Contactless and mobile payments could ease Christmas 2015 retail rushby
With retail sales reaching in excess of £14 trillion globally in 2014, a rise of 6.1% on 2013, and physical bricks-and-mortar sales still accounting for over 90% of this total, the need for retailers to reduce the friction in the payment process has been evident for some time.
However, while market analysis has predicted the rise of mobile payments, in particular, as being fairly stagnant over the coming 12 months, new research suggests a change in consumer demand could yet push certain technologies into the mainstream earlier than expected.
Surveying shoppers in the UK during the Christmas rush, The Logic Group’s Christmas Shopper Survey 2014 found that 74% of British shoppers would “prefer to use contactless card payments” in 2015, while 54% would be happy to pay for their 2015 Christmas shopping using mobile payments in-store.
The study also found that one in five consumers showed interest in paying for goods through wearable technology (such as Apple Watch or Google Glass) or a social media account.
“British consumers are eager to have a quick, convenient and secure shopping experience – at the click of a button, in-store or on-the-move,” said Nick Stacey, director of business and market operations at The Logic Group.
“Retailers who have rolled-out omnichannel customer interactions in 2014 are coming out ahead of the rest. 2015 will be a crucial year for retailers to truly utilise multiple shopping channels and offer secure payments in order to enhance consumer confidence and overall profitability.”
Despite the positive response, concerns over the security of mobile payments remain, with the research finding that over half of the consumers surveyed placing security as more important than any other factor when using new payment technologies.
The findings mirror further recent research from Tripwire that found that in the US, just 1% of consumers believe using a third party mobile payment provider such as Apple Pay or Google Wallet is a safe way to pay for in-store purchases.
There are roughly 320m mobile payment users across the globe at present, according to data from Statista, however when you take into account that 44% of this figure is made up of PayPal users, and that PoS systems (required by merchants to make mobile payment transactions) the technology only currently account for approximately 2% of total global transactional value.
The proliferation of contactless payments have been more successful in comparison, with 54.4m contactless cards having been issued in the UK, an increase of 2.9% on the previous month and 48.3% over the year.
However, much of contactless payment’s success has been down to the number of card providers that have switched to contactless payment, and the technology is currently restricted to a £20 transaction limit.
Chris is Editor of MyCustomer. He is a practiced editor, having worked as a copywriter for creative agency, Stranger Collective from 2009 to 2011 and subsequently as a journalist covering technology, marketing and customer service from 2011-2014 as editor of Business Cloud News. He joined MyCustomer in 2014.