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Remember when Maxwell Smart spoke to CONTROL headquarters through his watch? It was a revolutionary idea and fueled our imaginations of future communication. Now, his shoe phone was a bust, but modern-day technology has created amazing smartphones that combine voice and non-voice communication for a myriad of applications.
Each of us keeps a handy computer within reach all day long – sure, it looks like a regular phone, but it is so much more. For franchises, these smartphones offer opportunities, at very little cost, to collect payments for goods and services. Half the population pays with their phone, so franchises are wise to consider offering mobile payments for buyers.
As a franchisee, your franchise corporate office will likely already have a policy in place for mobile payment options. However, if you are given a choice, here are some advantages and possible disadvantages to accepting mobile payments.
Advantages of Offering Mobile Payment Options
Happy Customers. Not everyone carries cash or credit cards. Customers want options, and mobile payments are yet another way to offer ease of purchase. Withso many mobile payment options to choose from, customers appreciate the convenience you offer along with your goods and services.
Offer Incentives. APew Study shows that incentives are of high value to customers, especially millennials, and that mobile payment options with incentives are preferred. As a franchise owner, you can use mobile payments to offer discounts and special deals. This can lead to increased revenue; especially for cash back and points programs that build loyalty.
Integrated and Faster POS. As mobile payment options mature, they integrate with most POS systems. This is important for inventory and record-keeping purposes. As an added bonus, mobile wallet payments are usually faster than counting out change or relying on credit card processing systems.
Track Buying Trends. Data collection can be immensely valuable. And, unlike cash, mobile phone payments provide data that franchises can use to increase sales in the future. Knowing what customers are buying provides powerful information for franchise owners.
Lower Fees. Set-up and ongoing fees will vary, but mobile payment fees are often lower than credit card fees. A credit card may charge as much as 5% per purchase, but mobile wallet apps are often under 3%.
Possible Disadvantages
If you decide to offer mobile payments there will be some costs, and the use must be high enough to justify it. What might hinder a mobile payment program from adding to your franchise?
Security and Fraud. Clients worry about personal data on phones. Whether the fear is justified or not, some simply will not use a phone for financial transactions. But if your business caters to a younger clientele, this is probably a small issue.
Technical Issues. As with any application or system, there could be technical issues. Not all apps work in all areas, and having to solve a problem while a customer is waiting is far from ideal. This probably doesn’t happen any more than other POS issues, though, and the benefits probably outweigh any inconvenience.
However, as true “smart” phones (not the one in a shoe) become our go-to for daily activities, the use of mobile payment will become as ubiquitous as GPS-guided driving directions and free worldwide texting. As a franchise owner, offering mobile payment options is probably a sensible choice.
Anne Daniells is a co-owner of Enterprising Solutions, a professional services firm specializing in corporate communication and financial improvement for businesses where she shares decades of corporate and entrepreneurial experience—including franchise ownership—in her writings on business culture. She has authored hundreds of articles for publications including AllBusiness.com, TweakYourBiz.com, and MSN.com. Reach out via her website for more on where corporate culture, communication, and human architecture collide.