Negative payment experiences could drive 85% of consumers away
It may have historically been seen as a mere transaction, but 59 per cent of merchants say payments are a critical part of the customer experience (CX), according to research published by Discover Global Network.
The Riverwoods, Ill.-based payments provider commissioned a global survey of more than 5,000 consumers and more than 2,250 merchants to produce its 2024 Payment State of the Union, the first portion of which was released amid the Money 20/20 Europe event.
Discover found that the vast majority of consumers said they would be less likely to interact with a business where they experienced false declines, performance lags or other payment challenges. CX is also one of the most important attributes business leaders consider when they select payment partner, according to 39 per cent of merchant respondents.
Payments-related CX needs to work well regardless of where and how it happens, however. Today, 86 per cent of merchants feel their omnichannel payments experience remains a work in progress. This could include contactless payments, which 58 per cent of consumers said was their preferred method for in-person purchases. Perhaps in response to Amazon, meanwhile, 45 per cent of merchants believe a one-click payment experience is key to converting more online shoppers.
More than half of merchants surveyed also said they prefer to work with multiple providers to process transactions.
“As digital payment methods become increasingly ubiquitous, payment providers must ensure they offer relevant wallets and buy now, pay later (BNPL) options to help merchants accommodate their customers’ diverse needs,” the report’s authors wrote. “Consumer payment preferences vary widely, making it incredibly important to deliver a personalized and streamlined checkout experience online and in-store.”
360 Magazine Insight
There was no mention of the words “cash” in the Discover report, even though it’s one of the oldest and arguably simplest forms of payment experiences merchants can offer.
This is worth bearing in mind when you look at some of most fascinating data in the study, which focuses less on payment methods but shopping channel preferences. In-store purchases are up 10 per cent compared with similar research last year, representing 43 per cent of where consumers say they will spend the majority of their discretionary income. This was even higher in marketers like the U.S. and EMEA.
If you don’t want to fumble with bills and coins, though, tap to pay on mobile could be considered the physical equivalent of a one-click button on a web site. Nearly three quarters of consumers said they would be comfortable using this method (though that’s not the same thing as being their No. 1 preference).
Payments may be a critical part of CX because of where it sits in the customer journey — the point at which people have gotten the information they need and have made up their mind about buying a product. Having something go wrong at this stage is obviously a key area of friction.
Many CX leaders are much more focused on either the early phase of attracting customers through effective marketing or building loyalty by improving post-purchase service and support. This research, which is ungated and laid out as an easy-to-scan infographic, may be a good reminder to ensure what happens in the middle is as outstanding as everything else a brand delivers to its customers.
