As customers continue purchasing food online from grocery stores and restaurants, their expectations for what a good buying experience is have increased. In fact, the definition of a good payment experience has grown– it must be fast and frictionless, but also secure.
Maintaining this balance of ease and security is challenging for grocery stores and restaurants. A recent survey by Industry Dive and Cybersource, a worldwide leader in digital payments, offers a clear view of issues restaurant and grocery leaders face as they try to meet customers' evolving expectations.
In the survey, 55.6% of respondents in both industries said that giving customers a unified, seamless, frictionless experience regardless of payment method was their top payment challenge.
The study revealed additional highlights:
- Restaurants and grocery stores are offering more ways to pay. Most (75%) of restaurants and grocery stores offer in-store cash and in-store credit cards as payment options. But many also allow customers to pay through third parties (55%), digital wallets (52%), food service provider websites (50%) and retailer apps (46%). Nearly 3 in 4 respondents (74%) believe the payment method influences the customers’ likelihood to purchase.
- With more payment options comes increased fraud prevention strategies. But even as these strategies are implemented, they still must appear seamless for the customers when they are paying. Nearly 30% of respondents said one of the top fraud challenges was the time it takes between a customer inputting card information for an online transaction and when the transaction is approved.
- Grocers and restaurateurs are concerned with fraud, with more concern in maintaining payment security (37%) than protecting loyalty account takeovers (11%).
- More than half (54.2%) indicated they had seen fraud issues within their loyalty program, with member policy abuse, card testing and loyalty account takeovers heading the list. Those affected said loyalty fraud impacted customer loyalty (27.5%), business operations (19.6%) and finances (19%).
In looking towards the future, payment options will continue to evolve to ensure that the payment methods offered by grocers and restaurateurs keep customers secure, while still remaining frictionless.
In February 2022, Industry Dive surveyed 153 leaders in the restaurant and grocery industries to find out how businesses were optimizing grocery and restaurant payment and loyalty programs to build customer loyalty. Most respondents were managers or senior managers (48.4%), followed by individual contributors (19.6%), C-suite members (13.1%) and director or senior director (9.8%).
Nearly half (41.2%) made decisions about payment and fraud/risk management. Others were influencers (24.8%), implementers (18.3%) and evaluators (15.7%). Respondents from the restaurant industry heavily outweighed grocers (85.6% vs. 14.4%), but their challenges were similar.
Although the survey respondents represent a small sample of industry leaders, the results are indicative of universal strategic issues that leaders in both industries face.
Complete survey results are available here.