How Restaurants Can Build Loyalty with Mobile Messaging [2023 Update]

Loyalty programs through mobile messaging are an effective way to increase your restaurant’s customer retention rate. The increasing use of mobile in placing orders is unlikely to change. That trend is here to stay. SMS marketing is the best possible way to utilize this opportunity to get your customer’s attention.

However, SMS marketing is only effective when done correctly. If your promotional messages annoy your customers rather than help them, they can unsubscribe, wasting a perfect opportunity.

You don’t have to worry about going wrong if you carefully follow our guidelines to build loyalty with mobile messaging and the rules we discuss.

What is Text Message Marketing?

SMS marketing or text message marketing means communicating with your customers through text messages on various deals, updates, offers, or reward programs.

Build Loyalty with Mobile Messaging – Strategies to Follow for an Effective Marketing Program

There are a few strategies at the heart of successful text message marketing campaigns. Let me discuss them here and, you too can drive sales and reap the benefits of this marketing tool.

Reach Out at The Right Time

The first thing to keep in mind is that there is a window of time when your customers decide where to dine. If you are visible to them during their time of decision-making, there’s a good chance they’ll pick you.

83% of consumers decide where they’ll dine within three hours of having their next meal. That is why timing is crucial. If you are offering a combo meal of soup, salad, and sandwiches at a discount rate, your chances of getting your customers to eat at your restaurant are higher if you send them a promotional text before lunchtime.

On the other hand, a 2 a.m. text about the same deal is likely to annoy your customer and hit unsubscribe.

Analyze Data for Personalized Marketing

The great thing about the increasing use of mobile for ordering food is that you can easily track your customers’ preferences. If a customer tends to order food at a specific time, make use of that information and send them eye-catching deals and offers around that time.

If your customer always orders two items together, maybe add a discount on that combo. Your customer is much more likely to purchase if you are responsive to their consumption patterns.

Focus on Providing Value

You can introduce different loyalty programs to increase customer loyalty. Promoting these programs through text messages is a good way to go. It is important to be clear about the benefits your customers will receive. Customers don’t want to know about your business if there isn’t something in it for them. Keeping all your promotional content customer-oriented and relevant is necessary.

Rewarding customers on their birthdays, giving special discounts on repeat purchases, and, other such tactics are good ways to retain customers.

You can also give them special discounts if they place an order through your restaurant’s app. Incentivizing your customers to download your app like this is a clever strategy that many businesses follow.

Have a Clear Call To Action

A call to action is a message that induces a customer to perform a specific task. Make it clear in your promotional texts what you want your customers to do and reward them for that behavior. To make this even more effective, create a sense of urgency. It is an age-old trick in marketing but, it still works.

People have a fear of missing out on incredible opportunities. Creating that sense of urgency will drive in that fear and make your customers respond. The end date to an offer makes that offer far more tempting. Use this strategy and, you’ll surely see some results.

How To Create Restaurant Text Coupons

Here are some guidelines that will help you compose the perfect test coupons.

Say More with Fewer Words

A text message is limited to 160 characters. This can be restricting if you’re not making sure to cut down on unnecessary words. Stick to the point as much as you can and get creative to come up with captivating taglines.

Proofread

A spelling mistake can be disastrous as customers may see your messages as spammy and unsubscribe to your text message marketing campaign.

Include Opt-Out Option

If you are not required to add an opt-out option to your promotional text messages by-law, I’ll still recommend you to do it. Having an opt-out option makes your customers feel secure as they are in control. Nobody likes feeling trapped and hassled. Your customers will probably disengage from your brand completely if you give them that feeling.

I once had an entrepreneur send me an email about how I wasn’t interacting with his emails as I used to. He even sent me a link to unsubscribe if I wanted to do that. It made me feel that he aimed to provide value to his subscribers. I found myself paying more attention to his content. This reverse psychology gimmick worked on me. You could give it a try as well if you see your customers not interacting with your campaign at all.

For Higher Engagement- Send MMS Instead of SMS

Visual messages are more effective than text messages. There is a whole science on making MMS more impactful. Through MMS you can send attention-grabbing bold headlines, short videos or, colorful pictures to hold your customer’s attention.

Some services help businesses connect to their customers through text messages and MMS. They make your work much easier and know what needs to be done to help your business grow.

Conclusion

Mobile marketing is a must to grow a business in today’s fast-paced world. Starting from text message marketing to launching apps and partnering up with third-party delivery apps, businesses now have to tackle a lot just to stay relevant and thrive. Without doing these, your restaurant may find it hard to grow.

Businesses that adapt fast to the shifting trends are the ones that stay strong. Following these tricks will help you start a successful text message marketing campaign and keep you in the game.

For more on mobile messaging for restaurants and other restaurant payment questions, see Restaurant Payment Resources.

How to Finance a Restaurant and Secure Restaurant Funding

The success of a restaurant depends on a wide variety of factors. These factors are delicious food, great location, superior customer service, and a steady supply of funding. There are a lot of expenses involved in running a restaurant. Without financial backing, it is impossible to run a restaurant business.

In the first six months of the pandemic, one out of six restaurant businesses had to close. This fact alone will make anyone think twice before opening a restaurant. Fortunately, the worst of the pandemic seems to be beyond us as we are moving on to a better world. There is increased demand among people to have a dine-in experience in restaurants. If you have been passionate about starting or expanding your restaurant, now is a good time to follow your dream.

To run your dream restaurant effectively, you need to have a steady supply of capital. There are a lot of costs involved in running a restaurant. You need money to rent or buy space, hire staff, manage inventory, marketing, etc. It’s hard for any individual to have that kind of money on his own. If it is difficult or impossible for you to manage thousands of dollars on your own, you need to turn to restaurant financing.

You need funding to get your business up and running. It takes businesses ample time to become profitable. Funding helps you cover the expenses until your business becomes profitable. The process of securing funding is a great learning experience for any aspiring restaurateur. It forces the restaurant owner to think about the financial implications of the business and come up with a solid plan on how to be profitable.

We will be looking at some of the best options to secure financing for your business. Whether you are looking to start or expand your business, these will be helpful for you. We will discuss the pros and cons of each of these options.

Merchant Cash Advance (MCA)

Merchant Cash Advance is a way of securing a lump sum of money in return for a percentage of profit on future sales. These advances are offered by merchant payment systems and they act as a loan against your future credit and debit card receipts. Institutions that provide merchant cash advances provide capital to businesses. In return, they will get a fixed percentage of the sales until their loan is repaid. The amount to be repaid will be set beforehand and it will be greater than the original amount. It will make sense if we look at an example.

Let’s say your restaurant receives an advance of $30000 for a 10% markup. Now, you will have to pay the advance provider $33000 from your future sales. The payment to them will be automatically made from your credit and debit card sales.

Pros

MCAs are great for you if you have a steady flow of regular credit and debit card sales.
It’s a simple and unrestricted way to secure funding. If you have steady credit and debit card transactions, it will be easy for you to get an advance.
You can get funding really quickly. In some cases, it takes as little as 2-3 days.

Cons

You can’t pay it back early to save interest rates. The payback amount is already set and you will have to pay it in full.
This option is not ideal for new businesses as some business history is required to get these loans.
It is not ideal for businesses that do most of their transactions in cash.

Small Business Administration Loan

SBA Loans are a great way for small businesses to secure funding. The SBA guarantees to repay a certain percentage of the loan to the bank if the borrower is unable to repay it. The most common SBA loan for restaurants is the SBA 7(a) loan. These loans typically cover expenses to purchase an existing restaurant, purchase equipment for the restaurant, and renting or buying space for the restaurant.

Pros

It is easier to qualify for SBA Loans than traditional bank loans.
The loans are backed by the government and you can get up to a $5 million loan.
If one institution rejects your application, you can still seek approval from other institutions.

Cons

Loan approval can take up to months.
A lot of detailed documentation is required to get approval for the loan.

Business Line of Credit

With a business line of credit, you can secure loans as you need them. You won’t have a lump sum of cash but you will have a line of credit that you can use whenever you need it. You will be able to borrow the amount that your line of credit allows you to.

It’s a flexible option for you to use. You will only pay interest on the amount you borrow. It works similar to a credit card but better. The limit is higher and the interest rate is lower than a credit card.

Pros

It’s a flexible option for you to secure loans as you need them.
You only have to pay interest on the borrowed amount.

Cons

You need to pay administrative costs to keep your line of credit open.
It is not a long-term financing solution.

Friends and Family

If all your efforts to raise capital fail, your friends and family are likely to be your biggest supporters. This may seem like a scrappy option but having people you love and trust to back you in your journey is actually a viable option.

Pros

No paperwork or detailed documentation is required.
You don’t need collateral to get a loan from your family and friends.

Cons

It has the potential to destroy personal relationships if things go south.
The terms and conditions of the deal can end up being confusing and unclear.

Final Thoughts

Finding a way to secure funding is a key ingredient in your restaurant’s recipe for success. You need to prepare well to secure funding for your restaurant. Have a clear and concise business plan that you can be proud of. When pitching your ideas to your potential investors, predict the objections they are likely to raise and provide logical answers to those objections. Securing funding will allow you to make your dreams come true.

Financing a restaurant: one piece of running payments in a restaurant. The rest of our restaurant payment guides are in Restaurant Payment Resources.

4 Ways to Grow Restaurant Revenue Using Your Online Menu

Online ordering is growing in popularity every day. More and more customers are starting to order online. Online orders are a great way for restaurants to serve their customers. They can serve more customers now than they could in their limited dining space.

Unfortunately for many restaurants, the level of competition is also very high. Most restaurants are engaged in a fight to encourage more customers to purchase with them. To stand out from this competition, you need to make sure that you are positioned well. One of the best ways you can make your brand differentiate from others is through your online menu.

Your online menu is your silent salesman. Did you know that 77% of diners are likely to visit your website or go through your online menu before they decide to purchase with you? When customers are deciding whether to go with your restaurant or not, your online menu will be their biggest decision-making factor.

Your online menu needs to be well planned and strategically designed. You can’t just make a scanned copy of your existing menu, upload it, and expect great results. The rules of engagement are different when it comes to online ordering. Your online menu needs to be organized well and easy to navigate. Here are the best tips we can give you so that you can use right away to optimize your menu and increase your revenue:

Use Your Brand Story in Your Menu

If you want your brand to stand out from the others, you need to make sure you are telling your brand story through your menu. You can influence a customer’s decision by the simplest of subtle triggers.

If you just incorporate a positive adjective, it will create a positive perception in the customer’s mind. You need to keep that in mind when you are drafting your menu description. For example, if you have a vegan restaurant, make it known to the guests that you only used locally grown vegetables. Whatever it is that you do differently from your competitors, make sure your customers get a chance to know that.

If you are using this strategy, you can justify charging a premium on certain items. For example, the price of the meal that is cooked with organic produce is likely to be higher than the other meals on the menu. Your customers will have full transparency to the menu and it will help them come to a final decision quicker.

Strategic Upselling

Do you want to maximize your revenue from your online menu? Upselling is the best way for you to achieve that. We all know that bringing in new customers is difficult and expensive. It costs four times as much to retain your existing customers than to acquire new ones. Through upselling your customers, you can generate more money from your existing customers and increase your revenue.

One of the ways to upsell your customers is to offer recommendations to them. Once they have added something to their cart, you can show them an option that says “Most customers pair it with this”. You can use your own verbiage but hopefully, you get the idea. It’s all about making a digital version of the “Would you like fries with that” effect that McDonald’s has been executing successfully. If they add the additional item to their cart, it’s more revenue for you. If they don’t, then no harm is done to you.

The other way of doing upselling is more common. You can offer customers options like “Extras, Add Ons” where they can customize their meals and add extra slices of cheese, toppings, sauces, spices, etc. This allows the customers to get creative with their meals while you make money in the process. Customers are much more likely to check a box on the screen than when they are dealing with a live server.

Optimize Menu Categories for Online Order

The attention span of people is getting shorter and shorter every day. Our goal is to make it easier for the customer to make a buying decision as soon as possible. If you don’t get a customer interested in your online menu within three seconds, there is a strong probability that you have lost that customer.

If you look at a traditional menu, the categories in there go like “Appetizers, Entrees, Sides, Desserts, Drinks”. This set of categories works in a dine-in situation as customers are already familiar with this setup. But as we mentioned earlier, the rules of engagement are slightly different in the online world.

We need to capture the attention of our customers as soon as possible. The way to do that is to highlight your most popular items right away. Your customers should know about what most of your customers are ordering from you. Think of it as a digital way to offer your recommendation to a customer. Doing this will make your customer more likely to be interested in your menu and make a purchase.

Highlight Specials and Follow Trends

Nobody can expect what the next big trend will be. But everybody can be prepared to capitalize on it as it happens. For example, a while ago the pictures of rainbow-colored foods were going viral on Instagram. A lot of restaurants joined that trend and started offering these rainbow-colored foods. That trend was short-lived and then the trend of activated charcoal blackness came into action. You will never know what the next big trend is but you can capitalize on it as it happens.

On the more predictable side of things, there are seasonal trends that you can always use to your advantage. For example, you can customize your menu according to seasonal holidays. Also, it will be a great idea if you highlight the different diets you cater to. For example, having a separate category for vegan, keto diet, gluten-free and paleo foods will greatly help your customers. It will help them navigate your menu quicker and they will know exactly where to find what they are looking for.

You can also make the most of your online menu to attract customers by providing discounts, offering “buy 1, get 1” offers, or highlighting a rewards gram. You can offer coupon codes if they order during happy hours. If you leverage these tips, you can make the most of your online menu and generate more profits for your business.

Restaurant Payment Resources covers online menus and revenue alongside tips, POS and card fees, all in one place.

Benefits of QR Codes and How Restaurants Can Use Them

The pandemic has made it necessary for restaurants to limit face-to-face interactions as much as possible. In that effort, restaurants and pubs have set up QR codes for taking orders and digital payment.

We don’t think this change is going to go away as both customers and restaurants are benefiting from the use of QR codes. According to a survey, about eighty percent of pub-goers who have used digital methods to order online want to keep doing it in the future.

If you are wondering how your businesses can reap benefits from using QR codes, we’re here to give you a breakdown of them. We’ll also discuss the process of introducing QR codes to your restaurant.

Benefits of Using QR Code Menus And Payment Portals

There is no shortage of benefits to restaurants when it comes to using QR codes. Here’s a list of them.

Reduce Expense by Eliminating Printing Cost

Printing Physical menus can increase your restaurant’s expense a lot if you frequently need to change it. The upside of having a digital menu is that you’ll save up on the expense of printing physical menus. The only expense will be the graphic designer you hire for this job.

Reduced Staffing Cost

When a customer scans the QR code provided on their table, it redirects them to your restaurant’s website or app where they can have a look at your menu. After that, they can choose the items they want and order directly. Since you won’t need people to take orders, you can reduce the number of your waiting staff and save up.

Your staff can also focus more on the needs of the customer and provide a better service when they don’t have to run back to the kitchen.

Getting Bigger Orders

Customers are likely to place a 30% bigger order when ordering digitally. This is because they don’t feel hassled to make a quick decision. They can take their time to order everything that they want.

Sometimes customers also find it awkward to order too many items at once, thinking they will be judged. Not having to tell another person that they want a second helping of fries, is just what can make the customers order that second helping.

Better Dining Experience

There is nothing that can ruin a customer’s dining experience as much as having to wait for someone to take their order for too long can. As they say, first impressions stick to the mind and if your customer has had such an experience with your restaurant, they are unlikely to return.

QR codes reduce this waiting time as customers themselves are in charge of placing orders. Since the order is sent to the kitchen directly, the food can be prepared faster as well, reducing the time that your customers spend waiting even further.

Reduced Expense on Updates to The Menu

You can update your menu frequently if you are using a digital menu. The process is also less time-consuming as there is only one thing you need to get done, which is updating the design of the menu.

If you just want to change only the prices or lists of items, then you can do that in a matter of minutes. You’ll just need minimal editing and integrating the updated menu into your system.

A digital menu is much less of a hassle.

More Menu Design Options

With a printed menu, you have to worry about fitting things in a limited space. But with a digital menu, you can add as many enticing images as you want as there are no space limitations. Images can be far more lucrative when it comes to food, tempting your customers to try out more dishes. You can also add short videos to make certain items on your menu even more appealing.

Customer Data

Customers have to input their email address and number to place their order. This lets the restaurant enter them into their mailing list or text marketing campaign. These channels of promoting restaurants have proven to be effective when done right.

Restaurants can get more customers to come back by sharing value-adding promotional content with their customers.

How Restaurants Can Use QR Codes?

To set up a QR code payment and ordering system at your restaurant, you have to take care of these steps.

Create QR Codes for Ordering And Payment

You can do this with the help of numerous companies that offer their services to help your business set up QR Code payment and ordering systems. You can set up self-serve ordering with square online, Clover, or any other such company in the market.

Setting Up Your Restaurant With Required Tools

You’ll have to ensure that your waitstaff has access to tablets or smartphones. You’ll need to configure some back-end software to integrate QR code ordering and payment with POS payment solutions.

Place QR Codes in Appropriate Places

Place the created QR codes throughout your restaurant. The entrance, individual tables, near the cashier are places that are more visible to the customers. QR codes to place orders should be placed on individual tables so customers can scan them to order.

When the customers are done eating, your staff can bring them a printed-out QR code that they can scan to pay. Customers will either pay with a mobile wallet or they can manually input their payment information in a form that will load when the QR code is scanned.

Conclusion

Setting up QR code payment and ordering systems is easy and cost-efficient. You don’t have to spend a lot on hardware as your waiting staff most probably have access to smartphones. There are also loads of benefits for you in making this conversion.

People are moving towards mobile ordering and payment. This is becoming the preferred way of doing things. Customers these days expect to be able to pay with a quick scan and order without much face-to-face interaction. Setting up QR codes is a step in the right direction for any restaurant business.

With QR codes in restaurants on your list, the restaurant resources hub has the related guides.

Branded Mobile Restaurant App Vs. Third-Party Apps

The number of orders that customers are placing through their phones is increasing every day. While websites for every restaurant have become a standard and are still an effective portal to drive online sales, their usage is declining. These days the most convenient way of ordering food online is through a mobile app.

Here we will compare the pros and cons of launching a branded mobile restaurant app with joining a third-party delivery app. We’ll also discuss which approach will work best to drive your sales and maximize revenue.

Pros and Cons of Branded Mobile Apps

Branded mobile apps are apps that are run by the restaurant and represent the brand of the restaurant. The initial cost of designing and launching such an app is more. That is what most business owners focus on and opt out of this option. However, there are benefits of a branded mobile app that can be worth investing in.

Pros of Branded Mobile Apps

Here’s a look at the pros of branded mobile apps.

No Competition

If you are using a branded mobile app, the only restaurant that it features is yours. Your restaurant will be one of many in whatever category you are featured in a third-party app.

Control Over Your Branding

You can control your branding completely. The design of the app can be such that it gives your customer a taste of what it’s like to dine in your restaurant. You can’t do that with third-party delivery apps as they have complete control over the interface and design.

Customer Data

Now, this is the best benefit branded mobile apps have to offer. You get to keep your customers’ data and therefore market to them on a personal level. Personalized offers that are based on your customers’ past purchases are far more effective at making them your repeat customers. You can cater to their individual need and establish a connection to gain customer loyalty.

Control Over All Aspects

You get to control every aspect of the process. Starting from what your customers see up to delivery, everything is in the restaurant’s control. If there is any issue, you can respond quickly as you know exactly what went wrong. This is important in retaining your customers. As a customer who has had a bad experience is highly unlikely to order at your restaurant again.

Cons of Branded Mobile Apps

There are several disadvantages as well. They are listed below-

Hard To Get Downloads

This is by far the biggest issue with branded apps. A customer has limited phone storage. It makes much more sense to download a third-party app where they get so many options. Customers are not in the habit of downloading individual restaurant apps, The only customers that are likely to download your app are those who already order from you frequently.

Getting new customers to download your app is not easy. The best way to mitigate this is to offer special discounts for using your restaurant’s app to order, referral code reward campaigns, and special loyalty programs.

High Initial Cost

Making and maintaining an app is costly.

Training and Hiring Employees for Delivery

You’ll have to spend on additional employee salaries and training programs.

Pros and Cons of Third-Party Delivery Apps

Third-party delivery apps get millions of downloads. They’ve become closely integrated with modern life that most people reach out to their phones these days to place an order. The pandemic has only accelerated the rise of mobile ordering.

There are lots of ways in which third-party apps can boost your business. Let’s discuss them here.

Pros of Third-Party Delivery Apps

No Initial Cost

To get registered on a third-party app, restaurants do not have to pay any additional fees. If your business is small or new, you probably want to limit your expenses. Third-party apps allow you to reach a customer base you’d otherwise have no access to.

Easy to Acquire New Customers

Third-party apps come with their own sets of loyal customers. You can register in the most popular ones and tap into that market. These apps come up with many marketing schemes to attract even more customers. You can leverage their popularity and bring in business.

Delivery is Taken Care Of

Third-party delivery companies have trained employees who take care of delivering your restaurant’s food to the doors of your customer. These companies are delivery experts and are very efficient.

Access to Additional Resources

You can get access to resources and experts that your restaurant cannot invest in. Delivery tracking, various payment methods, delivery systems, and many other such resources are costly or time-consuming to manage.

Shared Service Accountability

Your restaurant and the third-party app will both be accountable in case any issue arises. Having two brands attached to an experience confuses the customers as to which one to hold accountable. But with a branded restaurant app, you are solely responsible and your name is strongly associated with any bad experiences.

Cons of Third-Party Delivery Apps

No Control on Visibility

You have no way of controlling your visibility in a third-party app unless you spend extra dollars to be featured heavily by those platforms. Even when customers actively search your restaurant’s name, third-party apps show other similar restaurants to the customers along with yours.

High Commission Rate

Restaurants have to pay anywhere between 15-30% of their revenue. Needless to say, that can eat into your profits.

Branded Mobile Restaurant App Vs. Third-Party Apps- Which One to Choose?

If you run an established restaurant with many loyal customers, I’d recommend you to use a more blended approach. Investing in your restaurant’s app can lead to long-term benefits. But, if your business doesn’t have a huge customer base and is new or on the smaller side, you should stick to only using third-party delivery apps.

Final Verdict

It is getting tougher each day to stand out in the restaurant industry. Having a website is now only the bare minimum you can do. Having a way for your customers to order through an app is essential to stay in the game.

We keep our restaurant payment articles together in Restaurant Payment Resources; see it for more on branded apps versus third-party apps.

Pros and Cons of P2P Payments for Merchants

Timely payment is essential for the success of any business. A business cannot survive without a system where the buyers can quickly pay them. Therefore, with the advancement of technology, we see many new methods of payment evolving. Especially in late 2021, when the corona pandemic is waning, the businesses have adopted P2P enthusiastically. But with this new payment facility, many new issues need to be addressed too. Today we will address the pros and cons of P2P payments for merchants and individuals.

Peer-to-peer payments have given people a seamless option to send or receive money without friction. Companies have benefited from P2P services during COVID19 when people avoided any physical contact, primarily through currency and cards. P2P was a great solution in this scenario.

Growth of P2P globally and in the US

Over time, P2P has become more popular and acceptable as a payment system. Every day, millions of people globally install and use a P2P app like Google Pay, Venmo, or Apple Pay Cash. The global peer-to-peer market will reach a level of $589 billion by the end of 2028. Furthermore, the number of P2P users in the US will grow exponentially to around 132 million by the end of 2021. The future of P2P is bright.

P2P is a convenient mobile wallet application that eliminates the requirement of carrying cash, credit cards, debit cards, or any other physical forms of payment. Users can pay from the app on their mobile devices. They can easily receive money without hassle. They can also keep the money in the wallet provided by the app or they can get the money transferred to their bank account in seconds. Furthermore, they can keep a track of how much they are spending.

How does the peer-to-peer system work?

To make a P2P payment, the sender and the receiver must install an app on their respective devices. There are multiple different P2P apps available today, which the user can download from the app stores.

The user has to complete a quick registration once the app is installed on their smartphone. Registration is a simple process. It takes only a few minutes of users’ time. Once the user registers, a fund source needs to be added. A bank account or debit card usually needs to be added so that you can easily add and withdraw funds from the app. Similarly, if someone pays you via the app, you can transfer the amount to your bank.

Before you start sending or receiving payment, you will have to go through an authentication process. P2P app companies follow almost identical authentication methods. However, the authentication process might be different in different countries.

Once authenticated, the user can then send and receive money. To send money, the user will first have to add a recipient. One can also request money from someone else. Both parties should have the same app for a P2P transfer.

How will businesses benefit?

A business owner knows that the easier you make it for your clients to pay, the more they will buy from you. In simple terms, if you accept peer-to-peer payments, it is more likely that the customer will purchase from you instead of going to a merchant that only accepts cash or cards.

Globally, P2P payments have contributed to the expansion of the economy.

Countries like Saudi Arabia, Peru, Chile, and Colombia are witnessing a multi-fold growth in P2P transactions. They are the leaders in this segment when it comes to growth per million population. According to the latest figures, people worldwide made 70.3 billion transactions in the year 2020. Estimates for 2021 are yet to be known, but we know which direction this is going.

P2P Payments – Important Pros and Cons

With such an encouraging growth of P2P transactions in the US and globally, one should remember a few essential aspects of P2P. With facility comes risk. And yes, there are specific risk factors with P2P.

Many new people are switching to peer-to-peer transactions because of the ease and compliance. But, they are not aware of the risk that it poses. It can be anything, ranging from the human error of sending the money to the wrong person to getting scammed easily. Therefore, it is essential to know the pros and cons of a P2P payment for merchants and individuals.

You can assess the benefits against the risk and then decide if P2P payments are right for you.

Pros of P2P Payments

#1- It is an effortless process to send or receive money. One doesn’t have to go through multiple complicated steps for the transaction. You can directly use a phone number or scan a QR code to proceed with the instant transaction. This ease of sending or receiving money has made peer-to-peer transactions popular.

#2- When you send or buy money via P2P, there is no middle man or a money holder. Transactions are electronically processed. This doesn’t require much overhead. Therefore, the transaction fee is relatively low. Most systems offer free debit and ACH transactions and make a fee on credit cards processed through their system.

#3- Safety is another reason why people prefer P2P. P2P networks are encrypted when used properly can be relatively safe since they don’t expose card data or personal information to merchants.

#4- Many people use P2P networks because the currency conversion charges are less than banks or brokers. P2P also makes it possible for the user to buy products globally and enjoy the real benefits of globalization.

Although P2P payments offer many benefits, there are also drawbacks to discuss.

Cons of P2P payments for merchants and others

#1 Mistaken transactions: Sending money to the wrong person is the most common error that we find on a P2P network. New people are not accustomed to the interface. They make mistakes while sending or receiving money. Human errors lead us to the next issue, which is another significant drawback with peer-to-peer payment.

#2 Dispute redressal: If you made a payment to the wrong person from your bank’s Internet banking system, you could get a refund quickly. You can contact the bank, and they will get the refund from the recipient. But, when it comes to P2P, there is no mediator involved in the transaction.

Many P2P apps do not have a refund or dispute system in place. Nor do they have any arbitration process in case of a disagreement between the sender and receiver. This makes it very difficult for an individual or a merchant to get a refund of their money.

#3 Security: Complete security is essential at both ends. P2P networks are secured, but what about your smartphones? If the smartphone is compromised or hacked, the hacker might use the P2P app on your mobile for fraudulent transactions. New smartphone users are usually the target of hackers as well as social engineering to trick them into sending funds.

As an individual, one should always use strong passwords, face recognition, or fingerprint authentication to avoid such issues.

Conclusion

Peer-to-peer payments for merchants and individuals have made life easier. The market for such apps is growing like never before. But one should always be cautions and take appropriate safety measures while sending and receiving funds via P2P systems.

Trends in Mobile Credit Card Processing for Fall 2021 and 2022

Over the last 12 months, almost every retailer felt the need to shift from the in-store traditional payment methods to the new-age digital methods. Businesses have also understood that this shift has a vast scope – it is not just a momentary reaction to the prevailing coronavirus pandemic, but a long-term trend. IBM’s U.S Retail Index study revealed that the transition to digital payment was speedy due to the pandemic, which otherwise would have taken five years. E-commerce purchases are predicted to grow by 20% this year.

Even in these uncertain economic times, retailers can be confident that online and hybrid shopping will continue to grow. Today, the customers have become more aware and want more flexibility and security in mobile solutions from these brands. And therefore, brands cannot just sit quietly.

We know that even if the pandemic ends, the e-commerce growth and related customer needs are here to stay. For businesses to keep up with the competition, they must shift to modern payment methods. This article will discuss six trends in mobile credit card processing for fall 2021 and 2022 that will make their way into the future.

#1 E-Wallets

With the increasing number of smartphones, e-wallets have become the most convenient mode of payment for consumers. A mobile wallet syncs your bank accounts and credit cards and turns your smartphone into a contactless payment device. According to some statistics, the global estimate of smartphone users in 2021 was 3.8 billion, compared to 2.6 billion in 2016. A smartphone has become a necessity as it gives you apps for every need from banking to driving, social to nutrition tracking related to all aspects of your life.

55% of Americans use their smartphones when shopping, all due to the increasing use of e-wallets like Google Pay and Amazon Pay. With mobile wallets becoming popular and the growing use of peer-to-peer transfers, the security of these apps has also increased. E-wallets are going to change the way how we pay now. It is one of the most significant trends in mobile credit card processing that cannot go unnoticed.

#2 Social Shopping

A retailer’s most remarkable ability is being able to use personal relationships to his advantage and engage their customers in their business. More than 78% of customers trust the recommendation of their friends and family for shopping, so brands can count on social media sharing and engagement as a better proof of purchase than a direct message to the consumer.

Retailers can hire social media influencers for promotion and make use of social media tools to get to know their customers better. They can further promote positive reviews, give better customer service and sell directly on the platform where their customers spend substantial time.

#3 Contactless Payments

During the pandemic time and earlier, we would hesitate to touch cash as we did not know how many hands the bill was exposed to. With credit cards, handing them over to the cashier for a swipe and typing your card pin is avoided to minimize the touch. Things have changed much over the past months, and Mastercard’s survey suggests the same. The survey says that more than 51% of people use cashless payment in some form. Contactless payments are now more secure than the traditional swipe method with scanning technology to complete the transactions. All this is possible because of the encrypted microchips and mobile apps.

#4 Mobile POS Devices

As more and more consumers use contactless payments, retailers align their shopping experience with POS technology. With the help of mobile POS, retailers can accept payments anywhere as these are wireless devices and not connected to checkout locations. This gives even the smallest brick and mortar storse the flexibility to offer customers multiple checkout locations. With various payment solutions, customers can safely pay in line with social distancing norms. More than 73% of customers want more checkout options with advanced technology. Having said this, mobile point-of-sale devices are fast becoming a necessity for retailers large and small.

#5 Biometric Authentication

If someone had talked about authenticating a process using biometrics five years ago, it would seem like a scene from a futuristic movie. Now this process is everywhere and most of use this technology daily to unlock our phones. Biometric authentication consists of fingerprints, face, and voice recognition that we use today to unlock e-wallets. Biometric authentication gives more security as it is unique to each customer, and due to this trust, the technology attracted huge investments. According to a study by Mobile Payment Authentication & Data Security, by the year 2024, the use of biometric authentication is expected to grow more than 1000%, with a transaction value of more than $2.5 trillion. By the end of 2019, transactions valued at $228 billion were already authenticated by biometric technology.

#6 Flexible Payments

With consumers demanding more convenience and security while using mobile wallets for payments, the pandemic has also forced them to maintain and stick to a budget. Retailers now offer options like installments or Buy Now Pay Later to their customers. With enhanced security, convenience, and accountable spending, consumers have accepted these offers enthusiastically. Consumers get maximum flexibility with the zero-interest installment schemes which the retailers offer at the point of sale. It helps the customers to make large purchases easily without worrying about the having the full payment up front. The popularity of e-commerce and online shopping is growing drastically. The mobile payment strategy of the retailer will play a significant role in the purchase pattern of their customers. This strategy is almost 80% responsible for the rise or fall in sales. If the customer is getting complete flexibility in payments, multiple payment choices, and a streamlined checkout process, nothing can stop him from completing the decisive step of the final purchase.

Bottomline

As the digital world is changing fast, all kinds of e-commerce stores and other retailers need to adapt to the latest payment trends as soon as possible. With contactless payments and e-wallets offering complete convenience to consumers, they are becoming popular at an unimaginable speed. If your customers get absolute security along with seamless checkout, they will keep coming back to shop at your store. Therefore it is important for all fintech companies to keep a watch on. One thing is certain – that even if the pandemic ends, the e-commerce growth and the related customer needs are here to stay. For businesses to keep in the competition, they must shift to modern payment methods.

Top Trends in Restaurant Tech for Fall 2021

Restaurants, cafes, and other food businesses have seen many trends emerging through the COVID pandemic. People have become concerned about their health and safety more than ever, and as a result, the competition in the food business is rising. Restaurants are using these trends and competition as opportunities to grow.

Food businesses are ready to embrace new marketing techniques, even if that means rethinking their business strategy. Whether it is installing a POS unit for contactless payments or online order tracking software, these businesses never fail to stay up-to-date with the latest trends. Below we have listed a few interesting trends in the restaurant payment tech industry for 2021. Let’s get started.

Reduce Food Waste

Going green has become a new priority after the 2020’s global pandemic. People choose businesses that put effort into making their products and services sustainable. For example, nobody likes to eat at a restaurant where the staff doesn’t take the necessary measures to control food waste. That’s why businesses have started using technologies to predict customers’ orders in advance so that they can prepare food accordingly.

Over 70% of food is wasted before it is served to the customer, and 80% of this waste occurs because of overproduction, Winnow reports. Businesses are now embracing technology trends that can help control food waste with the help of software apps that offer accurate prediction features.

Exciting Elements for a Perfect Dining Experience

Why should your customers dine at a restaurant when they can simply order food online and enjoy the meal with their loved ones? You need to give them the “extra” they can’t get at home. Anything that takes their experience to a whole new level will do. For example, you can share the recipe of the restaurant’s signature meal, offer your restaurant-special sweets for free, or organize a contest for your regular customers. The idea is to give your customers an experience they will remember your business for.

Better Packaging

People might not have noticed it before, but customers are now looking for better packaging as the eating-at-home trend is gaining immense popularity. Restaurants need to level up their food packaging so that customers can enjoy safe food delivery. It’s better if you can consider packaging that can go into the microwave for heating.

Personalized Dining Experience

A personalized experience has become a trend in almost every industry, especially the food sector, where people look for recipes that fit their tastes and budget. Tracking down each customer’s taste and customizing the restaurant menu to their requirements has not always been an option. However, today’s technology has made it easier for restaurant owners to improve guests’ experience by serving them the most delicious food.

You can integrate the loyalty program into your restaurant business to attract the audience’s attention. This is the perfect way to make them your regular customers. Once they become your regulars, it will be easier for you to track their recent food orders and get insights into their preference, taste, budget, and more. You can use this data to provide them with a better and more customized experience tailored to their choice. For example, you can welcome your new customers with their favorite drink or give them a special discount as a reward for being a regular.

Let them Track their Order Status

Customers want to know how long until their food is ready to be delivered. The order tracking feature became quite popular in the pandemic, as people couldn’t help but check the status of their food. Your customers want every detail – when their order is ready, who is delivering it, when it will be delivered, and so on. Those who track their orders every few minutes will not order from a restaurant that doesn’t offer the food-tracking feature.

So, if you don’t already have the order-tracking function on your website and mobile app, now is the best time to integrate it and make your restaurant look more credible to your audience.

Contactless Payment – A New Standard

Contactless payment was trending before the COVID outbreak, but the popularity of this technology skyrocketed as people started using the contactless payment for all types of online and offline purchases. Not only because of safety concerns, but customers use contactless payments for convenience.

Swiping a card at the POS seems more convenient and easier than paying through cash. It is also easier for restaurants to record the payments. You no longer need to count cash at the reception, make manual entries in your accounting books, and manually record each transaction in your business software. Pay-at-the-table, self-order kiosks, mobile payments, and EPOS payments are a few contactless payment options for restaurants.

Kitchen Automation

Restaurants are incorporating different channels for payments, orders, and food delivery. To support other platforms for online food ordering and payments, restaurants need to implement kitchen automation technology. Automated kitchens bring efficiency in restaurant operations – whether it is taking orders through websites or in person.

An Increased Percentage of Direct Orders

Food service providers do not want customers to reach out to them through third parties. Direct ordering gives restaurants and food businesses more control over their customers’ experience. They can use loyalty programs, rewards, and other exciting offers to build customer trust in their brands. It is also easier for customers to place an order directly on your restaurants’ website or mobile app instead of using a third-party service. It offers a better customer experience by cutting down the middlemen while allowing restaurant owners to customize the end-to-end customer experience.

Conclusion: These were the top restaurant trends every foodservice business needs to embrace for 2021-2022. The sooner you implement the above technologies into your business, the faster your business will grow. Good Luck!

Related reading on restaurant tech trends: Restaurant Payment Resources.

Sinch Acquires Pathwire, Mailgun, in 1.9B Transaction

Sinch is Sweden’s leading communication service provider in the world. The company is renowned for its cloud communication tools that ensure seamless and fast communication between businesses and customers. It has recently made a big announcement of acquiring Pathwire, the developer of Mailgun – the software that supports quick and efficient delivery of emails as well as integration of your email with other apps. The main goal of Pathwire is to build an efficient mode of communication between users and businesses through email.

A Brief on Pathwire and its Products

Mailgun is one of the most popular and fastest-growing products of Pathwire. Started as a small team in San Francisco, Mailgun has become the leading email service provider in the world with over 100,000 paying clients and a global workforce. The company will soon be merged with Sinch and the deal is expected to be closed by the end of this year.

The workforce and founders of Pathwire were quite thrilled to announce this collaboration with one of the best cloud-communication developing companies in the world. The main goal of both companies is to ensure seamless and effective communication between businesses and customers. The acquisition of Pathwire also means that Sinch can offer better communication solutions to businesses.

The Acquisition Cost

The deal closed at $925 million (that will be paid in cash) and 51 million shares (in Sinch). Considering the current trading price of Sinch, this deal pays a whopping $1.9 billion to Pathwire. The deal is going to play a key role in making Sinch a tough competitor of Twilio.

This shows the scope of email, which goes beyond the receipts of regular messages. The booking of hotels, train reservations, password reset messages, and other similar messages are delivered through email. Considering the current popularity and uses of email marketing, Sinch has estimated this industry to generate $16 billion annually. They have added email services, investments, and other products to the figure. Transactional marketing, the service covered by Pathwire, contributes to 60% of this revenue.

Pathwire was owned and operated by Thomas Bravo and the company itself was an acquirer of other tech giants and credible businesses in the same industry. In fact, it acquired one of the popular email service providers – Email on Acid – in June this year. So, it is only normal for people to wonder what made Thomas Bravo sell such a profitable and reputable company to Sinch. One thing that justifies the deal is the fact that 51 million shares of the company are given to Bravo, which makes him an investor in Sinch. So far, this deal is Sinch’s biggest and hopefully most profitable acquisition. Pathwire has made it possible for businesses to integrate email with mobile apps and other communication platforms. The company has reported more than 100,000 high-paying customers who are connected to millions of people using Mailgun and other email services. Some of the top businesses using Pathwire’s products for email marketing and other communication-based services are Microsoft, Kajabi, Lyft, and DHL.

The Popularity of Email Among Businesses

Oscar Werner, the CEO of Sinch, mentioned that for any form of digital communication, technical expertise is important. He further added that the main purpose of this collaboration is to provide customers with a seamless communication experience while offering businesses a reliable way to build connections with their audiences.

This merge will help Sinch launch a set of products that make email, voice, and messaging more effective and easier for businesses. In addition to the estimated profits, this announcement of acquisition is expected to give Sinch a competitive edge in the US market where it has acquired other top communication service providers, such as Inteliquent for $1.14 billion. The company’s focus is totally on “embedded communication”.

Building voice and email services from scratch is simply not a viable solution for any company, especially for those who need to integrate email into their apps and website. Since these companies have a totally different core service, investing their resources into building email services will be pointless. Not only does it cost a fortune, but the maintenance of the voice mails, messages, and other communication services can get hectic and time-consuming. APIs have brought a major transformation in the way communication services are built and used for marketing. Now, companies can buy the ready-made email APIs from the developers and integrate them with their services, websites, and apps effortlessly.

Email API – How is it Used and Why it’s so Popular?

API’s are not only used in the communication industry but are applied to other complex systems, such as financial services and payment gateways to ensure safe transactions. Pathwire has done a tremendous job at launching some of the best cloud communication tools and email services, one of the reasons why it’s a profitable buy for Sinch. Mailgun is the most comprehensive and extensively used email APIs for professional developers, while Mailjet is designed for regular users (the less tech-savvy) people. It allows them to use the drag-and-drop feature of the software to integrate email into their websites and mobile apps easily.

Sinch and Pathwire make a perfect fit, as both tech companies focus on providing businesses with an easy and reliable way of using email for their business operations. In addition to the goals, the companies have products in a similar category, making them a perfect solution for businesses looking for fast and easy mail integration options. The CEO of Pathwire, Will Conway, mentioned that he was very proud of how far the company has come and he is looking forward to this acquisition. There couldn’t be a better partner for Pathwire than Sinch, and given the deal Sinch is offering, it is obvious why Pathwire did not turn the offer down. With 51 million shares and $925 million in cash, Pathwire has secured a very good deal valued at approximately $1.9B in total. Add to this the fact that the founder will become an investor in Sinch, and it is clear why the deal took place.

NFC vs QR Code

With the COVID pandemic still being a major concern of people, sharing essential information with the citizens through effective means has become a necessity for the government. People are now more concerned about their safety than ever before. A report published by Walker shows that customer satisfaction and their experience will become the major factor that sets a brand apart from the competitors in the market.

To improve customer experience, businesses have started embracing modern technologies that could connect the offline and the online world. Now, the question is “which one is better”? Should you rely on QR codes or are NFC tags a better alternative? Let’s have a look:

NFC and QR codes are an innovation in the modern eCommerce technologies. Both offer unique functions, but with the same goal – to offer a seamless and safe user experience to your customers. Let’s understand each product and later we will discuss the differences, features, and benefits.

What is NFC?

NFC stands for Near Field Communication, a system that enables uninterrupted and smooth communication between two electronic devices in close proximity. It consists of a small chip. The appearance may look a little dull, but the performance of these chips is pretty impressive. According to technavio, 25% of mobile payments will be processed by NFC in 2021.

User Cases and Compatibility

The best use of this technology is for electronic, contactless payments. You must have seen the customer queue at the supermarket, where each customer swipes their cards at the POS to complete the transaction. It is NFC. In addition to payments, NFC is used for sending media files, documents, directions, mobile numbers, and files in other formats.

Despite being new to the market, NFC has garnered a lot of attention among smartphone users recently. The technology is compatible with Android and iOS devices, in fact, the number of Android devices compatible with NFC has increased in the past few years.

iPhone users have also witnessed consistent growth in near-field communication technology. Some iOS devices are capable of reading the NFC code from the home screen without having to install any mobile app.

Why Use NFC?

NFC is not as old and popular as QR codes, but the technology is globally accepted for contactless payments. Its popularity has skyrocketed after the pandemic. Here are a few reasons why businesses should use NFC tags:

A Wider Scope: the user case of NFC goes beyond contactless payments. Businesses have started using these tags for marketing. The NFC cards are designed for businesses looking for a smart way to share their contact details with their prospects. These cards direct your prospects to your website or email for easier and faster communication.
Convenience: It only needs one tap from customers’ end to sign up for the company’s loyalty program. So, if the customer experience is concerned, nothing outperforms NFC tags. Customers can use the NFC tags to collect and redeem reward points with a single tap.
Security: NFC is one of the safest technologies. It catches data from customers’ devices located within their acceptable radius.

What are QR Codes?

QR codes were launched as a better and powerful alternative to the barcode for inventory. It was designed in such a way that people could scan these codes from any angle with just about any device without any hassle. Introduced in 1994, the QR code reading has made a big impact not only in the inventory management market but it can be used in transferring digital information.

QR codes are small square-shaped boxes that can be scanned vertically and horizontally through any smartphone that has the barcode-reading function enabled. QR codes offer great flexibility. Like NFC, these codes can be used for making contactless payments at any retail store. You could also use it for location sharing and marketing.

Most businesses embed their website URL into these square boxes, allowing their audience to visit their website without having to memorize the URL. Similarly, QR codes are used to direct people to your blogs, landing pages, social media accounts, and other sales channels. Recently, many social media sites have embraced QR codes to enable a smooth and seamless information sharing experience for users.

Why Use QR Codes?

Over 9 million families scanned QR codes at least once in 2018, shows a report published by Statista. It is one of the most convenient ways to share information, transfer payments, and direct your customers to your commercial sites. Here are a few reasons why QR codes are better than NFC tags.

Versatility: QR codes are used for all types of websites, social media accounts, and mobile apps. For instance, a QR code that directs your user to your mobile app link can increase your app downloads. You can also share QR codes for product links, your email, landing pages, and more to extend your reach.
Ease of Use: QR codes can be scanned from any angle as long as you have a smartphone with QR code reading functionality enabled. Some mobile cameras have a built-in QR scanning feature, while others need to download an app to scan these codes. Either way, the scanning part is super simple.
Customizable: QR codes are customizable. Businesses can use customized codes that match their brand’s logo and looks relevant to their business practices. You don’t have to settle for the traditional black and white square boxes for the QR codes. Add interesting colours, put a nice background, and design a nice QR code that is relevant to your brand.
Security: Another major advantage of the QR codes is that they are used for the purpose they were designed for. They offer a high level of security to both customers and merchants.

Which One is Better?

Both NFC and QR codes deliver excellent performance when it comes to marketing, payment processing, and transfer of information. QR codes, however, are more advanced and relatively better than NFC. These codes can be scanned easily, allowing you to process your transaction in the fastest and easiest possible way.