The evolving nature of digital payments in the Vending industry
01 / 11 / 2021
Vending merchants need to be innovative to keep pace in their industry, which is evolving fast to accommodate for a greater range of customer services. Payment methods are also increasingly cashless and so the necessary infrastructure must be adopted.
Vending customers have become used to higher-spec services offered to them since the start of the pandemic; any vending operator not continuing to maintain – or preferably augment – their services still further, could face losing custom to their opposition.
Cashless is king
In 2020, two thirds of vending transactions were cashless payments, according to the AVA, and the move towards enabling contactless payments with everything from mobile phones to wearable technology such as watches is accelerating. For example, the recent Capgemini World Payments Report 2021 highlighted that 45% of customers are now using mobile wallets to make payments, up from 23% in 2020.
The growth in this area is expected to continue with Capgemini estimating that global B2B non-cash transactions are expected to reach almost 200 billion transactions by 2025, up from 121.5 billion in 2020.
No time for change
So, the traditional vending experience of finding change or notes to put into a machine to get the goods or service you need is starting to look old hat. Rather, people are increasingly looking to alternative payment methods that are more streamlined and convenient, which should prompt forward-looking vendors to adapt their technology to accommodate them.
It’s about more than just money
However, the changes required to compete in the post-pandemic landscape are more expansive than just changing the way people can pay for your products and services. For example, in Paris we are already seeing the repurposing of old-style newsstands to become vending kiosks that provide everything from traditional newspapers through to smartphone charging points, online ticket sales and digital screens. While some are unsure about the changes to the iconic newsstands, the benefits to the vendors are significant.
This €52.4m (US$56m) project uses recycled glass and aluminium so even nods to the importance of making changes that not only enhance the customer and vendor experience, but also help to save the planet.
A similar revamp of newsstands is happening in the US. Plans had already been put in place for a revamp of metro station newsstands to become vending machine kiosks in New York as far back as February 2019. Chicago has also adopted vending services with everything from sandwiches, soups and snacks to phone charger dispensers and photo booths available to travellers.
Given the increasing interest in selling products in this way, expanding the ability to offer a variety of payment options is becoming ever more important.
Choosing the right partners
However, there are often several partners involved in the successful roll-out of vending services, as you may have different suppliers offering products for sale through your machines and creating a seamless integration between suppliers and payment service providers can maximise returns.
There has been a 600% growth in micro markets in the past three years, with major uplifts in the past 18 months as people and companies move away from staff canteens, for example, to a vending option. But to compete, the quality of food on offer must be up to standard and cater for vegan and vegetarian options and healthy snacks.
Quality leads the way
Vendors also need to offer more information about what is being sold in the machine too. People are more conscious than ever about what they buy and eat and where their food comes from. So, the more information there is about what is on offer, the more customer loyalty you are likely to create.
Yet all this needs to be done in a smarter way to increase information and choice without increasing the complexity of use to the consumer. This is where a wider range of payment options comes to the fore, as simplicity in purchasing is now an essential part of the vending experience. But you cannot do away with cash altogether, as for some this is still the preferred payment option.
There is no question that cashless transactions are on the rise and vending operators need to pay attention not just to the need to expand payment options, but also to ensure any other partners they work with are providing quality goods or services. If they do not, then customers will quickly find alternative vendors who do.
Find out more about Worldline’s Vending solution here: https://business.worldline.com/en/wl-vending-suite
