The Green Sheet Online Edition

March 14, 2022 • Issue 22:03:01

Embrace consumer-centered digital transformations

By Tyler Kem
Strike Tax Advisory

For many employers, the pandemic shifted business as usual, and they're trying to get ahead of the challenge. In 2021, 2.4 million more Americans retired earlier than anticipated, according to Federal Reserve Bank of St. Louis Research Economist Miguel Faria-e-Castro. This number may increase as the pandemic wears on and potential early retirees decide that reentering the workforce is off the table. Even though early retirees are just one part of the labor shortage puzzle, they represent a segment that may never return to work.

Employers also face supply chain problems and a shift in customer preferences. Yet only 11 percent of businesses surveyed in 2021 by McKinsey & Co. indicated they could be economically viable through 2023. Another 64 percent of respondents recognized they needed to build new digital businesses for their next business iteration.

Businesses cannot delay digital transformations. If 90 percent of businesses can't see economic viability for their companies within two years, the time to adapt to the new normal is now.

Fintech digital transformation

Customer-centered digital transformation changes how a company uses technology, people and processes, from website to product delivery, to better serve customers. For most, this means building a digital product to bridge that gap. For others, this means abandoning legacy tech and embracing cutting-edge solutions.

Fintech digital solutions will vary. Focusing on customer-centered solutions means matching the business with customer demands. Across industries, customers may demand different payment options, more convenience or a seamless checkout process incorporating the following:

• Cryptocurrency: For cryptocurrency to move into the mainstream, it needs to be as accessible to the average consumer as a debit card. VendingMarketWatch reported that 67 percent of crypto owners would use cryptocurrency for everyday purchases if it were linked to a mobile wallet. Around 70 percent of those consumers are aged 18 to 54. Companies building bridges between cryptocurrency and everyday shopping are poised to capture a large market share. Blockchain: Discussion around blockchain is usually about cryptocurrency. But blockchain technology is just blocks of data linked together acting as a chronological ledger for transactions. It's a secure database, and developing financial applications on the blockchain increases an app's data privacy. Financial institutions that want to improve their security layers are the perfect candidates for tech that utilizes blockchain.
• QR codes: QR code use increased 96 percent from 2018 to 2020. This isn't just attributed to pandemic behavior. Jay Bean, CEO of FreshLime, pointed out in a recent Forbes article, "Not only are QR codes providing customers with the convenience they've grown accustomed to, they are also providing businesses with important information." Businesses that adopt QR codes will have insight into customer behavior that will help them improve the buying experience—and sell more. Coinbase introduced QR codes to millions of Americans in a primetime ad during Super Bowl LVI that invited viewers to scan a QR code. Security concerns aside, it was a creative marketing strategy to expose QR codes to mainstream Americans.
• Pay-at-the-table: Convenience might be the first reason businesses switch to a pay-at-the-table system, but additional benefits quickly show up. Modern Restaurant Management reported that self-service technologies increase order speed by 40 percent, but (here’s the important part) customers also feel comfortable spending more. Customers spend 21 percent more when they can order and pay without interacting with a human. Industries heavily affected by labor shortages, especially retailers, bars and restaurants, should view the investment in digital transformation as an investment in future sales.

Digital transformations will pay off

In the same 2021 survey noted above, McKinsey concluded, "At the organizations that experimented with new digital technologies during the crisis, and among those that invested more capital expenditures in digital technology than their peers did, executives are twice as likely to report outsize revenue growth than executives at other companies."

As this survey demonstrates, early investment in digital transformations will yield outsized returns. No matter what challenges the last few years have thrown at businesses, those who use technology to solve their problems will be ready for their next business iteration.

Tyler Kem is co-founder and president of Strike Tax Advisory, which helps businesses discover and claim government-provided tax credits and incentives available to them. Strike Tax helps SMBs compete more efficiently while keeping jobs in the United States. For more information, visit www.striketax.com.

The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.