The emphasis placed by European consumers on choice, convenience and flexibility in the shopping experience presents a good opportunity for retailers to capitalise on the power of technology and innovation, according to a report by Visa Europe.
After extensive consumer research in Germany, Greece, Italy, Poland, and the UK during 2006 and 2007, the 'Visa Europe Consumer Insights Report' showed that European consumers expect shopping to be stress-free, and that they don't want it to add to the strain of everyday life.
Impact of payment innovation
According to Mariano Dima, executive vice president of marketing and products for Visa Europe, retailers should not underestimate the impact of customer insight combined with innovations in payment technologies. In particular, Visa suggests that giving consumers technologies that make life easier is likely to stimulate both customer loyalty and brand differentiation.
According to the report, consumers today value the "small pleasures of life" and tend to prefer retailers that recognise and respond to their personal needs. Shorter queues, multi-channel retailing, polite customer service staff, and offering a range of payment options are among consumers' basic expectations for any shopping experience.
Among the main findings of the consumer insights study for retailers:
- A range of payment mechanisms is preferred
While cash may be the preferred payment option in some parts of Europe, cards are increasingly the European consumer's first choice, and many are now annoyed by card-phobic retailers because cash payments have actually become more time-consuming than cards in many cases. In addition, some consumers felt that cash reduces their ability to maintain control over spending.
- 'Chip and PIN' has been an important development
The chip-and-PIN system that operates throughout Europe was found to have brought benefits for retailers and consumers alike. Retailers can expect a range of new developments in the future, made possible by the payment card's chip in conjunction with a PIN number that only the cardholder knows. These developments include contactless payments (like Visa's payWave and MasterCard's PayPass), prepaid cards, multi-application cards, in-store instant card issuance, and even mobile payments.
- A multi-channel approach is essential
Retailers need to consider the benefits of all types of retail format (i.e. online, bricks and mortar, and self-service kiosks) and invest in the appropriate payment technologies to make sure that consumers can pay safely in every situation. This includes embracing security initiatives such as 'Verified by Visa' and 'dynamic passcode authentication', and accepting contactless payments.
European consumer insights
The new study followed on from Visa's first consumer insights report, which examined European consumer shopping habits and trends in 2006 and 2007. Some interesting findings from the original study included:
- 69% of consumers in Poland and 75% of people in Greece said they "love to shop";
- 69% of Germans who said they are "very happy" and their lives "couldn't be better" treat themselves at least once a week;
- Everyday small pleasures really count, as 73% of Italians said a smile brightened their day;
- Approximately 50% of Germans said that queuing is the most annoying part of shopping;
- 78% of UK consumers said they loved internet shopping because it allowed them to shop 24 hours a day, 7 days a week;
- 71% of UK consumers said they were more likely to shop online if they felt it was safe, while 70% of Germans were most likely to shop online with a retailer they recognise from the High Street;
- 70% of Italian consumers said they are "worried" when they spend their money;
- 40% of Germans prefer to pay with a card and said they would use it more often if it were possible to do so in more shops, while 60% of UK adults now choose cards as their preferred payment method.
- In Europe, there are over 348 million Visa debit, credit and commercial cards. In the 12 months up to September 2007, those cards were used to make purchases and cash withdrawals to the value of over �1.3 trillion, and an estimated 11.4% of consumer spending at the point of sale in Europe was done with a Visa card.