With this week’s news of Barclays partnering with fintech startup Flux to trial its digital receipts technology on customers, Yoyo co-founder Michael Rolph considers what this means for mobile payments, the power of basket data insight and how it can be taken further to benefit retailers and their customers.
This week, it was reported that Barclays entered into a partnership with fellow London fintech startup Flux to trial its itemised receipt technology.
Around 10,000 users of the bank’s Launchpad app (the platform Barclays uses to test new features with real customers) will receive digital itemised receipts rather than those annoying bits of paper that clog up our wallets.
This is a perfect example of how the mobile payments experience can be enhanced for retailers and their customers.
Some excellent work guys – well done!
What does digital receipts mean for mobile payments?
Similar to Flux, Yoyo has a mechanism that allows retailers to deliver itemised receipts to their customers by capturing basket data at the point-of-sale, as part of an end-to-end mobile payment and loyalty experience. But this reveals only a small fraction of what basket data can do!
For some time now, we’ve been saying that adding value to the mobile payments experience is imperative if it is to overtake cards as the dominant form of payment.
While the big tech players have made accepting mobile payment a no brainer for retailers – bottom line, they’ve just added another payment method to the mix, and it’s been difficult to see how this tops the contactless card experience.
Being able to deliver digital receipts to customers is a step towards adding value to the mobile payment experience – but it’s only the beginning!
The power of basket data insight
Retailers are not short of data – they have tons of it. At the same time, they are constantly looking for new ways to better engage with their customers, add value and increase retention.
For most, this comes in the guise of a traditional loyalty scheme – branded plastic points card or paper stamp card campaigns. But consumers have long found it difficult to see the value in these schemes, are unimpressed with the benefits on offer and frustrated by the process of collecting points/stamps and redeeming rewards.
Meanwhile, retailers have been unable to gauge any real success metrics from these campaigns and they provide little insight into who their customers actually are.
But, by tapping into the point-of-sale through a simple transaction API, which provides full SKU level basket data with a payment authorisation request, retailers can find out who their customers are, what they’re buying and when.
What does this mean for retailers and their customers?
Basket data insight blows apart the whole idea of a traditional loyalty scheme and can lead to a complete end-to-end mobile transaction experience, with loyalty points/stamp collection and instant rewards, as well as itemised digital receipts, delivered to a customer in a single moment – creating a fully immersed in-store experience.
With this basket data insight, not only could a retailer segment and reward customers based on what they most like, they could also set loyalty conditions to influence and reward certain behaviour.
If business was slow on a certain day or a new product line wasn’t gaining enough attention, a retailer would have the basket data insight at their fingertips to create a campaign that could tell customers they’d receive extra rewards if they shopped on that slow day or bought that new product line during a certain time period.
One retailer, who has been taking advantage of this is Vietnamese fast food chain HOP.
Earlier this year, HOP wanted to increase the frequency of purchases on a slow business day – Tuesdays. The fast food chain created a campaign that offered double loyalty points to all customers who came in on that day.
Activity on a Tuesday for the month after the campaign launched looked very different: Unique customers increased by 85%, transactions went up 51% and revenue increased by 61%.
Taking basket data even further
High street chain Caffè Nero took the power of basket data one step further this month by creating a unique surprise and delight promotion to reward its customers with digital Christmas Crackers every time they bought their usual hot drinks over the festive period, giving app users the chance to instantly win prizes.
Over the next two months, every time a customer makes a transaction that includes a hot drink through Caffè Nero’s payment and loyalty app, they receive a digital Caffè Nero Christmas Cracker – and all they will have to do is “shake” or “pull” it open to find out if they’ve won (the campaign is ongoing until 31 December – to take part, download the Caffe Nero app here).
This first-of-its-kind post-transaction campaign brings a new level of added value to the payments process – with the Caffè Nero Christmas Cracker tailored, in real time, to customers’ purchasing behaviour and brought to life through a range of engaging user experiences. Caffè Nero app customers are being rewarded just for going about their daily business! Oh, and they’re still receiving their usual stamps, rewards and digital receipts.
The success of mobile payment will lie in making the payment process a core part of a positive customer experience and this requires added value.
Using basket data to create digital receipts for customers goes a long way to adding this value, but the retailers who are willing to push their basket data even further to create a full end-to-end payment and loyalty experience are the ones who are most likely to steal the march on their competitors.
Michael is an experienced entrepreneur and business developer. He is co-founder and CPO of Yoyo, which launched in 2013 and has become the fastest growing and largest multi-retailer mobile wallet in Europe.
He was previously an advisor at Azimo, a mobile and internet money transfer company, and a mentor at Seedcamp, where he helped jumpstart the entrepreneurial community in Europe.
Prior to that, Michael was non-executive director at The MoBank Group, which specialises in creating and operating transactional systems for mobile commerce, banking and payments. He was also director and EiR at Anthemis Group, a specialist advisory firm for growth-stage companies in financial services, markets and technology.
Michael also has experience working at PayPal, First Data Corporation and Barclaycard Business.