The student population in the UK remains substantial, at well over two million, spread around all regions.
Experian, the global business information service, estimates that total spending by students in 2015 was £30 billion and is set to rise to £37 billion by 2020.
With each student reckoned to spend an average £13,000 last year, the collective financial clout of this group of consumers is not to be underestimated.
This is especially true for sports retailers, as much of this money will be spent at sports and other leisure shops. Sports retailers will win a greater share of the over £30 billion spent annually by students if they put more effort and investment into facilitating contactless and mobile payments. Recent research by Vista shows a clear preference among students for card payments, with nearly nine-out-of-ten (87 per cent) preferring them over cash payments.
While this may not come as a surprise, the research also showed that over one-third (39 per cent) of students prefer contactless payments above all.
Even more – an astounding 46 per cent – said they would be more inclined to shop with a retailer that offered reliable contactless payment.
Another 36 per cent said they want to use the technology on their smartphones to pay for goods. The survey also suggests that too few retailers in general are taking advantage of this technology and actively catering to the student demographic; despite being the preferred method of payment for 39 per cent of students, contactless cards were the most common form of payment for only 36 per cent.
Mobile payment apps, meanwhile, were preferred by nine per cent of students but only four per cent named them as their most common method of payment. The true value of contactless payment for retailers The real value of installing modern point-of-sale (POS) equipment increases year-on- year as students and other consumers continue to rely more heavily on contactless cards and mobile payment systems, particularly with the recent release of Android Pay opening up the option to those without iPhones.
Figures released by the UK Cards Association reveal that during January this year, over £1.1 billion was spent using contactless cards, an increase of 286 per cent over the year.
The growing preference for contactless and mobile payments, particularly with the younger, tech-savvy generation, is due to a number of factors. According to the Vista survey, the main benefit drawing students to contactless cards was speed, with 90 per cent of respondents listing it as a reason. Meanwhile, 46 per cent said they preferred contactless cards because they didn’t like carrying cash and 18 per cent said that contactless cards made it easier to track their spending.
This preference carries a heavy weight for student consumers. When asked what would persuade them to enter a shop, 47 per cent of students replied with “contactless payment technology that always works.” In addition to this, 13 per cent of students said they would avoid a store altogether if it did not allow them to pay via a contactless payment card. It’s clear that retailers have much to gain by ensuring their POS systems are up to date.
Despite many retailers already being fully equipped to accept contactless payment cards, in many cases both sales associates and customers are completely unaware of this capability, meaning that retailers are missing out on lucrative sales as a result.
The key to unlocking this revenue stream will likely prove to be educating staff on the store’s payment capabilities and making sure that any students entering the shop are aware that contactless payment – and possibly mobile payment – are accepted on the premises.
Sports retailers across the UK must also ensure that they have the ability to cater to this valuable demographic and transform them into loyal customers.
With thorough preparation, the right payment solutions in place and backup from a retail support specialist, canny retailers can ensure they are top of their class in the eyes of student shoppers.