According to an article published by TechCrunch, we’re in the midst of a great revolution in the technology and payment processing industry. With the rapid advancements taking place with payments, social media, eCommerce, email, and text messaging all converging on one device, business owners finally have available to them the opportunity to get an actual ROI when it comes to credit card processing, unless they are using Square.
This is an opportunity many business owners, especially in the restaurant and retail space, are completely missing the boat on because it has to do with big data and analytics, something they probably aren’t all that interested in. The light bulb in my head turned on when I read this paragraph though:
Payment companies can utilize data from existing transactions to generate more transactions. Companies who maintain a direct relationship with the consumer — such as American Express, PayPal, Square, Discover, etc — are in the perfect position to serve as an Amazon recommendation system for “everything.” Did you buy a tennis racket at Sports Authority? How about tennis lessons with Saul the tennis pro, at a discount thanks to your purchase of a tennis racket, only redeemable with the same payment instrument? You weren’t searching for Saul, and you wouldn’t want an unsolicited email from Saul, but seeing an advertisement for Saul shortly after buying a tennis racket (say, on your purchase receipt) would likely produce a response. It’s a way to preempt search for a large class of “secondary” purchases (e.g., charcoal after buying a grill; tennis balls after buying a tennis racket, etc), in a “pull” based way.
In a nutshell, payment processing companies can leverage cardholder data to drive additional sales by collecting the purchase data and remarketing additional products and services to the consumer based on their purchase history.
You’re probably wondering, what does this have to do with my Square Register? I’ll get to that but before we get there, let’s talk a little bit about the value of an email address. Here’s what Neil Patel, co-founder of KissMetrics and Top 10 marketer according to Forbes, had to say about email:
“Out of all the channels I’ve tested as a marketer, email continually outperforms most of them. Not only does it have a high conversion rate, but as you build up your list you can continually monetize it by pitching multiple products. Just look at e-commerce sites like Amazon, one way they get you to continually buy more products from them is by emailing you offers on a regular basis.”
So what does this have to do with Square?
Well when you decided to plug your Square POS system in at your place of business, you decided to give up ownership of your most valuable asset, your client list, and their payment data. As your customers frequent your business over the next several years, they’ll ask you to email or text their receipts, a trend that is rapidly increasing as consumers continue to ditch paper and rely on mobile devices, tablets, and apps to organize their finances.
This is data that you can monetize to grow your own business and create unique experiences that allow you to further differentiate your business from your competitors. Data you can use to deepen the relationships you have with your customer by being able to send them an email that is customized to them. Data that allows you to understand what products and services are the most popular in your business at what times of the day. Data you can use to build and customize your loyalty program to attract ideal clients.
These are all processes you have the opportunity to own but instead will opt to purchase them back from Square, the company you gave the data to in the first place.
One of the most important assets in the new economy is the relationship you have with your clients, what you know about them, and what you do with what you know about them.
If you’re using Square, they know more about your customers than you do, because they own the phone numbers, email addresses, and ultimately the payment data that your clients gave you when you swiveled the register around to pay for your services.
There’s a reason they won’t allow you to export your customer data to your own CRM, they’re not your customers according to Square. Whoever owns the data, and leverages it to create additional value for the consumer, wins. Unfortunately, it won’t be the business owner using the Square Register.
If you’re happy with the functionality you get with Square but you would like to grow your business by leveraging your client data in a more efficient way, feel free to reach out. We can introduce you to several tablet-based point-of-sale solutions that will allow you to utilize your customer data to grow your enterprise, while also keeping the functionality you’re accustomed to.