Source: Forrester - US Mobile Payments Will More Than Triple By 2021

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2 Digital disruption is revolutionizing the payments ecosystem. Traditional payment methods like cash, credit and debit cards, have been upgraded, while new payment methods such as Apple pay, Android Pay, Samsung Pay, have been added, transforming the customer journey and the way shoppers interact with brands. The new payments landscape may seem bright for businesses, but it has also revealed various key challenges. Especially, within the rapidly growing global e-commerce market, the changes are occurring really fast, forcing all parties; merchants, consumers, and the companies that come together to move money, to keep up with the latest innovations. Today s Connected customers are using technology across all the stages of the customer journey. According to Bain & Company survey, people reach for their mobile phones about 200 times per day. So, people are not only searching online, but they are also making more and more purchases, especially via their mobile devices. Source: Forrester - US Mobile Payments Will More Than Triple By 2021 Given the fact that about 30% of all online shopping purchases now happen on mobile phones*, it is crystal-clear that mobile is not a standalone channel, but a core part of the unified commerce. E-business leaders have already designed mobile payment strategies to leverage mobile moments in the most effective way. * Source: Think with Google Mobile Principles of Retail Apps and Sites: Designing a Better Experience for Shoppers

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4 The new payment models are putting businesses under intense pressure; they are struggling to adopt new payment systems, handle payments data effectively and manage to create seamless customer experiences across all devices. Mobile payment options are crucial for both digital and in-store purchases. According to Kount's 2017 Mobile Payments & Fraud Survey about 70% of merchants are now supporting at least three mobile payment options. Moreover, over the last five years, merchants who actively support the mobile channel have increased from 54% to 78%. Mobile payments include remote mobile payments, such as purchasing in-app when the consumer isn't physically present with the seller, mobile in-person payments, and person-toperson (P2P) payments. According to Forrester Research*, mobile remote payment is the largest of these three types, and it will grow to 2,7 times its current size in the next five years. Regarding mobile in-person payment, it is expected to grow the fastest amongst the three types, increasing to 6,8 times its size between 2015 and Shoppers that choose to make transactions with their mobile devices can enjoy several benefits; avoid long queues, centralize loyalty points and rewards, check the availability of products, order ahead, enjoy customized offers and easily compare prices. * Source: Forrester, US Mobile Payments Will More Than Triple By 2021

5 In the age of the Connected customer, where customer expectations are high, and loyalty is declining, mobile payments enable brands to connect with the customers and create a strong relationship with them, enhancing brand loyalty. As mobile payment services grow, more consumers are using their devices to complete purchases, expecting great mobile experiences. To deliver positive experiences, organizations should not just reach customers on these mobile moments, but actually embed the payment in each of these moments.

6 The key to building customer loyalty via mobile payments is a deep understanding of all the changes in the payments market and especially how these affect the customer journey. Think beyond transactions. Think customer experiences Thinking of customers only as transactions could lead in the wrong direction, plus, it might harm customers trust. As the Connected customers seek for convenience at every channel and seamless experiences, businesses should get a deeper understanding of the new reality of the omnichannel consumer and think beyond the transactions, if they aim to convert them into loyal customers. Getting a single customer view Nowadays, our phones are carrying more information than ever before. Businesses that can collect all these customer data; payments and transactional data, could turn them into rich customer insights and manage to deliver personalized messages. Taking into consideration that payments data is very sensitive, using them could be extremely risky for businesses. However, when handled right, transaction data bridge the gap between customer insights and loyalty data, giving merchants a full customer view. Attracted to personalization, today s empowered shoppers expect the right payment experience at the right time. For example, people make purchases online but might return the products in-store. Retailers that are able to have a 360-degree view of a customers profile and access their transactional data, can reach shoppers in the most effective way, meeting their expectations for personalized services.

7 Trust is a key factor in creating unique mobile moments. It drives customer adoption and satisfaction. Focusing on the right steps could give businesses an opportunity to convert mobile moments into valuable mobile payment moments. Actions businesses should take to enhance mobile shopping experiences and stand out in the competitive mobile payments market include designing a winning customer-centric mobile payment strategy which provides increased payment convenience, choice and a secure payment environment to customers. The first step to leveraging mobile moments is to start with one of the most critical part of the successful purchase, the checkout experience. Delivering breakaway customer experiences means elevating the checkout process. Given the fact that users expectations on mobile are really high and that 23% of those visiting retailer sites and apps abandon them because they had to create a new user account during the checkout*, businesses should focus on helping consumers complete purchases on the go. Apart from the checkout experience convenience and flexibility play a key role in keeping shoppers engaged throughout their interaction with a brand. * Source: Think with Google, emarketer, Visual Website Optimizer, ecommerce survey, Oct

8 Shoppers are not demanding new mobile payments. What they care about is being able to enjoy seamless retail experiences. According to Forrester Research, offering faster or more secure payments alone is not enough. By providing solutions to their pain points, such as giving consumers the ability to check product availability, access loyalty points, or receive digital copies of payment receipts automatically, is vital to delivering customer experience excellence. Indeed, shoppers especially in the US are interested in having access to all these services from one single place, their mobile digital wallet. More specific, 57% of US online adult smartphone users are interested in having access to loyalty program points and rewards within a digital mobile wallet. *Source: Forrester: The Future Of Mobile Wallets Lies Beyond Payments

9 "WHICH OF THE FOLLOWING ARE YOU INTERESTED IN HAVING IN A MOBILE DIGITAL WALLET? LOYALTY PROGRAMS POINTS AND REWARDS COUPONS, DISCOUNTS, AND SPECIAL OFFERS PRICE COMPARISONS FOR ITEMS I WANT TO BUY PRODUCT INFORMATION FOR ITEMS I WANT TO BUY MAKE A RESERVATION AT A RESTAURANT REQUEST BILL AND PAY AT THE TABLE DIGITAL RECEIPTS FOR THINGS TO BUY PLACE ORDER BEFORE ARRIVING AT THE RESTAURANT DIGITAL TICKETS MY PAYMENT CARD (EG. CREDIT, DEBIT, PREPAID, OR GIFT) OR BANK ACCOUNT BALANCE OR INFORMATION 34% 36% 31% 27% 27% 23% 26% 19% 30% 28% 57% 56% 52% 50% 50% 50% 49% 49% 48% 48% EU7 US Source: Forrester s North American Consumer Technographics Financial Services Survey, 2014 and Forrester s European Consumer Technographics Financial Services Survey 2, 2014

10 Data security should be a key priority for businesses who aim to win mobile payments moments. While trust in retail is really low, providing more secure mobile payment solutions to shoppers is critical to cultivating stronger relationships with them. According to Forrester Research*, about one-third of US online adults have concerns over data security and do not feel comfortable storing their credit card information with the retailers they buy from regularly. Moreover, many shoppers (60% of responders), as reported to Bizrate Insights survey agreed that current security to protect credit card and personal information at retailers websites isn t strong enough. To overcome such challenges and boost shoppers confidence, all parties; payment companies and merchants, must develop data protection strategies to successfully manage the various security threats of the digital ecosystem. To properly provide more efficient mobile payment experiences, brands should design and implement the right payment strategy. The right mobile payment strategy should be based on business specific needs, coupled with the customer s unique preferences, while simultaneously minimizing risks. In this way, and with the customer at the center of the strategy, mobile payments will become a strategic component to meet business goals. * Source: Forrester s North American Consumer Technographics Retail Online Benchmark Recontact Survey, 2015

11 By focusing on mobile moments, retailers can leverage customer experiences and drive customer adoption. When used right, m-payments are a strategic differentiator in the digital transformation of a business and an effective way to build customer loyalty. Benefits of mobile payments for customers include less check-out time, convenience and flexibility. Especially, when there are loyalty programs attached to mobile payment applications, more options and value are added to purchases. Customer data and payments history from loyalty programs are all stored within the application, meaning more opportunities for personalized services. For businesses, this opens up the door for rich customer insights which can lead to smarter and more efficient customer experiences. Challenges with mobile payments mainly involve technology adoption and security. Companies that understand the customer journey and manage to overcome such challenges, will step ahead of the competition.

12 QIVOS is a marketing technology agency, member of FF Group, that delivers successful end-to-end customer loyalty management through unified commerce. Based on its expertise in customer experience strategies and tailor-made technology solutions, QIVOS helps brands build unique long-term relationships with their customers. marketing@qivos.com