposed to just £20.

How to respond

The speed of the payment method fits the profile of today’s busy, impatient shopper. Therefore, now is definitely the time to ensure that your store not only accepts contactless, but encourages its usage.

You’ll also find that the same NFC technology in contactless terminals works with some mobile payments services, e.g. Apple Pay. As availability widens, consumers will come to expect all retailers to offer the method to them in-store. Those that don’t are likely to be viewed as outdated pretty soon, while those that do will see queue times accelerate and customer satisfaction soar.

Of course, if you’re planning on implementing such technology, you’ll want to make sure that your card payment network security is up-to-scratch. You can find out how to ensure this here.

“They go mobile” – Episerver

Mobile shopping is already playing a huge part in how people are shopping this year; 59% of Brits used their device to purchase items in the January sales.

How to respond

Shopping on a mobile device is meant to provide the ultimate convenience for consumers, allowing them to browse retailers wherever they go. With this in mind, it’s essential that you make your own mobile experience easy – ensure that you’re website is properly optimised, and that the payment process is neither lengthy nor fiddly.

“They click-and-collect” – Atomik

Shoppers might love mobile, but not quite as much as click-and-collect. A recent survey saw it beat mobile as the method that impacted their 2015 shopping experience the most.

How to respond

The role of the store has evolved from being just a sales channel, it now has to deal with a constant flow of click-and-collect orders. As most retailers now offer the service, they need to make sure that it’s the best it can be to stand out from so many others that offer the same. Training staff, implementing dedicated click-and-collect personnel, or adding an interactive kiosk are all ways to better optimise the store for click-and-collect. Of course, with all this extra technology, retailers must invest in a network that’s robust enough to support it.

Have you seen any recent retail statistics that you think offer real value to retailers? Then share them with us on Twitter via @Vodat_Int.

 

6 stories that redefined retail in the first 6 months of 2015

It’s hard to believe we’re already in July; where has the first 6 months of the year disappeared to?!

As we pass the halfway point of 2015, let’s look at some of the retail stories we could not have predicted on New Year’s Day, and the trends that are likely to shape the months ahead.

  1. The demise and (sort of) rise of Tesco

2014 wasn’t a great year for Tesco – and 2015 didn’t start well either, with the company announcing the biggest ever loss in its 96-year history in April. However, once incoming CEO Dave Lewis got his feet settled under the table, things started to improve for the supermarket chain, which defied analyst predictions to post lower-than-expected sales falls in June.

  1. Cheaper by the dozen

There’s just no stopping shoppers’ appetite for low-budget bargains; in May, the Local Data Company announced that Aldi and Lidl are now opening at least 5 UK stores each week – growing at twice the rate of the Big Four supermarkets – while Iceland and Farmfoods are also rapidly increasing their retail footprint.

Poundland is proving another unstoppable force, entering into talks with regulators to acquire fellow discount brand, 99p Stores.

  1. Apple Pay hits the UK

July is an important month for the UK payments industry, as Apple Pay hits shop floors and restaurant tables for the first time. Though consumer awareness of mobile wallets remains conservative, the fact that major corporations such as Boots, Costa, New Look and Nando’s have signed up to the service, indicates that the industry expects great things in the long run.

Read our blog: there’s a lot more retail & hospitality needs to get right before taking a bite out of Apple Pay.

  1. The £1 takeover

A pound can’t get you much these days: 1.3 Mars Bars, half a bottle of shampoo… an entire retail chain?!

That’s exactly what private consortium Retail Acquisitions paid for BHS in March, as Sir Phillip Green offloaded the struggling retail chain from his Arcadia Group.

Despite its name, Retail Acquisitions has a lack of experience in the sector, and its early plans include heavy-handed measures such as the potential closure of BHS’ flagship store on London’s Oxford Street. Watch this space.

  1. Retail delivery take-Uber

Uber takes the title of 2015’s most controversial company to date, with disgruntled taxi drivers in France and the USA protesting against the service within the last few days. However, it’s not just the travel sector that Uber wants to change; it has reportedly joined forces with the likes of Tiffany and Hugo Boss to pilot a luxury goods home delivery service for designer shoppers.

Over time, Uber’s aim is to combine retail fulfilment and passenger services, to bring down the cost of transporting goods – definitely one story to keep an eye on.

  1. Honey, I shrunk the high street

They say size doesn’t matter, but everything seems to be getting smaller in 2015. Supermarket chains have turned their attention to the c-store market, while another traditional big box retailer – Ikea – has announced its first UK foray into small format stores.

Even larger retail space is being divided and conquered; Asda has teamed up with Decathlon to launch a ‘store within a store’, while Argos will be rolling out a number of collection points within larger Sainsbury’s supermarkets.

Which stories have defined your retail year to date? Tweet us @Vodat_Int with your views.

 

Apple Pay: there’s a lot more retail and hospitality needs to get right before taking a bite

Like most technology vendors, we’ve been eagerly awaiting the formalisation of Apple Pay’s launch in the UK – and paid particular interest to which retailers and hospitality vendors will be first to launch the service.

Boots, Dune, JD Sports and New Look are early retail adopters, while Costa, KFC, Pret A Manger, Nando’s and Wagamama are all flagship Apple Pay candidates on the hospitality side.

Of course, whilst this has novelty value at the moment, there is still a consumer adoption mountain for Apple Pay’s advocates to climb. For starters, the function is only available to Apple Watch, iPhone 6 and iPhone 6 Plus users – those devices equipped with NFC technology – so it will take time for earlier technology users to make an upgrade.

Also, the concept of mobile payments is still very young. Don’t forget, it’s only in the last 18-24 months that we’ve seen contactless take off as a convenient transaction method; and that’s using debit cards, a familiar means of paying for goods.

Speaking of contactless, this brings me to another point. The purpose of these emerging payment technologies is to make life quicker and more convenient for the consumer. Giving them the chance to use a niche payment service like Apple Pay is fair enough, but many retailers and hospitality vendors still haven’t perfected their current transactional offering.

In today’s customer-centric society, getting the basics right cannot be underestimated. Adding new payment channels puts greater strain on stores and hospitality venues – devices, data, networks, staff knowledge, customer service etc. Without a solid foundation to build on, businesses risk adding to a house of cards that could collapse at any second.

One thing we do know is that mobile commerce has increased significantly in importance over the past 12 months, so it’s likely that mobile payments will follow suit. While consumers are coming to terms with using their smartphones as a payment device, retailers and hospitality companies have a prime opportunity to refine their existing transactional technology, ahead of Apple Pay’s widespread launch further down the line.

For more payments insights visit our sister site, The Payments Network.

3 sectors that can’t survive without contactless

Contactless has become the unstoppable force of the payments industry. From a relatively niche transaction method less than two years ago, its popularity has soared among consumers, with contactless spending increasing by 330% during 2014.

Although this change in consumer behaviour impacts businesses across the board, there are certain industries where contactless payments are proving critical to success. Here, we outline the opportunities in three of those sectors – and why it’s paramount that companies in these areas embrace the latest payments technology.

  1. Retail

It’s official: contactless is the new cash – it’s even driving down ATM traffic. ‘Touch and go’ style card transactions are the fastest growing payment method. According to recent Halifax statistics, contactless now accounts for £15 of every £100 spent, and have contributed to a 16.6% fall in cash withdrawals.

What does this mean for retailers? Put simply, today’s shoppers want to use their card for both low and high value purchases. With companies including Boots, Marks & Spencer, Sainsbury’s and WH Smith already proactively using contactless payments services, the technology is quickly moving from a differentiator to a necessity.

The need to offer contactless payments will increase over the next few months as well; from January 2016 all new POS terminals that accept MasterCard will be required to have contactless capabilities.

  1. Travel

Of all the sectors, travel has been most progressive in its use of contactless payments. Almost half of contactless payments take place within the M25, predominantly due to its adoption across the London transport network.

Since switching from Oyster to contactless, Transport for London has reached more than one million taps a day, becoming the fastest growing contactless merchant in Europe.

With one of the country’s largest transport networks leading the way, it is only a matter of time before customers demand to use contactless payments whenever they commute. This will, however, enable travel companies to address challenges such as passengers attempting to board with pre-pay cards that are out of credit.

  1. Hospitality

An important change takes place this September, which will catapult contactless to the front of the hospitality agenda: the maximum transaction value will increase to £30.

While contactless is already being used by some pubs and cafes to cover low value orders, raising the limit on payment levels will place new vendors – such as restaurants – in the ‘sweet spot’ for tap to pay technology.

Contactless will also become a crucial queue buster during busy periods. McDonalds and Starbucks are among those already using payment solutions to improve customer convenience, and even those outside the traditional hospitality environment, like market stalls and mobile food vans, will need contactless card payments to keep up with consumer demands.

Enjoyed this article? Check out our surprising stats about contactless payments for more insights.

The store of the future: top trends and technologies from NRF 2015

At the start of the year, most industries wonder what their sector will look like in 12 months’ time. Luckily, retail doesn’t have long to wait – we were treated to an insight at NRF’s Big Show, which took place in New York City this month.

The store took centre stage at this year’s event, as retailers pondered how the world’s online obsession will continue to shape bricks-and-mortar shopping. It also provided an opportunity to see how technology vendors are pushing the boundaries, and blending the advantages of digital and physical shopping in a reconfigured retail experience.

There were hundreds of ideas and solutions to choose from, but here are our top NRF technology takeaways that are set to shape shopping in 2015:

Interactive displays

This cutting-edge solution reacts to consumers selecting goods from the shelf, changing the graphics on display to provide further product information. All activity is fed back to the retailer, providing comprehensive analysis of how shoppers interact with items around their store.

Connected glass

Building on the capabilities of interactive displays, connective glass enables consumers to select products to view and research virtually, and even send an item to the fitting room or checkout. It’s worth checking out Kate Spade’s pop-up pilot to see how ecommerce retailers are using this technology to venture offline.

MerryMirror

Gone are the days of looking over your shoulder to view the back of an outfit with Neiman Marcus and MemoMi Labs’ innovation. This smart mirror enables shoppers to view their outfits through 360 degrees, and save those images to compare with other items, send clips to their phone or share with friends for feedback.

Alternative ways to pay

The final point in the store purchasing journey is a hot topic in 2015. From biometrics to wearables and mobile wallets, technology vendors are looking to find the next development in consumer payments. One solution worth mentioning from NRF – even though it’s still in its infancy – is Touchless Commerce by Toshiba. This uses facial recognition technology to scan the items in a shopper’s basket and the customer’s face, before charging goods to the credit card linked to the facial profile.

For more insights into the future of bricks and mortar retail, read our blog: The store isn’t just a shop anymore – it’s a theatre of dreams.

What’s in store for stores in 2015? 3 retail game changers

Retail never stays still – if anything, it’s moving faster than ever. This year alone, we’ve seen growing adoption of click and collect and contactless payments, to name two examples. But what will be the major influences changing retailer/consumer relationships in 2015?

In our final blog of 2014, we’re looking towards the year ahead – and predicting what’s in store for retail stores next year. Here are our top 3 most influential trends:

  1. There will be more devices in the store

From mPOS tablets being operated by sales associates, to mobiles being utilised by consumers to showroom, digital touch points will become an even greater part of the store experience. This will place additional strain on retailers’ data networks.

Those who triumph will offer reliable connections for staff and robust complimentary WiFi connections for the customer.

  1. Technology will personalise store shopping

We touched on the store becoming a theatre of dreams in a blog post earlier this year, and this trend will most certainly continue into 2015.

Technology such as near field communication (NFC) and Bluetooth beacons, are already being piloted by major retailers like John Lewis and House of Fraser; this points towards in-store interactivity dominating next year’s marketing and customer service agenda.

  1. Reputations will thrive or dive on payment security

With more consumers than ever using credit and debit cards to pay for goods, data breaches could prove devastating to retailers’ reputations. From June 30th 2015, businesses accepting card payments will need to meet PCI DSS v3 standards.

As a result, the race will be on to upgrade current payment solutions and reduce scope for PCI compliance before legislation comes into force.

For further information about payments security in 2015, visit the Payments Network, our online community for retailers and hospitality vendors.

What are the big payments issues we’ll be talking about in 2015?

It seems only yesterday we were welcoming in the start of 2014, wondering which payment talking points would dominate the agenda during the months ahead. Yet now we’re starting to form our next batch of New Year’s resolutions – and putting a new set of payment predictions together – for 2015.

There are of course still two months remaining this year, and things can change quickly in the world of payments. However, we’ll be given an insight into some of 2015’s hot topics at the upcoming Cartes Secure Connexions event in France, which takes place between 4-6th November.

Digital dominates the programme at Cartes this year, which is no surprise considering the exponential rise of mobile usage within retail. Much of the discussions will be surrounding location technologies such as iBeacons and NFC; it will be interesting to hear the industry’s thoughts not just on how geo-based connectivity will transform consumer relationships, but how it will impact shoppers’ payment preferences.

The future of currency will also be under debate, focusing on cryptocurrencies and mobile wallets. Bitcoin is sure to provoke strong reactions – PayPal founder Peter Thiel recently proclaimed his scepticism towards it – while Apple’s announcement of its first mobile wallet has reignited concerns surrounding ‘tap to pay’ security.

On the subject of protecting customers’ payment information, recent breaches for major US retailers such as Home Depot and Kmart have put the issue of data security as a whole under the spotlight. It’s interesting, though, to note that most of the Cartes sessions focus on rebuilding and maintaining customer relationships, rather than how to minimise the risk of information compromise. This is a subject we have discussed at length in our online community, The Payments Network.

Though we’ll have to wait a few more weeks to see exactly what unfolds for the industry in 2015, the Cartes programme has highlighted one interesting issue regarding the future of payments: we might be reaching new levels of sophistication and digital interactivity, but at the same time we’re still trying to address age-old concerns.