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Small Business Payments Spotlight

As technology continues to evolve, consumers are fundamentally changing the way they shop for goods and services

Small business owners and managers who continue to adapt to these shifts in behavior and preferences are being rewarded with a growing, loyal customer base.

Our second-annual Small Business Payments Spotlight surveyed more than 500 U.S. small business owners and more than 500 consumers who frequent small businesses. With a firmer understanding of emerging commerce trends, merchants can better position their business for success today... and tomorrow.

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Here’s what we learned about changing consumer behaviors:

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8% of consumers in 2018 reported being likely to pay with a digital wallet on their mobile phone in stores, compared with 5% in 2017.

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24% of consumers want to have the ability to pay with a mobile device or digital wallet.

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18-29 years olds are 7 times more likely to use their mobile device to shop than those 65 or older.

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35% of consumers are no longer willing to tolerate lines at businesses because of the convenience of mobile checkout.

Ways to pay continue to evolve

With each passing year, consumers are growing more comfortable with shopping and paying for goods and services on their mobile devices. Meanwhile, small businesses are using digital wallet applications to streamline the payments process, boost customer loyalty, and stay ahead of the competition.

36% of small businesses surveyed in 2017 reported they accepted digital payment methods, but that number climbed to 46% in 2018.
 

Limiting payment card acceptance puts sales at risk

Of the consumers surveyed, 32% never make purchases at businesses that do not accept credit and debit cards.

35% would be annoyed if a business did not accept the brand of credit card they wanted to use (but they’d still go through with the transaction).

18% would not make a purchase and walk away from the transaction if a business did not accept the brand of credit card they wanted to use.

Flexibility is key at the point of sale

Small businesses with flexible and even mobile point-of-sale (POS) solutions are finding they can do more and deliver a better customer experience.
 

Benefits small business owners claim from offering customers a mobile checkout experience:

 

Improved customer satisfaction

 

Faster checkout times

 

A smoother checkout experience

 

Improved customer loyalty

 

More efficient use of staff resources

 

Increased security

 

Shorter lines at checkout

 

Increased basket or sales size

eCommerce is driving small business growth and opportunity

More small businesses are turning to eCommerce as a greater number of consumers shop online.

51% of small businesses run an eCommerce site. This is a seven-percentage-point rise from 2017.


Want to peek into the past? Download the 2017 Report.

Data breaches grow costlier

Costs associated with combating a breach of customer or payments data continue to rise. And even one incident could cost a small business more than 20% of its customer base. Nearly 40% of small businesses that experienced a data breach suffered more than $50,000 in losses.
 

Tactics small businesses implemented in the past 24 months to improve security and reduce fraud:

49% – Updated POS equipment

43% – Ensured compliance with industry security standards

37% – Purchased security so︎ftware

38% – Trained/coached employees to gather complete payment details from customers

It pays to be loyal

Both consumers and small businesses reap rewards from loyalty programs. According to Bank of America Merchant Services’ research, consumers are most enticed by rewards points and instant discounts, and they’re willing to provide personal information to get these benefits.

The incentive that most entices a consumer to sign up for a loyalty program:

42%
Rewards points for purchases or visits that can be redeemed with that business

40%
Instant discounts

10%
Access to exclusive announcements, coupons or personalized discounts

Your business made better, together

Small businesses report receiving various benefits by having an integrated merchant services and banking relationship.

79% of small businesses consider their merchant service relationship important to their success. See the benefits in the full report.

Why work with Bank of America Merchant Services?

As a global leader in payments, eCommerce and security solutions, we can help you with a range of business needs.
 

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