Rambus Payments CTO Chakib Bouda recently sat down with Pymnts.com to discuss the future of mobile wallets. According to Bouda, brick-and-mortar retailers are now seriously rethinking their approach to remaining competitive in the digital age as mobile and online eCommerce channels continue to consume a larger portion of consumer spend.
“[Retailers are] seeing it not just as a process to be managed, but as an opportunity,” he explained. “Indeed, 80 percent of merchants now see payments as a fundamental part of their business strategy, with 92 percent expecting to maintain or increase investment over the next 12 to 18 months.”
As Bouda notes, every retailer is different, so they need to build a wallet that is completely tailored to the needs of their customers. For example, they can go all in and deploy a full digital wallet right away. Or they can adopt a phased approach.
“Doing something simple like digitizing a branded store card within a mobile wallet has several benefits, for example, they can reduce costs by making fewer transactions subject to fees,” he said. “The retailer can also incentivize use of the store card by pushing in-app discounts to encourage adoption and drive brand engagement and loyalty.”
Bouda also emphasized that payments alone aren’t enough to incentivize most shoppers to leave their cards at home.
“It’s all about value. The Starbucks app is arguably the most successful mobile wallet to date. Why? Because they made their customers’ lives easier with added value through features like ordering ahead and simplistic payments,” he continued. “Essentially, people need a reason to do something, and payment is not strong enough to change habits. Retailers should be looking to bring together everything to make a better in-store experience. This could be ‘mixing’ credit, points and vouchers in a single payment, the ability to order ahead, discounts for users of the app and tailored deals and digital receipts, to name just a few.”
In addition, says Bouda, digitizing receipts is something that retailers have an incentive to do and is in and of itself a reason to move to mobile wallets – as paper and plastic have costs seen and unseen for merchants.
“Plastic cards, cardboard coupons and paper receipts have an environmental impact. For retailers, a mobile wallet is a vehicle to [a] considerably more cost-effective and sustainable future, while delivering increased consumer engagement and insights,” he elaborated.
Bouda also told Pymnts.com that mobile has the power to help retailers to avoid theft of customer payment credentials, transaction histories and identities.
“Retailers get there by layering security methods to meet their requirements, while maintaining simplicity and convenience for consumers,” he added. “Those layers are the current and emerging form factors present in the marketplace today for digital payments — including app security, device authentication, biometric authentication and tokenization, among others.”
Interested in learning more about mobile wallets? The full text of “What Should Be Inside Your Mobile Wallet (Strategy)” is available on Pymnts.com. You can also download our eBook below.