Despite store closures and labor and supply chain shortages during the pandemic, grocery stores and restaurants raised the bar for customer expectations by offering increased online shopping options.
Retailers already entrenched in digital transformation added or augmented online ordering, curbside pickup, and delivery services. Those that didn’t have the digital capabilities teamed with third parties for ordering, payment, and delivery, making it convenient for customers to shop.
The pandemic has lessened, and customers are returning to in-store shopping. But they've become accustomed to those eCommerce conveniences and expect them to still be offered, no matter how they shop. So merely offering these services is no longer a competitive advantage. Now it's time for grocery stores and restaurants to elevate their payment options to ensure they are seamless and convenient.
Businesses are focusing on providing convenient payment options
One aspect that convenience restaurants and grocery stores are focusing on is providing a variety of payment options and making each process smooth. In a recent survey by Industry Dive and Cybersource, 55.6 percent of restaurant and grocery leaders said ensuring payment options were seamless and convenient was their biggest challenge.
Respondents said they offer a combination of payment methods, including:
- In-store cash: 83%
- In-store credit card: 73.9%
- Payment through a third party: 54.9%
- Digital wallets: 52.3%
- Online payment through website: 50.3%
- Payment through app: 45.8%
Nearly three in four leaders (74.6 percent) agreed that which payment methods were offered influenced customers' likelihood of purchase. Most respondents said the primary purpose of providing multiple ways to pay was to make it convenient (85.6 percent). But many also saw the additional benefits of speeding up transactions (65.4 percent), attracting different generations of customers (51.6 percent), and building loyalty when customers shop through their website or app (31.4 percent).1
Payment options do affect purchases
Even after customers have begun shopping with a business, they'll abandon their online cart if the retailer doesn't offer enough payment options.2 Customers want flexibility: They may want to use different payment plans depending on the purchase. For more expensive items, they may prefer credit, while they will use debit for others.3 In the same vein, they may want to use different payment methods for similar occasions, like a digital wallet to pay for lunch today and a debit card to pay for lunch tomorrow.
With safety still a concern, customers value having contactless payment options. Visa’s Back to Business global study reported that 41 percent of shoppers said they planned to shift to cashless within the next two years.4 Businesses that don’t provide cashless options may be more likely to lose customers.
The rise of mobile shoppers drives the need for payment options
From downloading QR codes to smartphone apps, more and more customers use their mobile devices to shop and pay, at home and on the go. It's not enough for them to pull up a restaurant menu on their phone. They want to order and pay, all within their device. While paying for groceries, they want to use the digital wallet on their phone to pay, so they don’t have to take their card out to swipe.
This flexibility in payment options is especially notable among younger shoppers. In a recent study, 78 percent of Millennials and 80 percent of Generation Z said they would continue to use cashless or contactless options in the future, compared with 57 percent of Baby Boomers and 71 percent of Generation X.5
Seamless payment processes are essential
In addition to wanting their preferred method to pay for a meal or groceries, customers also want the payment to be quick. When paying in person, they don't want to wait in line or search their wallet for the right payment card. When buying online on an app or website, they want the process to be integrated and simple, from ordering through payment. And naturally, secure payments are important too with nearly 38 percent of grocery and restaurant businesses confirming that maintaining payment security is a significant challenge.1
While many grocery stores and restaurants have made significant strides in winning and keeping customers, the challenge isn't over. The next step is to improve processes like payment technologies to give shoppers the flexibility, integration, security, and ease of use they demand.
How can you get ahead in the market for meals? Read our latest survey to find out more about the top restaurant and grocery payment challenges.
1 “How can you get ahead in the market for meals? Restaurant and grocery top challenges” Cybersource.com, 2022, https://www.cybersource.com/en-us/solutions/payment-acceptance/restaurant-and-grocery-payments.html.
2 “46 Cart Abandonment Rate Statistics – Cart and Checkout –.” Baymard Institute, baymard.com/lists/cart-abandonment-rate. Accessed 4 May 2022.
3 PaymentsJournal. “Consumers Prefer Credit Over Debit for These Types of Purchases:” PaymentsJournal, 19 July 2021, www.paymentsjournal.com/consumers-prefer-credit-over-debit-for-these-types-of-purchases.
4 “Visa Back to Business Global Study: 2022 Small Business Outlook.” Usa.Visa.Com, 2022, usa.visa.com/dam/VCOM/blogs/visa-back-to-business-study-2022-outlook-jan22.pdf.
5 “Digital Payment Power Play: Shifting with Your Customers.” Www.Thryv.Com, 2022, www.thryv.com/media/payments-survey.pdf.
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