This is why digital wallets are your best friend
One word: conversion. It’s a straightforward metric that tracks how well a product manages to capture customer interest and maintain that interest through to the completed transaction. When tweaking a product, conversion rates factor heavily into analyzing the impact of the changes.
E-commerce managers rightly focus on this metric when evaluating the potential of new solutions to improve the bottom line. The evaluation balances the potential increase in conversion against the cost (in both time and money) to complete the integration.
So why should managers focus on conversion? There’s a massive opportunity unfolding on mobile. By 2021, the majority of digital commerce will be completed on a mobile device. Poor mobile conversions will soon have an outsized impact on a merchant’s revenues.
As more consumers transact on mobile, there’s a growing expectation of a frictionless user experience. This expectation will very soon become table stakes for merchant competitiveness – if it hasn’t already.
What is a digital wallet?
A digital wallet is quite similar to an analog wallet: a place to store your debit, credit, gift, and loyalty cards. The main difference being, of course, that the digital wallet lives on your devices. Usually, this means a mobile phone, but some digital wallets are available on desktop computers as well.
Since a digital wallet can store multiple cards, it has become a flexible utility for many consumers. From standard bank-issued cards to airline loyalty to Starbucks, a digital wallet is a storehouse for a user’s retail life. As the shift to mobile commerce continues, the digital wallet offers payment flexibility to consumers who want to spread purchases across a variety of branded cards.
Security is one of the greatest benefits of digital wallets. There’s a reduction in fraud as each card’s information is tokenized once it passes to a merchant for processing. Tokenization makes it nearly impossible to intercept card information, protecting both merchants and consumers.
Another benefit is that consumers trust digital wallets, and are more apt to complete a purchase given the convenience of a 1-click digital wallet. Online merchants that accept digital wallets enjoy a combined conversion rate of 55.3% compared to a combined 48.7% conversion rate for all payment types.
Integrating digital wallets
There are many digital wallets to choose from. Companies (Apple, Samsung, Google, WeChat, Amazon), as well as banks (Chase), inundate consumers with choice. As the options proliferate, the odds of a “winner take all” market dwindle. The reality facing merchants is one of overwhelm: there are just so many different digital wallets popular with consumers.
Rather than invest internal resources on a limited number of integrations, consider a vendor for integrations. Wallets rise and fall in popularity due to rapidly changing consumer preferences; a vendor invests its expertise to determine which wallets to add and which to remove. The vendor also ensures security and compliance, as it maintains the integrity of the integration on behalf of its clients.
Case study: MyCheck
The simplest way to add digital wallets for your customers is find a vendor that integrates directly with a wide range of payment methods, so merchants don’t have to do any work. One example: MyCheck’s digital wallet tokenizes a customer’s payment methods for secure storage and enables re-use across many customer touchpoints, such as on-site restaurants, front desk check-in/check-out, and online booking.
Regardless of the payment method or software system, the digital wallet works seamlessly within a hotel brand’s ecosystem via a single integration. Hotels just “turn it on” and the work is done. This “instant on” access makes for quick work; as more brands enable digital wallets across their customer touchpoints, consumer adoption of digital payment methods – and their spending – will grow.
Are digital wallets right for you?
Onboarding a new vendor requires an investment in time and money. If you answer yes to at least one of the following questions, you should consider adding digital wallets to your checkout flow.
- Is the volume of purchases completed on mobile growing?
- Do you want the volume of purchases completed on mobile to grow even more?
- Do consumers see your brand as tech-savvy and expect to see that reflected in the user experience?
- Is your traffic data showing an upward trend in visits to your website via mobile devices?
Some businesses report a 3X increase in conversion rates after integrating digital wallets. Don’t miss out on the rare opportunity to both improve your user experience and your bottom line: your customers are ready for it.
Let Pay By Group do the legwork: we integrate digital wallets into your payment flow so you don’t have to. Contact us to schedule a consultation.