Understanding the New Customer Journey and the Expectation of Frictionless Payments

As payments move from desktop to mobile and from mobile to voice, merchants need to leverage frictionless payments technology to ensure a seamless experience across channels. Learn how the digital customer journey has evolved—and what merchants can do to stay ahead.

In 2018, payments are increasingly moving in the direction of an invisible experience, making a frictionless omni-channel experience table stakes for ecommerce merchants. As more payments move from desktops to mobile web and mobile app, merchants must ensure that customers have a consistent, seamless experience across all channels to boost profitability.

The main thrust behind the payments movement is the evolution—and increasing sophistication—of the digital customer journey. Customers are more focused than ever on convenience and demand the ability to shop wherever and whenever they want. This has driven the rising popularity of conversational commerce (backed by frictionless payments technology), where customers bypass humans altogether and utilize chat- and voice-bots to complete purchases. The bottom line? Customers are embracing embedded and invisible online purchase experiences. To maintain pace with customer preferences, merchants must embrace the new customer journey—and adapt their payments experience to meet new customer needs.

What is a Digital Customer Journey?
The digital experience has changed exponentially since the Internet first became a medium for commerce and has evolved substantially even over the past several years. The touchpoints on which merchants can connect and interact with consumers are endless; digital media channels include social media (Facebook, Twitter), owned media (website, mobile site, mobile app), third-party messaging apps (Facebook Messenger, iOS Messaging), and more. Consumers have come to expect that they can interact with brands on all of these channels, including browsing products and services, resolving customer service issues, and making purchases.

It’s also important to note that the digital journey is complex and highly personal. Some people prefer to browse in-store products and then complete their purchase at home via the online channel (showrooming). Others prefer to research products online but make the final purchase in a brick-and-mortar store (webrooming). Merchants need to be aware of the preferences of their own customer-base and adjust their experiences accordingly. On the whole, 69% of people webroom while 46% of shoppers showroom.

Understanding your customers’ own unique customer journeys can be beneficial, especially as more and more purchases are made online and via mobile. Today, the average household owns over five internet-connected devices. That translates to hundreds of different journey variations and thousands of points of interaction. A recent article noted that the average person taps, swipes, and pinches their smartphone screen 2,617 times per day.

As conversational commerce takes hold, customers are beginning to conduct commerce via voice commands to voice-activated assistants. This represents another touchpoint that must be adapted to consumer purchasing preferences. The shift in this direction highlights how driven consumers are to find the easiest way to pay. Merchants looking to stay ahead of the curve must begin seriously evaluation the best frictionless payments technology that will enable them to personalize commerce for their customers.

Frictionless Payments Technology Become Foundational
The easiest path to purchase is the one that requires the least amount of effort from the purchaser. As frictionless payments technology—backed by machine learning and artificial intelligence (AI)—becomes more sophisticated, merchants need to re-evaluate their own payments operations and find ways to streamline the experience.

The checkout process needs to be truly seamless. To support frictionless payments, merchants should consider one-click payments, alternative payments options, and 3D Secure 2.0 solutions optimized for mobile and in-app shopping. Merchants that invest in this type of frictionless payments technology will inevitably see better conversion rates, lower cart abandonment rates, and more return customers. Payments now extends beyond commoditized functionality to a competitive cornerstone that can build brand reputation and increase the number of loyal customers.

Fraud Prevention is an Important Part of Frictionless Payments
As customers come to rely more and more on AI-powered payments, merchants should, too. This includes leveraging machine learning technology for fraud prevention, which can significantly decrease payments friction and reduce false positives.

AI and machine learning engines have the power to process and analyze substantial amounts of data, making them ideal to take on fraud detection and screening. Currently, many merchants rely on rules-based fraud detection software paired with human review to identify and stop fraudulent transactions. This process is resource-draining and often inaccurate, costing merchants significant losses related to false positives. Machine learning technology is more accurate than the human eye when it comes to identifying and learning the patterns of fraudsters. Machine learning technology can also spot the tiniest traces left behind by bad actors online, making them more precise than human screeners. The ability to quickly process large amounts of transaction data and detect anomalies signifying fraud make machine learning and AI the ideal solution for fraud prevention.

Merchants should not discount the importance of accurate fraud prevention as part of an overall frictionless payments experience. Merchants should consider these sobering statistics: false positives account for roughly 30% of transactions that are flagged, 26% of declined cardholders shop less with a merchant after a decline, and 32% stop shopping with that merchant altogether.
How Digital Payments Technology Partners Play a Role
Maintaining pace with the rapid changes in the payments space—in both technology and consumer preferences—can be a challenge for many merchants. It can be beneficial for merchants to partner with technology partners that have the domain expertise to build out and facilitate frictionless payments across channels.

For examples, a merchant that wants to enable Apple Pay so customers can pay via smartphones and wearables may work with a technology partner on Apple Pay SDK implementation to ensure seamless, secure, and compliant payments.

Creating frictionless payments experiences via mobile apps is another area where merchants can leverage the help of technology partners. Ride sharing companies and applications like Amazon’s Just Walk Out Technology create an exceptional user experience by syncing with a customer’s credit card and processing payments automatically. Ensuring payments are processed without a hitch—to either the merchant or the customer—often requires a team of experts to implement and test technology.
Merchants should take heed to understand the direction in which payments are moving in 2018 and beyond. We’re at a critical crossroads where merchants that invest in frictionless payments technology will inevitably outperform those that do not. It’s also important for merchants to remember that seamless payments extends into fraud prevention controls as well. False declines can add substantial problems to the payments experience, leading to lost customers and lost revenue.

The focus should be on frictionless omni-channel payments experience with customer preferences as a top priority. Leveraging frictionless payments technology enables merchants to allow customers easy navigation and purchasing through desktop, mobile web, mobile app, and conversational commerce channels. This seamless experience can result in improved customer experience and increased profits.

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