Contactless payments are a trend quickly transforming the local business landscape. While the exchange of paper money used to be the standard hallmark of the shopping experience, payment is taking on new and exciting forms. From a simple text to near field communication, customers are growing to expect unparalleled convenience from their payment options.
Cash—the previous king of retail transactions, has plunged in popularity over recent years. In fact, 2018 was the first year debit cards became the number one payment method in the United States. Text-based and mobile payments are chomping at the bit, expected to grow from $10.3 billion in transactions in 2020 to a whopping $18 billion by 2025.
Another trend underpinning the growth of contactless payments is the current COVID-related calls for socially distant, low-touch interactions. Shoppers sport gloves and other protective gear to avoid directly touching conveyor belts, keypads, and other check-out equipment—and 82% view contactless transactions as the safer way to pay.
The traditional wallet is slimming down, digitizing, and in some ways, fading away entirely. Is your local business ready for a no-cash, no-contact financial future? Here are the step-by-step considerations your business must take to meet and surpass growing customer expectations.
How to add contactless payments to your business step-by-step
1. Review your entire payment process
Have you ever abandoned a purchase at the sheer sight of a lengthy checkout queue? Contactless payments can help your business eliminate this costly issue. By removing any unnecessary steps from the payment process you’ll capture more revenue and keep customers happy.
Most local businesses have their own style of payment procedures. For instance, a rapid tap-to-pay option deployed at a convenience store can dramatically cut down transaction time. On the other hand, no matter how swift the checkout process, a coffee or sandwich shop still requires shoppers to wait in line to place an order. Before taking the leap into contactless payments, think of any and all time-sucks in your payment process so you can patch them up for maximum customer convenience.
2. Assess the readiness of your current hardware and software
You’ll most likely find the necessary hardware for contactless payments in any upgraded Point of Sale system. However, if it has been a while since you’ve refreshed your store’s technology, you will likely need new equipment to accept contactless payments.
That doesn’t necessarily mean you’ll need a completely new system. While integrated terminals are a popular option, many merchant services offer add-on readers that easily plug into your current terminal. If your business model allows, give customers the option of text-based payments before, during, or after doing business with you. This option might not work as well for a quick-service restaurant, but for a dental practice or a furniture retailer, text-based payments cut down on back-and-forth and allow your patrons to support your business from anywhere. Work alongside your merchant provider to identify the right solution for your business.
3. Advertise its implementation
While most shoppers will assume a store accepts cash and credit cards, contactless payments are not yet an expected technology. It’s important to remind shoppers that you’re offering this new convenience. With placards at checkout or door decals, you can encourage customers to utilize their contactless options for a more streamlined shopping experience that also shows your business is adapting with the times.
4. Train your staff
Implementing new technology requires buy-in from everyone on your staff. More than half of consumers have experienced a challenge or technical difficulty when deploying a digital wallet. When this happens to a shopper, they’ll turn to your staff for a solution. If they’re met with shrugs or confusion, shoppers will be far less likely to try out the contactless tech you’ve invested in. They’ll feel frustrated and be less likely to come back.
The Benefits of Future-proofing Your Payment Processing
Attract younger generations
The opportunity to try out new technologies always excites younger consumers, and contactless payments are what this demographic craves. One of the leading growth sectors for contactless payments has actually bolstered the generational divide. Mass transit operations in cities heavily populated by millennials—New York City, London, and Toronto—have become a hotbed for contactless technology with 70% of Gen Z customers and 74% of millennials loving this new style of payment.
As younger generations age, their preference for payment technology becomes the default. Even the CDC is recommending that businesses use contactless payments to help stop the spread of COVID-19. As more business owners adapt to the new normal, other forms of payment start to feel inappropriate. Millennials and Gen Zers will gravitate towards businesses doing everything possible to be socially conscious and take care of their customers.
Prepare your business for the next wave of technologies
Contactless payments are only the beginning. Waiting in checkout lines to pay for groceries is quickly becoming a thing of the past. In the near future, sensors will paint a digital picture of a shopping cart as it travels throughout the store, and automatically charge the shopper as they exit. Use this opportunity to bolster your business technology so you’re prepared for the future of payments.
2 Things to Consider Before Changing Your Process
Customers Are Carrying Fewer Card Types
Picture the age-old cliche of the unwieldy wallet overflowing with old receipts, business cards, and credit cards. For retailers, one benefit of the jam-packed wallet is that the customer is likely carrying store-specific credit and loyalty cards.
As customers carry a slimmer cache of payment options, the discount-loaded key fob that also tracks customer purchases is likely left at home. Local business owners will need to find new ways to deploy customer loyalty programs—or miss out on the data and benefits they offer.
Additional Training May Be Required
As more and more shoppers try contactless payments for the first time, they’re bound to have questions. If your team is unable to provide answers, confused customers will feel discouraged about trying new systems. They may also develop a bad taste in their mouths about your business as a whole.
Contactless payment methods are a critical tool in the modern retailer’s arsenal. By empowering your local business with the modern tools it needs to take advantage of this exciting new chapter in payment processing, you can boost profitability and serve customers with the streamlined experience they expect.