Panel: Crypto Payments Will Divide Merchants

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Once seen as just a fad, cryptocurrencies are gaining, well, currency as a conduit for mainstream commerce.

Stephen Pair, CEO of BitPay, Michael Relich, CEO of PacSun and Jeremy Belostock, head of advanced payment methods at Verifone, told PYMNTS Karen Webster that merchants must heed the call of the bugle: tens of millions of consumers around the world have crypto in hand and want to spend it.

Retailers must respond to this desire to spend at the point of sale. If done right, integrating as an offering at key decision points offering crypto payments can be a game-changer for consumers and merchants, boosting customer loyalty and increasing basket sizes.

According to Belostock, consumers are increasingly pushing merchants to add the ability to use cryptocurrencies at the point of sale.

Unsurprisingly, the panelists themselves told Webster they had first-hand experience with cryptos. Pair noted that he made a point-of-sale purchase with the payment option, Belostock said he held cryptos, Relich said he did own crypto, but at the time of the conversation did not hadn’t bought anything with it yet.

At a high level, said Pair, traders need to be aware of emerging trends. As he told Webster, the compelling reason for a business to accept point-of-sale crypto is simply that [we] now see this growing population of people who have crypto.

Platforms offered by companies such as BitPay, he said, allow a merchant to accept a payment relatively easily and integrate that payment into a workflow and even educate crypto holders about it. ‘they can transact with this merchant.

Good to go to Crypto

The value of using digital offers to transact is clearly there, as the numbers show. PYMNTS research found that up to 46 million consumers, or roughly 18% of the US adult population, would make a purchase using crypto. If crypto was available as a payment method, of course.

Merchants must be able to integrate cryptocurrencies into their payment transactions. When they do, they can build loyalty and even increase shopping cart size or consumer spending.

PYMNTS also found that 12% of the population or around 30 million individuals own at least one crypto. This will prime the pump, so to speak, they have the cryptos in hand and could therefore spend it. Over 60% of current and past holders have purchased crypto to be able to transact using it, but two-thirds of those holders said too few merchants accept crypto payments.

The conversation came after PacSun recently became the first youth fashion retailer to accept crypto, which would be consistent with young consumers being the key demographic for crypto-as-payments: up to 54% of crypto holders are Generation Z. The retailer is working with BitPay to support around 11 cryptocurrencies.

Read more: Gen Z Fashion Retailer PacSun Now Accepts Crypto

Relich noted that accepting crypto has been on our roadmap for some time and [with BitPay], we were live in less than three weeks. Verifones Belostock explained that integrations can be simplified and streamlined for traders wanting to connect to digital wallets and pick up cryptocurrencies at the point of sale.

Smooth the way

Favorable winds at this time could ease the shift to crypto spending, the panelists noted. The adoption and use of digital wallets has increased. And the rise in crypto prices, as volatile as they are, has got people thinking about how to leverage these gains into tangible benefits by purchasing goods and services.

Digging deeper, we find nuances in how consumers want to hold and spend their cryptos. Pair noted that when people own crypto, they want the convenience of being able to spend it directly rather than trying to sell it, convert the crypto to fiat, and then make a purchase.

To get a sense of the scale, consider the fact that there are at least 100 million crypto wallets, according to PYMNTS estimates. And as Pair noted, the company’s e-commerce solution (BitPay also works with Verifone), which supports 90 wallets, allows merchants who log into the platform to support each of them. between them.

For cryptos to become mainstream and more widely accepted at the point of sale, Pair explained, you not only need to make the experience enjoyable for the buyer, but you also need to make it ideal for the seller who might have to deal with a potential. refund.

Digital companies

For digitally-focused companies like PacSun, which has two million TikTok followers and weekly live business events, Relich said, meeting the needs and wants of Gen Z makes intuitive sense.

Embracing crypto was natural for us, he said. But as Pair noted, interest in crypto payments has spread from traditional big box retailers to quick-service restaurants. Merchants want to show they can take it the way consumers want to pay.

Avant-garde traders

The panelists noted that offering cryptos to consumers broadens the user base and could push through the proverbial door to potential customers who may not have looked at them before. They find, as Relich said, that the merchant fits their philosophy.

The panelists also observed another benefit for forward-thinking traders: They can use crypto as a competitive advantage when it comes to hiring talent, paying their salary in crypto if those workers want that option (BitPay offers a payroll product that allows employees to receive part of their salary in cryptocurrency).

Per Relich: People see that they were ahead of their time and I think that makes PacSun a great place to work.

Of course, its first innings are still in the crypto-as-commerce game. Relich noted that the realization that crypto is spendable, and that traders can and should embrace it, is not as widespread as it could be. For traders who accept crypto, he noted, the impact is significant: the average order value of transactions made with crypto is much higher than with traditional currencies.

Perhaps this is because the average crypto user is a bit richer than other customers; with the crypto gains in hand, they have more purchasing power than other consumers. Pair confirmed, noting that among BitPays traders, people who use crypto spend around twice as much as a typical credit card user.

Going forward, the panelists said, the crypto community will grow, possibly exponentially. According to Pair, traders in all categories will start adding crypto as a payment option for their customers at first for them to experience. And as Relich noted, there will be a network effect with the haves and have-nots among retailers. There is nothing wrong with accepting crypto.

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NEW PYMNTS DATA: 2021 HOLIDAY SHOPPING PERSPECTIVES

By the way: It’s almost time for the holiday shopping season, and nearly 90% of U.S. consumers plan to do at least some of their purchases online, 13% more than in 2020. The 2021 Holiday Shopping Outlook, PYMNTS surveyed over 3,600 consumers to find out what drives online sales this holiday season and the impact of product availability and personalized rewards on merchant preferences.

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