Why Context Matters in Commerce

Why Context Matters in Commerce

Why Context Matters in Commerce

Guest Bio

Andrew B. Morris

Andrew is Chief Content Officer at Money20/20 and leads content development, including speaker selection/recruitment and all agenda planning, for Money20/20's flagship event in the U.S., which is scheduled for October 23-26, 2016 in Las Vegas.

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Like most of us, you're probably in the middle of another time-crunched day as you work to check the items off a daunting to-do list.

As you move through your day, the context of your surroundings and situation changes. The one constant is the mobile phone that you carry at all times to navigate your world and connect digitally with people, information, products and services.

But what if you could have ready access to the products and services you need exactly at the time and place you need them? And wouldn't you be more likely to make a purchase if the offer was at your fingertips in precisely the right context?

This concept has come to be known as 'contextual commerce,' and it's descriptive of the new reality for retailers and service providers.

A variety of contexts

But, to enable contextual commerce, merchants must be able to accept payments within a variety of contexts. Let's call it 'contextual checkout.' And that commerce context for millions of consumers is viewed through a digital lens. Products and services are gathering views, likes and shares within social media platforms like Pinterest and Facebook. As a result, these platforms have begun to embed 'buy buttons' that offer an intuitive checkout experience to purchase products that are discovered by consumers within a social media post. And payment vendors (PayPal, Stripe, Shopify and others) are working to enable the payment functionality required.

Last year, PayPal made a significant investment in their contextual commerce capabilities through the acquisition of Modest, a company founded by Harper Reed, who gained fame as the chief technology officer for President Obama's 2012 election campaign. As PayPal’s first purchase after its split from eBay, the acquisition was an indicator of PayPal's direction as an independent company. Modest technology allows retailers to embed buy buttons within their own apps and emails, an end-to-end experience that makes selling on any platform (in any context) easier and simpler.

In September 2014, Stripe announced a new product called Relay that would allow retailers to sell goods directly in social networking and content apps. Stripe's biggest platform partner for this new product was Twitter, but just months later the social media giant announced that it would be disbanding its 'buy button' team. Despite some reports that Twitter's decision shed doubt on the future of buy buttons, Stripe remains committed to Relay’s long-term bet that people will increasingly want to purchase items in this digital context.

More than buy buttons

But contextual commerce is not just about pressing buy buttons to purchase products online. Service providers like Uber and Airbnb have created disruptive new models for commerce that consider context in ways the incumbents have not. And the payment is nearly invisible in the Uber experience. The rider simply gets out of the car and walks away while the card-on-file payments infrastructure in the background enables this 'contextual checkout.' The same type of 'invisible payments' could be a key part of smart commerce networks in the Internet of Things. Imagine your refrigerator automatically buying groceries as your supply runs low.

As emerging models of commerce continue to evolve, new opportunities and challenges are created for payments providers. One important component is this notion of 'card on file.' The ability to register and securely store consumer payment credentials so that they can be used for payments in a variety of contexts helps remove friction from any contextual checkout experience. Braintree, another PayPal acquisition, has been a leader in this space. Manually typing a 16-digit card number is rarely a good user experience, and this is amplified in a mobile context.

It's also important for payments providers to offer a flexible SDK/API to merchants so that the payment functionality is easily embedded within their various digital contexts. And finally, there is greater need for collaboration and partnership, often between payments industry competitors, as the commerce ecosystem becomes increasingly integrated and complex.

And so let's get back to your hectic day. With mobile phone in hand, there is new hope. You might find just the outfit you need for the party this weekend as you scan through social media posts. No need to search every store in town, or even to search through retailer websites, to find the great clothes in the picture. You’ll be able to buy it right there on the spot; just hit the buy button and it will be delivered to your doorstep. And you won't need to get out your wallet, fumble for cards, swipe, dip or sign when you go through the pharmacy drive-through. They'll have your card on file.

It won't happen overnight, but merchants and payments providers are working to create commerce experiences that work within the context of our lives.

The statements and opinions of the writer do not necessarily reflect those of TSYS.

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Andrew B. Morris

Andrew is Chief Content Officer at Money20/20 and leads content development, including speaker selection/recruitment and all agenda planning, for Money20/20's flagship event in the U.S., which is scheduled this year for October 23-26, 2016 at The Venetian in Las Vegas.

Although not currently practicing, Andrew is also CEO & Founder of Morris Advisors Inc., an independent consultancy that advises retailers and other industry stakeholders on payments and commerce strategy. In addition, Andrew is a member of the FinTech Steering Committee for the Technology Association of Georgia and is Co-Chair for TAG's annual FinTech Symposium to be held in Atlanta in February 2017. He was formerly head of the mobile commerce consulting practice at inCode, a division of Ericsson Inc.

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