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With new customer-centric solutions and trends springing from every corner, you need a tried-and-true payment solution to stay ahead of the curve. However, more often than not, irrelevant features, underutilized resources, and an unclear target audience prevent brands from creating the best product.
But there’s a way–market research.
Comprehensive market research is the cornerstone of creating, improving, and maintaining a stellar payment solution. This article dives deep into how you can use this powerful tool to enhance your product–both easily and effectively.
What is Market Research?
Market research is the process of collecting, analyzing, and interpreting data on your prospects’ and clients’ payment behavior, preferences, and needs. It helps you understand how customers use your payment solution–answering questions like:
- What features are the most/least used?
- What challenges do prospects face with the solution?
- How secure and trustworthy do customers perceive your solution to be?
Solid market research consists of a combination of primary and secondary research.
Primary market research is usually less structured and is carried out in real time via open-ended questions, focus groups, surveys, usability testing, etc. Secondary market research, on the other hand, analyzes pre-existing data–industry reports, case studies, or financial analysis.
This information forms the foundation for creating the most competitive, efficient, and customer-centric payment solution. It answers the “why” and “how” behind every user behavior, revealing hidden opportunities to refine your product.
Through detailed market research for your payment solution, you can:
- Optimize product features
- Discover market gaps
- Stay ahead of emerging trends
- Boost customer satisfaction and loyalty
Leveraging Market Research to Future-Proof Your Payment Solution
Change is the only constant in today’s ever-changing market. This constant evolution requires you to use different strategies and analytical skills. Market research aids you in the journey by pinpointing areas of pain–giving you a heads up and improving.
But how do you use it for your payment solutions? Here are four practical ways:
Know Your Audience
Users’ payment preferences can be miles apart across different demographics and psychographic groups. For example, SMBs gravitate towards solutions with low transactions, and high-income users seek premium solutions with advanced security.
That’s what you have to know your audience inside out. The first step to this is segmenting the target market based on demographic, psychographics, and behavioral data. This includes:
Demographics: basic information, such as age, gender, income, and education level.
Psychographic data: information related to customer’s lifestyles, values, interests, and hobbies to help you understand the motivations behind their needs and actions.
Behavioral data: Specific insights about customer behavior–purchase frequency, devices used, preferred payment methods, etc. This will show you patterns of how users engage with your payment system, thus enabling you to track factors such as average transaction size, payment methods, and drop-off points during the shopping process.
Therefore, begin with surveys and customer feedbacks. Analyze your website and app analytics. Monitor customer service interaction. With these, you’ll have ample data for segmenting your target audience–empowering you to choose the right audience for your payment solution.
Analyze Your Competitors
How well do you know your competitors? What new strategies are driving your customers away from you to them? If you don’t, then right now is the perfect time to start your competitor analysis.
It’s important because analyzing your competitors will help you:
- Benchmark your own performance and offerings in the industry
- Reveal issues in their product/service and capitalize on them
- Avoid costly mistakes
- Learn for your success
For example, a competitor has successful introduced new payment methods, but users are hesitant to adopt it due to lack of education. Leveraging this, you can integrate same feature in your solution backed with better onboarding and educational content.
To conquer the market, therefore, identify all your competitors–both direct and indirect–and start the competitor analysis. Look for their:
- Product features
- Pricing structure
- Security measures
- User experience
- Marketing strategy
- Customer support
Use all the resources you can find–customer reviews, website and app analysis, social listening, industry reports, and more.
With the competitor data in hand, identify their strenghts and weakness–and opportunites. It can be a competitor sharing higher transaction fees. Maybe you can offer the same at a lower pricing and additional features. It’s about finding and filling those gaps.
Therfore, capitalize on the insights you’ll gain here to innovate with new features, adopt best practices, and differentate your payment solutions. Even better collaborate with ecommerce agencies specializng in audience, market, and competitive analysis. They can hep you capitalize on the insights, innovate with new features, and differentiate you payment solution in the competitive landscape.
Market Trends as a Tool
While we have yet to develop a crystal ball that lets us in cusotmer’s heads and figure out how our solution can make them happy–analyzing emerging market trends, does give us some of that forecasting power.
In the financial space, trends like mobile payments, alternative payment methods, BNPL (Buy Now, Pay Late), and one–step payments are reshaping how consumers use payment solutions. Having more choice is often a reassuring thing for the customer, who might want to consider dedicating a specific part of their budget to your product or service. According to Researchandmarkets, the number of BNPL users is expected to quadruple from 2021 to 2026, so it’s useful to take that into account.
For B2B clients, account reconciliation tools are another crucial factor gaining popularity. Integrated with the payment solution, they help businesses ensure a smooth process through different methods and maintain accuracy.
By keeping a close eye and integrating the relevant ones in your product development and marketing strategies, you can always stay ahead of the competition. Therefore, based on your market research, see what trends are in the limelight and leverage them to anticipate market needs.
For example, here are two current market trends you can leverage:
Buy Now, Pay Later
BNPL offers businesses flexible payment alternative for large-ticket purchases to manage thier cash flow. This is where monitoring health metrics, espeically Accounts receivable turnover ratio becomes important. For example target audience with higher AR turnover ratio are better suited for offering BNPL service without risking liquidity.
Contactless Payments
Since the pandemic, contactless payments have gain exponential momentum. Customers expect it because its safer, hassle-free, and more hygienic. Major retailers like Walmart and Target have integrated these payments to enable faster transaction–something you can integrate in your payment solution.
Use Your Research to Improve Payment Solutions
Conducting in-depth market research is only half the battle. The other half is translating the data, information, and insights into actionable strategies that really improve your solutions.
Therefore, equipped with the research, use it to create the best payment solution on the market. Leverage market analysis templates to organize and interpret your market research. The templates will ensure harmony in data collection. Plus, it’ll be easier for all the departments–sales, marketing, and customer services–to interpret the information.
Next, translate them into actionable strategies by:
- Identifying key insights into market trends and customer behavior
- Prioritizing customer needs–focus on the aspect that will have the biggest impact on customer satisfaction
- Developing enhanced features, such as installment payments or subscription models
However, before rolling out major changes, A/B test to validate the improvements to ensure it doesn’t negetaively impact the customer experience or business.
Lastly, market research is only effective if it aligns with your business objectives. Therefore, review goals, connect the findings to your goals, and set and measure KPIs to keep your business on an upward trajectory.
Empower Your Payment Solution with Market Research
Market research is a powerful tool for improving your payment solution because it lets you truly understand the audience and keep a pulse on the industry. Leveraging this, you can create a stellar payment solution that exceeds your customer’s expectations.
Therefore, use the above shared expert tips in your market research and let the insight guide you into shaping the future of your payment solution.
