by Dom Morea, senior vp for Advanced Solutions and Innovation with First Data
The lines between traditional brick and mortar commerce, e-commerce and mobile commerce are blurring. Currently, consumers expect a more integrated buying experience that is quick, consistent, secure and available wherever they happen to be, at any time and through any type of device. At First Data, we call this Universal Commerce (UC). UC is powered by the evolution of smart devices, which can include anything from smartphones, tablet computers, many point-of-sale terminals right through to ATMs. The ‘smartness’ of the device depends on whether it is used by a consumer, a merchant, or a financial institution.
In general, though, all smart devices possess the ability to process information using their own internal intelligence; share information with other devices and systems; integrate with applications using advanced APIs, provide personalised communications; and access the Internet or a proprietary network.
While consumers have been quick to adapt to the possibilities of Universal Commerce through the adoption of smart devices the implications for financial institutions and merchants remains complex.
For example, universal commerce has made it possible for a number of alternative payment service providers to compete with traditional financial service providers in the consumer credit and debit card space.
However, while new threats have emerged so to have new opportunities – according to a survey conducted by First Data, most consumers would rather have a virtual wallet application issued by their own bank than by any other entity (such as their mobile provider or a social network).
This represents an obvious opportunity for financial services providers as consumers move more of their financial management and purchasing activity to their mobile devices.
For retailers the landscape is similarly shifting. Consumers can now visit the online store of a retailer while standing in its actual brick-and-mortar shop, and at the same time, they can be accessing a competitor’s online store through their personal smart device.
Accordingly, retailers must develop an engagement strategy that addresses both consumer and in-store smart devices.
If retailers are to influence consumers in the universal commerce buying cycle, they must have: -an online store presence; a mobile application; and they also need to be in other places their customers go.
namely, social media; search engines; YouTube; daily deal and offers publishers; and other relevant sites.
Indeed, a positive user experience requires consistency across channels and locations.
Online and mobile channels should provide a similar appearance and navigation structure and consumers with smart devices should experience identical prices; loyalty points; discounts; return policies; and redemption policies across all channels, both online and in the store.
Another important engagement strategy involves reaching out to consumers with timely, relevant communications and value-added services.
These can be triggered by customer location, for example, and messages can be tied to customer catalogue activity; product searches; loyalty programme status; and analytics related to past purchasing patterns.
In turn, there are many ways retailers can deploy in-store smart devices to enhance the consumer experience and streamline transaction processing.
Whether retailers use traditional in-lane checkouts or mobile check-out systems, an essential capability of merchant smart devices is their ability to integrate with consumers’ online activities.
For example, if a consumer purchases a daily deal or accepts an electronic coupon, then the merchant’s transaction processing system should automatically apply that offer to the appropriate transaction at the time the customer makes a purchase.
Another example is the ability to accept mobile payments, either by scanning a barcode displayed on a mobile device or with contactless payments managed through the customer’s virtual wallet.
In either case, customers expect that the offers and loyalty redemptions they track on their devices are automatically applied to their transactions.
Smart devices, in their many forms, have had a profound impact on the way consumers engage with merchants and financial institutions.
Effectively they have become the focal point of an integrated customer experience before, during and after a transaction.
Accordingly, businesses must embrace these changes by developing universal commerce strategies that take into account the power and potential of smart devices and optimise the customer experience.
Dom Morea is a senior vp for Advanced Solutions and Innovation with F irst Data where he is responsible for leading the company’s efforts in transformational initiatives such as mobile commerce and personalised marketing. He is a 20-year veteran of the financial services industry. Before joining First Data, Morea was with Encorus – a mobile payments company. Prior to that, he spent six years with First Data. He serves on the boards of influential organizations such as the Smart Card Alliance. Dom is a graduate of Hofstra University.