We know the customer is what businesses pivot on. Gain them or keep them in a satisfied state and you will normally do well, whatever your business is. In the Australian context there has been a strong focus on “customer centricity” or customer experience in the last few years. Much of this has been in the context of mastering digital channels.
But has this focus also extended to the role of payments? We often find organisations treat payments systems as a “back end” thing. Something you (or a partner) implements and trusts will fulfil its role. In other words, it’s a functional outcome that should just work, or at least that’s the assumption.
At a recent roundtable event we held in Sydney, hosted by Tech Research Asia, and attended by over a dozen leading CIOs and business leaders we asked the question of whether payments should be considered more important to business strategy than a function. The answer was a somewhat surprising, but from our perspective obviously not unwelcome, yes. And it was a resounding one at that from all at the table.
Some of this change in mindset we are witnessing in 2016 is due to association of payments to the very strong interest shown in the FinTech sector. A lot of money and effort is being poured into FinTech at present and any associated area is likely to be viewed as being of strategic import.
Yet, regardless of the hype of the day, when you examine the role of payments in detail in any organisation, they are arguably, after all, one of the most critical parts of the customer experience. Think of it this way, if a customer can’t pay or you can’t receive their payments then there is effectively no “customer”. There is no business being transacted. It’s hard to think of this as not being a critical component of any experience with an organisation. And, yes, that’s a deliberate understatement.
But there are also other reasons to also elevate payments into a business strategy discussion. Firstly, is the notion that your customers are now the ones in control. In the majority of urban centres that have decent digital infrastructure, customers are more informed than ever before and in many industries are able to switch providers with relative ease. They expect to be able to use a variety of payment types. If they can’t pay quickly and with the method of their choosing then they’ll likely be mighty upset and in addition to sharing it with their social media world, possibly take their business elsewhere if the frustration is high enough.
Second, is the fact that payments transactions offer a wealth of data and insights about your customers if you can capture it effectively and analyse it within context. This data can be critical to ensuring your business strategy is effective at delivering on its stated aims. It is also personal data that needs to be stored and secured in compliance with all relevant regulations. A breach can have fatal consequences.
The last reason is that there is significant innovation occurring within the payments industry that may either change your customers’ expectations or offer you an opportunity to also innovate. From the exploration of using block chain technology to mobile wallets to integration with wearable devices, there is no shortage of possibilities with payments.These are just a few brief examples of the reasons why payments are now on the strategic radar for Australian businesses. As 2016 unfolds we expect this new mindset to continue to gain a foothold. See the latest CIO and Customer Software research for more Australian payment market insights.