COVID-19 has tremendously changed how businesses and consumers interact with each other. For both, digital-first has become a norm and a necessity. As we emerge from the pandemic, it’s time to reflect on the most important changes we have witnessed, the key lessons learned, and understand how businesses can adapt to the “new normal.”
When the pandemic started, both businesses and consumers were forced to increase the adoption and implementation of technology solutions, like e-commerce, digital wallets, and QR codes, to carry on with everyday life with minimum disruption. In fact, in a matter of only eight weeks since the epidemic broke out globally, we have vaulted seven years forward in consumer digital channel adoption — a never-seen rate before.
Technology played a crucial role in keeping many aspects of our lives going even during lockdowns or restricted movement.
- Stores, retailers, and F&B businesses have shifted to online ordering and delivery as their primary operation
- Banks have transitioned to remote sales and services, and at the same time launched new digital outreach so that customers can flexibly make payment arrangements using solutions like Buy Now Pay Later
- Customers have made a lasting shift towards online shopping, mobile applications, contactless cards, biometric verification and payments, and so on.
And now, seven months into 2022, it is certain that this steady adoption of technology will continue to reinforce the importance of digital channels, tools, and devices in maintaining the connection worldwide and accelerate the need for consumer solutions that are touch-free, seamless and digital-first.
The evolving expectations of consumers in their contactless journey
The pandemic has driven significant changes in the way consumers shop, pay, and demand. More and more consumers in the Asia Pacific are moving towards digital means for their transaction needs. Enthusiasm for a broader range of payment technologies has also surged, as 94% of people say they will consider using at least one emerging payment method, such as QR codes, digital or mobile wallets, installment plans, cryptocurrencies, biometrics, and others in 2022, indicating all signs that digital payments will continue to grow.
Consumers haven’t just adopted new payment technologies, but are making deliberate shifts based on considerations around necessity, convenience, personal safety, and especially security.
- Concerns about safety and security stay top of mind, as 79% indicated they are willing to try new payment technologies if they perceived them to be safe, while 85% want to make sure the payment options offered by merchants are secured.
- In addition, consumers are showing increasing concerns regarding data privacy, especially now that they are able to own and manage their own data. As business is built on loyalty, and loyalty itself on trust, unless online privacy and security are guaranteed, customers might simply take their businesses elsewhere.
Not only are customers today considerably more digital-aware, but they are also more demanding in terms of their expectations for experiences.
Mastercard's global research shows a growing interest in rich and engaging experiences, either offline or online. After more than two years of social distancing and uncertainty, the pent-up desire to reach out and connect has been empowering people to seek out experiences that they have never tried before, and those that expand their horizons.
Whether that means getting in touch with a long-time passion in a new sense, or engaging with new places and cultures, grand scale or intimate, today, it is being able to explore new cultures, enhance knowledge and create meaningful connections that are top priorities.
In a sense, people have always valued experiences that connect them with their passions and each other, even before COVID-19. What has changed is perspective: Momentary entertainment is simply not enough. Consumers are seeking uplifting and inspiring moments that leave a transformative impact lasting for a lifetime.
New challenges for businesses in today’s contactless world
Considering how rapidly consumers are evolving, businesses are now under extreme pressure trying to adapt and respond to such transformation. The shift towards “digital-first” is surely something businesses need to acknowledge closely to reimagine customer journeys in the new normalcy.
As consumers come to expect seamlessness in their day-to-day activities, reducing the friction and hassle of cash payment should be one of the key focus areas for businesses to stay competitive in this new economic environment. Smart businesses today should view digital payment acceptance as a revenue growth driver.
The more options for digital payment a merchant can offer, the more points of interaction it has with customers, driving not only operational productivity but also leveraging customer experience. Businesses that can deliver these frictionless experiences are well-positioned to thrive in the experience economy.
Mastercard believes that the more connected the world becomes, the easier it should be to connect with what matters most. We are committed to creating “a world beyond cash”, in which no one is left behind. This vision continues to drive the company forward in its effort to solve the “getting paid” challenge.
Mastercard is working with banking partners to enable consumers to scan a QR Code and pay using a Mastercard card conveniently. In the meantime, small merchants may benefit from providing “tap and go” contactless payments with a card or mobile device via Soft POS solution. This helps merchants to widen their acceptance net, giving them the flexibility to accept payments in and out of stores, as well as providing a better consumer experience.
Supporting SME owners will continue to be a priority for Mastercard in the years ahead. Through the wide range of partnerships worldwide, it is making strong efforts to create an environment that empowers small businesses to flourish and increase their access to the digital economy. These include training curriculums that equip businesses with resources that guide them towards their digital transformation, help them tailor new payments strategy, engage with consumers and capture new revenue.
But it’s not just about digitizing. The utmost important lesson of the new age is to always stay close and be connected with consumers, understanding their needs and demands. Tuning into what it is that they need will help you identify their goals and pain points. Once you have succeeded in providing a pleasant experience, you’re likely to earn more than a sale; you’ve found yourself a loyal customer.
While its technological solutions enable fast, simple, accessible, and secured payments, Mastercard continues to leverage global expertise in consumer understanding to help unlock new opportunities and priceless experiences, so that consumers can connect with their passion points that businesses can provide.
Mastercard believes that these behavioral changes are just getting started, and it can stay hopeful of a positive prospect for the digital economy in Asia, as well as a more comprehensive transition toward digital means of payment for consumers.
For businesses to thrive in such post-pandemic circumstances, an experience-centric, digital-first strategy that responds in real-time to consumers’ needs, prioritizing privacy, clarity, and equality will be the next frontier in providing better customer experiences for today’s consumers.