After two years away from trade events, Divido were excited to kick off the 2022 season with the flagship Retail Technology Show. Dubbed the UK’s fastest growing and most exciting event of its kind, RTS2022 did not disappoint. Over 200 of Europe’s most forward-thinking retailers and innovators met for two days of talks and exhibitions at the London Olympia.
This article outlines our three key takeaways from the Retail Technology Show 2022.
1. Customer Experience is key
Consumers consistently cite quick and easy checkouts as the most valuable shopping experience. Discomfort at the point of sale causes frustration as consumers are increasingly used to seamless shopping. If a merchant does not provide a frictionless experience, prospective customers will look elsewhere. The easier retailers make the checkout experience, the more consumers will use the service. Simple.
It should come as no surprise then, that customer experience was a key theme at this year’s Retail Technology Show. Friction at the point of sale was widely discussed throughout the talks, particularly amongst the Payments and Checkouts stage.
Innovation in this space is lively. Consumers demand choice at the checkout and merchants are keen to provide it. But crucially, consumers also demand ease of use; seamless payments. Innovators are providing the technology to enable this enhanced customer journey in the form of experiential shopping in-stores and, of course, buy now pay later offerings. Forward-thinking merchants will put their customer’s experience at the heart of any decision regarding alternative payment offerings, before choosing to partner with a provider.
2. Too much choice can be a bad thing
Customers like choice. But they don’t want to be bamboozled by it. Too much can be overwhelming.
Yet merchants can also suffer by providing too many options. With so many innovations within e-commerce, it can be difficult to know which technology to incorporate at the checkout. And even with a decision, seemingly similar product offerings are unavailable across geographies. This results in merchants providing multiple products to service the same consumer need.
Navigating the marketplace is complex. But the issues don’t stop there; rarely do these innovations share the same back-end structure. Without talking to one another, servicing each platform can be incredibly costly, as Kate Lavery, Head of Technology at Morrison’s explained in a session exploring how retail payments will develop in the future. High-operating costs across multiple platforms providing the same need will mean retailers will eventually reduce their offerings, disrupting the consumer experience.
Finding a retail finance provider that offers the same service across multiple geographies not only eliminates this complexity, but also reduces costs and future proofs against the developing market.
3. Launching your own Checkout Finance platform may be the answer
It’s on every merchant’s radar. But how best to implement it?
BNPL has exploded in recent years. Once the new kid on the block, BNPL now boasts mainstream status as the fastest growing payment method on the planet. Its popularity is difficult to ignore; set to reach a global value of $1tn by 2026, BNPL appeals to all price points at all ages and is a proven way to increase revenue for merchants.
The demand is obvious. The benefits are clear. But as a merchant, there are some important things to consider.
Many BNPL providers are designed to drive traffic away from a merchant’s website at the point of sale. In fact, many providers now encourage consumers to discover retailers via their own website – as opposed to simply offering an alternative means of finance at the checkout.
This can provide benefits to the merchant – co-marketing with BNPL providers can boost revenue as consumers are directed to the merchants website from the BNPL platform. But the flip side is that merchants lose control of their customer journey at the most crucial stage. Consumers are redirected to the BNPL provider’s website as accounts are set up, bouncing from one site to another. This can create friction; consumers will lose patience if they need to fill out multiple application forms. In fact, 40% of consumers* would shop elsewhere if their chosen payment provider was unavailable. Consumers driven by BNPL alone can be fickle.
Some of the larger players in the BNPL market are also repositioning themselves as Amazon rivals. Rather than best serving merchants, these providers will focus on providing price comparison between retailers. This creates a race to the bottom with prices; if you’re not the cheapest merchant, you won’t get the customer.
Brands drive trust. Merchants risk that trust by handing the experience over to a third-party.
On day two of the Retail Technology Show, Reshmi Suresh, Director of Enterprise Product Commercialisation at Worldpay concluded her ‘Boosting Sales Through an Effective Buy Now Pay Later Strategy’ talk by highlighting the benefits of opting for a White-Label BNPL solution. Namely, lower cost, increased approval, increased sales, and, crucially, merchant brand equity and more control over customer experience.
For merchants, the message appears to be clear: take ownership of your brand and customer experience to retain trust, build loyalty, and stay in control.
The checkout is evolving
As a concept, BNPL is not new. Spreading payments has been a key function for many types of credit for some time. What separates it from previous financing is the seamless customer experience it provides. Consumers, increasingly in the habit of shopping with as few clicks as possible, are treated to an easy, flexible alternative way to pay, often with interest free credit. The smooth shopping experience keeps consumers coming back for more.
And merchants, rather than cannibalising their existing offerings, open themselves up to previously underserved customers through the enhanced experience it provides, creating an additional stream of revenue in the process. BNPL provides an opportunity for retailers to get closer to their customers and build tru
Divido’s whitelabel retail finance platform helps merchant’s take back control of their brand experience and customer journey. Our award winning technology is powering the retail finance programs for some of the world’s leading retailers.