In the business world, as in life, the key to success is working smarter - not necessarily harder. Consumers have demonstrated this desire for convenience and ease by the way they pay for daily expenses, as cash is no longer king in today's mobile device-driven society. Indeed, in 2016, cash use fell 6 percent, according to data maintained by Blackhawk Network, and check usage also slid, down 8 percent.
In their place are alternative payments, which are increasingly preferred by consumers. For instance, mobile wallet usage climbed 8 percent in 2016 compared to the previous year, and mobile adopters are spending more per transaction than they were in years gone by.
The variety of ways that consumers are spending their money is what makes integrated payments a worthwhile option for business owners, particularly those in the retail, hospitality and restaurant industries. Mobile POS systems helps create a customer experience that's dually effective, simplifying the purchase process for store owners while at the same time giving customers more control over how they choose to spend.
In short, mPOS gives business owners the competitive advantage they need to stay one step ahead of rivaling retailers.
Customers spend more
As the name suggests, integrated payments makes the purchase process more seamless by augmenting buyers' ability to pay for products and services in a variety of denominations. In doing so, they often wind up spending more than they would with only one or two options. This has been established in a variety of studies on the topic, including one performed by researchers from the Massachusetts Institute of Technology.
"When you vary the payment method, people are willing to pay more," Duncan Simester, a professor of marketing at MIT who has studied this issue, told the New York Times. "You're not forking over a dollar bill, so there is less sensation of loss."
Simester, along with his colleague Drazen Prelec, found that when customers have the ability to pay with credit cards rather than exclusively cash, it's not unusual for them to pay 100 percent more than they would with fewer payment options.
Accounts for consumer trends
Store owners and managers have to be ready and willing to adapt as demand dictates. And numerous polls suggest that mobile payments are in, necessitating mPOS system technology. According to survey research conducted by Pew Charitable Trusts, over 45 percent of Americans have made at least one mobile payment in their lives, the equivalent of 114 million consumers. This has corresponded with an increase in smartphone ownership, as 70 percent of adults acknowledge they own one. The share is even higher among millennials, coming in at 90 percent.
Expand customer base
Although they may not be a majority, an increasing percentage of the U.S. is made up of immigrants - meaning individuals who originate from other parts of the world. For instance, in California - the U.S.' most-populated state - nearly 1 in 5 legal residents are immigrants, according to government figures compiled by CNN. In New York, immigrants represent approximately 12.5 percent of the Empire State's population.
International consumers are major mobile payment users, even more so than U.S.-based customers. For instance, in a survey conducted by ACI Worldwide, 25 percent of consumers from Spain use mobile wallets on a regular basis. That's the highest share in all of Europe. The same is true for 24 percent of residents from Italy, 23 percent from Sweden and 14 percent for United Kingdom consumers.
"What we are seeing is a tipping point regarding adoption, which can be attributed to consumers worldwide now almost exclusively using payment-enabled devices, as older models have cycled out, with a few exceptions," said Mark Ranta, head of digital banking solutions at ACI Worldwide.
Installing an integrated payment system provides customers - throughout the world - with the kind of diversification that they have come to expect.
Enhances data security
Retailers and business owners in general are squarely in cyberhackers' crosshairs. Because so many consumers use their smartphones and credit cards to spend, there's a tremendous amount of data that cybercriminals can potentially exploit. Several nationwide franchises have learned this the hard way over recent years. But mPOS systems that facilitate payment integration reinforces financial security measures through tokenization and point-to-point encryption (P2PE). This combination not only helps to decrease the potential for a breach, but it increases customer loyalty because buyers know their sensitive data is in good hands.
Datacap provides the payment solutions that make a difference. With more than 30 years in the integrated payments industry, our tailored product offerings have given our Point of Sale partners the formula they need to set themselves apart from their toughest competitors. Contact us to learn more.