How fashion retailers can transform payments from cost centre to growth engine

We may all have returned to in-store shopping in a big way, but our shopping habits have been dramatically altered in the last few years. 

Today’s digital-first shoppers expect a seamless experience whether they’re buying online or offline. They expect their brand to recognise them as the same customer wherever they choose to engage or purchase. What’s more, in the current economic climate, they’ve become very value-conscious.

The Adyen Australia Retail Report 2023 shows shoppers are looking for the best deals online and in-store – with almost a third of them (31%) holding off from purchasing until seasonal sales like Black Friday or Boxing Day for added discounts. They also expect a personalised shopping experience and want to be rewarded for their loyalty. 

In today’s Tik-Tok fueled fast fashion era, when the next big trend can come from anywhere, overnight, fashion retailers have to be on their toes.

Navigating these changing market dynamics, fashion retailers have had to adapt to evolving customer behaviour more than most other sectors. And their efforts to deliver the flexibility and choice customers expect are bearing fruit.

With current cost-of-living pressures, Australian fashion brands know how important it is to make the right investments to tap into available demand. Our survey showed that as much as 40% of fashion retailers we spoke to  – from a survey group including H&M Australia, UNIQLO, Lorna Jane, Cotton On and R.M. Williams – say they’re looking to invest in technology in the next 12 months to improve the shopper experience.

This strong investment appetite indicates a clear focus on growth in the next few years. Our data shows that by 2026, a significant percentage of fashion retailers aim to increase their revenue by 11-20% (35%) and 6-10% (35%).

A small but significant percentage have set themselves even more ambitious targets, with 12% of Australian fashion retail businesses planning to boost their revenue by over 40% by 2026.

So, fashion retail is gearing up for growth and is ready to invest in improving the customer experience. But there’s one essential part of their technology mix that’s key for unlocking growth but often gets overlooked – and that’s their payments data. 

Fashion retailers need to adopt the technology that not only helps them deliver a great customer experience, but also supercharges growth by  connecting their payments data and delivering rich customer and business insights. 

But some fashion retailers are finding that having multiple payment providers is making it hard to link up their payments data across channels to extract maximum value from it.

Without connected data, they cannot get the full picture on customer behaviour they need to tailor experiences and grow loyalty. 

Nearly a quarter (24%) of fashion retailers we surveyed say they use multiple payment providers and are keen to reduce the number. By doing this, they can streamline operations, reduce costs and simplify payments not only for their business but also for customers, they say.

Fashion retailers need a solution that connects the dots across online and offline payment channels while unifying and simplifying their tech. Done right, a unified commerce solution can deliver a whole raft of benefits.

Expansive coverage: Fashion businesses need a platform that can support their expansion goals by enabling a wide range of payment methods – from large credit card providers to very localised alternative payment methods such as eftpos for online.  

Improved efficiency: By having all operations on one platform, fashion brands can streamline processes and automate tasks, reducing the need for manual intervention and minimising errors.

Reduced costs: By consolidating multiple systems into one platform, retailers can reduce the costs associated with maintaining, upgrading, and developing multiple payment systems. This can significantly improve ROI.

Channel-agnostic payment: Retailers need a solution that acts as a digital foundation to help future-proof payments – by making it easier to introduce new technology and open new channels as they arise. This can help the business stay one step ahead of consumer and technology trends with the ability to pivot and move fast in the face of rapid shifts. Data-driven decision making: With a solution that can provide crucial data insights, detailed reporting and analytics, businesses can understand customer behaviour and make informed decisions about their payment strategy. This can help them build strong customer loyalty programs.  

Fraud prevention and security: Retailers need a solution that protects from fraud by combining automated risk (through machine learning) with manually customisable risk rules. This can deliver maximum protection with the flexibility to adjust for optimised payment authorisation rates.

By adopting the right unified commerce solution, fashion retailers can get a 360-degree view of their customer journey across channels. They can get a single view of their operations across stores and channels – with the data to optimise operations, reduce costs, and minimise risk at their fingertips. It gives them the agility to meet changing customer trends, and gain strategic advantage over their competitors. 

This is the time for fashion retailers to deliver the exceptional shopping experience that customers expect today and win their loyalty. Tomorrow, when macroeconomic conditions improve, the shopping confidence of their loyal customers will go up further. Fashion brands will be rewarded for the superlative experience they delivered today.