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SMS Payments: Complete Guide To Text To Pay

SMS payments are becoming one of the growing alternatives for making payments in business transactions. As a result, small and medium-scale businesses must consider this viable option. This article will discuss everything needed to know about SME payments and how businesses can leverage them in their payment operations.

What Are SMS Payments?

SMS is the abbreviation for Short Messaging Service. SMS payment means making payments through text messages. While few businesses already use this payment method, many others are new. An SMS payment is when a customer sends a payment via text. It is also when the business sends a purchase invoice to the customer by text.

In SMS payments, a link is attached to the message. This link redirects to a payment form where the transaction details are entered and confirmed. The process is secure and relatively easy, making purchases convenient for both buyers and sellers. It is a contactless payment procedure. A business should know how it works if it is interested in an SMS payment system.

How SMS Payments Work

SMS payments are pretty easy and fast compared to other payment systems. Although SMS payment service providers operate differently, there are some basic processes they all generally possess. When it comes to how it works, below is what every business should expect from a typical SMS payment process:

The business must enable the SMS payment option with an SMS payment service provider to start an SMS payment system. These service providers integrate messaging with payment-compliant features.
The business texts a shortcode number to the customer’s phone number. The code contains a link that shows the purchase invoice. The customer can initiate the sale procedure by sending a shortcode text containing the link.
The link redirects to a secured payment system where the customer can fill in the required details and finalize the sale procedure.
The customer approves the payment. They can also save their debit card information to ease subsequent payments.
The customer may receive a unique code to complete the procedure, depending on the SMS payment service provider.

Some SMS payment service providers operate credit card systems. So, if the business is already working with a credit card facilitator, it can also inquire if an SMS payment system is available. This makes the messaging-payment integration faster. A purely SMS payment service company can also work.

Benefits Of SMS Payment Systems

SMS payments offer some benefits that may not be available in other payment systems. These are why some big businesses now make the payment alternative available to their customers. Below are some of the advantages SMS payments have over other systems:

All Devices Are SMS-Enabled: Virtually every phone has access to a mobile text messaging feature. This means texts are easily received and read quickly.
Quick Payment: Since text messages are scanned, payments are made quickly. So, generally, SMS payments make payment delivery more efficient and time-saving. This is a very good leverage if the business has a lot of customers in the payment queue.
Contactless Payment: Contactless buying is when the buyer orders online and receives the package at their doorstep. It only makes sense that there is contactless payment. SMS payments offer contactless payment, which became more popular during the coronavirus pandemic.
Invoices Are Read Quickly: Customers can read the invoice quickly when received via SMS. This also means payment can be made immediately. It is fast and convenient for both the seller and the buyer.
Limits Fraud: SMS payments are a way to curb fraudulent transactions and fake credit card payments. It also prevents counterfeit cash payment since funds are sends virtually through a secured channel.
Multiple Payment Types: With SMS payments, there are several payment types depending on what the business requires or what the customer wants. For instance, there are credit and debit card options, ACH payments, and digital wallet options (PayPal, Google Pay).
Convenient Initiation: SMS payments can be initiated from anywhere. There is no need for any hardware purchasing instrument like POS.

What To Consider Before Choosing An SMS Payment System

To be safe when choosing an SMS payment system for any business, below are some considerations that should be made:

The SMS payment service provider must be PCI compliant and have high data security.
The operation of the SMS interface and all other functions must be easy to navigate.
Backup systems to ensure data are saved, and transactions are recorded.
The provider should provide a unique dedicated number for the business, which can be used by the business and its customers only.
Check for a provider that boosts high-quality connections to ensure messaging is trouble-free.
Compare the subscription fees of the providers.

Popular Text-To-Pay Services For Businesses

There are a few SMS payment service providers. However, it is best to get started with a provider that offers what fits your business. Service providers are unique when it comes to functionality and fees so it’s best to go for the one that works well with your business operation. Below are some popular SMS services for businesses.

Paysley: This service integrates messaging payment through text or email. It also allows POS to scan a QR code linked to the payment. Text and email fees are different and are charged per message.
PaymentSavvy: This service uses multiple payment options all in one SMS payment package. Customers can also store their payment information here for future use.
Relay: Formerly Rhombus, this service uses Stripe to initiate payments through debit and credit cards. The service also attaches marketing and customer service features to its functionality. Relay fees are charged monthly, and a specific number of “tickets” is given.
Everyware: This service pairs with Visa’s CyberSource to provide credit card functions with SMS payments. It is a new, growing system SMBs are using.
Podium Payments: PP combines marketing features, automated messaging, debit/credit cards processing, and customer service system. The service operates a robust system that large businesses can work with.

Is SMS Payment Option Good For Your Business?

SMS payments are a suitable payment option for all businesses. They are fast, reliable, and secure. Every business should find an SMS payment that works with its processes. An effective SMS payment service helps the business connect with its customers and makes payment easy and convenient.

Pros and Cons of SMS Payments

Pros of SMS Payment

Convenience: SMS payments offer unparalleled convenience, allowing customers to transact anytime and anywhere using their mobile phones. This ease of use can significantly enhance the customer experience.

Wide Accessibility: Since SMS payments only require a mobile phone and not necessarily a smartphone or internet connection, they are accessible to a broader range of customers, including those in areas with limited internet service.

Speed: Transactions via SMS are typically fast, with payments being processed almost instantly. This speed ensures that services or products can be accessed quickly, improving business and consumer efficiency.

Simplified Transactions: SMS payments streamline the payment process, eliminating the need for physical cards, cash, or an app. This simplification can reduce barriers to purchasing, potentially increasing sales.

Security: Many SMS payment systems incorporate security measures such as encryption and one-time passwords, helping to protect users’ financial information from unauthorized access.

Cons of SMS Payment

Transaction Limits: SMS payments often have lower transaction limits than other payment forms, which might not be suitable for larger purchases.

Dependence on Mobile Network: The reliability of SMS payments is contingent on the mobile network’s stability. Network issues can delay or disrupt transactions, impacting the payment process.

Security Concerns: SMS-based transactions can still be vulnerable to fraud and phishing attacks despite security measures. Users may receive fraudulent messages attempting to steal personal information.

Fees: Some SMS payment services charge fees to the sender or receiver, which can deter users from utilizing these services, especially for smaller transactions.

Limited Acceptance: Not all businesses accept SMS payments, which can limit where customers can use this payment method. The acceptance range is growing but still not as widespread as traditional credit or debit cards.

Conclusion

In conclusion, SMS payments are a convenient and accessible payment solution. They provide quick transactions with the benefits of ease, speed, security, and broader accessibility. There are some limits, though, like security concerns, transaction limits, and variable fees, which must be handled carefully. As digital payment technology continues to evolve, SMS payments represent a vital component, offering a unique blend of accessibility and convenience for today’s mobile-centric world.

Frequently Asked Questions

EU Votes Against Ban on Cryptocurrency Mining

The ECON or Committee on Economic and Monetary Affairs by the European Parliament has spent several days struggling with the proposed MiCA (Markets in Crypto Assets Regulation) to coordinate the approach of the EU (European Union) to cryptocurrency.

Recently, ECON went ahead with rejecting different versions of the legislative package containing what has been referred to as the ‘de facto’ ban on cryptocurrency mining. It is typically utilized by leading cryptocurrencies like Ethereum and Bitcoin.

An advisor who had been involved in the negotiation revealed that there had been two alternative compromises that had been linked to the weathered-down version of the ban on unacceptable and unsustainable protocols. The advisor added that the proposal that had been responsible for the existing mobilization would no longer be a part of the MiCA text. The advisor referred to the overall opposition from the cryptocurrency industry to all prospective bans on proof-of-work blockchains.

The vote towards rejecting language on the existing mining ban had been succeeded by the count of around 32-33, with 6 individuals abstaining.

What is POW or Proof-of-Work?

POW or Proof-of-Work is a dedicated system of rewarding the miners of cryptocurrency. In the existing system, every miner on the network is rewarded for lending their computer power to execute some transaction. POW is utilized by Bitcoin. While Ethereum continues moving to some different proof-of-stake mechanisms, POW continues to serve as the primary governing methodology on the given blockchain.

The POW system has been significantly reported to be highly energy-intensive because cryptocurrency miners are capable of using as much power as a data center. One study estimates that bitcoin mining will consume around 133.65 TWh of power annually.

The issue related to significant energy consumption turns out to be a major one for most countries, including China. China had recently banned crypto mining within the country. As per the reports of The Cambridge Index, bitcoin mining will end up ranking 27^th in the entire world concerning electricity consumption if it serves to be a nation in itself.

On the other hand, a relatively newer form of cryptocurrency mining – referred to as POS or Proof-of-Stake, is known to be more energy-efficient. According to The Ethereum Foundation, it is estimated that POS will help reduce the overall energy consumption of the Ethereum Foundation by around 99.5 percent when the system completely shifts to the dedicated POS system.

Ban on Cryptocurrency Mining – Power Play

It is highly unlikely for Bitcoin to follow suit because Ethereum is famous and has an influential impact on pushing the development of cryptocurrency mining. Also, bitcoin does not have any pressing need in comparison to other cryptocurrencies.

Currently, around 15,000 node operators of Bitcoin are widespread across the globe, but it still hasn’t reached the coordination levels of Ethereum.

Crypto Mining and MiCA

The proposed cryptocurrency regulatory framework by the European Union has generated ample controversy for quite a long time.

As per the original arrangements, the legislative package was expected to include a dedicated section that called upon the respective proof-of-work blockchains to meet minimum standards for environmental sustainability. They were expected to be mined, used, or exchanged within the borders of the European Union.

However, some lawmakers of the European Union were not content with the decision. On February 28th, the vote got delayed amidst the fears that the package might have been misinterpreted in the form of a de facto ban on Bitcoin, according to Stefan Berger – the Chairman of the Economics Committee of the European Parliament.

Recently, the European Union went ahead with rejecting a deeper version of the original text observed by Decrypt and listed by the European Green Party. The reviewed proposal went ahead with stating that cryptocurrency assets should be subject to ensuring minimum standards for environmental sustainability. It will be by the respective consensus mechanism that is utilized for the validation of transactions, before the issue, admission, or offering to trade within the European Union.

The Environment and Proof of Work Mining

Proof-of-work cryptocurrency mining is utilized by some of the largest cryptocurrencies including Ethereum and Bitcoin. The concept has generated ample scrutiny from major environmentalists from all corners of the globe.

According to Cambridge University, bitcoin is known to consume more units of electricity every year than most of the major countries in the world. Based on the source of energy being used, it could leave a significant carbon footprint.

Previous research by a team at Decrypt revealed that the greenhouse gas emissions due to Bitcoin mining are equivalent to 60 billion pounds of coal that gets burned. They continued hoping that something would come up in the legislation that would end up opening the debate at least. The group also aimed to extend its discussion on specific measures that would be centered on addressing the overall environmental impact of the respective crypto assets.

Alex De Vries, Founder of Digiconomist, revealed in a statement that the vote of an individual might not be the last time everyone will watch authorities contemplate how to deal with the problem. The reality is that the cryptocurrency or bitcoin industry will have no subsequent plans to do anything about the issue, so these numbers will not get better on their own.

What is the Future?

Until now, ECON has only presented votes for approving the language of the legislative package. It has not voted on whether or not approval should be given to MiCA.

Whatever might be the case, even when MiCA goes through ECON, it will have to be agreed upon when discussing subsequent debates that involve the European Commission and the European Council.

BNPL (Buy Now Pay Later) Firm Announces Earnings and Boosts Outlook

The global business of BNPL or Buy Now Pay Later had laid out its report to announce its earnings and outlook. According to the latest survey of BNPL through Q4 2021, it is estimated that the global BNPL industry will be growing by around 60.7 percent on an annual basis and is expected to reach $409901 million by the end of 2022.

The overall story of medium to high-scale and long-term growth of the global BNPL industry is quite strong and reliable. The adoption of BNPL payment schemes is estimated to grow at a rapid rate and is anticipated to record a CAGR of 32.7 percent during the period of 2022 to 2028. The gross merchandise value of the global BNPL industry in the nation is expected to rise from $255147.1 million in 2021 and reach around $2240349.1 million by 2028.

BNPL Market in the Asia-Pacific Region

The market of the BNPL industry in the Asia-Pacific region has recently recorded major growth during the past 4-6 quarters. Asia takes pride in being home to some of the leading BNPL companies in the world, with nations like China, Australia, Indonesia, Malaysia, and Singapore having estimated stronger demands for BNPL payment schemes during the time frame.

It is believed that a large-scale younger population is significantly driving the overall demand as well as market growth opportunities. The experts believe that with the ever-increasing demands for BNPL payments and transactions, the region of Asia-Pacific will be attracting more investment – both in the short-term and long-term perspective.

In Europe, the concept of BNPL payments is becoming increasingly popular amongst consumers because of the overall rise in consumer preferences towards deferred payment for online shopping experiences. Consumers prefer BNPL transactions due to the widespread convenience and affordability the concept has to offer. Consumer credit, after pay, or BNPL transactions allow consumers to pay money only once they have met their specific expectations. Some of the major players involved in the BNPL industry across the globe are Splitit, PayPal Credit, and Klarna.

BNPL Market in the Middle East and Africa

The adoption of the BNPL products and services has been on the significant rise in the Middle East and Africa regions, and has recorded a rapid rise in the period of last 4-8 quarters. A number of global BNPL giants and startups continue offering a wide range of innovative products along with deferred payment services for end customers in the area.

At the same time, the adoption of BNPL payment systems from merchants’ end is also on the rise. This is because an increasing number of consumers are demanding the ease of BNPL payments – both for online purchases and in-store shopping experiences.

BNPL Market in the Latin American Region

The Latin American region has also been successful in recording substantial growth within the BNPL market in the last 4-8 quarters. The region has experienced significant growth amongst both consumers and merchants. Experts believe that the ongoing trend is going to thrive in terms of both short-term and long-term perspectives, as consumers from the end of an informal economy perceive the revolutionary payment mechanism to receive ample credit.

BNPL Market in the United States of America

In the period of the previous 4-8 quarters, the overall popularity of BNPL transactions has increased significantly in the United States as well. The ever-growing need for dividing the costs of purchases, and the advent of the global pandemic has resulted in the widespread adoption of the BNPL method or payment trend. Some of the leading providers of BNPL services in the country are PayPal, Klarna, Affirm, and Afterpay. The rapid growth in volumes of the respective BNPL payment providers has also been driven in specific parts by the sudden increase in online shopping due to the pandemic.

Leading BNPL giants or players continue redesigning the respective products and services to improve the market share in the United States. As competition in the BNPL market in the United States continues to grow, service providers look forward to innovating this service to ensure improved flexibility and more traction from the end customer.

Some of the instances to consider in the context are:

In November 2021, Afterpay – a leading BNPL service provider, made the announcement that the organization will be introducing installment payment services for subscriptions across the United States. The organization further announced that users could use BNPL payments on gym memberships, entertainment subscriptions, and other types of online services. The organization is also expected to extend its BNPL services in Australia and the United States by the end of 2022.
An increasing number of initial merchants that might offer this type of service in the United States are Savage X Fenty, IPSY, BoxyCharm, and Fabletics. In addition to ensuring payments for subscriptions, the organization aims at offering BNPL payment services for other pre-ordered items as well. This way, the consumer is capable of paying in four installments once the product has been shipped.

As of November 2021, Afterpay has been successful in partnering with around 100,000 retailers- boasting the presence of over 10.5 million users on the platform in the regions of North America. It is one of the largest regions with respect to underlying sales.

Affirm – another leading BNPL service provider, reported a major boost in the overall business performance outlook for 3^rd quarter and entire 2022 from the original version. The company revealed that its fiscal quarterly financial performance has exceeded overall expectations. The company featured stronger GMV (Gross Merchandise Volume) with the help of enterprise partnerships. It is estimated to be a minimum of $3.71 billion for the ongoing quarter.

BNPL (Buy Now Pay Later) Trends for 2022

Buy Now Pay Later, or BNPL, has gone from a niche payment method to one of the leading trends in the payment industry in just the past few years. One study estimates that BNPL transaction volume will reach the $680 billion mark by 2025, and it is expected to serve as the mainstream mode of payment in future as well.

The overall need to balance oversight with consumer safety, along with impending regulation will give way to the rise of all-new innovations and business models. With competition heating up and new players entering the market, banks will effectively get into the relevant action to ensure the protection of the entire market share.

Top Trends Revolutionizing the BNPL Industry

Although the concept of installment payments is not new, the concept of BNPL brings the payment method into the digital age by allowing retailers to offer installment payments for any service or product – both in-store and online.

The rapid surge in BNPL transactions has been attributed to a number of factors – from omnichannel application of the technology to its flexibility, increasing merchant adoption, and loyal young customers. Some of the latest trends to observe in the BNPL industry are:

BNPL Expanding Across Industries

There are some key differentiators between different BNPL services. This is because the model is typically based on two core aspects: ability to divide payments in equal proportions and the ability to ensure later payments. This makes the overall process easy to replicate across multiple industries. As such, BNPL companies tend to differentiate themselves by launching within new markets – whether it is fintech, travel, B2B trading, healthcare, cryptocurrency, blockchain, or insurance – and all of these industries are hopping on the BNPL bandwagon.

For example, Klarna – a leading Swedish fintech company – recently partnered with Expedia to allow travel-related customers to “travel now, pay later”. The company also acquired Inspirorock – an online travel and trip planner that makes use of AI to recommend trips to travelers based on their specific interests. Another financial company called Affirm has partnered with American Airlines to create a “fly now, pay later” concept.

BNPL technology continues to expand amongst other industries as well, like Ascend – who aims to expand BNPL commercial service with the help of payment APIs for automating end-to-end insurance related payments. Another is Walnut, a fintech startup that has worked with healthcare providers in the USA to allow patients to utilize BNPL for healthcare costs.

Banks Entering the BNPL Market

Banks are observing how some consumer loan and credit card revenues are taken over by BNPL service providers, making it the perfect time for them to enter the BNPL market. As banking is a highly regulated industry, not only are banks expected to be experienced in credit underwriting and regulatory compliance, but they should also have access to the customer base and data necessary in order to compete in the existing market.

Banks are also well-positioned to personalize BNPL offers for customers depending on their risk profile with the help of financial data. Some banks such as Revolut, Monzo, Santander, and Barclays have already paved the way for entering the BNPL market.

For example, Santander launched Zinia – its own BNPL in Germany that allows shoppers to divide their purchases into interest-free monthly payments. Monzo has also launched its own product called Flex, which allows up to 3 interest-free installments

As regulations continue evolving, one can observe a number of banks entering the BNPL market, whether it be through acquisitions, partnerships, or the development of in-house solutions. Whatever might be the marketing strategy of the banks, they will have a better chance of success if they are capable of integrating across the complete purchase journey of consumers and the integrations that they adopt will continue contributing to engagement and scale. At the same time, it will also deliver improved visibility into the credit behavior of consumers.

Open Banking Transforming Affordable Checks and Credit Risks

Most BNPL providers out there tend to use standard credit assessments such as previous repayment history and soft credit checks to determine consumer eligibility, and the practice is expected to motivate changes to regulatory oversight in the industry. For example, in the United Kingdom, the FCA or Financial Conduct Authority seeks affordability to become aligned with proper credit risk checks to balance existing risk with a satisfactory customer experience.

Fraud systems in the payment industry should be capable of analyzing data in real-time and generating accurate predictions related to credit risks without compromising on the entire merchant checkout experience. With the help of real-time open banking access to customer data, decisioning software, and predictive analysis, BNPL providers are able to successfully assess the creditworthiness of end customers. More importantly, they are able to deliver frictionless consumer experiences.

BNPL should come up with a proper Open Banking strategy for building the platform and partner with third-providers to ensure acquisitions toward regulations. Open Banking will help in transforming the manner in which affordability checks and credit risks are executed, and allow BNPL providers to ensure highly accurate lending and affordability decisions.

Conclusion

BNPL or Buy Now Pay Later is continually expanding across multiple industries and continues to compete with banks and financial institutions for revenue shares. Banks, along with large competitors making an entry into the BNPL market, should effectively look into effective strategies in order to be able to compete within the industry.

Top Trends to Watch in Digital Transformation 2022

Digital transformation can be described as the way a business integrates digital technology in order to change how they operate. Previously, effectively implementing a technology-driven strategy would take several months to years. However, with the event of the global pandemic, businesses have ramped up the speed at which they are adopting the latest trends related to digital transformation.

One study estimates that spending on technologies related to digital transformation is expected to reach around $1.8 trillion by the end of 2022. If a business would like to emphasize spending on rapid digital transformation, what technologies should they invest in? Below we cover some top trends.

IoT and 5G

5G is regarded as the 5^th generation technology for mobile networks. The primary characteristics of the 5G technology include low latency, multi-peak data speeds, improved connectivity, better user experiences, better network bandwidth, and greater availability.

When combined with edge computing, 5G is capable of high-end innovations for leading technologies such as Artificial Intelligence, video inspections, and drone-initiated inspections. These help in automating day-to-day tasks while averting network issues. Some common uses of 5G technology in the IoT industry are:

Connected automobiles
Shipping and logistics
Remote healthcare

Software 2.0

This revolutionary technology uses the help of DL or Deep learning for the development of neural networks or automated code drafting. Software 2.0 is still at its entry phase in the technology market, but businesses are expected to gain expertise with additional technologies like DataOps (Data Operations) and MLOPs (Machine Learning Operations).

Cybersecurity Transformation

With the rise of IoT and 5G technologies in the modern era, cybersecurity is finally being pushed to the core of business operations while ensuring digital transformation. A recent study report of a number of businesses across China, the EU, and the US revealed that cybersecurity remained a top priority with respect to digital transformation and AI implementation.

A number of companies out there leverage artificial intelligence and machine learning for detecting malware and boosting cybersecurity. Effective cybersecurity solutions are especially prioritized in the domain of digital transformation.

Hyper automation

Hyper Automation is aimed at automating businesses and IT processes to a significant extent. Whether it is no-code or low-code adoption or RPA (Robotic Process Automation), machine learning, or AI, businesses should plan at upscaling investments in rapid automation.

Some of the initiatives related to hyper automation are:

RPA: Robotic Process Automation is responsible for handling complicated and redundant tasks at work with the help of software robots. RPA helps in increasing the speed to market, reducing expenditure, and increasing the scalability of business operations.
Low-code Platforms: These come with the simple drag-and-drop functionality for building software. Minimal coding knowledge is required, making it a great platform for non-techie people. Low-code tools also help with API integrations – allowing seamless integrations without the involvement of the developers.

XaaS or Everything as a Service

Anything-as-a-Service or Everything-as-a-Service is another leading digital transformation trend that is helpful in promoting the ‘as-a-service’ model while delivering all possible aid to customers. XaaS goes beyond the concept of the conventional cloud-based models and includes additional services like:

CaaS or Containers As a Service
STaaS or Storage as a Service
FaaS or Function as a Service
VaaS or Video as a Service
UCaaS or Unified Communication as a Service
SECaaS or Security as a Service

Generative AI

Generative Artificial Intelligence (AI) is a kind of revolutionary AI technology that uses existing content like images, audio, text, and more to create similar yet original content.

Some of the most common instances of generative AI are face-based applications through which users are expected to offer images as the input. In response, the app will reveal how you will look across the entire phase of life. Modern enterprises can look forward to leveraging the Generative AI by using the following techniques:

Transformers: including Wu-Dao, LaMDA, and GPT3
GAN or Generative Adversarial Network – featuring two neural networks like discriminator network and generative network
Variational Autoencoders: It is a form of the architecture belonging to Artificial neural networks

AR Cloud

AR Cloud or Augmented Reality Cloud is a digital 3D copy of an ongoing real-world environment created with the help of its spatial properties, and can be thought of as the digital twin of any given real-world surrounding.

While the overall success of AR Cloud will be dependent on the overall maturity of the subsequent 5G networks, businesses like Facebook, Amazon, Google, and others are leveraging investments in the technology already.

Agility as the Top Priority

Cybersecurity is a major concern for a number of industries while adopting digital transformation. The rising concern has prompted businesses to realize that agility is pivotal to surviving dangerous hacking attacks.

Companies want to reach a specific point at which they are not preparing for “what if” situations, but instead have access to actionable steps that are dynamic and prevent them from suffering from any specific outage.

In addition to cybersecurity, improved agility within organizations can serve as the foundation of subsequent digital transformations.

Data Democratization

Data democratization is going to be one of the important aspects of ensuring digital transformation within modern businesses. Data democratization will be promising businesses a future in which data remains open to all for analyzing and drawing insights.

Conclusion

Modern businesses can look into digital transformation trends for 2022 and beyond to ensure success in the long run.

What is Digital Transformation, and Why is it Important?

In the modern era, ‘digital’ is the talk of the town. We come across terms like digital data, digital transformation, digital marketing, and so on. Everyone wants to adopt digital. What is digital transformation? What are its benefits to different industries?

What is Digital Transformation?

Digital transformation is the effective integration of high-end digital technology into different areas of any business, resulting in fundamental changes to the way in which businesses operate. Organizations across different industries can benefit from rapid digital transformation. It allows businesses to conceptualize legacy processes, ensure efficient workflows, improve security, and enhance profitability.

It is estimated that around 90 percent of businesses across the world conduct operations on the cloud. As companies continue migrating data to the cloud, a majority of what is required to be done is only replicating existing services in the digital format. However, true digital transformation is much deeper than that. In-depth digital transformation should be transformative throughout the organization, involving the creation of a dedicated technology framework to streamline these data and services into meaningful, actionable insights. The framework designed should be capable of improving almost any facet of the entire organization.

Instead of only migrating data to the cloud, organizations can harness digital transformation to re-evaluate as well as optimize different processes and systems. This will ensure that organizations are interoperable and have ample flexibility to deliver robust business intelligence while setting the future for your company.

Why is Digital Transformation Important?

Digital transformation is responsible for changing the way an organization operates. Workflow, processes, culture, and systems within an organization become integral parts of the process of digital transformation. The transformation is responsible for affecting all possible levels of an organization while bringing together data across specific areas to work more efficiently.

By leveraging the benefits of advanced processing and workflow automation, including Machine Learning and Artificial Intelligence, organizations are capable of connecting the dots across the customer journey in new ways.

Top Benefits of Digital Transformation

For most organizations, the driving force behind digital transformation is related to costs. Moving data to some public, private, or hybrid cloud environment will help in reducing operational costs. It minimizes software and hardware costs while allowing team members to focus on other core projects of the organization.

Improved Data Collection

A number of businesses have to gather huge amounts of data. The real benefit lies in optimizing existing data to ensure in-depth analysis for driving the business forward. Digital transformation helps in creating a system for collecting relevant data while incorporating it to ensure business intelligence at some higher level.

Analyzing how customer data is collected, stored, evaluated, and shared as a part of the digital transformation process is important. As organizations analyze the customer journey as an integral part of digital transformation, they should think about how they can offer clients improved autonomy over their data.

Better Resource Management

Digital transformation helps in consolidating resources and information into a single suite of important tools for organizations. Instead of dispersed databases and software, the process helps in consolidating company resources and reducing vendor overlap. Digital transformation is capable of integrating databases, software, and applications into a centralized repository for improved business intelligence.

Digital transformation is not any specific functional or departmental unit. It is important to optimize as well as secure data at all possible departments. Organizations should also equip teams with high-end, easy-to-use tools to execute the job effectively.

Improved Customer Experiences

Customers in the modern era have higher expectations for digital experiences. Consumers are habituated to having endless options, faster delivery, and low prices. CX or Customer Experience is the all-new battleground for modern brands. As per a report, over two-thirds of organizations reveal that they are competing significantly on the overall customer experience.

CX has evolved as a major driver for ensuring sustainable business growth. One effective way of differentiating your brand from customers is to analyze that you pay attention to their privacy. Offer customers ample control on how their data is gathered and used while empowering them with relevant autonomy to ensure decisions around the data.

Data-driven Customer Insights

Data is the key to unlocking important customer insights. By effectively understanding the customers and their specific needs, you can come up with a relevant business strategy that is highly customer-centric. With the help of both unstructured and structured data, including social media metrics, such insights can help in driving maximum business growth.

Data allows strategies to deliver highly relevant, agile, and personalized content,

Collaborative Digital Culture

By offering team members the right tools, customized to your work environment, the process of digital transformation helps in encouraging a digital culture.

While these strategies and tools offer a seamless way to ensure collaboration, they also help in moving the entire organization digitally. The digital culture shift is important for businesses to be sustainable throughout. It enforces digital learning and upskilling to team members for leveraging the benefits of digital transformation.

Better Agility

Digital transformation makes organizations highly agile. Businesses can look forward to improving agility with effective digital transformation to enhance speed-to-market and make use of CI (Continuous Improvement) strategies. This allows for rapid adaptation and innovation while offering a dedicated pathway to ensuring improvement.

Improved Productivity

When you have access to the right technology tools working together, it can help in streamlining overall workflow and improving productivity. When manual tasks are automated, and integration of data takes place across the entire organization, it empowers respective teams to function efficiently.

Getting Started with Digital Transformation for Your Organization

A digital transformation strategy can be regarded as a dedicated plan of action for analyzing, introducing, and driving the digital transformation initiative forward. Coming up with a strategy will help in defining what business goals you wish to achieve with the help of digital transformation. A proper digital transformation strategy will help in creating a framework for following the ever-evolving process.

How Can I Increase Conversions on My E-Commerce Store in 2022?

The Internet is a big place, so it makes sense that those with an e-commerce store are keen to do what it takes to increase conversions. The journey a brand takes when increasing conversions can differ, but it is important to ensure that areas of a website are not being overlooked.

The competitive nature of the Internet means that a simple flaw with a website is all that is needed to rank lower than the competition online.

Fortunately, some steps can be taken to ensure that conversions are always the best they can be, regardless of the product or service being sold.

Ensure The Design is Persuasive

Despite there being several ways of increasing conversions, one of the important starting points is the design of the website. Of course, an e-commerce store mustn’t compromise its brand. However, the design must persuade visitors to remain on a site.

A clean design with an obvious call-to-action will always fare better than a page cluttered with options and information. Likewise, clear imagery of the products available that reflect the essence of the brand should be used instead of standard stock imagery.

An e-commerce site that can keep visitors on the site longer is more likely to see increased conversions.

Ensure the User Experience is the Best it Can Be

The design of the website may entice visitors, but niggly navigation and slow loading pages will often be enough for a potential customer to look elsewhere for products or services. Fortunately, this can be easily avoided by ensuring the user experience is the best it can be.

Not only must the site load quickly but must also be designed with mobile users in mind. It is also important that any information regarding products or services can be found quickly. Users that can find information quickly are more likely to make a purchase, thus increasing conversions.

Use Search Engine Option Optimization and Conversion Rate Optimization Together

When promoting an e-commerce store online, some may choose search engine optimization or conversation rate optimization. Both are important, but those wanting to increase conversion will find using both methods are often the key to success.

SEO is often about being found online and is carried out via keyword research. However, this doesn’t mean that visitors will stick around after visiting the site. This is where CRO comes in.

Keywords need to be used in the content, but not to the point where it is unreadable and bewilders visitors. Conversion rate optimization means taking the keywords and using them in a way that still offers value to the visitors while being complemented by a clear call-to-action and an easy sign-up process.

Take The Shopping Experience to Social Media Platforms

Very few businesses need informing about the popularity of social media, but many are surprised to discover how lucrative social media websites can be when increasing conversions.

Although nothing can replace an efficient e-commerce store, offering the same great products and services with the same branding on social media allows a business to make connections with customers that may have otherwise been overlooked.

As well as promoting products to a new audience, social media integrations mean making a purchase is easy, and can increase the likelihood of repeat purchases in the future.

Make Sure to Promote Reviews and Feedback on the Website

An e-commerce store is about finding balance when delivering information to customers but showcasing the excellence of a brand is something that should be placed on all e-commerce stores.

Despite many e-commerce stores offering fantastic products and services, some mislead or take advantage of customers. Fortunately, those shopping for products online have become more knowledgeable about checking the integrity of an e-commerce store.

An e-commerce store that has a strong social presence online will find more favor with customers than those who don’t. Customers can be left on various platforms, but there will be no issues integrating reviews into the website.

Showcasing genuine reviews from others instills confidence in those using the site, increases the likelihood of a purchase being made, and helps improve the social proof of an e-commerce store moving forward.

Abandoned Carts Should Be Treated as a Benefit

When checking the sales of a product, it can be disheartening to see an abandoned cart. However, it is important to ascertain why this has happened. If there are many abandoned carts, then it could be due to a checkout problem. Making a few changes could be all it takes to improve conversions.

However, there can be other reasons for abandoned carts that aren’t due to a fault with the e-commerce store. Some may have been in the middle of a transaction before becoming distracted by something else.

Similarly, those using a smartphone to make a purchase may have lost Internet access when trying to make a payment.

Reaching out to customers with a small discount can often be enough for them to make a purchase and gives customers an example of the brilliant service they can expect moving forward.

The steps taken to increase conversions can differ among e-commerce stores. However, taking advantage of the steps taken ensures that a website is taking full advantage of every opportunity when increasing its online conversions.

Tips to Collect More Revenue Using Recurring Billing in 2022

Running a business is challenging, and there can be instances where some are searching for ways to increase the turnover of a business. Although recurring billing is commonplace, it isn’t used by all businesses. As such, this could mean that company is missing out on revenue regularly.

Fortunately, the introduction of recurring billing can be applied to many different business models and can help build a stronger bond between companies and customers.

The following is an overview of steps that can be taken to introduce recurring billing into a business model and use it effectively.

Be Aware of The Challenges

Although recurring billing is a fantastic way of collecting more revenue, it is vital to be aware of the challenges that could be faced. For example, if different subscriptions have different periods, then some form of management will need to be undertaken to ensure customers are receiving products at the right time.

The challenges of a business can vary depending on the product or service being sold but being aware of the challenges allows brands to have a contingency plan in place and make changes at the right time making the process non-disruptive for customers.

Ensure Security Is the Best it Can Be

Regardless of the product or service being sold using recurring billing, the security of the website needs to be the best it can be. As well as instilling confidence in customers entering the personal details, it also ensures the sensitive information doesn’t fall into the wrong hands, which will do little to raise the profile of a brand.

Ensuring that data is safeguarded and encrypted is easier than it has ever been and is essential for e-commerce stores wanting to take advantage of recurring billing.

Ensures Customers Receive a Contract Regarding Recurring Billing

When collecting payments using recurring billing, the last a business wants is a misunderstanding with customers. Contracts remain an important part of any agreement, and for good reason.

As well as safeguarding the business when a customer agrees to recurring billing, it also ensures that users are given a full breakdown regarding their subscription. This allows both parties to be fully aware of the agreement in place and allows for increased revenue without there being disagreements in the future.

Make It Easy for Customers to Update Payment Details

Despite the benefits associated with recurring billing, there can be instances when payments fail. The main reason for this is that customers have been issued a new debit or credit card and have not updated these details in their account.

Introducing a proactive way of keeping details up to date can help ensure that recurring payments can be processed efficiently, leading to more revenue.

An e-commerce store can also use an account updater that allows card details to be refreshed within the payment system, which again helps avoid failed transactions.

Consider Products and Services That Can Be Used for Recurring Billing

Recurring billing can be overlooked by some e-commerce stores simply because it feels their business models is not a good fit. Although there can be instances when recurring billing isn’t a good fit, it is more flexible than many assume.

Recurring billing will involve a repeat purchase of a product or service, so the subscription model can depend on the length of use.

For example, those selling perfume can offer subscriptions based on usage, and even offer to introduce new fragrances based on their profile. If a bottle of perfume is expected to last two months, then a recurring payment can be set up, so shoppers never run dry when purchasing their favorite perfume.

Software as a service (SaaS) is a great fit for recurring billing, as there are many sectors to explore. Accountancy software can offer a set amount of features for a monthly fee, whereas music production platforms can offer a subscription that allows access to new samples and loops every month.

Those who offer education courses can also use recurring billing to their advantage. As well as selling courses for a one-off fee, breaking the courses down allows benefits for the customer and the business.

Those offering the course can increase their revenue due to the monthly payments in addition to other sales, while customers can access courses that may have been unaffordable otherwise.

Recurring Billing Can Be Used for Gift Subscriptions

Practicality and affordability can be two of the most important components of a gift, so a subscription that allows people access to products and services they love can yield increased revenue for a business.

When selling gift subscriptions, it is a good idea to offer several options. This allows the business to find more traction with users while allowing customers to become more aware of the products available.

Check-In with Customers Who Coming to an End of a Subscription

Although there will be instances when recurring billing is ongoing until a customer cancels, there will be others that operate within an agreed period. When a user is nearing the end of their subscription, this can be the ideal time to check in with them and gather some feedback so far.

Even if there is negative feedback, this can be used to improve the subscription model moving forward and allows the customer to witness a brand that listens to customers and makes a change. Simple interactions with customers can make all the difference when increasing revenue using recurring billing.

Virtual Credit Card Payments Trends in 2022

The modern payment industry keeps evolving at a rapid pace. As more businesses go digital amidst the pandemic, the concept of virtual credit card payments is becoming the go-to business solution for businesses – both offline as well as online.

There has been an overall increase of around 85 million active virtual credit card payment users. The global economy has managed to improve during the second half of 2021, and most businesses are now in a better position to handle the pandemic now than they were during the first wave of the COVID-19 pandemic. For the payments industry, offering support to businesses as they plan their way beyond the COVID-19 pandemic will be an overarching narrative of 2022.

The Rise of Virtual Credit Card Payments 2022

Throughout the pandemic, the dependence of consumers on digital payment technology has made modern transaction methods quite an expectation rather than just a feature. It is estimated that over 80 percent of consumers using leading digital wallet options remain satisfied with those services. The methodology is known to extend past the sales of traditional B2C or Business to Consumer methods. However, nowadays, B2B or Business to Business organizations are becoming increasingly dependent on alternative methods of payments for sending and receiving funds to buyers and vendors.

The main component of the digital payment industry that is evolving rapidly is the concept of virtual cards. Businesses all around are beginning to understand the efficiency and importance of virtual cards for AP (Accounts Payable) and expense management operations.

Top Benefits of Virtual Credit Cards

Typically, a virtual credit card payment through a dedicated credit card will help you in performing all the core functions of a traditional card payment solution – only better.

Everything is carried out online. Therefore, it will include some basic steps towards adding money, performing transactions, paying buyers or suppliers, and so on. Some of the core benefits of ensuring virtual credit card payment solutions for businesses in 2022 are:

Improved Security

With the wide range of security challenges for traditional payment cards, physical credit cards have become quite a common target for fraud.

The main reason why virtual cards are considered more safe and secure is that you are capable of pre-setting a particular spending limit you would like to have at any time. There is also the option of terminating the account anytime you would like, with just a single click in case of any data breach. During every transaction, there is a one-time bank number to use for performing the payment.

In contrast to the ACH payments and checks, it can significantly help in improving the data security of the respective bank account details while protecting your privacy – even in the case of transactions. With the help of virtual cards, it is impossible to execute account theft on e-commerce.

E-commerce Convenience

Unlike conventional banking institutions with fixed working hours, virtual financial institutions work round-the-clock. Therefore, they can be on standby for international businesses whenever you require. The best part is that there is no need to waste time going to a physical branch. All you are required to do is make a few taps on your mobile device, and you can easily implement online transactions to make your business more efficient.

With virtual credit card payments, you can forget manual mistakes or paperwork. You can embrace streamlined accounts for ensuring that you are covered throughout. The single-issued virtual credit card enables the Accounts Payable department to focus on core financial matters and focus on your business.

Reduced Cost

A number of virtual banks or institutions deliver access to reduced fees needed for customers. With every amount that you spend, you can look forward to earning cash rebates for paying your buyers or suppliers, and virtual credit cards come at low or no cost.

As everything is executed online, the overall operating costs can be reduced with the help of virtual transactions. In turn, finance service providers will be charging less to customers.

Revolutionizing the B2B Digital Payment Space

Electronic payments are on the rise. It is estimated that more than 80 percent of B2B payments will go entirely digital by 2025. Accounts Receivable and Accounts Payable departments are increasingly shifting to digitization over complicated manual processes for completing vendor payments and improving overall cash flow. The innovative set of tools is offering B2B organizations improved consistency and transparency into how they are spending money or obtaining the highest revenues.

Virtual card payment is one such innovative application for revolutionizing the modern payment industry. The virtual credit card payment industry is expected to reach a value of around $6.8 trillion by 2026, a major jump from the value of $1.9 trillion in 2021. It is becoming increasingly popular amongst B2B firms relying on buyers to buy bulk items for the purpose of resale. This is because virtual credit card payment helps employers in tracking the business expenses of workers while setting spending limits for preventing fun exploitation or overspending.

To top it all, modern gig economies like food delivery or ride-sharing services can make use of virtual cards for appointing benefits of earned wages to contract-based workers.

Conclusion

The pandemic has accelerated the pace of digital payments while focusing on the shortcomings of outdated, complicated manual processes for a number of organizations around the world. Due to this, an increasing number of B2B companies are tapping into newer technologies like virtual credit card payments for improving the overall operations and security mechanisms for high-value transactions.

The digital shift during the ongoing pandemic has resulted in permanent behavioral changes amongst businesses and customers alike. Due to this, e-commerce transactions have accelerated while being anticipated to keep moving forward in the upwards trajectory – especially for B2B organizations.

A High Percentage of Restaurant Customers Report Using Loyalty Programs

With leading brands like Taco Bell and McDonald’s shifting toward pop culture and garnering a spot in social conversation, millennials have made food marketers realize that food is fuel.

The advent of the global pandemic only complicated the existing connection, however. Restaurants have been asked to ensure safer food delivery while minimizing overall contact. Later, as the category started getting crowded, restaurants all around were expected to execute this in a way that differentiated them across different channels.

The concept of loyalty programs in the restaurant industry came about in 2020. In most cases, consumers all around link loyalty programs – along with the discounts, convenience, and benefits that they provide – with improved customer experiences. In a recent study, it was revealed that around 69 percent of respondents claimed that loyalty programs brought them back to the restaurant culture.

An Insight into the Loyalty Programs in the Restaurant Industry

According to one report, it is estimated that around 47 percent of modern diners make use of at least one loyalty program. The overall share of consumers using loyalty programs in restaurants has increased by around 12 percent in 2022. The QSR segment has experienced the highest growth, with 24 percent of chain QSR customers using restaurant loyalty programs in 2022.

The increased utilization of loyalty programs can highlight the increasing number of lucrative reward programs in the modern restaurant industry. There are several restaurant chains that have already launched or improved their loyalty offerings to win over the existing market share, while generating return visits and improved spending.

For instance, Popeyes has recently come up with their first-ever loyalty program, and McDonald’s is planning to extend MyMcDonald’s Rewards in the upcoming months. Chipotle and Taco Bell are also committed towards enhancing the existing programs. The loyalty programs help restaurants target the consumer base that spends money most and market to them.

The Role of Loyalty Programs in the Restaurant Industry

It is possible that a highly saturated loyalty program can end up turning off some consumers who don’t want to dedicate space on their mobile devices for restaurant loyalty apps. However, it is believed that young consumers especially look forward to taking advantage of such programs. The leading loyalty program consumers are bridge millennials and millennials. They continue signing up for new loyalty programs quickly in comparison to other age groups.

A majority of modern diners do not appear to mind the inclusion of more applications to their smartphones. Around 60 percent of consumers who are already using at least one restaurant-based loyalty program revealed that they would consider spending more money on food orders from different restaurants if they had access to a dedicated loyalty program.

While a number of restaurants have launched different types of loyalty programs in the span of the past few years, research reveals that there is still more room for growth. Restaurants can still consider improving diner awareness. Both QSR and full-service customers are more likely to interpret program unavailability as a major reason for not using loyalty programs.

The Change in Consumer Behavior

Consumer behavior all around has experienced a major shift towards the concept of digital ordering, and modern habits are expected to stick around. Another report revealed that digital sales will be on the upward scale to span around 54 percent of the entire QSR business by 2025, a 70 percent increase per pre-COVID estimates. As consumers continue adopting the notion of digital ordering, the delivery of a dedicated loyalty program in a digital space can be a great way to incentivize end consumers to ensure returns.

It could also feature trials. According to a study, around 19 percent of consumers revealed that a loyalty program would be sufficient for them to try out new QSR, and 30 percent of consumers revealed that they would go ahead with downloading a restaurant app to get access to loyalty points.

Leveraging the Benefits of Loyalty Programs in Restaurants

Restaurants are rapidly turning to loyalty or reward programs to encourage the overall sales – especially amidst the pandemic-induced economic changes, as a number of diners are choosing to eat at home rather than dining out.

Coupons or loyalty rewards seek the attention of deal consumers. Loyalty programs – like a simple app-based service or a punch card – are aimed at targeting individuals who might have already visited the restaurant. It encourages them to return.

It is regarded as more budget-friendly to retain a customer than to bring in new ones. Therefore, loyalty programs help in delivering more ROI than other relevant marketing strategies, because it targets the customers directly, and not prospective customers.

At the same time, customers want to feel special. They are looking for a relationship with the brand and not just to do some transactions. Loyalty programs allow them to enter an exclusive group or club while helping them feel more connected to the brand. When a frequent customer receives an app notification that they have received a meal box combo or a free drink, they are more likely to return while spending money at the restaurant.

Conclusion

There are a multitude of options for loyalty programs for restaurants. It could include traditional punch cards and swipe cards to modern restaurant apps. Regardless of the approach adopted, the loyalty program can help in attracting and retaining repeat customers.

Repeat consumers serve to be the lifeblood of any restaurant. They could also depict the role of brand ambassadors. A loyalty program is helpful in ensuring that these customers keep coming back.