Banks and retailers can work together to create a fully contextual eCommerce experience, with payments as the common thread. As NCR’s Doug Brown, senior vice president and general manager of NCR digital banking, and Marc Haberkorn, corporate vice president of product management, told Karen Webster, banks want to help merchants in the community, but up until now, technology has been a limiting factor.
In the digital shift, merchants have to manage their financial health by meeting consumers where they want to be, whether that’s curbside, in-store or at home (which, of course, means getting items delivered to the doorstep). For consumers, managing their financial health means juggling the minutiae of everyday spend and receipts. The proverbial shoebox approach, laden with crumpled paper slips detailing who bought what and when, simply won’t cut it anymore – nor is it necessary in the digital age.
The common thread, or the connective tissue, is payments. It was the topic of a recent conversation between PYMNTS CEO Karen Webster and NCR’s Doug Brown, senior vice president and general manager of digital banking, and Marc Haberkorn, corporate vice president of product management. They said that banks and retailers can work together to create a fully contextual eCommerce experience. On top of that, payments can serve as the connective tissue that binds enterprises, financial institutions (FIs) and customers together into a new ecosystem. In other words, an app-like experience takes shape.
But Brown and Haberkorn were quick to note that for FIs and retailers, gunning for a super-app may not be the optimal strategy.
“We don’t ascribe to the theory that there is one app to rule them all,” said Brown. “That is just not going to happen. But banking and services need to be connected. We want to bring these ecosystems together — banking and payments and retail.”
The Catch-22 Of The Forced Digital Shift
The urgency is there, wrought by the pandemic. Drilling down into the continued pressures faced by retailers across all verticals, said Haberkorn, as COVID-19 hit early last year, merchants faced a version of “Sophie’s choice” as they moved to embrace commerce platforms and aggregators, but lost some autonomy in the process.
“They had to either not quickly participate in the shift to eCommerce and lose a portion of their revenues, or they participated quickly but conceded or forfeited control of their most prized resources: their brand, consumer engagement and potentially even margin,” he said of these retailers. He noted that eCommerce might be marked by the “come to me” channels (delivery or curbside) or the “you go to it” options (in-store purchases) — but as the lines are blurring and converging, merchants need to rethink fulfillment and re-invent their ecosystems.
Building Consumer Trust Through Strategic Acquisitions
To help forge those new ecosystems, NCR said last month that it would acquire the grocery eCommerce brand Freshop. Through the deal, NCR is adding eCommerce to its retail point of sale (POS) platform, giving grocers the ability to quickly add “buy online, pickup in-store” (BOPIS) capabilities, where demand for this type of eCommerce is growing by 25 percent annually. Noted Haberkorn, the acquisition “allows the best of both worlds and aligns our interests with our grocer customers, such that they maintain the relationship with their end consumers. Consumer trust actually increases as well. So it’s a win-win.”
Freshop will become a key component of NCR’s Next-Generation Retail Store Architecture, which gives retailers the ability to simplify store operations and introduce future innovations without expensive integrations. It’s part of NCR’s initiative to help retailers manage operations and inventory in a world where the ratio of in-store to digital purchases has flipped during the past year. For example, NCR Counterpoint offers an inventory management solution that includes a POS system designed to handle reporting, loss prevention and variable pricing.
Through offerings like NCR Retail Online and NCR R10, a unified commerce platform, smaller retailers and chain store operations can build their own omnichannel and checkout experiences (including online stores) and monitor sales to ensure that inventory needs are met. That real-time information flow and optimal business management can be especially useful for convenience stores, where service mixes are changing. For example, consumers are not commuting to work or traveling as much anymore, and demand for fuel has suffered as a result. That means convenience stores must pivot and replace the margins lost on fuel, with sales coming not at the pump but from the convenience store itself. Convenience stores thus need to manage their relatively small store footprints and SKUs judiciously.
Enhancing The In-Store Experience
As retailers of all stripes have ATMs and POS devices on-premise, said Haberkorn, there are opportunities to enrich the customer experience in-store. Last November, NCR debuted its ATM-as-a-Service initiative, which runs an FI’s entire ATM channel, including installation, maintenance, security, compliance, cash management and more. The company believes frictionless ATM interactions result in better customer experiences.
Stated Haberkorn: “We can tie some of the individual’s experiences, from a loyalty perspective, to the ATM so that we can give them offers.” Data suggests that 80 percent of the time, customers take cash out at the ATM and then they spend some of that money in the store.
Digital Receipts For More Intuitive Banking
NCR has also innovated on the consumer side of the ledger, providing a connection point between banks, retailers and their customers. To that end, NCR has debuted Digital Receipts, a feature that helps banks see SKU-level information about transactions and identify meaningful spend patterns. For consumers, digital receipts can eliminate the shoebox syndrome, creating a portal that lets consumers look up previous transactions and receive targeted marketing promotions.
Helping consumers manage the abstraction of digital is “personalizing the relationship from the bank and credit union side,” said Brown, where payments brings the separate pillars of retail and banking together — and where banks can use personalized retail data to create deals and offers for consumers.
Because of the trust consumers have in banking, said Brown, “that’s where they’ll go to get the overall guidance, the coaching, the wellness — but then a marketing team is going to guide them to the best deals, including promotions and a fast experience, inclusive of payments.”
The Contextual Trend Extends To Banking
Against a larger backdrop, banking needs to be as contextual as any other aspect of commerce and retail — no matter the channel in which the banking itself is occurring. There is still a role for physical banking, Brown and Haberkorn told Webster, but it will be modernized. And that means the in-person experience must be perfect. To that end, on Feb. 8 of this year, NCR acquired Terafina, which offers the technology for customer account opening and onboarding across digital, branch and call center channels.
As Brown recounted, the perfect contextual experience is one where the bank is aware of a customer’s arrival as soon as they drive into the parking lot, where an appointment has been scheduled in advance, and the appropriate staffers are on hand to address the consumer’s concerns. With advanced technologies, he said, “the bank can acknowledge the customer by name as they come in, because the proximity detection has relayed that awareness to the branch manager and the bank can do what needs to be done. Then we’re going to survey the customer on the way out to ask, ‘how was your visit?’”
As Brown stated, “what was ‘digital-first’ is now becoming ‘digital in the branch.’”
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