When it comes to customer experience (CX), few industries are at the forefront of change more than retail. Personal shopping assistants, experiential retail and augmented reality are just some of the many innovations the industry is developing to usher in a new era of excellence.

However, while these trends are undoubtedly intriguing and innovative; after two years of uncertainty, shoppers today are craving reliability, simplicity and convenience above all else. 

When it comes to CX then, retailers should focus on doing the basics well rather than investing in unproven and potentially gimmicky innovations. Today, few strategies better cater to contemporary consumers and their desire for convenience than contactless SMS payments. But what are contactless SMS payments? Why should retailers embrace them? And how should they go about doing so?

Why contactless?

Physical cash was once the dominant form of exchange between shoppers and retailers. However, cash use is plummeting; being replaced by the likes of card payments, digital wallets and Buy Now Pay Later services. While they’re the most prominent, one the most revolutionary, exciting and convenient new trends is SMS-based and mobile payments. These payments involve a retailer sending a customer a text, with a link through which they can process a payment almost immediately. 

In 2020, almost AUD$15bn in global transactions were processed through contactless payments, and that figure is expected to almost double to over $25bn by 2025. Today, so many of us live and work on our smartphones. Text messages have a 98% open rate, and a 209% higher response rate than emails, Facebook, and phone – making it an incredibly effective channel to send contactless payment links.

The opportunity to try new technologies always excites younger consumers, and contactless payments are what this demographic craves. In fact, 70% of Gen Z customers and 74% of millennials love this new style of payment. As younger generations age, their preferences become the default. Here’s how to add this innovative, convenient and simple tool to your retail business.

Review your current practices 

Have you ever abandoned a purchase because of a lengthy checkout queue? If you have, many of your shoppers will have, too. Don’t let your retail business lose customers needlessly. Contactless payments can help you eliminate this costly issue by removing unnecessary steps from the payment process.

However, before taking the leap, it’s important to review your current process. Have disgruntled shoppers complained about the lack of options? Do customers often leave at the sight of a long queue? Do your staff spend too much time processing payments rather than providing brilliant face-to-face service on the shop floor? If so, it’s time to embrace the convenience of contactless. 

Review your point of sale system

You’ll most likely find the necessary hardware for contactless payments in any modern Point of Sale (POS) system. However, if it has been a while since you upgraded your retail tech, you’ll probably need a new system to issue, accept and process contactless payments. While integrated terminals are a popular option, many merchant services offer add-on readers that easily integrate into your current terminal. 

If your business model allows it, give customers the option of text-based payments before, during, or after doing business with you. SMS-based payments reduce queues, making it easier for your customers to pay quickly and giving your staff more time to be present and helpful on the shop floor. 

Advertise its implementation

While most Australians assume a business now accepts credit cards, contactless payments are not yet an expected technology for retailers. It’s important, therefore, that they’re aware you offer this convenient, sophisticated payment option. Whether through placards in your store, decals on the windows or signs above the checkout, inform them that you’re streamlining their shopping experience. It demonstrates that you’re a contemporary retailer, adapting as their habits and preferences do.

Train your team

As with any significant change, the process is only as efficient as your team makes it. Ensure you provide ample time to train your staff, so they’re comfortable with the new process. The easier it is for your staff to issue contactless SMS-based payments, the easier it is for shoppers to pay in a timely manner. For retailers, the convenience of contactless is worth its weight in gold.

Contactless payments are a critical tool in the modern retailer’s arsenal. By empowering your business with the contemporary tools it needs to take advantage of this exciting new chapter in payments, you can boost profitability, increase efficiency and provide the streamlined and memorable experiences that shoppers demand today.

Dave Schiene is country manager for Australia at Podium.