The development of online payment systems in the mobile commerce age:
Remember a time when the internet meant connecting to a couple of basic websites on an archaic desktop machine using Internet Explorer 4 or 5? Ecommerce was simple – one browser to design for, one shop with checkout to build, one platform to market.
Fast forward to the present; Laptops, Notebooks, iPads, Smart phones, Tablets, Kindles, Web enabled TV’s, Web enabled gaming consoles, web enabled fridges!!……..
The list of technology that is enabling users to connect to and buy from the internet is ever expanding. The days of everyone using a desktop with 1 or 2 browsers has long disappeared.
A little over 2 years ago I recall sitting in a room of ecommerce merchants, developers and industry experts discussing our thoughts on the future of ecommerce. I made a forthright statement then, which I stand by now.
“Mobile phones will become the “new credit cards” of tomorrow!”
So, what does this mean for the online merchant of today? What are the opportunities for the small, medium and large merchants? What are the costs and implications?
Firstly you need to take stock of the emerging technologies for allowing people to purchase online. Not an easy task. There are new technologies every day. Here are a few of the current available options:
- NFC – Near field communications. The ‘wave and pay’ with your mobile phone e.g. BarclayCard
- SMS Premium payments. You may using SMS from your phone e.g. Boku
- Simply Tap – register based payment app
- Custom Merchant apps e.g. Starbucks Payment App
Let’s discuss each one and the impact for merchants:
NFC – Near Field Communications
This is the “wave and pay” technology where your mobile device can communicate wirelessly with a terminal within a store to enable a payment transaction from your phone to the store for goods. Recently trailed by Barclay’s bank with some success, using a small “paytag” stickers attached to the back of participants mobile phones. Blackberry were there first mobile producer who installed NFC by default onto their devices. This trend is sure to continue across other devices as time goes on.
For online merchants this technology does not directly impact unless you have a “bricks and mortar” store, where NFC could indeed become a significant method for payment the next few years.
SMS Premium Payments
Imagine your customers arrive at your checkout (through whatever means) and all the simply have to do to process payment is enter their mobile number. They then instantly receive an SMS message asking to confirm the transaction. Viola! The process the payment against their mobile account and you receive the money through the electronic transfer process via their Mobile Phone Network acquirer.
This is a simple and elegant method of payment that rivals existing PSP (Payment service providers). It is widely used in many other countries, particularly in Asia.
For online merchants this presents a real opportunity to increase the options for customers and to enable their customers to easily buy from anywhere, whether they do or do not have a credit card, bank account or debit card.
Simply Tap – www.simplytap.com
Simply Tap™ is an instant mobile checkout app that makes shopping on your phone quicker, easier and more secure. Once your customers have registered with Simply Tap and have the app installed on their portable device then they can literally buy your product (assuming you have signed up with them) wherever the see it by either scanning the QR Code, Taking a photo of it, or entering in the code.
As services like these grow the opportunity for customers to increase their impulse purchasing increases massively, allowing customers to buy their products on impulse whenever and wherever they find them.
Retailers can see an example of the benefits here: http://mobilemoneynetwork.com/how-simply-tap-works/retailers
Custom Merchant apps
For the larger, heavily branded retailers with large customer bases (think big nationals), the cost of having a company develop their own mobile commerce app (tens of thousands of pounds!) is offset by the kudos, marketing potential and additional sales revenue that comes from having their own app. e.g. Starbucks – the coffee company has developed it’s own app which allows loyalty card members an option to pay, directly from their loyalty account, using a simple mobile app.
Smaller merchants may not ever see a benefit to this. They may simply not have the type of customer base that would utilise this, however there may be some business models with smaller client bases where this does work well. I am sure that when prices of developing bespoke apps integrated with some global payment provider fall there will be more businesses taking up this option.
Finally a word on design. Designing websites has always been a challenging business, with a multitude of browser versions and browser platforms to cater for. Now added to this cacophonous mix of variables is the multitude of platforms with which to design for.
It is clear to us at teclan that, whilst the majority of mobile devices display websites normally and perfectly sensibly, it is in the interests of web developers to deploy reactive design techniques to allow websites to adapt to the device they are rendered on. It is also beholden on the business in question to opt for a design that can be trans-platform and trans-device safe, displaying effectively across all versions whilst keeping the focus on giving the customer the best possible experience they can have.
The future?
Well, as more technological developments occur the mix of options will simply thicken. I do not feel we will see an entire sea change to one technology or another. More a case of a more diverse range of options available to the consumer about how to shop and how to pay.
One certainty is that shoppers will want to continue to shop and pay. It’s up to the merchants to ensure they can do that easily and simply.