Small businesses are critical to the growth of our nation’s economy and our communities. As local businesses across the country celebrate National Small Business Week, a number of electronic payment technologies that have developed in recent years are poised to converge on the retail payment scene. Many of these tools hold great potential for boosting retailers’ bottom lines while enhancing the shopping experience for customers.
There are a lot of groups providing top-notch resources for small businesses looking to save time, make more money, and expand their reach. One program is Master Your Card, which works with small businesses to connect them to the technology and resources they need to thrive.
Here are five major trends that will shape the way you do business this year. (More information and resources on these topics are available at www.masteryourcardusa.org.)
1. Mobile payment is growing.
With the rise of chip cards and the need for businesses to upgrade their payment terminals, retailers have the opportunity to offer more payment options. Many EMV terminals come equipped with near field communication (NFC) capability. This technology allows two electronic devices–like a smartphone and a payment terminal–placed a short distance apart to exchange data, enabling mobile payment options such as Apple Pay and Samsung Pay. Research from eMarketer indicates that the value of mobile payment transactions in the U.S. will triple in 2016.
2. More stores are adopting apps.
Consumers are demanding a streamlined shopping experience that is quick, easy, and secure, and retailers are delivering by integrating the latest technology. Several large retailers offer apps, which allow customers to create shopping lists, check in-store stock availability, and see the latest sales on items related to their recent shopping history. A few of these superstore chains are also working on payment features that will let users attach a credit or debit card to the app in order to make in-store purchases directly through their phones.
Small businesses with more modest budgets can create their own affordable apps using services like Appsme and Biznessapps. Mobile apps will continue to facilitate an immersive, multimedia shopping experience that is efficient and saves customers time.
3. Buy online and pick up in-store is on the rise.
Buy online and pick up in-store, or “BOPUS” as it’s commonly known, is growing in popularity as busy customers seek ways to skip the line. The trend holds significant promise for brick-and-mortar stores looking to increase sales.
During the 2015 holiday season, 69 percent of shoppers who used BOPUS made additional in-store purchases while retrieving their online orders. Small businesses are able to access the benefits of BOPUS through several innovative point-of-sale providers like Retail Pro and Revel Systems.
4. Loyalty programs are changing.
One-size-fits-all loyalty programs are no longer enough. Currently, only 42 percent of people enrolled in traditional loyalty programs actively use them. Shoppers—especially millennials—are drawn to personalized loyalty programs that offer incentives related to their specific interests and habits.
Belly, a customizable loyalty platform designed for restaurants and coffee shops, lets small business owners offer rewards, create email campaigns, and generate social exposure through multi-channel integration. Perka is an app that uses a virtual punch card to incentivize customers to “check in” at participating stores and sends alerts to employees with customers’ names and loyalty statuses to allow more personalized service.
5. Social media will grow as a point of sale.
Social media is creating places for consumers to not only view, share, and discuss products, but to make purchases as well. Facebook recently rolled out a “buy” button with the help of e-commerce software company Shopify, allowing users to order items directly from their newsfeed. Soldsie has created a platform that lets Instagram users buy products simply by writing “sold” in the comments section and then subsequently confirming an emailed invoice.
For e-commerce startups and other small businesses with an online presence, sales via social media offer a low-cost and effective way to reach very specific audiences on the platforms they use the most.
Looking Ahead
In an increasingly connected world, most customers are not only comfortable with technology-assisted shopping, but have come to expect it. Many of these innovations are fueled by interchange, a small fee that businesses and their banks pay to the electronic payment network provider for processing the transaction.
And electronic payment technology’s return on investment is significant. According to The Perryman Group, electronic payments supported nearly $433 billion in business activity and nearly 5.7 million jobs in 2014.
For small businesses to increase sales and customer loyalty in the growing digital economy, it is essential that they harness the power of electronic payment tools.
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