Small and medium-sized businesses that have not innovated to include emerging technology lost £1.6 billion in sales in 2016, according to new research published by Barclaycard. The study comes as National Insurance payments are increased for many of these companies and forecasts predict cashflow troubles.
Invisible and conversational payments
The report by Barclaycard, which surveyed 2010 adults and 253 decision-makers within SME retailers, showed that nearly half of millennial shoppers (18-34 year olds) are opting to pay using ‘next-generation’ solutions.
Invisible and conversational payments, including one-click ordering, contactless payments and digital personal assistants like Amazon’s Alexa, are growing in popularity, with 15% of shoppers abandoning their purchase altogether if unable to use one of these methods.
One in four small retailers admit losing customers
Barclaycard’s survey further revealed that 24% of small retailers said consumers are turning away from them due to a lack of emerging payment methods, with 65% in total losing customers because of a lack of contactless, online, mobile and wearable device payment options.
The findings indicate that constant innovation is key for SMEs to keep up with their customers, particularly the younger demographic who arguably hold the largest spending power. Millennial shoppers spend up to £80 on going out per month and almost £6,700 on annual discretional purchases, according to Business Insider UK.
Not only that, but the greater choice that the digital age has given consumers has also created a need among buyers to feel that they're the ones making the decision to purchase – so businesses need to be ready to let shoppers interact and pay in the way they want.
It's therefore more important than ever for SMEs to remain afloat of innovations and tackle the factors hindering their sales if they want to protect their bottom line and future-proof their cashflows.
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