Omnichannel shopping – where consumers can use multiple channels to research, buy and collect products, all while being recognised by the brand regardless of how they choose to interact – has long been a familiar concept to retailers. But as demand for an even more technology-focused shopping experience continues to increase, how can businesses take their offering a step further to better meet ever-changing customer expectations?

Finance Monthly hears from Sharon Manikon, Managing Director of Customer Solutions at Barclaycard, on what’s next for retail technology and the many ways we shop.

Staying up-to-date with the latest technology can be a challenge, but it can also hold the key to standing out from the competition, leading to increased footfall and more satisfied customers. Here, Barclaycard explores three common shopper frustrations and the technologies emerging to help businesses satisfy those needs.

Reduce fitting room frustrations with smart changing rooms

Barclaycard research reveals that three in ten shoppers (29%) become frustrated when they have to queue for a fitting room. One potential solution is to offer ‘virtual’ changing rooms, an interface in which customers upload a photo of themselves or create an avatar with their measurements, then ‘try on’ clothing items. This could prove a big hit, with three in 10 people (30%) saying they would be more likely to shop with a retailer using this technology.

Online shoppers are also interested, with 30% reporting that virtual changing rooms on a retailer’s website would help them when making a purchase. Offering ‘smarter’ fitting room options both in-store and online could therefore alleviate consumer frustrations and may even help retailers cut down on the number of items that are returned.

Keep queues short with the next generation of payments

The Barclaycard results also finds that four in ten shoppers (42%) get annoyed when they have to wait in a queue at the checkout. Payment technology can hold the key to lessening those long lines; indeed, new, faster payment methods are already helping to do this. Retailers should prepare for the increased popularity of checkout options like contactless, wearables and invisible payments.

Firstly, Barclaycard’s Contactless Spending Index reveals that half (50%) of Brits now pay contactlessly at least once a month – and this number is set to increase, with contactless spend jumping by 166% in 2016. Our data also shows that the trend to pay via ‘touch and go’ payments on a mobile or using wearables, clothing or accessories that has become more popular in the past two years is likely to continue to go from strength to strength this year.

In the longer term, invisible payments like those pioneered by Uber will gain traction, as they allow customers to complete a transaction within an app without ever hitting ‘checkout’ or walking to a till in-store. An extension of invisible payments that is currently under development is ‘scan and pay’ apps. These enable consumers to walk into a store, scan an item on their phone and pay ‘invisibly’ through payment details that they have previously input and stored on their device. Although the technology has only just been tested, one in five customers (19%) already say they would welcome apps to scan and automatically pay for items.

Retailers should expect consumers to embrace this technology in the next few years. Contactless, mobile and wearables are already starting to become mainstream, and the growth of invisible payment options will soon start to emerge as ways to pay in the retail space.

Improve the customer service with conversational commerce tools

Today’s demanding shoppers also expect more from customer service, and want quick and easy interactions at any time of day – through whatever channel they choose. According to a recent survey by ubisend, a chatbot development company, 51% of people say businesses should be available 24/7 and half (49%) would rather contact a business through messaging, such as texting, than on the phone. Companies are already using various forms of artificial intelligence (AI), such as computer systems that are able to perform basic tasks and answer simple queries, so to satisfy this demand brands should watch the AI space for applications that they can integrate into their high street stores.

As customers continue to seek out other payment options besides in-person transactions, corporations could see a rise in ‘conversational commerce,’ or the use of AI for making purchases. Already, chatbots, AI customer service tools in apps and online platforms, and digital assistants like Apple’s Siri and Amazon’s Alexa, are becoming popular stand-ins for personal shoppers and check-out counters. As this technology continues to develop, consumer demand for it across all aspects of commerce is also poised to increase.

Consumer expectations are driving exciting innovations in the retail space. Payment solutions providers are already looking forward to make sure payment systems continue to match customer demands – and businesses should ensure they are keeping up too. Not all of these solutions are ready to hit the high street, but retailers can stay abreast of new developments by speaking with their payment providers and exploring advances in technology. The brands that embrace these new tools will be most likely the ones driving repeat – and new – custom.

You’ll have noticed over the past year, that every time you go to pay for something, contactless methods are saving you time. Kevin McAdam, Head of prepaid at Allpay Limited, tells us more about this evolving theme in the payments sector.

Society has developed a thirst for speed and ease of payment, originating with online payments and direct debits, followed by the birth of contactless. The use of contactless payment is on the increase, with recent research highlighting the technology’s prevalence over cheque payments. Equally, at allpay Limited we’ve seen an increased demand for contactless, with upwards of 90% of new orders requiring contactless functionality. Moreover, while not a mandatory requirement, many local authorities are seeking contactless in their tenders, most notable in the last 4-6 months. This proves that the market is shifting towards faster payments which require minimal input.

For tenants living in social housing who are elderly or infirm, minimising the room for error is key - especially if they lack access to, or an understanding of, certain technologies. Contactless eliminates the need to remember a PIN number, resulting in small payments being processed with minimal intervention and stress. Transactions are processed quickly, easily and with peace of mind.

As a result, prepaid card payments are evolving to facilitate contactless. Both prepaid and contactless cards enable easy, swift and secure transactions, but are not in competition.  Rather, moving forwards, the two payment methods are integrating to optimise ease for the payee and the speed of transactions. Our future goal at allpay Limited is to issue debit free, re-loadable prepaid cards with all the security benefits, as well as contactless capabilities.

The next step towards further facilitating payments is providing access to universal credit via prepaid cards from the government. Universal credit is less restrictive as, instead of paying for one specific outlet, payees would have autonomy over how the money was spent. Of course the pre-set limit of £30 maximum would remain. Yet, this versatility is an appealing prospect for those reliant on prepaid cards, with contactless capability an additional bonus.

Access to universal credit via prepaid has already been tested by the Kent Council, with a largely positive response. The trial demonstrated that prepaid cards have the potential to promote financial inclusion and independence, helping people manage their money and debts and widening options for financial management. On this basis, the evaluation concluded that it would be feasible for the Department of Work and Pensions to carry out a more extensive trial of using prepaid cards to support vulnerable claimants. We pride ourselves on the convenience we offer our customers by providing a wide range of payment solutions. With this in mind, we aim to be at the forefront of all new developments in the prepaid sp

With over 60% of global travellers identifying the smartphone as their "most indispensable" travel item, a new airline industry brief from CellPoint Mobile explains why carriers should embrace the ‘Three Ps’ - Passengers, Payments and Profitability - as key components of their strategy for revenue growth in 2017.

The airline industry is currently at a crossroads defined by high expectations for financial success, rising competition, and a mobile marketplace that is undergoing profound, rapid and global change.

Already accustomed to using smartphones to pay for everything from shared rides to in-app retail purchases, today's passengers also are demanding access to the most popular digital wallet solutions and alternative payment methods (APMs) to meet their travel needs. Airlines that enable fast and convenient ways to pay through Android Pay, Apple Pay, PayPal, MasterPass, Visa Checkout and Alipay and other solutions are well positioned to capture lucrative revenues from the mobile marketplace.

By acknowledging the impact and potential of the Three Ps, airlines will be better positioned to create more paths to purchase for passengers and to reach their revenue goals for continued growth and increased profitability beyond 2017.

The industry brief from CellPoint Mobile highlights key trends and growth from across the airline and travel sectors, including:

• Passengers: In a 2016 Expedia/Egencia survey, nearly 10,000 global travellers identified the smartphone as the "most indispensable item" to carry on their journeys, with rates as high as 90% among Asia-Pacific travellers confirming that passengers increasingly rely on mobile devices to research, plan, book and pay for their trips.

• Payments: Travelers have access to several hundred global and regional mobile wallet solutions and alternative payment methods (APMs) enabling them to make purchases from anywhere - if airlines deploy them.

• Profitability: eMarketer estimates that digital travel sales will reach $817 billion (USD) globally by 2020, led by Asia-Pacific, North America and Western Europe, while a new report by Allied Market Research estimates a $3.3 trillion global payments market by 2020.

Airlines that make mobile transactions easy and seamless for their passengers can capture new revenues that arise from a variety of opportunities, including the direct sale of tickets and services, ancillary products, day-of-travel purchases and upgrades, impulse purchases, loyalty program transactions, social media channels, chat bots and other emerging technologies.

(Source: CellPoint Mobile)

From chatbots to instant payment solutions, Finance Monthly has heard from Ralf Ohlhausen, Business Development Director at PPRO Group, who gives his top 10 on the ever-changing payments sphere, the fintech disruptions of 2017, and the latest regulatory updates for the coming year.

1. Usability of payment methods

Payment methods need to become more user-friendly to appeal to various platforms of commerce from the till point to online, taking differing devices into consideration in order to stay competitive. This is especially important for providers of e-commerce payment methods who need to come up with optimised user experience and facilitate the growing trend of mobile payments.

2. Strong Customer Authentication (SCA)

SCA becomes a mandatory part of the Payment Services Directive 2 (PSD2), which will be implemented in the member states of the EU over the next two years. Unfortunately, the SCA’s increase in security will likely affect usability, which is completely contrary to what merchants and consumers want. New innovations around authentication methods may reduce the problem, but may also lead to more advanced concepts overall, making SCA obsolete.

Going forward, we will see increasing discrepancies between fast moving technology and slow moving regulatory changes - a difficult dilemma, which can only be overcome by fundamental changes in the regulatory approach. If you are impacted by SCA watch out for exemptions that might be granted and new authentication methods mitigating the adverse effect on usability.

3. Mobile payments

There’s been some bad news for mobile-payment sceptics. According to the 2016 Visa Digital Payments Study, in just one year the number of European consumers using mobile payments has increased by 200%. Previous scepticism may have been prompted by the fact that it took mobile payments longer to take off than originally predicted.  Bashing mobile-payments also became a favourite sport for some journalists.  But that doesn’t change the fact that mobile has now reached its tipping point. And with companies such as Apple and Samsung now getting serious about mobile payments, it seems a fair bet that the pace of that change is about to accelerate.

ApplePay is now rolling out to most major markets. And it’s doing so, as it turns out, exactly as consumers are starting to accept mobile payments. Given how often Apple has got it right before, particularly in terms of user experience, there’s every reason to be optimistic this time too. That can only be a good thing both for mobile payments and for the alternative-payment market as a whole. On a more wide-ranging note, this is a lesson for all of us in the industry. New developments invariably go through the whole of the hype cycle — including what Gartner refers to as the “trough of disillusionment”, when everyone is pointing to early failures and disappointments and saying “it will never work.”

As an industry, we’ve got to get better at recognising this cycle for what it is. We need to stick with good ideas, even when they don’t seem to be fulfilling their early hype. Because good ideas don’t go away. And no one wants to be the late adopter when, suddenly, everything starts coming together at last.

4. Instant Payments

The Euro Retail Payments Board (ERPB), a successor of the SEPA Council, is currently pushing very hard to make sure that SEPA is not falling behind the many national initiatives for implementing faster and even instant payments. The European Payments Council (EPC) just published their first rulebook for instant SEPA credit transfers (SCT Inst), which will bring down the crediting of the beneficiary’s account from one business day to a mere ten seconds. Similar instantaneous funds availability shall also come to SEPA Direct Debits, Cards and other payment methods. Implementation of SCT Inst will be optional for all the banks (at least for now) and may take some time, but the future of payments will be instant – just as it happened to messaging, the purchase of books or music and many other things of our daily lives already.

5. Access to Account

January marks one year until the Second Payment Services Directive compliance deadline, which will bring the new concept of “Access to Account” (XS2A) into the EU. Licensed Third Party Providers (TPPs) will be granted access any bank account in the EU to provide payment or account information services to their customers. 2017 will see increasing competition to the additional layers of value-added services (VAS) presented to banking customers.

6. Chatbots

At the beginning of 2016, internet giants rushed to incorporate an Application Programming Interface (API) into chat programs – also known as chatbots – for automated communication with customers. After a year of creating a firm presence in the UK, chatbots will become one of the biggest innovations in 2017 since the introduction of smartphones and it won’t take long until “chatbot payments” are the norm.

7. Blockchain Technology

The underlying blockchain technology behind bitcoins will certainly make further headlines in 2017. Blockchain is a database where all bitcoin transactions are saved. It consists of a long chain of data blocks in which one or more transactions are being compiled, encrypted and securely stored. Transactions are very fast with blockchain, and although they are not made in real-time, they are very cheap. Ideas, where the blockchain technology might be used in the future, are only just being developed. Basically, however, it is already clear it could be beneficial for all transactions that are currently in need of a “trusted third party”. One example is smart contracts. Instead of solicitors, computers take over the contractual management, meaning that they are proofing all preconditions in live mode and are able to realise individual agreements automatically.

8. Anti-Money Laundering

It has been much speculated whether the fifth Anti-money laundry directive (AML5) will actually come into play in 2017. If it does come in the form currently proposed by EU legislators, it will have a massive impact on e-money institutions. The already low limits for e-money usage without Know Your Customer (KYC) processes will be further decreased in a way e-money will lose its appeal over standard banking. That would through the baby out with the bathwater and could collapse the whole EMI industry.

9. Peer-to-Peer (P2P) payment

Person-to-Person or Peer-to-Peer (P2P) payment solutions have been popping up across Europe and the rest of the World for quite some time, but we can expect 2017 to see the method to gain traction here in the UK. The European Retail Payments Board (ERPB) is working to facilitate the co-operation of existing and future P2P mobile payment solutions to ensure interoperability on a pan-European level. The vision is to provide any person with the ability to initiate a pan-European P2P mobile payment safely and securely. 2017 could finally see a standard brought into place which reaches a critical mass of people and enables P2P payments without the need for knowing lengthy bank account numbers.

10. Cashier-free stores

Amazon recently unveiled plans to bring a chain of cashier-free stores to the UK next year. By using technology to track which items have been selected, the store will remove the need for products to be scanned or for customers to queue at a checkout as customers will be able to pay via smartphone as they exit the store. The introduction of such stores will accelerate the UK’s move towards a cashless and even encourage a card-less society in 2017.