Consumer trends, such as demand for Embedded Finance (EF), and rise in use of non-banking provider financial services illustrate a change in the way products are perceived and consumed: customers now subscribe to an ease of use, a means, a journey, an experience.
According to a new research white paper from Visa, merchants wise to these trends realise that consumers interact with and relate to brands now more than ever and therefore it is their brand identity that matters and needs to be built.
Payments are simply a building block. For merchants, the brand is the payment but for customers, the payment is the brand.
Being all things to all customers actually means being very little to the individual.
It is about being what’s right for them and using data to understand individual habits and preferences to offer the relevant choices at checkout vis-à-vis payment method, lending, insurance, etc.
Checkout should be Customised – personal and tailored to the customer, Contextual – relevant to the purchase or transaction, and Configurable – adaptable to changes in either of these.
Add to this ubiquity and of course reliability and confidence is inspired, creating the foundations for real customer loyalty, or advocacy.
In this way, through embedded finance, a merchant can become an essential lifestyle mechanism, elevating their offering to a trusted brand status.
The bottom line opportunity in embracing EF as a merchant is all for the taking, explains the white paper.
Spend uplift at checkout through additional financial products is one obvious benefit; promoting products through personalised ads is another; repeat custom and stronger reputation a third.
Then there are fruitful revenue opportunities to be struck with the provider in question as well.
Whether the merchant wants to build, buy or own the solution is a key deciding factor in how the business is to grow.
Relationship ambitions, and technological capability underpin this decision and it is a trade-off between the brand identity and cost.
POS options have evolved significantly, meaning E-POS and SoftPOS solutions offer infrastructure and hardware through which the entire ecosystem can be built as well as business insights garnered.
And the opportunity to boost both online and offline retail sales becomes enhanced.
Partnering with other merchants can bolster a proposition either better, sooner or both and certainly, as these trends continue, platforms are growing likewise, connecting all manner of commerce, finance and lifestyle in one ecosystem.
There are hidden benefits to fostering a data-centric approach other than prospering from a more strongly nurtured customer-base, and these lie in the relationship with the lender.
A better handle on business data and increased customer numbers lead to more accurate and reliable forecasting, boosting credit and growth viability and greater negotiation leverage.
Because, ultimately, brand recognition bolsters lender confidence too. And as we know, brand ambassadors are the ultimate customers.
Download a free copy of “Embracing the Future of Financial Services – Insights into credit and payments for Merchants”, the new white paper from Visa.
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