Covid-19: The digital acceleration it caused that no one saw coming

To suggest that COVID-19 has transformed the future of business would be too obvious. But, in certain industries like retail, it is hard to fathom just how much change the pandemic has ignited.

The crisis has expedited society further into the digital world; technology that was predicted to be adopted in five years is now on track to be embraced in mere months or even weeks.

Shoppers have been forced to go from wandering aisles to navigating websites and using QR codes. We are seeing new user groups embracing e-commerce and digital payment methods at a much faster rate than anyone ever thought possible.

It’s important to note that these new consumer habits are taking root and will become preferences that persist long after the pandemic. The digital world is no longer for the millennials: every age group is represented these days.

There’s unprecedented urgency for merchants to be proactive as the usage of digital payments spikes. Offering preferred payment methods that are not only convenient, but safe or contactless unlocks a whole new world of opportunities, literally. The retailers seeing exponential growth are the ones who have tailored and localized their payments offering to a global audience.

COVID-19 catapulted demand for digital payment methods

Shoppers have heightened expectations for frictionless shopping experiences. Social distancing is facilitating the surge in e-commerce, increasing demand for digital payment methods over traditional cash and card payments.

Ahead of the virus, the world was on a trajectory to becoming a digital-first society. Some regions were ahead of others; for instance, figures from the PPRO Payment Almanac, pre-coronavirus shows 56% of online transactions in China were already conducted via e-wallets, compared to 23% in the US. However, now that the coronavirus curve has flattened in most areas, PPRO is still seeing increased demand for these types of payments in every region.

Addressing millions of new e-consumers

The global digital payment revolution has previously been led by Gen Z and millennials, but COVID-19 has forced older shoppers to embrace the digital world that may never have happened without the pandemic and subsequent lockdown globally.

We are now seeing increased e-commerce adoption by Baby Boomers; an E-Marketer report anticipates a 5.8% increase in the number of online shoppers aged 45 years and older, equating to nearly 5 million brand new e-commerce users.

New needs have sparked a shift towards online shopping and away from brick-and-mortar. For example, groceries have seen a meteoric rise in online ordering; according to PPRO, online purchases of food and beverages are up 285% since the start of the pandemic.

With new curbside and buy-online-pick-up-in-store programs, the typical cash and card payment methods will be harder to maintain post-pandemic.

Now, merchants must offer e-commerce, and implement digital payment options at checkout. Recent data from Internet Retailing shows 80% of shoppers across Europe’s three largest markets will now make at least half of their purchases online.

Merchants must get ahead of the digital curve

This accelerated push towards digital puts retailers at a pivotal crossroads. A failure to offer a variety of digital payment methods can severely limit their customer pool.

COVID-19 will eventually result in a digital race to create the best possible online experience. The merchants that understand this and make the checkout experience a top priority will succeed, and those who stick to their guns of how they did business pre-pandemic will be left behind.

This is evidenced by a recent PPRO report, showcasing that 42% of U.S. shoppers abandon a purchase if their favorite payment method isn’t available.

While COVID-19 has put a large strain on global economies and consumers, it has also birthed a new age of innovation.

During the pandemic, technology helped keep humans connected and provided access to the goods and services they need. As the world moves forward to a post-pandemic stage, the digital adoption will only proliferate. Merchants can’t afford to be left behind. The time Is now: get ahead of the curve to secure a viable future.

Source: Mobile Payments Today