Read part one here.
A credit line
Fast-forward eight decades and the payment scene in Britain was transformed again. Plastic payment cards had been introduced in the US in 1950 by Diners Club, and in 1966 Barclaycard introduced the first credit card in the UK. With strong and somewhat controversial campaigns, shopping universally with credit was born. Barclaycard issued one million credit cards to ‘reliable customers’ and set up over 30,000 retailers to accept their card payments. For many Britons, being able to purchase a product and pay the balance on a later date was not unlike the system they were used to but the difference lay in the fact that they were accustomed to settling balances with individual shopkeepers with cash or a cheque. The credit card was an open line of credit that could be used in many shops and many felt as though it was immoral or, at the very least, dangerous. In reality, it gave consumers the ability to manage their money in a different way. The foundations were laid for the shopping environment we know today.
Spoilt for choice
Soon after credit cards came to market, there was a succession of payment developments in the UK. The first cash machine was created in 1967, in 1973 there was the first nationwide effort to encourage women to take out their own credit card and by 1987 debit cards were introduced – all pioneered by Barclays. By the 1990s, shoppers could spend on credit cards, withdraw cash when they were out and about and pay for goods with their own debit cards. To ensure shopping transactions were secure and to mitigate the risk of fraud, the UK initiated the roll out of Chip and PIN so Britons started to verify transactions with a PIN. (Personal Identification Number) Personalised service became self-service as supermarkets grew quickly and bespoke outfitting became out-dated. But there was another disruptor that has been the biggest game changer for shoppers – the World Wide Web.
The big boom
The ‘dot com boom’ in the 90s changed everything. From sourcing information to new and improved platforms to perform tasks, the tech expansion in this period affected the world. Amazon set the bar high launching in 1995 as a bookseller and rapidly scaled up in order to sell and deliver all and sundry at low cost prices. Barclaycard tapped into the world of e-commerce and set up Barclay Square in 1995, a site that brought together a wealth of retailers to make shopping simpler for consumers. Department stores like John Lewis followed suit and by the 2000s, online shopping was fast-becoming the norm.
Rise in mobility
Payments were responding in parallel. Contactless payments were introduced in 2007, meaning shoppers could simply ‘touch-and-go’ to make everyday payments and today one in five transactions are now contactless. Also, over the last few years, there has been a prolific rise in online sales, specifically in the mobile space. Shopping apps, Apple Pay and Contactless Mobile, the first Android mobile payments solution, have contributed to mobile spending trends. According to Juniper, by the end of 2016, 148 million consumers will be making mobile payments. More importantly, consumers have changed their behaviour. High street footfall has been volatile as many Britons opt to shop on a laptop, tablet or mobile. Conversely, many shoppers will browse in store and then purchase or check prices on their phones to ensure they are getting the best possible deal; or buy a product online and pick up in-store – first introduced by John Lewis and now adopted by others such as Argos. This seamless omni-channel experience is at the heart of modern-day shopping.
The game’s afoot
Interestingly consumers have not set their hearts (or wallets) on just mobile or online shopping. There has been shift towards an account structure where consumers subscribe to a product or service for personalised access. British organic food store Abel and Cole have thrived on this model. Ethical eaters create a bespoke veg box online and the produce is delivered on a weekly, fortnightly or monthly basis. Shoppers can change their boxes at any time if they prefer.
This model has also thrived in the media space. Both Netflix and Spotify offer almost unrivalled access to a ream of content that consumers essentially rent each month. This lack of ownership gives consumers the option to trial content, it’s cost effective and the cloud infrastructure gives users the flexibility to tap into their accounts with the touch of a button. This emerging pattern has given Brits the opportunity to maximise all available channels to ensure a seamless, affordable experience.
Down the road
Today shopping patterns are being driven by changing customer expectations and the ability of technology to enable the development of more efficient, simpler solutions for consumers. Long gone are the days when shoppers happily compromise on price or product offering simply because now there’s no need with the astonishing amount of options available to all. Shoppers are able to take advantage of a myriad of buying opportunities; from shopping centres, high-streets, e-shops to ever-growing mobile commerce.
And this variety has spilled into the payment space. Consumers can touch-and-go with contactless, wave a wrist to pay with a wearable, buy items with fashion accessories and set up online and mobile accounts with retailers all over the world. The combination effect of all these options is that consumers are now able to shape their own individual shopping patterns, creating an ultra-personalised experience. There’s no telling exactly what the next 50 years hold, but we can expect technology and shopping habits to continue to work hand in hand.