Here’s Why Payment Considerations Are More Important Than Ever In Retail Marketing 4 351

Between artificial intelligence, online shopping and mobile, retailers have a lot to contend with in 2017. And those that want to survive into the next era are going to have to make more room on their plates to prepare for it. Whether you’re a one-store operation or a global enterprise, the same rule applies. You need to cater to changing customer preferences if you’re going to stay in the game.

And one of the major game-changers beyond etailing and online presence is how people pay for your products. From handling cryptocurrency to loyalty and the omnichannel experience, payment processors are increasingly valuable when it comes to marketing. I sat down with Susanne Steidl, Chief Product Officer at payment processor, Wirecard, to find out how retailers can prepare for the future of payments. Here are three things to keep in mind.

Cryptocurrencies And The Global Economy

Unless you’re living under a rock, chances are you’ve heard about cryptocurrencies like Bitcoin. You may have noticed companies hanging up a “Bitcoin accepted here” sign, including major retailers like Expedia and Shopify.

But while most of us can’t escape news of the tumultuous investment landscape surrounding Bitcoin and other cryptocurrencies, the majority of us still don’t know what cryptocurrency actually is, let alone how it’s going to impact our businesses. (If you’re like me, and you’re still trying to conceptualize the blockchain, this TED Talk might help.)

It’s important for retailers to understand the unique benefits of cryptocurrencies over conventional currencies, such as decreased fraud and bank fees. But when it comes to marketing, the potential benefits are even more intriguing.

 “The global spread of cryptocurrency may bring customers from new regions and a wider range of socioeconomic backgrounds,” says Ted Lanpher, co-founder of Pareto Network Ltd, an information network for cryptocurrency traders.
In short, savvy marketers are thinking ahead to what cryptocurrency might mean for the global economy and how to leverage globalization to tap into new markets.

Payment Processing And The Omnichannel Experience

When marketers think about the omnichannel experience, we often consider communication and engagement, with the payment experience as an afterthought. Still, it comes as no surprise that providing customers with a seamless transaction across channels can increase retention and satisfaction.

Many payment solutions today have built-in loyalty programs, and collect important data. By making payments a central component of the omnichannel strategy, retailers are rewarded with rich customer insights.

“Payment solutions are the next frontier of loyalty programs because they’re so data rich,” says Jon Wolfe, the founder and CEO of House Advantage, which recently launched an omichannel solution that leverages customer data on behaviors and transactions to provide real-time rewards across digital and brick-and-mortar sites.

 “You get to understand the customer beyond their habits in one place – you get data that tells the stories of their lifestyles, how they live, and from that are able to up the value of currencies like points into rewards they actually want to use,” says Wolfe.

Incorporating payment solutions into an omnichannel strategy has been particularly difficult for brick-and-mortar retailers, who often don’t know who their customers are in-store.

“If you really look at the situation, most [physical] retailers have separate systems for ecommerce and POS,” says Steidl. “By combining that for the first time, they have a common pool of data to illuminate who customers are, regardless of where a purchase takes place.”

By treating in-store purchases as you would online, customers receive targeted and customized treatment. With the right data from their payments processor, retailers can create relevant offers at the point of sale and beyond and enhance the overall customer experience.

The Future Of Voice And AI In Payments

Just as we’re seeing a rise in importance of voice and AI online and in customer searches, that technology will soon wind up in payments. Why? Because anything that saves consumers time is big business and that’s ultimately what voice and virtual assistants do.

“Whatever adds value to the customer experience is something that will gain traction,” Steidl confirms. “In specific situations I can imagine that voice can play a role because it’s so much more convenient for consumers. The technology will combine everything that’s available – whatever makes it easier for customers – this is where we’ll see developments.”

Essentially, retailers can can get a foothold on changing payment technology now and brace themselves for the future by selecting the right payments processor. They need to offer their customers preferred payment options and ensure that evolving currencies like Bitcoin are in their sights. When they understand the tie between payment processing and loyalty they can extend omnichannel to payments and enhance the customer experience at every point of contact.

This article was originally published on August 8, 2017 in Forbes.

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Tina Mulqueen is the CEO of Kindred PR. She consults with reputable ICOs on marketing and public relations strategy, helping clients to secure more than $10M in funding. She was named one of the top young communications professionals by INC Magazine, and her campaigns have been featured in Adweek, Entrepreneur, INC and Forbes, in addition to multiple other niche and television outlets. She's an advocate for women in technology, and often speaks about the intersection of technology and retail marketing. She writes regularly for Forbes, and has written for Huffington Post, Today, Thrive Global, Elite Daily, New York Lifestyles Magazine, and more.

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VEZT Wants You to be Able to Own Shares of Your Favorite Songs 5 891

Mr. Cheeks has been producing music since the early 90s, under the mentorship of his late uncle, the legendary Gil Scott-Heron. He started with the Lost Boyz, won a Grammy for his work with Stephen Marley, and has released a handful of solo albums since.

Now, royalties for his singles will be available to his fans, thanks to the blockchain. Mr. Cheeks’ songs will be available on a platform that allows fans and investors to claim a slice of the rights to pop music they believe in. When the song is licensed for use, in advertising or film for example, you, the investor, get a cut.

It’s made possible through an app called VEZT, which is positioning itself to revolutionize the way music relates to money as the world’s “first music rights marketplace.” VEZT partnered with a long time Mr. Cheeks producer, Bink, to offer shares of the song “Lights, Camera, Action” which is currently available on the company’s website.

The Problem of Selling Music

Mixing music and markets is an old problem. How should musicians get paid? Who pays them? What about their support teams? How do we keep track of the flow of money and make sure everyone’s fairly compensated? Among the music world’s financial obstacles, one of the biggest issues is navigating licensing and royalties.

In Austin, for example, one of America’s most proficient music hubs, almost a third of musicians make less than minimum wage, and 70 percent are earning less than $10k per year on their work. That’s below the poverty line even for a household of one. It’s been like pulling teeth trying to get royalties from companies like Spotify, who generate income off their songs. Meanwhile even more expensive lawsuits pile up, or go completely unpursued from lack of funds, as marketers continue to ape good music with copyright infringing fakes. It’s a constant headache for musicians, producers and labels, and it makes it prohibitive to eke out a living in the music world.

Under VEZT’s model, royalties are simple. Music is intellectual property owned by the artist. The artist can sell a portion of those rights to fans, who become investors when they purchase a percentage of shares. Fans and musicians make an agreement to co-own the songs they both care so much about. If you love a song and want to see it do well, you invest. If it does well, you have a share in the artist’s success. Royalties are split based on percentage of ownership.

The concept comes from cofounders Robert Menendez, a former Wall St. financial trader/analyst, and Steve Stewart, an industry regular with entrepreneurial tendencies, whose accomplishments include ushering Stone Temple Pilots to fame in the early ‘90s and managing the band for a decade. They say they founded VEZT as part of a vision to “detangle a lot of the financial problems in the music industry, and connect fans more directly with the music they love.”

And now, they’ve expanded across the Pacific from VEZT’s headquarters in Los Angeles, and opened an office in South Korea.

‘The Perfect Environment’

“The fans of music in Korea are quite possibly the most enthusiastic and active fans on the planet,” says Stewart. “Combine this with a robust tech community and a government leading the way in adopting blockchain technologies and you have a perfect environment for VEZT.”

The ROK’s new legislation legitimizing crypto exchange, Dapps, and blockchain systems will take the peninsula farther into a brave new technological world, where many others have so far feared to tread. Combined with their now-world-famous maximalist pop industry, and it’s not hard to see why VEZT moved in.

Construction recently finished on their new 2500 square foot office in the Gangnam district of Seoul. VEZT has enlisted a host of professionals to their C-Suite, including veterans of major Korean record labels, Kpop producers, marketing and PR executives and, of course, tech experts.

Fixing Music With Blockchain

If their model works in Seoul and LA, VEZT could bring a more harmonious rhythm to an industry still trying to find its groove in the digital age. The world needs music, and musicians need to get paid. As with anything blockchain, cutting out some of the middlemen could be the Occam’s razor with the solution. When fans are directly invested in their music, everyone will want to see it succeed.

The Patent That Wants to Fix Crypto’s Volatility 5 645

The number of blockchain-related jobs posted on LinkedIn more than tripled last year, according to CryptoCoin News. And blockchain patent filings more than doubled. Companies and individuals alike are innovating, exploring the blockchain’s well of possibilities. Major fintech companies, meanwhile, are gobbling up blockchain patents like they’re going out of style. But cryptocurrencies themselves still have yet to see a mainstream embrace.

The main problem with crypto right now is the same problem people have been talking about since Satoshi Nakamoto said Let there be Bitcoin: volatility. And ever since Bitcoin’s dramatic rise and fall around the turn of last year, cryptos have become virtually synonymous with wild fluctuations.

This reputation has given Bitcoin specifically, and cryptos in general, a mixed reputation. By now we’ve all heard the songs of praises from evangelists and the sour sneers of financial titans alike. Crypto is exciting because it’s unstable; crypto is unrealistic for the same reason.

The Primary Criticism of Cryptos

According to Eric Lamison-White, founder of the investor’s crypto intel platform Pareto Network, volatility is the “primary criticism of cryptocurrencies.”

But he doesn’t think it has to be that way. What if you could stabilize your crypto accounts? Lamison-White says the risks of owning cryptos are “easily mitigated by a variety of hedging techniques that are available in all other asset classes.”

He proposes treating crypto accounts like more traditional assets. “Hedging with options, futures and swaps allow for stable value or any risk profile that an owner or even a speculator would desire.”

That’s the idea behind his patent, filed in 2014, for a structure of interconnected accounts. The system “removes volatility from owning cryptocurrencies,” Lamison-White says, transferring its fluctuations into a hedge account. Here’s how it works.

Lamison-White’s System

The system requires at least two accounts: one for your cryptos and one you’ve funded with fiat currency, let’s say $400 US dollars. These accounts connect to a network of decentralized nodes, which measure the amount of cryptocurrency you have from moment to moment. If there’s any drop in the crypto’s value, the system automatically deducts from your $400 in the other account and transfers it to compensate. When the value of your crypto goes back up, the system re-deposits back into your fiat account.

This holds the value of your crypto assets steady, while transferring its volatility to your hedge account.

What makes it unique compared to other trading systems is that crypto assets can be divided into infinitely small portions. “A futures contract on oil costs $80,000 for example, although a trader only needs to put up maybe $4,000 as a minimum,” Lamison-White says. “This is because the contract represents the price of 1,000 barrels of oil or something crazy.” He notes that even hedging stocks are usually offered in units of 100 or 1,000.

Not so with crypto, where the “infinite divisibility of the asset itself” makes hedging much more finely tuned. Because cryptos are pure math instead of physical assets, “arbitrary sized contracts can be traded just as easily with larger contracts.” One future could represent one bitcoin, for example, but you can also trade in .01 increments. With fractional futures and options, people with very small amounts of cryptocurrency can be shielded from price fluctuations in a way that had only been available to the wealthiest and investment banks for most of the last millennia.

The System at Scale

The system gets even more interesting when you make it scalable. According to Lamison-White, you could have multiple people funding and connecting to the same hedge account, each using it to stabilize their own crypto accounts. Alternatively, you could connect multiple hedge accounts to a single crypto account. Suddenly the possibilities extrapolate, like tinkertoys, developing into an interconnected network of crypto- and fiat-funded accounts, with a variety of owners controlling their assets at a variety of access points, everything regulated with the intelligence and transparency of a decentralized ledger.

Patents Like This are Attracting Corporate Giants

There’s a feeding frenzy going on for patents like these. Visa filed a patent for a B2B blockchain payment system, Mastercard developed its own blockchain patent for anonymous transactions, and Wal-Mart has come out with a few as well. But it’s Bank of America that’s gobbling up the most. With claims to at least 43 live blockchain patents, the financial giant holds more than any other person or company.

Whether they’re just trying to get a leg up on the future of tech, or positioning themselves to harangue the little guy with barrages of lawsuits for intellectual property rights, we’ll just have to wait and see.

Whether or not Lamison-White anticipated the blockchain patent arms race, he was ahead of the curve, filing for his patent in 2014. It could be the thing to finally put skeptical minds to rest about the viability of crypto assets. And with big financial institutions like Bank of America placing a premium on innovative blockchain patents, he may have spun ether into gold.

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