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¡¡¡¡By Wise Marketer Staff

¡¡¡¡Posted on June 8, 2021

¡¡¡¡One of the most telling findings about how consumers altered their shopping behaviors in response to the pandemic comes from a 2020 McKinsey report ¡°The great consumer shift¡±. The headline statement that should grab your attention is that ¡°75 percent of US consumers surveyed tried a new shopping behavior in response to economic pressures, store closings, and changing priorities¡±. These new shopping behaviors include curbside pickup, online order delivery, purchasing from different brands, and through new digital shopping channels (IG, FB, etc.).

¡¡¡¡Every new interaction experienced by consumers entailed a brand impression, and how brands responded to new customers either created or eroded trust in these new relationships. According to the survey, about 73 percent expressed an intent to continue these new shopping patterns, so expect change to continue.

¡¡¡¡The centerpiece of these new shopping behaviors is the mobile phone, and all retailers should be giving priority to how they will leverage the mobile device, in particular how they can add value to their mobile apps to go beyond the basics.

¡¡¡¡Coalescing the benefits of loyalty programs and mobile apps could be the most direct approach to achieving this goal. Loyalty programs continue to register strongly in the way consumers make purchase decisions and, while the mobile device continues to be reinforced as the principal channel for brand engagement, the value of mobile apps for consumers needs to be improved.

¡¡¡¡Let¡¯s look at some data that supports both of these statements.

¡¡¡¡The prevailing effectiveness of loyalty as a marketing vehicle is being noticed more than ever by leaders in the Convenience and Fuel retail category. The top priority for C-store operators is customer retention, with a recent survey showing that both US and Non-US convenience retailers cited customer retention at the top of their objectives list, ahead of acquisition and developing customer insights.

¡¡¡¡If our driving experiences are like yours, then maybe you have observed more people behind the wheel next to you in traffic looking at their phones rather than the road ahead. Our small-screen addiction is nearly indisputable. More than 50 percent of all consumers globally own a smartphone and 20 percent check their phone in excess of 50 times each day. People are using these phones for more than taking selfies and posting in social media channels. One report showed that 72 percent were using mobile devices while shopping in brick-and-mortar stores in 2020, up from 47 percent in the previous year. That¡¯s nearly a 54 percent increase year over year.

¡¡¡¡Here¡¯s where you need to pay attention. We know consumers are glued to their phones and that a mobile app can be the prime vehicle to connect with customers on their phones. But while the average smartphone user has 80 plus apps installed on the phone, only 9 are used each day as an average. If you look deeper into what types of apps compose the short list of 9 that are opened each day, you may be surprised to know that shopping apps rank #18 on the list.

¡¡¡¡When thinking about your mobile app strategy, its critical to consider how to add features that pass time savings and convenience unlocking tools for your customer. The apps you build should communicate value clearly to users and provide a business value to them. For convenience retailers, using the mobile app to activate fuel dispensers and to enable a touchless purchase experience of both fuel as well as products inside the store is one example. Tying these benefits together creates payment fluidity. Creating a digital wallet offers customers the convenience of completing a transaction in less steps, saving them time and creating a more satisfying shopping experience.

¡¡¡¡The importance of enabling payments on the mobile phone is driving growth in the mobile wallet market. Estimates for the mobile wallet industry, as reported by Finaria, predict the mobile wallet industry will grow by 24 percent this year and the market will register $3.5 trillion in value by 2023. The average annual value for mobile point-of-sale transactions per user grew by 25 percent over the past year. Future growth rates have similar double-digit forecasts.

¡¡¡¡As we researched this topic further, looking for some ideas that would show Convenience and Fuel retailers ¡°how¡± to incorporate payment features into the mobile app, we read a white paper from Comarch titled ¡°Technologies to improve customer engagement in the Oil & Gas industry¡±. The paper highlights how mobile wallets and artificial intelligence could be the keys to success going forward.

¡¡¡¡Comarch explains that to build retention among customers and carve out additional market share, retailers need to take full advantage of their loyalty programs, introduce technology solutions that save customers time, and turn purchases into a more safe, fun, and engaging experience. We contacted Comarch to learn more and were able to interview Bindu Gupta, Head of Loyalty Strategy Consulting:

¡¡¡¡¡°Incorporating the payment functionality within a fuel retailer¡¯s mobile app can help boost convenience store sales in addition to fuel purchases. This creates a friction-free experience and saves time for the customer which means more brand recognition and loyalty.¡± Gupta continued, ¡°This, as always, is the goal with the largest potential profit upside and one that leads to establishing your brand as a preferred brand among loyal customers¡±.

¡¡¡¡She went on to share that the most comprehensive approach to creating a mobile purchase experience that customers will appreciate is to enable them to carry out an entire business transaction within the app. Being able to activate the pump, select fuel type, dispense fuel, and complete the transaction with payment is one way to ensure that your app demonstrates high utility and will continue to be downloaded by new members as well as frequented heavily by existing members.

¡¡¡¡Comarch also points out that there¡¯s no reason today to prevent retailers from extending the purchasing utility of their app to inside the store. By incorporating a QR Code into the app, point-of-sale scanners can identify the customer at the cashier inside the store and complete a purchase of any type of beverage or munchie through the payment options loaded into the mobile wallet.

¡¡¡¡With many retailers considering curbside delivery of items purchases in the store, it is also quite possible to enable customers to order products inside the store while dispensing fuel outside. With some thoughtful planning, those items could be delivered to the customer¡¯s car at the fuel island. And don¡¯t forget to layer into the app experience discounts and deals made available through supplier funding. Gupta favored taking this holistic approach, saying:

¡¡¡¡¡°It provides motivation for additional purchases, leading to increased basket purchase. There is a rich opportunity here to reach new cross-selling and upselling levels.¡±

¡¡¡¡As much of a learning curve as you may experience introducing digital payments through your mobile app, there are still additional enhancements you should consider. Building in gamification-driven journeys to drive visit frequency or specific product adoption is one of the tactics that has proven to increase visits by 15 percent or more during a promotional period.

¡¡¡¡Before a fuel retailer decides to incorporate mobile payments into their infrastructure, they should consider the behavioral forces driving their customer base as well as seek out a provider partner which demonstrates a comprehensive understanding of customer loyalty, mobile app development, digital wallets, gamification and more.

¡¡¡¡The Wise Marketer recently cited Trust, Clarity and Ease as three words shaping our views of customer loyalty in 2021. Trust doesn¡¯t mean that customers, once satisfied, will remain immune to service problems, dirty stores, or high prices. They may trust you but won¡¯t give you the benefit of doubt forever. But, if you take time to smartly plan your digital marketing strategy and craft your own plan for blending loyalty and payment into a mobile app, you can win a share of mind from customers that will influence where they stop for food, fuel, and more when setting out the door and driving down the road.

¡¡¡¡A smart build out of a mobile app that enables both fuel and inside store transactions, maybe even becoming the platform catalyst for curbside delivery, can transform customer perception of your brand from the classic gas station image to a ¡°retail¡± experience.

¡¡¡¡How you use the data you collect in your loyalty app is another frontier of opportunity. We¡¯ll follow up this discussion of how technology can improve customer engagement and loyalty in convenience and fuel retail with a closer look at how artificial intelligence is being used to predict behaviors, drive personalized offers, and even be used to detect and prevent loyalty fraud.

¡¡¡¡Driving Loyalty With Mobile Payments in Convenience and Fuel Retail

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