How Digital Payments are Playing a Crucial Role in Indian Retail's Pandemic Recovery
Indian retail is witnessing a new wave of technological transformation. The way customers shop and make retail decisions has changed dramatically owing to the pandemic. From fostering virtual connections to relying on apps, customers now firmly recognize interactions through a digital-first lens, with higher expectations towards personalization.
In a world of e-commerce and limitless choice, retailers must place customers at the center of their business. The idea of going ‘contactless’ has brought a change in consumer mindset to explore new payment forms, and other factors like convenience, ease of use, and acceptance have provided the impetus to this adoption.
As online shopping booms, changing shopper preferences will continue to be the key driver to accelerate options in digital payments, unveiling an untapped opportunity for retailers. In response to the pandemic, Indian retailers are rapidly investing in digital technologies like artificial intelligence, machine learning, and contactless payments technology to reinvent themselves for customers at every touchpoint. These changes in consumer behavior are driven by convenience and safety and are likely to continue in the future.
Let’s look at how digital payments and online retail is a winning duo and why retailers need to rethink their current e-commerce payment strategies to be ahead of the game:
Opportunity to Embrace First-Time Users –While customers increasingly shop online for everyday needs, including food and apparel, lack of awareness about the advantages of using digital modes of payments has been one of the biggest challenges in its adoption across India. However, the pandemic-induced behavioral shift has drastically changed the narrative.
The findings from Blackhawk Network’s recent Global Digital Payments study revealed that when compared to global counterparts, Indians more than any other group surveyed prefer retailers that offer fast, frictionless, and secure digital payment options. The pandemic has given impetus to the adoption of digital payments for first-time shoppers in India, and they are increasingly embracing innovative ways of transacting using their mobile devices. There is an increasing acceptance of digital payments and awareness about the benefits of different platforms, including e-commerce. This trend is likely to continue.
Not All Gift Cards will be Gifts – Digital gift cards were rising in popularity and pandemic has further accelerated the adoption of digital gift cards. Digital gift cards saw a huge increase in popularity since they are an easy contactless payment option to send and use. Interestingly, the boom in online shopping led to increased gift card demand among consumers who eyed alternate methods to transact digitally.
Blackhawk Network’s recent Global Digital Payments study shows that 62 percent of Indian respondents purchased digital gift cards in the last year for themselves and 50 percent bought them for the sole purpose ‘to make purchases online’. Digital gift cards will continue to be seen in a whole new light by both retailers and consumers once we hit more of a stride in our pandemic recovery. Retailers that cater to the everyday digital payment preferences of today’s shoppers and their preferences will emerge as post-pandemic winners.
Heightened Competition and Innovation in Retail – In this new world, consumer-focused agility is vital for retailers, whether it is providing additional features on a digital platform or upgrading existing ones. More importantly, retailers must not limit these enhancements to their products and offerings. Besides ensuring their product is present across the different channels where customers interact with their business, retailers will have to focus on mapping digital payments to their consumers’ preferences. Embracing the changing shopper behavior and convincing them to come back by providing value will be the key to building loyalty in new-age shoppers.
Uncovering Retail Personalization with Digital Payments - In 2021, there is an enormous opportunity for agile brands to outshine the competition and achieve a higher level of success; integrating a digital payments solution is one such opportunity. With customer behavior changing rapidly, their expectation for heightened flexibility aided by digital payment options is growing. Digital payments options like e-wallets, QR codes, buy now-pay later, etc. are reshaping the payments ecosystem. Collectively, integrating these digital payments options could not only help retailers distinguish themselves from their competitors but also help them meet their customers’ needs.
Digital payments are empowering retailers to completely alter and streamline the conventional retail experience. The best part is that this change is already transpiring. As retailers invest in new-age digital payments technologies, the holy grail would be to complement their commerce operations with digital payments to achieve growth.