UK Omni-Channel Payment
Customer Experience
Q3 2016
As e-commerce and m-commerce sales
continue to grow, retailers and payment
service providers look how to manage the
payment experience to improve
convenience, control and ultimately
conversion.
This ‘bite size’ research is a snap shot of the
ecommerce check-out experience of 54 well
known UK retailers and their omni-channel
return and refund capability.
The sample size has been limited to reflect
processes of the top non-food retailers in
the UK.
Current State of UK Omni-Channel Payments
54 top UK Multi-Channel Merchants
Payment Options Available
Ability to Return to Store
Refund Processes
Omni-Channel Payments Customer Experience Report: Q3 2016
As retailers succeed in breaking down the silos to achieve omni-channel merchandise
management, often payment is overlooked and the customer experience severely
compromised.
Offering a wide choice of payment methods must be balanced with the ability to deliver
a consistent brand experience and meet customer expectations for easy return and
refund. ‘One click’ payment may boost conversion rates but not being able to use a gift
voucher online or receive a refund instore to the original payment method will have the
opposite effect.
Core Principles of Omni-Channel Payments
Store e-Com m-Com Phone
Loyalty Scheme : collect and redeem benefits in any channel
Refunds : receive a refund to the original payment method across channels
Payment Methods : consistent payment options includng gift cards & vouchers
Omni-Channel Payments Customer Experience Report: Q3 2016
All retailers surveyed follow the same basic steps to complete an order using a progress bar.
Step 1: the ‘Sign in’ process varies in complexity, encouraging account set up for personalisation and faster future checkout. In contrast, ‘guest log in’ options, where available, are not necessarily quicker for one off purchases.
13% of retailers show steps 2-4 on a single page.
Discount codes are typically handled before progressing to payment. However, handling of gift cards and vouchers is dependent on how the payment engine is integrated.
Check-Out Experience
1. Sign in / Guest log in
2. Delivery 3. Payment 4. Review &
Confirm
Omni-Channel Payments Customer Experience Report: Q3 2016
Accepted Payment Methods
0%
20%
40%
60%
80%
100%All merchants surveyed accept
Visa and Mastercard payments.
Most offer limited payment options.
Not all store gift cards are
recognised for online purchases.
More often than not, payment
methods are not shown until the
payment page.
Omni-Channel Payments Customer Experience Report: Q3 2016
Alternative Payment Methods
* Source : Attitudes to Payments Research Report 2015
78% of the websites surveyed accepted payment by PayPal.
New ewallets are starting to appear but have yet to achieve more than 5% market
penetration.
Zapp pay-by-bank looks to capitalise on the increased penetration of smart phone
ownership that reached 84% of Brits in 2015 and of which nearly half (46%) use
mobile banking.* As yet they are not visible on the check out pages of our leading
merchants.
Omni-Channel Payments Customer Experience Report: Q3 2016
Is Your Loyalty Scheme Omni-Channel Ready?
Of the websites surveyed……
87% of retailers use discount codes to stimulate sales.
31% use a loyalty scheme, store account or store credit card to
recognise customers shopping online. These allow access to
data to understand cross channel purchasing behaviour, create
targeted offers, manage loyalty points and introduce features
such as buy now pay later.
Only 3 merchants allow (part) payment using loyalty points.
The replacement of paper vouchers by eVouchers has pushed
online acceptance to 61%.
Omni-Channel Payments Customer Experience Report: Q3 2016
Card Purchase Return to Store
Cannot be returned instore
13%
Refund process not specified
11%
eCom refund (delayed) 4%
Giftcard / store credit 2% Instore refund
70%
Only 70% of merchants are
confident in their ‘return to
store’ policy…
Delayed refunds
Although only 4% of the
websites explicitly state that
refunds are only activated
once the goods have been
returned by the store to the
e-com warehouse, in
practice this is more
common.
Omni-Channel Payments Customer Experience Report: Q3 2016
Return of PayPal Purchases to Store
Cannot be returned instore
40%
Instore refund 15%
eCom refund (delayed)
7%
Refund process not specified
17%
Instore refund to card behind
PayPal account 4%
Giftcard / store credit 17%
Limited Service
Omni-channel refund processes struggle with alternative payment methods. Only one retailer specifies the use of the PayPal app to generate a barcode used to process an instore refund.
Omni-Channel Payments Customer Experience Report: Q3 2016
Omni-Channel Payment Infrastructure Standardisation
Merchant Estate
Face to Face
Mobile/ In-App
eCom
Call Centre
Traditional terminal
SW / mPOS terminal
Payment Gateway
Consolidated Reporting
Tran
sacti
on
S
ervic
es
Acquiring & Collection Services
DCC
Tokenisation
Mail link
Fraud Control
Loyalty
Shared Services Customer
Stock Movement
Settlement Self-serve
Trx Log
Omni-Channel Payments Customer Experience Report: Q3 2016
The core attributes of a successful omni-channel payment strategy ensures that the
customer experience is simple and secure:
• Payment – consistent payment options including gift cards and vouchers.
• Loyalty – collect and redeem benefits in all channels.
• Refunds – receive a refund to the original method of payment in any channel.
The refund process can ultimately define the overall consumer experience impacting on
brand credibility and trust, but many retailers are yet to fully address this.
To achieve operational cost efficiencies, reduce overheads and have effective security
controls, back end processes should also be reviewed:
• Standardised infrastructure – shared back end services such as tokenisation.
• Consolidated reporting and reconciliation – automated exception based reporting
Summary
Omni-Channel Payments Customer Experience Report: Q3 2016
CONVENIENCE CONTROL CONVERSION
OnStrategy Consulting is an independent consultancy providing market
management, customer experience and communication services. Founder and
owner, Emma Allen has over 20 years of international B2B and B2C experience in
retail, retail technology and retail payment services delivering product and solution
innovation strategy for market leading companies.
By bridging the gap between technical and commercial teams, we work with cross
functional international teams to define and align customer focused strategies with
a practical approach for successful implementation.
With a passion for customer service and business operational efficiency delivered
through the seamless integration of technology, OnStrategy Consulting believes in
creating demonstrable value.
For further insight on the omni-channel payment experience or support to
deliver your strategic objectives contact [email protected]
About OnStrategy Consulting
Omni-Channel Payments Customer Experience Report: Q3 2016
Emma Allen
Principal Consultant
OnStrategy Consulting Limited
+44 (0) 1908 551012
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