This video gives an overview of the report “Digitization Opening Up A Whole New (Old) World.”
Accelerated digitization across non-discretionary retail verticals presents a +$19 billion revenue opportunity for payments processors. Growth in eCommerce is expected to increase in 2021. Continued investment in digital channels is creating M&A opportunities. Press play to learn more.
We published an Ahead of the Curve® Series report on the future of digital ordering and payment.
COVID-19 is accelerating the pace of digitization even across the more non-discretionary, cash rich verticals such as grocery, retail pharma and restaurants. We estimate these verticals in aggregate, represent an incremental $19B+ of revenue opportunity across the entire payments ecosystem, as cash converts to digital.
Despite a strong 2020 for eCommerce sales, 77% of respondents from our survey across the grocer/pharmaceutical verticals expect a further increase in eCommerce 2021. Encouragingly, 74% of restaurant executives surveyed expect restaurant delivery sales to increase in 2021. This will benefit those restaurants with the best data analytics. The restaurant industry’s increased digital ecosystem also gives way to a bigger presence for virtual brands and ghost kitchens in 2021.
While investment in digital channels is accelerating broadly, by a margin of 2 to 1, retailers prefer to invest in proprietary/first party solutions as opposed to 3rd party platforms. We believe first party ordering platforms in verticals such as restaurants could represent attractive M&A opportunities for payment processors.
Next generation payment solutions are of critical importance with 88% of respondents adding/likely to add additional alternative checkout options – both online and in-store. Digital wallets are the most popular alternative payment solutions, but newer solutions such as Buy-Now-Pay-Later are gaining traction.
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