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How Fin-Tech Innovation is Driving the Future of Australian Retail
It’s a commonly held narrative that the Australian retail industry is in dire straits, and indeed, it’s a tricky time. If retailers choose to stay stagnant they will fail, but by leaning in to new technology the industry can grow and prosper.
The growth of e-commerce, rise in consumer promotion culture, and the impact of customer loyalty of increasing customer returns are genuine challenges, but with the right tools in place, these issues can be mitigated.
In our data-driven society, consumer insights are essential to retail success but can be tricky to come by. Research conducted by the Australian Retailers Association showed that only 53 per cent of Australian retailers have invested in tools that give them access to real-time sales and inventory insights, and 71 per cent of respondents have yet to embrace integrated front – and back-end ICT system – that’s where fin-tech companies such as Openpay can step in to support.
Currently, only half of Australian retailers have invested in deploying a point-of-sale platform that can take electronic payments while offline – but why?
When we know that the volume of credit card accounts in Australia is at their lowest since 2015, delivering deferred payment solutions to your customers can be the critical step in securing sales at your business, rather than a competitor.
We partner with fashion brands such as Seed, French Connection and Nine West to deliver BNPL solutions to their customers, providing a competitive advantage within the cluttered affordable fashion landscape.
Tech innovation is helping to bring value back to retailers through data acquisition, allowing you to better understand your customers through spending data, and to drive consumer growth by providing products that meet consumer needs, in our case, deferred payment solutions.
Openpay uses AI and machine learning to convert data from the shopping experience into comprehensive insights that detail consumer shopping behaviours for retailers. This data can include gender, age, income, distance travelled, purchase time of day and day of the week. By enabling an omnichannel view of your customer’s behaviour, we enable powerful data and insights about customer behaviour that can translate into sales.
By incorporating data sourcing tools such as this, physical retailers can help compete with the opportunities online retail has to track the consumer journey through all stages of the purchase funnel. Access to meaningful data allows retailers to build deeper relationships with customers and communicate more meaningfully, understanding the selling points or pain points that impact their customer
Leveraging tech innovation can bridge the gap between a disengaged community of consumers, and an independent retailer, helping to drive customer excitement and crucially, purchases. Our merchant data has shown that the presence of Openpay’s BNPL product can result in increased average transaction value, increasing units per transaction, and crucially – reduced returns. Online, we’ve seen that the presence of a BNPL offering can reduce in-cart abandonment by upwards of 10 per cent.
Additionally, in a time when the ‘race to the bottom’ mentality is rife and discounting is the norm, offering a buy now pay later product helps bypass this – creating an affordable way to pay without devaluing the product itself, protecting the margin
Offering a product that clearly communicates repayment terms and requirements also assists in driving consumer loyalty, and increasing return traffic and purchase.
That’s where technology comes in, but retailers have a role to play in making sure this works for them. The possibilities for the Australian retail sphere are boundless when technology and retail intersect to deliver positive customer experiences.
Dion Appel is the Chief Revenue Officer for Openpay.
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