How can design make sense of user behavior and influence the way people buy goods and services?

MOBILE PAYMENTS ARE CHANGING the way people pay for real-world goods and services. Since the introduction of the first plastic credit card in 1959, transactions have undergone a slow but monumental shift. It’s taken more than 60 years to reach the critical tipping point where over 50% of payments in the US are cashless. Cash was immediate and required no identity. But carrying large sums was impractical and unwise. Paper checks answered the practicality problem but merchants didn’t like the risks. Then, check cards and credit cards offered the convenience consumers want and the security merchants demanded. The next natural move is mobile payments, but designers have to answer one question: What can mobile payments offer that plastic can’t?

The possibilities are unlimited, but don’t assume that tying payments to consumers’ phones will lead to automatic adoption for consumers. Mobile payments have to offer consumers what cards can’t. And ultimately merchants need an incentive to promote the switch too.

This shift toward mobile payments doesn’t just apply to how people pay for goods, but also how they fundamentally think about their money. For many savvy consumers, their mental model of currency has moved beyond green paper to green pixels. As we progress past magnetic stripes to NFC and other digital wallet technologies, mobile phones, tablets, and computers will now serve as the always open banking center. The current mobile payments industry is still young and fragmented, but it offers a vision for the future of merchant-customer interaction.

Startups, retailers, and veteran payment corporations are trying to claim their piece of the mobile payment pie. The industry is ripe for disruption as new technologies and design solutions come together. San Francisco startup Square is a perfect example of a mobile payment service with the potential to disrupt the payment industry. Square’s latest application allows for contactless payment using GPS geofencing data and a user’s saved credit card account. By combining this new payment method with loyalty cards, businesses can now offer a richer checkout experience without the consumer ever needing to reach for a card or phone.

Among the many reasons retailers have to embrace mobile payments systems, are that they are often perceived as innovative, a help to their brand, which allows them to own more of the customer relationship experience. A better user experience, one that welcomes social sharing and discovery, can provide for a very short return on investment.

It’s vitally important to understand the context of use when designing for mobile payment systems. This often times necessitates a deep understanding of service design to create a comprehensive system with all parts working harmoniously. For consumers, payment ritual and habit are some of the biggest contributors to acceptance and adoption of mobile payments.


What Makes A Payment Experience Successful?

We believe in involving users throughout the design process. They keep us honest. Starting with Participatory Design, we explore users’ true needs by inviting them to design with us. Once we’ve refined our recommendations, we’ll bring back users for Concept Validation to see how well the concepts resonate. Finally, when we’re getting closer to a tightened-down design solution, Usability Testing will help catch any false assumptions and ensure users can perform tasks efficiently. At every stage, we have an opportunity to refine the concept.

Still, throughout this process, we know that when asking users what they want, you can’t always rely on what they tell you. Observation is the best teacher. Watching users over time reveals what they actually do, and allows us to design for those scenarios. Borrow a principle from game design: there’s no substitute for play testing.

Be mindful of the conditions of check out. A checkout line is a place of a thousand distractions. Consumers are often multitasking with their hands full while a line of impatient patrons forms from behind. Fishing for a smartphone, unlocking it, and finding a particular app may all pose an unnecessary burden. Simplify these transactions to maximize the potential for success.


Freedom of content fosters greater levels of discovery and consumption.



Plan For Plan B

Smartphones still aren’t perfect. They hang, their batteries die, data connectivity can be spotty, etc. Be sure to plan accordingly and have strategies to combat these conditions. Something which makes cash, and even more so credit cards so successful, is their resilience. Paper can be folded and crumpled, plastic can be submerged and frozen, all with no detriment to the payment process.



Security Is A Mindset, Not A Feature

Mobile payments will simply not work if consumers do not trust the security of their transactions. The design of hardware and software components is key to maintaining user trust. People are still appropriately sensitive to handing over credit, bank, and other personal information. Mobile payments offer a way to abstract out personal data and use temporal and secure constructs for payment transactions. These approaches can make mobile payments safer and more secure than our current plastic cards.

The final, and perhaps most important, insight…



Do Better For The Consumer

Credit card transactions — especially those without signature — are already streamlined and offer a solid consumer experience. The ease of credit card transactions should be considered the minimum level of experience for which to strive. What else can your mobile payment system do for the consumer? Aim for faster or more secure, offer simpler deals or be more personalized; the point is to offer something better. The possibilities are near endless.

We are on the brink of the next commerce and payment revolution. People are now paying for goods and services in ways that weren’t imaginable even a decade or two ago. There is huge opportunity to move from the wallet as a physical form to a digital entity. We can leave behind many of the security concerns and inconveniences of a 20th century article and advance to a tool that empowers retailers and consumers the same. The requisite technology is quickly materializing, the question is, whether or not the user experience can keep pace.

Punchcut has partnered with carriers, device manufacturers, traditional retailers and online retailers to help these organizations understand existing user behavior and motivations. We’ve designed for NFC and contactless payment interfaces and understand the opportunities and challenges the industry faces in making a transformational user interface.


Punchcut is a human interface design company specializing in mobile, connected products and services. Punchcut works with the world’s top companies to envision, design and realize next generation connected experiences across devices and platforms that engage customers and transform businesses in a connected world.
A Punchcut Perspective | Contributors: Mike Sparandara, John Wayne Hill
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