Digital Payments Turn the Checkout Occasion Into a Scalable Advantage

If there was one key to success, winning businesses would double it and scale it.

However, success is anything but static, meaning that those singular keys need to continually fit into ever-evolving locks.

Nowhere is that more true than in payments.

“Every day I get a new one thing,” Jeff Pomeroy, SVP, head of omnicommerce at Carat from Fiserv, tells PYMNTS CEO Karen Webster. “But the core of the discussions we have with merchants about delivering an omnicommerce experience for their customers is about cost.”

That’s because it is no longer just about payments being a cost center; merchants want payments to be a value provider that helps deliver a seamless and comprehensive customer experience.

But they know no matter what solution they integrate, they are going to pay for it.

“They want all the bells and whistles, the alternative payment types, foreign currency settlement in an elegant way, simple bifurcated settlement to multiple parties, things of that nature, but [merchants] also want to make sure that payments is not what is understood as a cost center,” Pomeroy explained.

That’s why the need to introduce value into the ecosystem is crucial for any service provider looking to build growth beyond an established cost foundation.

“Almost every conversation that ensues, whether it’s the beginning of the relationship or the consistent, gradual maturity of that relationship, is always [about how] I am going to introduce some new value to them,” Pomeroy said.

Crucial to that introduction of value is reframing the conversation around viewing payments as a cost of doing business to recognizing them as a strategic product in their own right.

Accretive Value as a Go-Forward Integration Strategy

Particularly as the world increasingly becomes digitized and engagements are reshaped around emergent behavioral norms and expectations, merchants are aiming to make everything they offer accessible to customers.

“There is a journey we go on with every one of the merchants. I always like to describe it as a big, Cheesecake Factory menu,” said Pomeroy, explaining that everything is available, but it all comes with calories and the menu is a bit overwhelming.

As for the recommended Cheesecake Factory order?

“I think it’s always about the customer. I think if I’m in a merchant’s shoes, I’m always thinking about how to engage the customer, how to get them to come back, how to increase the size of the basket, and you do that through a number of different ways,” Pomeroy said.

“It is important to actually get around to a foundational understanding of where each cost is going to go toward creating value and experiences,” he added.

And because customers don’t live in a world defined by buzzwords and jargon — like “omnichannel,” “multichannel,” and more third-party provider tentpoles — they simply want to interact with merchants and brands in a way that’s convenient for them, it is important for merchants to seek innovative ways to address costs, create engaging experiences, and stay ahead of the competition.

But with the modern advances inherent to today’s future-fit ecosystem, by tailoring solutions, considering channels as points along the customer journey and leveraging data, businesses can unlock the full potential of their offerings in the ever-expanding digital landscape.

Connecting all Sides of the House Provides More Value

In today’s fast-paced world, organizations are constantly seeking ways to improve their customer experience and reduce operational overhead. The availability of data as a service and the ability to analyze customer data is evolving the world of merchant solutions and customer experiences, helping organizations move the needle in terms of authorization uplift and basket size.

“Merchants are really paying attention to what other merchants are doing,” Pomeroy said. “The big merchants are out there leading the charge with [digital payments] … and they have created their own ecosystem where they’re storing personalized rewards and rebates on certain customers.”

That’s because one of the biggest opportunities embedded within today’s data-rich environment is creating bespoke checkout experiences through custom journeys and omnichannel experiences.

Winning merchants are recognizing the need to “reinvent the checkout experience” to meet the expectations of today’s customers, Pomeroy said.

But is there a role for future-fit innovations like generative artificial intelligence (AI) to play?

It depends on where you integrate it.

“I don’t think it can assist in payments,” Pomeroy said, “but I do think it helps from a customer service perspective and the automation of certain repetitive tasks on behalf of the merchant …  and as far as repetitive tasks, if you think about the banking side and statement generation, some of those can be updated in a meaningful way and reduce a lot of operational overhead.”

“Our job is to make that one-second [checkout occasion] of a customer’s life the most friction-free, easy scenario,” he said. “We focus on those little seconds, but over a magnitude of millions of transactions a day.”