Payments aren’t going to change much in the next five years. In 2020, most payments will still be made in physical stores, with physical cards, issued by one of today’s leading issuers, and routed over one of the major networks by one of a few national processors.
What is going to be completely transformed though, is consumers’ checkout experience, both offline and online. EMV will drive the transformation at physical checkout counters, of course. Issuer and merchant options for EMV deployment (not to mention contactless and mobile) will disrupt the consistency of today’s swipe-and-sign checkout experience. A former colleague recently brought my attention to one bank that is simply instructing cardholders to 1) Insert your card and 2) do whatever the terminal tells you to do. (See, EMV really isn’t that complicated).
Yet for all the change occurring at the point-of-sale, it pales in comparison to the upheaval that will occur in online checkout. My friend Ron Mazursky, who challenged me to write this post, asked “What will capture the attention of the consumer? What needs can be better met?” To which I respond, an easier way to checkout on the web and in-app!
So many companies are trying to solve this problem. Just to name some of the checkout solutions available: Visa Checkout, MasterCard MasterPass, Amex Express Checkout, PayPal Express Checkout, PayPal OneTouch, Alipay Express Checkout, Apple Pay, Android Pay, and Bitcoin.
Ecommerce merchants are going to spend the next five years defining their checkout strategy. Which solutions resonate the most with consumers? Which provide the greatest increase in conversion rates? Where is the best location to place a checkout “button?” How many checkout buttons are required? Strategies will likely need to be adapted to specific products, devices and/or geographic markets.
For payment providers, becoming a cardholder’s default online payment brand is critical, especially if payments continue to disappear behind variously branded “buy buttons” on merchant websites, online marketplaces, and social media platforms. Familiar payment brands that have already earned top of wallet status with cardholders will fight to keep that standing in the online world. Meanwhile, less preferred brands and industry newcomers will fight to become top of wallet by providing the easiest online checkout experience.
By 2020, the winning checkout strategies and products will have started to come into focus. In the meantime, payments enthusiasts can look forward to an exciting five years of product development and intense marketing. Online sellers can be confident that dreams of higher conversions and less frequent shopping cart abandonment will soon become reality.
This blog was originally posted on LinkedIn
