We all know that consumers today are avid users of technology, with 80 per cent now online and 60 per cent using smartphones. It's unsurprising then, that consumer appetite for new payment methods is increasing, but did you know that startup owners are leading the way in responding to this trend by incorporating popular technology into the payment methods they offer?
We recently undertook some research into small businesses which found that small to medium enterprises (SMEs) under three years old are much more likely to be tech-savvy than older businesses. They are reacting to the changing attitude of consumers about how they want to pay for goods.
Online retail is booming
Online retail has reportedly seen its fastest growth in 13 years and startups are responding to this by establishing and expanding their online platform to match the public's shopping habits. The research shows that startups are actually ahead of the curve in e-commerce, with almost two thirds (58 per cent) offering it as a sales channel compared to less than half (46 per cent) of SMEs in general.
Additionally, one in two (50 per cent) startups are trading using online and mobile wallets, compared to just 36 per cent of business that are over three years old. This number rises to 68 per cent when looking at card-accepting startups, suggesting that businesses that accept credit and debit card payments are most likely to adopt other innovative payment methods.
The need for speed
Our research also showed that the public is driven by a need for speed and will often choose technology over personal interaction. As many as 31 per cent of consumers say they are frustrated with the amount of time it takes to pay and are pushing for faster payment methods such as contactless, which many startups are now offering in their stores. Some 88 per cent of consumers currently using contactless payment methods are saying that it is "quick and efficient."
While some businesses may have reservations about working with companies that are not well-established, startups are at the forefront of the changing payments landscape in the UK and should not be disregarded. Startup owners are leading the way in planning for the future by thinking about how the technology consumers use every day can serve a purpose in terms of growing their business and accepting payments.
The importance of tech-savvy managers
The reason they are better in line with consumer attitudes towards technology than more established SMEs could because they have a similar attitude to technology themselves; 28 per cent of startup directors say they "must have the latest technology" compared to 20 per cent of established SME owners.
Whether you run a startup or a more established business, the research reveals the need to respond to emerging payment trends and keep up with the times. To give your customers the best possible experience, make sure that you are competing not just on price, but also by offering the best payment method.
Robin Mackenzie heads-up the SME business at Streamline, which is part of the WorldPay group. Streamline is the UK's leading card payment acquiring business which allows customers to accept card payments at point of sale, over the phone and the internet.
Image: Flickr (Victor1558)