While consumers may be happy enough with their payment options, they certainly aren’t 100% happy with the shopping experience as a whole. And mobile payments done right could transform that experience dramatically for the better.
So what exactly about the modern shopping experience needs improvement?
Fixing Coupons and Loyalty Programs: One problem with the current shopping experience is that, while merchants are generally eager to offer customers incentives in the form of loyalty programs, discounts and rewards, many of these offers are handed over at the wrong time: at the register. Instead, these benefits should be communicated early and often, with a personal touch. A good time to inform customers of a deal being offered on, say, a pint of ice cream, would be right when they walk into the grocery store on a hot July afternoon. Even better if the coupon could pop up as they stand in front of the freezer case making a decision. Location-based services embedded in mobile payment apps could put the offers that consumers actually want in their hands at just the right time.
Loyalty and rewards programs also tend to be very generic and rarely provide coupons and deals for the things that customers are actually interested in. For every CVS coupon I get for something that I actually need, I get a yard of paper coupons for things I have no interest in. Mobile payments apps with effective data collection and high-tech targeting capabilities could eliminate this problem (and as a side bonus do away with the paper trail altogether!)
Merging the Online and Offline Worlds
There is no seamless way to move from online browsing to offline shopping, even though many of us do this regularly. Barcode scanners and the like make it fairly simple to showroom items we’re interested from inside a store. And there are a few apps out there (Nordstrom’s comes to mind) that allow customers to quickly select an item for local in-store pickup. But for the most part, once you find an item that you want online, the only way to be sure that a store will carry it is to call around. That’s, frankly, a huge pain. It isn’t even close to the seamless shopping experience that most of us want.
But let’s say you want to locate and buy a particular pair of Ray-Ban sunglasses – pronto. In a perfect world, you’d be able to search a map on your phone and pins would pop up to indicate local stores where you can visit, try them on and buy them right away. Mobile payments apps, designed to connect customers with products, could do exactly this.
Shopping has become very impersonal. Few people have a relationship with a salesperson who knows their style and preferences and can direct them to the right items at the right prices as soon as they walk in the door. But wouldn’t that be nice? Preferable, certainly, to wandering cavernous stores, fending off pushy salespeople who don’t even bother to learn our names, much less our favorite colors and fabrics.
Online, personalization mainly takes the form of heavy-handed algorithms that are ineffectual if not downright intrusive. Even the internet’s famously creepy retargeting ads, which follow you from site to site flashing the same three pairs of shoes you just looked at on Zappos, don’t really offer anything personal. They’re just showing you what you’ve already seen in the hopes that repetition will sway you to purchase. Sure, retargeting might work now and again, but it definitely doesn’t add up to a better consumer shopping experience.
Mobile could offer a powerful solution to this problem. Imagine if, when you browsed for items on your phone, it suggested similar items and indicated which stores near you carry them. Using sophisticated big data algorithms, smart shopping apps could learn everything from your favorite color to your exact measurements (bypassing the annoying problem of vanity sizing) and even capture your style and preferences with enough accuracy to actively suggest new pieces to add to your wardrobe at the beginning of the shopping season. These are just a few (clothes-focused) examples of how mobile tech could make our shopping experiences significantly more convenient — and fun.
Businesses Want the Same Things as Consumers
The strange thing is that merchants want all three of the things mentioned above — a more effective loyalty program, a successfully merged online/offline experience, and a personalized shopping experience. They know that all of these things will bring them new customers and keep existing ones coming back.