"Omnichannel" is an increasingly common term in the payments technology industry, but it means different things to different people.
Generally, the word refers to a marriage between mobile payments and fixed point of sale systems that can open up opportunities to gather data and reduce cart abandonment. But in practice, "omnichannel" has become jargon for retail marketing, thus missing the technology's real complexity, said Ken Paull, chief revenue officer at Cayan.
In an attempt ease the work required to integrate mobile with in-store payments, Cayan has partnered with Demandware, integrating Cayan's Genius Platform with Demandware's Commerce Cloud and its LINK Partner Ecosystem. Cayan's Genius hosted payment system, which enables remote access to new transaction technology, will exist alongside Demandware's cloud-based EMV-certified payments system.
The use cases stemming from this combination include Demandware clients gaining access to Genius' "omni-tokens," which enable people to buy products online and return them in-store. Marketing and other content related to the physical store can be delivered to mobile apps in real time. Retailers can also integrate card and mobile payment options, including third party wallets and contactless payment systems.
For Paull, the mix of security and processing technology required to allow consumers to shop, communicate and pay from different devices as part of the same experience is being underestimated.
"Omnichannel is a buzzword; there are not too many people that have developed something that works across both brick-and-mortar and e-commerce," he said.
Security is the primary impediment, Paull said. In-store payments are primarily protected by chip cards, while digital or contactless payments are protected by a mix of tokens and encryption, and it's hard to create a seamless experience that accommodates both.
The challenge to embrace myriad mobile shopping, payments and marketing options while migrating to chip cards is particularly vexing, he said, considering that only about half of U.S. stores have even migrated to chip cards. That’s where Cayan sees its opportunity.
"They're having a hard time doing just doing EMV. Also, 'mobile' can mean a couple of different things," Paull said. "People can be shopping on mobile. Or using mobile to pay, or access an offer, or make a contactless payment. Mobile's not just a card not present transaction. It means being able to use a mobile app to shop and pay in an EMV world, and you'd be challenged to find anything that is fully implemented across all of those options."
The Demandware collaboration, which was announced on Jan. 13, is Cayan’s latest step toward becoming a merchant technology provider. The company formerly known as Merchant Warehouse earlier this year began a rebranding project and diversification beyond its ISO roots to include a mobile-focused mix of digital transaction processing and merchant services.
"There are a number of technology companies that play to specific verticals and target niches," said Rick Oglesby, a senior analyst and consultant for Double Diamond Payments Research. "However, those that play the horizontal market by targeting many types of industries are finding that [client] needs are becoming more specialized. Winning across the horizontal markets requires a broad set of options across all channels, and integration between the options and channels as well."
Cayan's not the only company with this idea. Volante recently began an IT project with NedBank, a South African financial institution, to upgrade the bank's payments messaging layer, or the technology that makes a card or mobile payment work the same way between parties. Volante also integrated with distributed ledger technology company Ripple to enable faster payments.
In both cases, the goals are similar—gain business share among companies that are struggling to adjust to rapid and diverse changes in transaction options and technology while maintaining security and compliance.
"In the past there was a lot you could do to change the retail experience by just routing mag stripe transactions to a back office at a store or to the retailer's headquarters," Paull said, adding the introduction of EMV and the new technology has made it hard to develop a ubiquitous solution that can integrate with any merchant acquirer. Through cloud enabled technology, Cayan is attempting to be both an acquirer and a technology gateway, Paull said.