ConsumerPaymentsLandscape–DeliveringaSingleSourceofTruth

The Challenges

There are numerous reports by established research agencies on the UK payments landscape. Despite giving a direction and an indication of consumer’s financial holdings and payment behaviour, they fail to provide the depth and breadth needed to truly understand consumer’s perceptions, attitudes, and actual behaviour. The payments industry is complex; and a multitude of factors affect how consumers pay, such as:

Therefore, it is challenging to get a complete view of the payments landscape. The intricacies of the four-party payment model (consumers, payment brands, banks, and merchants) mean that each stakeholder only sees the data they collect and never gets to understand the full picture.

Within the plethora of data sources used across Visa and its clients, there was no single source which looked holistically at consumer financial portfolios. Typically, there was a focus on one aspect e.g. debit or credit and therefore a gap in our understanding of consumers payments in their entirety.

The challenge was to develop a single, robust view of the consumer payments landscape that can be used by the entire UK Visa business and all clients.

Additionally, there was a second challenge in the methods of research used. Traditional qualitative methods rely on claimed behaviour which has a lag between the actual event and reporting it, which leads to inaccurate and rationalised biases. Quantitative methods give an in-depth understanding of what is occurring, but little context as to why and again included biases as consumers are forced to re-evaluate and rationalise their behaviour.

The Project

Brandscapes designed the Consumer Payment Landscape (CPL) research with Visa to overcome these shortcomings. Given the multitude of data sources already existing in Visa, it was important for the research to build on what Visa and its clients already knew, and bring all internal stakeholders onto the same ‘page’ through a multi-lens approach.

The goal of the research programme was to build the most comprehensive and detailed view of the UK payment landscape by understanding consumers ‘real’ payment attitudes and behaviours.

“It was critical from the outset that the research built upon existing knowledge whilst gathering new intelligence to create an unbiased view of the UK payment landscape. We needed a solution that triangulated existing datasets with extensive quantitative results of real-time purchasing behaviour along with a qualitative perspective to provide a true 360-degree view of the payment landscape.” Damion Lawrence, European Head of Research & Insights, Visa Europe

As befits such an ambitious exercise, a multi-stage and multi-modal approach was designed as shown in Graphic 1.

The outcomes and benefits of the studies to Visa and their client partners were clearly outlined. See Graphic 2.

Stage 1: Immersions

1A: Data immersion:

A comprehensive evaluation of published and internal data and reports, including consumer finance media, industry estimates and reports by regulators/ industry bodies, third-party research, Visa’s past research and internal transaction database.

1B: Stakeholder Immersions:

Extensive discussions with different stakeholders in Visa ranging from Marketing, Consulting, Product & Propositions, Merchant Solutions to Strategy.

“We were able to use the immersion sessions to understand the key priorities of the research and how it would be applied to the business, both for Visa and its clients. For example, a key criterion of success for this project was the ability to overlay the data onto the multiple segmentations that are used across Visa, and this was an outcome of the immersion discussions”. Kulvir Benning, Marketing and Insights Manager, Visa Europe.

This stage also, importantly, served to disseminate the need for and value of the study within Visa and generated internal buy-in for the project.

Stage 2: Mapping the Payments Landscapes

This was in two phases:

The diary and follow-ups were designed to capture details of over 120,000 payment and ATM transactions in real-time: what was bought, how was the payment made, why the payment mode was used and so on. The data from phase 1 enabled accurate attribution of the payment mode to enable us to cut the data in several ways including payment mode (cash, card, contactless, digital…), the bank issuing the card, merchant category where the payment was made, reasons for using specific card/ payment mode (or not), transaction amount and so on.

Stage 3: Calibration and triangulation

The data capture phase was followed by a crucial part of the project. The data captured through the two phases was consolidated, weighted, projected, and then calibrated and triangulated with external and internal data available from the immersion phase and with Visa’s databases. The result is a database that is not only unparalleled in its size and detail but also robust and reliable in terms of the payment volume of the various segments.

Outcomes Achieved:

The Consumer Payments Landscape study data has been analysed using different lenses such as card-issuing banks, merchant categories, product (e.g. credit Vs. debit). We analysed the data to help facilitate discussions between Visa and their client partners and co-creating strategic and tactical initiatives. For confidentiality reasons, we are unable to name these partners or go into specific details, but some examples of the analyses are listed below, and snapshots are shown in Graphic 3.

The multi-lens approach has resulted in analyses that cover different facets of the business

Further, Visa’s partner banks have expressed the desire to do follow-up work to hone-in into the implications thrown up by this exercise and different internal teams are developing propositions and service ideas specific to micro-segments.

“The CPL study has provided immensely valuable insights into the changing shape of the UK payments landscape! The study has allowed us to understand the full range of payment methods used by consumers, the relationship with their main bank versus other providers and most importantly the drivers for this. These insights are currently supporting the development of new propositions that will meet the differing needs of consumers taking account of their life stage and affluence”. Geoff Mozley, Commercial Account Manager, Visa UK.

Why should this entry win the award?

“Visa has to navigate an evolving and subtle payments space. When we develop programs to encourage behaviour change, we need to be consumer-led. We need to understand the environment within which consumers make their decisions and this study enables us to do this. I see this as the first of a series of studies that will ultimately explore other audiences including merchants/ retailers plus wider SME/ business owners. Very excited by this first phase of our roadmap and look forward to sharing observations and recommendations with our partners.” Neil Rycraft, Head of Marketing Strategy & Operations, Visa Europe