How the Pandemic Has Hastened Small Merchants’ Conversion to Contactless And Online Channels
Evidence continues to accumulate that the Covid-19 pandemic is not only boosting contactless and online payments, but doing so in historically short order. Some 48% of small and medium-size merchants reported in mid-June that they had observed an increase in the number of consumers either using contactless payments or asking about doing so. That’s up from 27% in a similar study in March, just as the virus was taking hold in the U.S. market.
These are among results of the latest merchant survey by the Electronic Transactions Association, Washington, D.C., and The Strawhecker Group, an Omaha, Neb.-based payments consultancy. The two organizations reported their findings Wednesday. The latest survey canvassed 173 small and medium-size U.S. merchants between June 12 and June 18.
The overall sales picture has worsened, with 53% of respondents reporting lower sales than in the months before Covid-19 struck. That’s up from 47% in March. But these sellers also reported a continuing rise in e-commerce sales, with nearly 40% reporting an increase since the March study. Of these, most reported an increase of at least 10%.
Top tactics to deal with the impact of the virus include new services or products (adopted by 49%), new sales channels (41%), and stepped-up marketing, including social media (39%). Popular tactics include mobile-based delivery, which half of the respondents have added. The most popular e-commerce platform for these merchants is Shopify, according to the survey. “Our survey found that SMBs are implementing new marketing strategies to meet customer demand in a safe and sustainable way,” said Mike Strawhecker, president at The Strawhecker Group, in a statement. “Diversifying sales channels through payments technology is a key part of that.”
But the emphasis on e-commerce has come with a downside: twice as many merchants reported attempted fraud and chargebacks compared to March.