You’d think there’d be a high-tech way to accurately predict future events by now, but things haven’t come quite as far as the movies said they would by 2017. (We’re also not seeing jetpacks anywhere around here or taking a daily shuttle to our satellite office in outer space—hurry up, Elon.)
So maybe the world still isn’t so great at predicting the future (meteorologists, we’re looking at you), but that doesn’t stop us from trying. It just so happens we have a few oracles-in-training around the office, and here’s what they have to say about payment trends in 2017.
1. Fraud in eCommerce will become even more sophisticated.
Unfortunately, here’s one payment industry trend you can absolutely count on. You can lay part of the blame on EMV chip cards entering the U.S. Ever since it became harder for fraudsters to wreak havoc in brick-and-mortar stores—thanks to the additional layer of protection offered by EMV—online stores have been the obvious new target, and the problem will only become worse.
We think you’ll see even more sophisticated criminal schemes happening online this year and in more places—not just websites but also mobile apps, social media networks, and email. And even though eCommerce merchants plan to spend record amounts of money in the coming years to fight fraud, it’s essentially an arms race that will never end. You can keep up (try customizing your fraud protection), but you’ll never be fraud-free.
2. Developing mobile payment options will become a priority for retailers.
In the U.S. last year, mobile payments reached an estimated $972 billion, and in just three years, mobile is forecasted to comprise 46% of all digital commerce. For many of our merchants, we see that they have already flipped to mobile as their top channel. The mobile payment trend has exploded to the point where every company—no matter what industry you’re in—must have a mobile-first mindset.
This year, we’ll see retailers working on expanding their mobile payment capabilities. Customers will expect options like mobile wallets and adoption rates will start to hit meaningful percentages of overall eCommerce. In addition, we’ll see more value add-ons accompanying mobile, like improved fraud prevention and faster mobile checkout.
3. As cross-border sales grow, merchants will struggle to keep up.
On one hand, the internet and the global economy are accelerating people’s desire for buying internationally; at the same time, the current political environment is more inclined toward protectionism and regulations. As a result, conducting cross-border sales is becoming harder, despite a consumer expectation of frictionless commerce. This year, we think merchants will (and should!) invest substantial time and effort into figuring out how to get cross-border right—how to ship overseas effectively, collect international payments seamlessly, and avoid complexity that could prevent the sale from happening. Those who do figure it out will win big.
Want to be among the companies benefiting from cross-border sales? Download this free ebook to find out how to design an optimal checkout experience anywhere around the globe.
4. Contextual commerce will be trendy but not meaningful—yet.
The idea of customers being able to buy wherever their interest is piqued online gives new meaning to the term “impulse buying.” A “buy button” on Pinterest makes it frighteningly easy to acquire that baseball glove chair you just stumbled on. This digital payment trend has been much talked about as of late, and we expect that same level of hype to carry through 2017—but primarily in the way of more blogs, white papers, and theoretical use cases. A few large brands may start experimenting with contextual commerce, but we don’t foresee it coming to fruition until at least 2018 or 2019.
What do we think will be the real trigger for takeoff? When a virtual reality headset shows you just how great that canary yellow sofa will look in your living room—and lets you buy it.
5. New regulations will help normalize the exploding sharing economy.
As the sharing economy grows, bringing new opportunities for workers, so do the challenges associated with it. The diligence required to properly underwrite an unprecedented number of sub-merchants in a marketplace brings increased risk and overhead, and increased regulatory oversight as well. Sharing economy firms that find the right balance will strike gold, as there are now marketplace models looking to disrupt nearly every sector—from dog walking to hiring to hi-fi electronics. This year, new regulations will help normalize growth, and ensure that the gig-economy model is a permanent part of our future.