Not since the Great Depression has America’s economy been in such a precarious situation. Although the country has stopped hemorrhaging jobs at an unprecedented rate and unemployment has dropped to 8.4%, industries still face severe challenges.
First and foremost, companies must contend with the marked shift in consumer behavior brought on by the pandemic. With COVID-19 continuing to spread and a vaccine months away, people are shifting their commercial activity away from physical stores and towards digital channels. Even the physical stores that remain open are changing, with many offering curbside pickup, expanded delivery services, and contactless payment options, among other changes.
Faced with all these changes, companies have their hands full just trying to deal with the present. This makes developing new initiatives, strategies, and plans for the future more difficult than ever before.
To better understand what solutions exist for companies looking to navigate the current crisis while also preparing for future growth, PaymentsJournal spoke with Sarah Grotta, Director of Debit and Alternative Products Advisory Service at Mercator Advisory Group. During the discussion, Grotta explained how Mercator Advisory Group is well positioned to help companies in the payments industry adapt and thrive in these uncertain times.
Ideas and initiatives for future growth are not getting the attention they deserve
The payments industry is no exception to all the economic disruption wracking the world.
As digital transactions volumes go up and the need for online financial services expands, financial institutions need to develop the necessary infrastructure, expertise, and product offerings to keep up. Due to disruptions in normal business operations, accounting and billing departments are scrambling to shift manual processes towards digital solutions.
With COVID-19 creating new fraud trends and causing legitimate consumers to change their behavior, payment companies must alter their fraud prevention models in response. And faced with millions of consumers in financial distress, credit card companies must adapt their product offerings and risk models.
To make matters more difficult, all of these challenges must be met by teams who are often working remotely. Remote work requires companies to adopt new technologies and procedures, as employees deal with finicky Wi-Fi networks and limited working space. Those who are parents must do all this while also providing childcare.
“Financial institutions and other entities are just so incredibly busy right now dealing with all the changes in their businesses,” said Grotta. As a result, ideas and initiatives that would lead to future growth “are just not really getting the attention that they deserve.”
Mercator can help identify opportunities for improvement
Luckily for companies coping with all these challenges, Mercator Advisory Group can help in a variety of ways.
First, Mercator can help companies identify new markets for existing products and services. Even in normal circumstances, identifying new markets to expand into is a challenge, but during a pandemic it’s even harder. Mercator will work with companies to help them find “new sales channels, a new audience, or perhaps even [enter] a new geography,” said Grotta.
For example, a European-based processing company partnered with Mercator to help it enter the U.S. market. Mercator assessed the processor’s current capabilities and identified where the company fit in the U.S. market. “We offered advice on some of the differentiations in the U.S and how [this processor] could plan for a successful launch” said Grotta.
Mercator can also help organizations identify product and service enhancements, thereby enabling them to generate growth. By figuring out the ways in which a product or service is lacking, and suggesting ways to improve it, Mercator helps companies forge stronger connections with their current clients.
Recently, a fintech in the prepaid space partnered with Mercator to better understand how its services compared against the competition. After thoroughly reviewing the fintech’s offerings and how it fit into the wider market, Mercator provided an extensive product review that identified where the key gaps were.
Since Mercator has a team of payments experts with decades of industry experience across many verticals—including prepaid, emerging technologies, debit, credit, and commercial—it can effectively provide help to a diverse array of companies. This includes financial institutions of all sizes, processors, issuers, technology providers, and fintechs.
Combining industry expertise with surveys and market assessments
Mercator utilizes numerous tools and methods to provide clear and actionable insights to its clients. In addition to drawing from its rich reservoir of industry knowledge acquired first-hand, Mercator’s experts combine the knowledge of its clients with survey work and rigorous market assessments.
“The first aspect of engaging in these types of initiatives is for us to do a lot of listening,” said Grotta. In order to meaningfully help companies, Mercator first must fully understand their needs and perspectives. She explained that while Mercator does come prepared with its own ideas and solutions, it appreciates that “clients are experts in their respective fields, and they have great ideas.”
After fully understanding what the client wants, Mercator can conduct a market assessment to help the company understand the contours of its industry, and how its products and services compare to those offered by competitors. While this may seem basic, many companies simply don’t have the time or bandwidth to conduct market assessments on their own.
Mercator can also deploy in-depth, 3rd party surveys to help companies chart a better course.
“Sometimes we will conduct a survey of consumers or small businesses that we can get really valuable feedback from,” noted Grotta. This is particularly helpful in B2B relationships, as Mercator will conduct executive interviews with buyers and potential buyers.
“We’re not really creating a prospecting list per se, but what we’re trying to do is to get a ground level perspective on what buyers’ interests are” explained Grotta. Based on these surveys, companies can get actionable insights and feedback that can be used to improve the design of products and the company’s market approach.