The banking, payments, retail and loyalty industries havebeen dramatically converging over the last decade, and this year’s Money20/20conference showcased those trends with keynote addresses from Square, PayPal,Google, Visa, Facebook and other industry leaders. Several key themes stood outfor me across the dozens of topics discussed at the show. Three in particularmarketers should take note of and address to serve the evolving needs of businessesand consumers in the coming years:
Security and fraud prevention are toppriorities. Anti-fraud and data security measures will continue to be oneof the biggest priorities for everyone in the retail and payments ecosystems,and brands need to invest both financially and strategically.
The country is just over 12 monthsin to the EMVimplementation, and eWeek reports that only 44 percent of U.S.card-accepting merchants even have EMV terminals. Meanwhile, as point-of-salechip card use continues to increase, card-not-present and new account fraudwill also hit new heights. All this just as we put away the Halloweendecorations and head into the busiest retail season of the year, where it’smore important than ever for brands to assure consumers that their paymentsinformation and personal data is safe.
Key takeaway for marketers: Being the weakest link in a security breachhas major financial and brand consequences for retailers, banks and anyone whotouches the transaction. If yourbusiness is directly involved in stopping payments fraud, you should be sharingkey concepts as part of a smart, proactive communications strategy. Even if securityis not your primary roll, don’t miss the opportunity to incorporate a securityand anti-fraud message into your media and customer communications.
Payments isnow a retail and branding strategy. No longer a means to an end or just atransactional necessity, we heard loud and clear at Money20/20 that payments solutionshave potential to be so much more. “Payments are moving to a point ofinfluence, not just a point of paying,” notedBlackhawk Network’s CEO Talbott Roche in her keynote presentation at Money20/20. She went on to say “paymentsolutions can solve a bigger issue that all companies face: how do we createdeeper and more engaged connections between consumers and brands?”
TheStrawhecker Group refers to this trend as “the evolving customer purchasingjourney,” and observes that companies that embrace this concept “…are rewardedwith more lucrative relationships with their customers and a deeperunderstanding of customer behavior and preferences along with the chance totarget product recommendations and discount or promotional campaigns directlyat individual consumer needs.” And Liz Garner of SmarterPayments echoed thisconcept via Twitter: “Anyone who doesn’t think of payments as part of theirretail strategy is behind.”
Key takeaway for marketers: Possibly the most far-reaching threadthroughout the show, the lines have blurred and the definition of a paymentsprovider is less defined than ever. Stop thinking about payments as a tool andstart thinking about it as a way to build customer affinity with your brand –whatever your core product may be. Take a holistic view of your customers’entire purchasing journey and highlight how you play a role in it from end toend.
Marketconsolidation is inevitable. Many variations are already in progress, includingbanks acquiring fintechs, mergers among fintechs, as well as social and mobilecompanies rapidly adding payments to their capabilities on their way tosqueezing other providers out of the market. PayPal and Facebook areintegrating via messenger to advance “contextual commerce,” while JohnScully tellsa cautionary tale to banks who aren’t ready for major change.
If your business has a middlemanproviding a barrier from consumers to reaching services directly, watch out.The explosion of companies offering online lending, investing, P2P gifting andmoney transfer via text were the talk of the show. If your gatekeeper doesn’tprovide some serious value-add, you are going to be disrupted.
Chances are that the coexistbumper sticker we’ve all seen is an unlikely long-term outcome. Moves areconstantly being made to separate winners and losers in this marketplace, andone thing is for sure, winners will deliver a differentiated experience that iseasy for consumers and businesses to understand and adopt.
Key takeaway: Having a solidservice offering is key, but so is how it’s positioned in the marketplace.Winners will find and promote the solution they can own with a smart,consistent and far-reaching message that summarizes their value proposition.
As these payments, banking, retail and loyalty industriescontinue to evolve and converge, consumers will care less about which one youcame from and more about how your solutions meet their needs. Botton line: betimely, be relevant and be easy to do business with.
JenniferTramontana is the President and Founder of The Fletcher Group,which provides thoughtful PR and marketing services for payments and fintechcompanies in US and Canada.