Discover Looks to Customer Shifts to Define Innovation

With technology as the driving force, consumers are demanding more than transactions from their payment experiences; they seek payment methods that seamlessly integrate into their shopping journeys, whether those journeys are taking place online or offline, or a combination of the two.

This means the quest for a seamless and frictionless payment experience has become paramount.

“Today’s consumers are looking for fast and convenient and personalized experiences that suit how they want to shop and where they want to shop,” Claudia Schaefer, vice president, strategic client management, Discover® Global Network, told PYMNTS. “The combination of online shopping with in-store connectivity has become even more important.”

The ongoing shift in consumer behavior — and payment preferences — has propelled the adoption of various payment methodologies, from contactless payments to mobile wallets and even in-app transactions. What once seemed like futuristic conveniences are now crucial components of everyday commerce, reshaping the way consumers interact with merchants and evolving merchants’ payment offerings needs, she said.

“The more opportunities merchants have to incorporate those seamless, secure payment experiences, the more they will ensure that their consumers continue to engage with them, continue to buy from them, because they’re offering a simple and easy solution to enable the experiences the consumer wants,” Schaefer said.

These trends represent not just a temporary shift but a behavioral groundswell that is expected to continue growing as consumers and businesses recognize the benefits of new and enriched payment experiences.

Enriching the Payments Experience: Navigating New Frontiers

Digital wallets, once heralded as the advance guard of a cashless society, have now transcended their initial purpose to become indispensable tools for merchants seeking to enhance the payment experience across more channels, she said.

The convenience of having all payment options in one place, coupled with added security features like encryption and biometrics, has made digital wallets increasingly popular — and, for merchants, impossible to ignore, she said.

But to deftly navigate today’s rapid technological advancements and shifting consumer preferences, Shaefer underscored the need for, and significance of, collaboration in staying abreast of emerging trends, particularly in realms like social commerce and the metaverse.

As platforms like TikTok and Meta usher in new paradigms of commerce, partnerships become indispensable for merchants and payment providers alike to deliver secure, user-centric payment experiences, she said.

“From a payments and a merchant perspective, sometimes you have to meet the consumer where they want to be,” Schaefer said. “And sometimes that may feel a little strange and uncharted in terms of how we engage, but having partners who know their own platforms, who can help us understand how we deliver the customer experience that we want our consumers to have, will help us to ensure that we prepare ourselves for what the roadmap may look like in terms of integrations.”

Empowering Merchants Through Payments Innovation

The future of payments is not just about technological advancements, but also about creating a more personalized and inclusive experience.

Against the backdrop of this dynamic environment, the key lies in anticipating consumer needs, fostering collaboration and using technology to craft unparalleled payment experiences, she said.

“Overall, the theme is that consumers want less friction in their lives,” Schaefer said. “The more merchants can blend the various channels together for the consumer and create better engagement, the more likely the consumer will complete their purchase and continue to come back.”

Too much friction can often lead to consumers abandoning purchases altogether, she added.

“The more merchants can think about how they can integrate into some of these newer platforms in a way that doesn’t disrupt the consumer’s experience in the moment and enables them to meet the consumer where they are — and where they’re ready to make a purchase — I think the more we can create a better experience overall,” she said.

In a world where convenience reigns supreme and friction is the enemy, merchants and payment providers must continually adapt, evolve and embrace emerging technologies to meet the ever-changing needs of consumers.

“The future will look quite different, and many of the payment experiences that exist today will continue, but they may be used in different ways,” Schaefer said.