Diverse channels, payment types, legislation and services are redefining the point of sale. Understanding critical trends and responding quickly with appropriate payment tools is vital if retailers, banks and acquirers want to survive and thrive during the challenges that lie ahead.

As competition across channels intensifies many retailers are responding by reassessing their payment strategies to retain flexibility, economies of scale and competitive edge as markets and margins get tighter. 

Previous disruptive technologies are now seen as vital to retail success. Harnessing sophisticated payment related technologies – like NFC, e-loyalty, multimedia devices and value-adds – are now becoming essential tools to link the virtual and physical retail worlds together. 

As retailers reshape their payments strategies accordingly, there are several key drivers that are influencing their payment technology and service investment:

Mobilisation of channels & services

Within Europe there are now 741 million live phone subscriptions, according to Global Mobile Statistics 2012 published by mobiThinking, and 366 active mobile broadband subscriptions. This makes the traditional, linear in-store approach to physical purchasing something of the past. Shoppers no longer choose between physical or virtual channels.  With their mobile they can browse the internet while in store to access product information, location-based offers, voucher codes, comparison sites, barcode scanners, product reviews and purchase tracking. Retailers must embrace this and evolve new ways of exploiting smart devices from MPoS and mobile wallets to customer facing service apps. This involves new platforms to help them exploit the myriad of marketing opportunities and to integrate payments with wider CRM functions within their business.

Greater integration of eCommerce 

Internet adoption in Europe is the highest in the world. As a result online B2C sales are climbing steadily despite economic headwinds and spend tightening. According to Forrester Research, online sales in key European markets will rise an average of 11% annually to reach €170 billion ($217 billion) in 2017. Consequently, retailers are looking at better ways to manage and consolidate payments and services into unified platforms that offer a single view across channels, provide better cost/performance benefits and create a consistent user experience. This will drive greater adoption of outsourced managed services and payments as a service solutions, which offer the development platforms, management and reporting tools required to better link the retailers transaction environments.

Improved customer experience

The inclusion of more memory, enhanced processing power, larger, colourful touch screens, multiple applications, flexible multi-connectivity and, of course, contactless and NFC are all contributing to the evolution of a new generation of payment devices that can do more than just accept cards. Retailers are waking up to the fact that the POS is no longer about 'closing the sale' – it is now part of the whole customer journey, helping to interact, create impact, and impress. 

PCI development & enhanced security

Protecting the customer against fraud will continue to be paramount for the entire payment industry. However, keeping standards maintained is not only expensive but requires significant internal resource and a long-term commitment. Many retailers are, therefore, seeking ways to simplify the process, reduce scope and costs through encryption and tokenisation or having a third party to manage their transaction platform.

While for many retailers the emphasis will be on how to embrace these changes, for some the challenge remains how to get the basics better – continuing to make the POS faster, more convenient and efficient and eCommerce platforms more accessible, reliable and secure. Any payment innovation will, therefore, have to be backed by pragmatic delivery and justified by its ability to deliver real value for shoppers and bottom line return.

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