28 May 2021

Are Contactless Payments Here to Stay?

By: Lori Stout

Strategy

As more of the consumer population gets vaccinated and pandemic restrictions are relaxed across the country, many restaurants and retailers are turning their attention to a return to “normal.” With a wealth of experience under their belts from the year-that-shall-not-be-named, restaurant and retail marketers are finally able to take a breath and analyze the tsunami of change that they just endured.

One thing is clear: brands that had integrated digital loyalty programs in place fared well overall compared to those that didn’t. From March to April last year, loyalty sales dipped by only 36%, compared to 55% for anonymous sales. And while anonymous sales took fifteen weeks to recover, loyalty sales recovered in only nine weeks.

But what about adjacent technologies like contactless payments, delivery, and curbside pickup? While many of the pivots that businesses were forced to make during the pandemic were born of urgency and necessity, marketers can take heart that they were not implemented in vain.

Now is the time to double down and permanently embrace some of the new technologies that emerged as a result of the pandemic. Contactless payment is one such solution that has risen to the top of the priority list for many brands. Here’s why.

Consumers will continue to expect contactless payment options

A recent survey revealed that over 70% of consumers intend to use contactless payment solutions post-pandemic. While the technology has been around for several decades, usage was relatively sporadic among restaurant and retail brands until the 2010s, when Google and Apple introduced their NFC-based payment solutions, Google Pay and Apple Pay. Meanwhile, a fast-growing San Jose company named PayPal was taking the payments world by storm. Founded in 1998 as a service for securely transferring money by email, the enterprise has grown to become the global leader in online and contactless payment solutions, with over 325 million accounts in 202 countries and 25 different currencies.

As consumers realize the security and convenience of utilizing a mobile wallet, companies like PayPal (and its subsidiary Venmo), are constantly innovating on new ways to make the consumer experience even faster, safer, and more frictionless. Today, PayPal and Venmo users can make secure contactless payments with the funding source of their choice, all in one simple scan of a QR code and without exchanging cards or cash. And with contactless payment integration to a brand’s loyalty platform, loyalty guests can seamlessly earn, redeem, and pay in one simple scan flow.

Loyalty participation and contactless payments go hand in hand

It’s not just a better experience for customers–brands have much to gain by embracing contactless payment integration. 47% of consumers report that they will not shop at a brand that doesn’t offer a contactless way to pay. Couple that with the fact that  69% of shoppers say that their choice of retailer is impacted by where they can earn loyalty and rewards, and it’s clear that contactless payments and loyalty programs are an integration made in revenue heaven. 

Consider adding contactless payments as part of the consumer experience to:

  • Establish a safe and convenient payment option that keeps customers inside the merchant app experience
  • Provide your franchisees a contactless option to deploy quickly in addition to NFC integrations
  • Allow customers to make seamless loyalty-integrated payments anywhere, including in-store and drive-through using a simple QR code
  • Leverage the reach of the PayPal/Venmo user base to acquire new customers through additional payment & funding options

If you’d like to hear more about how contactless payments can improve customer acquisition and loyalty participation, contact one of our loyalty experts today.