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Payments 3.0: How Intelligent Connectivity Will Transform The Customer Experience Innovation

Payments 3.0: How Intelligent Connectivity Will Transform The Customer Experience

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Payments 3.0 is the era of possibility. As I described in my last piece, everything about the way we pay for goods and services will become more exciting, seamless and hyper-personalized. Businesses of all types will be able to create truly amazing customer experiences, with payments at the heart of every interaction.

Remember how smartphones ushered in mobile payments? Now, internet of things (IoT) devices are accelerating always-on payment channels that deliver value, speed and convenience throughout every transaction.

Here are examples to illustrate how the Payments 3.0 era is already seamlessly wrapping invisible, frictionless payments into overall customer experiences, with a look forward to what is to come.

Grocery/retail: Checkout-free and auto-order shopping remove payment hassles.

Amazon is leading the way in delivering a smooth payment experience. In its Amazon Go stores, people can grab their groceries and bypass the cash register on their way out. The company’s Just Walk Out technology enables seamless, automatic digital payments. As this technology gains traction, consumers will expect similar convenience and speed elsewhere.

As IoT evolves and smart appliances become ubiquitous, online ordering will rise in popularity. For example, Amazon and others are working on smart refrigerators that keep track of common items and add pre-approved grocery items to your shopping list or have them automatically delivered to your home. Similar to Amazon’s Just Walk Out experience, payment will be an invisible part of this online shopping experience—it will just happen.

Automotive: Smart cars handle payment for fuel, tolls and parking.

Today, 91% of new cars sold in the United States are internet-connected, and by 2030, nearly all new cars sold (96%) will be. That means in-vehicle payment systems are just around the corner. No need to reach for your wallet (or digital wallet) when fueling up, parking or paying a toll. The car will pick up the bill, so to speak.

Our connected cars will be able to tell us when fuel is low and direct us to the nearest gas station or EV charger. The car will communicate with sensor-equipped fuel pumps and charging stations to automatically pay. Tesla cars do this today, as do EVs from other makers that have implemented the Plug and Go standard. Similarly, IoT-outfitted parking lots will direct us to available parking spots and electronically extract payments when we leave.

Bill pay: Smart technology makes payment as easy as a tap or voice command.

Today, consumers can pay their bills by just scanning a QR code from their mobile device or using a digital wallet that requires only tapping their mobile device. They can receive payment reminders by text or via push notifications, with personalized links they can click on to drop directly into their payment flow—without having to enter a password. Speedy and smooth experiences are the name of the game.

The next evolution may come via the smart speakers that already serve as the control center for connected homes, making bill pay even easier. Nearly half (48%) of U.S. internet users own at least one smart speaker, and they are using these devices to search online, create grocery lists and stream music. The more consumers use their voices to complete everyday tasks, the more likely they will trust smart speakers with more sensitive information like account balances and bill payments.

Already, smart meters let consumers view and manage their power consumption in near real time, and in-home displays show energy use and associated costs so consumers can make consumption decisions that reduce monthly bills. To pay, consumers simply tap on the display—or, again, talk to their connected smart speaker.

iGaming and sports betting: Connectivity creates more immediate, immersive experiences.ith iGaming and mobile sports betting, the focus has been on letting responsible players go from deposit to play as quickly and easily as possible. IoT-connected stadiums, coupled with 5G internet connectivity, will soon up the ante. For instance, imagine sensors that transmit performance data, enhancing fans’ ability to place bets throughout the game. That type of rapid, live play will require the ability to fund accounts as effortlessly as possible while simultaneously monitoring and evaluating activity to prevent fraud or identify and block problem gambling. The integration of real-time data collection within effortless, unobtrusive payment processes will enable responsible, fully immersive experiences.

Are you ready?

It’s still early in the Payments 3.0 era, but it’s increasingly clear the opportunities are unlimited. Businesses that want to meet consumer expectations for hyper-personalized payment experiences must deliver value before and after every transaction.

To prepare:

• Democratize your data. If your data is scattered everywhere and in different formats, and access is uneven, you’ll have a difficult time using that data effectively. An increasing array of tools are available to extract, normalize and make disparate sources of data available for analysis in real time. Making data accessible for real-time analysis is the essential first step.

• Consider purpose-built, flexible payment platforms. To fully take advantage of hyper-personalization, you’ll need a modern payments experience system that can be tailored to your specific needs and evolve as technology advances transform payment experiences. IoT is just one example of how complex and far-reaching the payments landscape will evolve, and it won’t end there. Those who rely upon legacy systems that have been cobbled together will have a hard time keeping up.

• Partner with a technology provider. Democratizing data, enabling hyper-personalization and capitalizing on new technology is not easy. Look for partners that can do as many of these things as possible, and be sure they are focused on helping you increase your overall margins by making your payment experiences as amazing and delightful as they can possibly be.

Get ready. According to Statista, “The number of Internet of Things (IoT) devices worldwide is forecast to almost triple from 9.7 billion in 2020 to more than 29 billion IoT devices in 2030.” Always-on payment channels that deliver value, speed and convenience throughout every transaction are going to be the new normal faster than you can say, “Innovate.”