Danny Shader is the founder and CEO of PayNearMe.
No matter the business, payments play a critical role in the consumer experience—which means getting the payment process right is essential for attracting and retaining customers.
Any business hoping to thrive in a Payments 3.0 world must offer a frictionless experience. That’s no more evident than in the iGaming industry, where the ability to deposit and withdraw funds quickly and easily is essential to the experience successful operators must offer to players.
To succeed, operators look to payment platforms that support all of the deposit and withdrawal methods players use—from digital wallets to the ability to receive instantaneous credit for cash deposited at the casino cage or a retail store—with a single integration. With modern technology, they can add and remove payment types and channels, compliance and reconciliation and data collection, all of which are essential to providing a hyper-personalized customer experience.
As part of our Payments 3.0 series, let's explore an iGaming case study to see how delivering better payment experiences can influence which operators win and lose players. As the CEO of one of several companies developing Payments 3.0 technology, there are several ways that this technology can evolve to create better payment experiences.
While the focus in this case is on iGaming, the lessons learned are universal. Regardless of your industry, I hope these insights encourage you to reassess the impact your payment experience has on acquiring and retaining customers.
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The Meteoric Rise Of iGaming
It has been a wild ride for iGaming operators in the U.S. as more states approve the practice and consumer interest grows. Currently, six states allow online casino betting, 30-plus states plus the District of Columbia have approved online sports betting, and others are debating proposals. The total annual revenue for iGaming is projected to reach $124 billion by 2027.
This dramatic growth has prompted operators to make enormous investments in the development and marketing of iGaming apps to capture market share while consumers are up for grabs.
My company, PayNearMe, recently sponsored a new study of iGaming players in partnership with Betting Hero that suggests that the iGaming operators who offer a seamless, elegant experience for players will rise to the top since payments sit at the center of the overall user experience in betting apps.
Do bettors care about payment? You bet.
iGamers require fast, hassle-free transactions so they can engage in events and enjoy their play. But here’s the rub: As one respondent said in the survey, “Other industries seem to get funds moved more quickly than any type of gaming payments.”
The iGaming study supports this perspective:
• Nearly a quarter (23%) of respondents said they would abandon an app if they had any problems depositing funds.
• About a third (32%) said they would abandon an app if it took too long to fund their account.
• 17% would leave if their payment was often declined.
Consumers initially gravitate toward brands they know, but they'll go elsewhere unless those brands provide a great customer experience. Payments are an integral part of that experience.
Payments 3.0 technologies can streamline deposits and withdrawals and enhance the user experience. Here are three tech-forward strategies that will shape the future of iGaming—and are equally applicable to other industries:
1. Enable seamless payment through a hyper-personalized interface.
iGamers are typically savvy consumers of online experiences, and today’s e-commerce sites set a pretty high bar that most gaming operators don’t yet meet. In the aforementioned survey, 22% of respondents listed UX and UI issues as their primary day-to-day frustration.
With Payments 3.0 technology, each customer’s payment history and practices can be used to personalize the experience; for instance, simplifying the player’s payment screen to display the individual’s preferred payment types, while facilitating quicker, faster payments with higher acceptance rates.
2. Make a great first impression with AI-assisted initial deposits.
When the process of setting up an account is cumbersome or doesn’t work, the opportunity to make a good first impression is gone forever—often along with the player.
In the survey, 20% to 27% of players said they were unable to fund their accounts on nine popular gaming apps. Twenty-three percent immediately abandoned the app, causing operators to forfeit both their player acquisition costs and future revenue; and 21% reached out for assistance, adding to customer service expenses.
Payments 3.0 will continue to evolve to deliver modern, AI-powered payment platforms with user interfaces (UIs) that make the initial deposit experience seamless.
In the event of a declined deposit, sophisticated AI and machine learning algorithms will recognize the reason and suggest corrective actions. This can be achieved by making real-time adjustments to the player's payment options within the user interface or initiating a push notification or text message with recommended steps to resolve the issue.
3. Improve the security and speed of withdrawals.
iGaming is all about the immediacy and excitement of the experience, including celebrating wins. About half of players overall (49%), and 60% of those who experienced payment issues, said they would be likely to switch to a new or competitor app if it promised faster withdrawals.
As Payments 3.0 solutions employ machine learning, this will help to verify player identities and prevent fraudsters from withdrawing winnings with less manual intervention. When operators spend countless hours manually reviewing and verifying each withdrawal, a player’s ability to withdraw winnings is delayed.
AI/ML can analyze large sets of payment data to detect issues substantially faster than an operator’s staff can do manually, which promises faster withdrawals for players.
Improving The Odds Of Success—In iGaming And Beyond
The iGaming industry, while unique, offers valuable lessons about creating frictionless payment experiences that apply to every competitive business. A Payments 3.0 platform that delivers fast, personalized transactions is crucial for customer retention and loyalty across all industries.
Companies that prioritize seamless payments alongside a strong sales and marketing strategy will ultimately build the successful enterprise they and their investors desire.
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