On this episode of Payments Dialog, we speak with Paytronix team members Andrew Robbins, CEO and Tim Ridgely, Head of Order & Delivery, as well as Steve Klebe, Head of Business Development for PSP Partnerships with Google Pay. Our guests explain how to make payments work as an asset for dining including how to best manage complex integrations and have payments flow seamlessly to ensure a positive customer experience.

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Rough transcript of this Payments Dialog:

Peter Mollins:

Hi, everybody and welcome to another edition of Payments Dialog. This is Peter Mollins over at Spreedly. Really happy to have everyone with us and have a terrific panel today for a panel discussion from folks from Paytronix and from Google Pay.

From Paytronix, CEO is Andrew Robbins. Andrew, welcome.

Andrew Robbins:

Thank you. I'm glad to be here.

Peter Mollins:

Excellent, terrific. Tim Ridgely, who's the head of order and delivery at Paytronix.

Tim Ridgely:

Hello.

Peter Mollins:

And Steve Klebe, who's head of business development for PSP Partnerships at Google Pay. Steve, good to see you.

Steve Klebe:

Hey, everybody.

Peter Mollins:

Excellent. Maybe what we can do is if you don't mind Andrew or Tim, would you mind first just giving a quick overview of Paytronix and then Steve we'll turn to you for similar on Google Pay.

Steve Klebe:

Sure.

Andrew Robbins:

Sure, I guess I'll jump in and do that. Paytronix is a customer experience management platform. We try to create great guest experiences that would include mobile phone apps, different types of automated marketing, text messages, email, loyalty programs, gift cards, e-gift cards and order ahead. We encompass all of this stuff in one platform that help restaurants and convenience stores create these just really rich, great experiences that get people to come back. And we do it for over 30,000 locations.

Peter Mollins:

That's great. All right, Andrew, thank you. Steve, can you do a recap of Google Pay?

Steve Klebe:

Sure. Thank you, Peter. Google Pay is a strategic initiative of Google and it offers payment facilitation across both the physical world with tap and pay, as well as online and in app. The main goal of Google Pay is really two things. Make the experience for the consumer as smooth and as efficient as it can possibly be, that's a key goal. Then on the merchant side, the main objective is to help Google advertisers who also happen to be merchants, be able to increase their sales by making it a better, and easier, and more secure checkout experience for the consumer.

Peter Mollins:

Terrific. Well, thanks both. Obviously, we're here to talk about that dining experience and how folks can be helped who are in the restaurant business. Really, if you think about it at the heart of a good dining experience, there's the customer. A solid payments process starts with the end in mind and that's how to meet the customer where they are. Maybe Andrew or Tim, could you start by giving a bit of a description of what role payments play in having a good dining experience?

Tim Ridgely:

Sure. I think you said it. It's meet the guests where they are. It's what device are they using, if it's off premise. If they're on premise, great. Now post COVID, there's all kinds of ways to order things. But whatever device they're using, however they're ordering, have the payment flow seamlessly with that. If they're on a Google powered device in this case, allow Google Pay front and center because it's quick and easy to use. It's frictionless or reduces the friction in the process and it should be integrated well into the ordering or dining experience. At our checkout, we've lifted those mobile payments methods to the top so that not only is it payment, but can provide guest information as well. So it saves you from having to enter your name and those kinds of things. Really trying to streamline the entire process and make it fast and easy. All of which is way better than typing a 16 digit number into your phone, which is not fun.

Peter Mollins:

No, exactly. And I think you, yourselves and I know Google has some data as well on what kind of an improved payments experience has had on net ordering trends. Can you tell us a little bit about that?

Andrew Robbins:

Sure. I'll tackle both on-prem and off-prem. For on-prem, we've together been innovators and pioneers, Paytronix and Google, to create NFC loyalty, where we have tied your loyalty account to a Google Pay or an Apple Pay. So when you just tap to pay, if you're not a member, it asks you to join. Then in the future, every time you tap to pay, you get your points. If you have a reward, you're asked to use it on the check right then and there. With the reduced friction, what we found and we find this every time we add a new way of identifying yourself, loyalty programs will get 10% more people involved. We've done this with programs that have been around for five years. So when we added this 10% more people joined, the people tended to be five years younger and that's really a skew shift with many more millennials. And then they tend to be 42% more frequent. So innovation with payment, it turns out to create these great experiences and you get rewarded for it.

Andrew Robbins:

We are seeing similar things happen for off-prem and everybody with COVID got pushed to online ordering. But there really are people that are pay forward thinking and if they like Google Pay, they expect to pay that way. When we've added more payment, we're seeing the same trends. More people order, order time's faster, the cart abandonment goes down because you meet the customer where they are. So we're really seeing the exact same stats play out as we're adding these new payment techniques in the ordering space.

Peter Mollins:

Yeah. Steve, anything to add to that?

Steve Klebe:

Sure, absolutely. That's great, Andrew, by the way. One of the things I can point you to, we have a couple of case studies published on our website and it's pay.google.com/about/business/resources. But we have case studies from both Panera and Just Eat. In the Panera case, they communicated that within a month of launching Google Pay, garnered 32% share of wallet of their checkout, which just attests to the fact of how much more simplified the checkout experience is. They also saw an increase in order value of 7%, which I think any restaurant would tell you if they can get their order values up 7%, that is super dramatic.

Steve Klebe:

Then in the case of Just Eat, they saw their share of wallet go up from launch to steady state from 7.5% to 15%. So a two X increase by simply implementing Google Pay. The other use case that I would think about is the pay at the table concept, which is really starting to gain some traction. Every business has to focus on efficiency of resources and any of us who have ever eaten out, we know the typical experience where the waiter has to go back and forth 16 times.

Peter Mollins:

Yeah, no, just to continue on Steve's point there, it's absolutely incredible that you have that benefit in terms of increasing the order size, but then you also have that reduction in cost. If you want to pick up that point there on the reduction in costs.

Andrew Robbins:

I've got some stats on this, but we do pay at the table and we've seen three benefits. One thing is that you save five minutes and so you're going to get better table turns. The second thing, and I think that this is often missed, is that it leads to a better experience because the last five minutes are the lowest rated by consumers when they visit a restaurant. They like being greeted, they like the appetizers, they like everything. But that last minute, while they're waiting to go makes them anxious. By getting rid of that, the guest satisfaction scores increase as a result of saving that five minutes.

Andrew Robbins:

Then the third thing that may be surprising, is that tips go up 4% for servers and that's something that people didn't necessarily expect, but people are happier. You can give a suggested tip through the process, instead of letting them guess. Sometimes they're not good with math and generally they tip higher. It's really a win-win for the cashier, the guest and the restaurant.

Peter Mollins:

And at that last moment, they're probably much more willing to do a review or to recommend, or reach out socially and promote someone. Steve, some of that other data that you're mentioning, feel free to add in.

Steve Klebe:

Andrew, that's great information on the pay at the table concept. Also, just the efficiency of the wait staff time, I think is a significant contributor to restaurant bottom line. Especially with the younger demographic who also probably have a tendency to travel overseas, they're used to the fact that the payment happens at the table because overseas it's totally common practice that the waiter brings a terminal right to the table. The US has lagged dramatically behind in this area. But now with these various pay at the table initiatives, slightly different than what happens in Europe, because they literally bring the terminal. That's starting to happen a little bit in the US market, but more common now is just this notion that you scan a QR code and it brings up your check right onto your phone. Then you just review the check and pay, hopefully using Google Pay, right through your phone. It's a very much more satisfying experience for the consumer.

Peter Mollins:

That's great. Tim, I don't know if you want to comment a bit on how Paytronix and Google Pay symbiotically work together, perhaps some more context there.

Tim Ridgely:

Sure. The easiest way, the most straight line thinking way to think of it is that yeah, Google Pay can replace a credit card. I don't like typing my numbers in there and all that stuff. I'm already on my phone, I don't want to get to my wallet and take it out and get the card number and look down and up and put it all in. That's no fun. But it can give you more than that. It can give you the guest information. It can give you a shipping address and those kinds of things, as well. You can integrate into the checkout to really streamline the heck out of it. That's what we've looked to do is to lift that up to the top of the experience, say, "Wow, we can really make this a one-touch checkout to say, sure, pay with Google Pay. Use your biometrics to authenticate that," easy. Now we have all the information we need. You can just review your order details and send it. You don't need to go in and do any more things. We've worked to streamline the whole process.

Peter Mollins:

Great.

Steve Klebe:

Yeah, I was just going to say, and these things are just totally synergistic. Google Pay in and of itself, the benefit is that the consumers are typically already logged into their Google account and we gather credentials generally organically. So anybody who's using Chrome and ever uses Chrome auto-fill, we're taking their card securely into the system and make them available then behind the Google Pay button to use. The combination of organic gathering of credentials, and then the fact that most people are logged in is a big differentiator for us compared to most other payment methods. Where consumers have to stop what they're doing, they have to log in, they have to remember their username and password. Because we're not asking people to set up a separate Google Pay account, this is associated with their Google account, either you're already logged in or if you have to, everybody knows what their Google login is. So it eliminates all the traditional friction that goes along with other types of payment methods.

Peter Mollins:

Right and then that allows you to go across, whether it's order ahead, or delivery, to purchasing from a restaurant. Andrew, you mentioned earlier about some of the other elements like loyalty programs and other branded elements, those are important to keep front and center. How does Paytronix support those?

Andrew Robbins:

Let's again, start with the consumer or the guest. They're going to come in from some entrance point. Let's say they start with online ordering and they gave you their credit card. At the end of their order, we ask them to join the loyalty program. Now when they come back, they're expecting that you remember them, that's part of what we expect. We expect these really smart systems that remember who you are and make your life easier.

Andrew Robbins:

Then maybe you want to give a electronic gift card to your niece, who's just graduated from college. We would make it very easy for them to pick out that electronic gift card and then pay with your payment credentials that you've saved. So save it once and you expect it to work everywhere. Then maybe you want to recharge your personal use store value card as a convenience factor so you can buy your coffee and leave very quickly. We would allow that as well. Then maybe you would buy a subscription for free delivery for a month for something like $8.00 bucks a month, and we would allow that as well. We're all in one, we remember who you are, enter your payment credentials once, is the experience consumers expect.

Peter Mollins:

Great. Now, when you're talking about all those various approaches, to me, that what comes to mind is this idea of flexibility. I know with Spreedly, we focus on the idea of payments orchestration, the idea of incorporating multiple payment services together. Tim or Andrew, would you like to comment on how you use payments orchestration? This idea of orchestrating payment services in order to support things like onboarding of new restaurants, new customers for yourselves?

Tim Ridgely:

Yeah, well basically we look to get merchants live as quickly as we can, in as easy a way as we can. We look to have them up and processing same day, if we can get there. We don't want payments to hold up your launch. When you're ready to use online ordering, you want it immediately. You already want it. You wanted it last week, but your menu wasn't ready or your imagery wasn't there, those kinds of things. Setting up payments should not hold up that process. So we've been able to build a stack that same day we can do the KYC and those kinds of tasks that have to get done to get boarded on a payments platform, get integrated and have payments flow through seamlessly.

Peter Mollins:

Terrific. Yeah, I appreciate that. I feel like we've gotten a lot of interesting insights into the customer experience and some of the needs of restaurant partners. Maybe if you don't mind, we can just take a little bit of a jump into the technical side. Steve, do you have any suggestions for what you recommend on the technical side to either platforms such as Paytronix or directly to larger restaurants, when it comes to launching new approaches to payments?

Steve Klebe:

Sure. I mean, specifically as it relates to Google Pay, a key thing to keep in mind is we have a API call that we refer to as ready to pay. I believe Apple has something virtually identical. The idea with that is, is that the moment you have the opportunity, you want to make a call to that API call, which happens behind the scenes. We respond back and let the merchant know, or the platform know that this consumer is logged into their Google account and they have a card associated with that account. If that positive signal comes back behind the scenes, the idea for the platform or the individual restaurant, depending on who's controlling the checkout experience, is to bring the Google Pay and/or Apple Pay as forward in the flow and as prominent in the flow, as you possibly can. That dramatically increases the click-through rates and the conversion rates.

Steve Klebe:

There are other things, of course that are not necessarily Google Pay specific or Apple Pay specific, which is you want to make the entire virtuous circle experience as seamless as possible. I think a lot of people were caught with their pants down when the pandemic hit. They hadn't really invested in their digital experiences, but the industry has accelerated in a good way, very quickly in that regard. But I think the simple concept that order ahead, but pick up in store, that experience needs to be seamlessly supported so that the customer, when they arrive in the store either can make the payment in store, or they can have completed the payment already on the app.

Steve Klebe:

But in theory, you probably need to support both the use cases. It's things like that, that you really need to look at it from the perspective of the customer. And restaurants and platform providers know this probably better than I do, that you have to be prepared for at least the half a dozen different possible scenarios or use cases and make sure that you've got all those options available to the consumer.

Peter Mollins:

Great. Thanks, Steve. I guess that makes me wonder Andrew, if you can get your crystal ball out. Steve mentioned about these various options that are coming. Where do you see us going in the restaurant industry from a payments perspective?

Andrew Robbins:

I think one of the areas that I'm seeing and Tim will jump in too, is going to be the use of biometrics. Biometrics help with two important things. One is convenience, and the second thing is fraud. So I am looking forward to a pay with your face environment. When I can walk up to a kiosk or something like that and it recognized me and I can pay. Then I think people have maybe noticed if you do something with your bank or Fidelity, or even Verizon, I called for customer support and they're doing voice ID. They're really moving toward forget your phone number or a PIN. They're like, "We can do a better job of knowing who you are based on the phone number you're using and your voice." It's more convenient and it cuts down on fraud. So I think we're going to see a lot more of that.

Tim Ridgely:

I think we'll see probably more and different mechanisms of payment as well. We're moving from Visa, MasterCard, Discover to what the heck is this Apple Pay thing? What's this Google Pay thing? Then it'll be probably Facebook and they've underpinned with the cryptocurrency, but you can have a Facebook payment mechanism. Signal is launching a payment mechanism, which may be digital, may cross into the physical realm. Certainly Facebook has the wherewithal to do that. So I think we'll see some of that. And maybe that will reduce the reliance on the main card networks. They can work differently than you may expect. Then you get into the cryptocurrencies. Andrew, I think has a bunch of thoughts on crypto, but that's going places, obviously.

Andrew Robbins:

I have to say, because I was doing my taxes and Turbo Tax kept asking me, have I done any transactions with cryptocurrency? So I did some research and the fact is that these cryptocurrencies are investments and their price fluctuates. So when you buy a coffee with a cryptocurrency, you may have a gain, maybe it's $2.99 cents. You're going to have to recognize a gain for your taxes, maybe of 12 cents and you'll have to keep records. Was that a short-term capital gains or a long-term capital gains? People are doing the transactional piece, but no one has touched the accounting piece and it's very clear you're going to owe taxes on cryptocurrencies.

Tim Ridgely:

Between an auto recharge from Bitcoin and then a coffee purchase, you could trigger a wash sale if you do it within 30 days.

Steve Klebe:

Yeah, I was reading an article about that exact thing recently. I went through that experience, as well when I met with my accountant this year. He had to ask me very clearly whether I had purchased or sold any cryptocurrency in the last year. Crypto's hot, obviously Coinbase went public today and so it's very much in the news. But I think most people don't realize what it entails. People ask me all the time what do I think about cryptocurrency and everything in my world I think about how does it translate into a mainstream payment medium? I still think we're quite a ways off, especially once people realize the tax consequences. I think we're a very long way off before any sort of cryptocurrency becomes a mainstream type of payment mechanism.

Steve Klebe:

Now the flip side is, again, outside the US we have a big shift towards real-time bank payments. This has been common in places like Germany for a long time, but now is live in countries like Singapore, India, et cetera, because those countries have mandated open banking standards and they have implemented countrywide authentication schemes. You can reliably do a bank to bank transfer as part of a payment transaction and it's had a very large scale. And coming to Europe in under PSD2, as we speak and probably three plus years out before it happens here in the US.

Peter Mollins:

Terrific. Well, really enjoyed the conversation. It was fascinating to hear how convenient, secure payment methods for restaurants really improve the customer experience and really excited to hear some of that data about higher ticket sizes, higher tips, better customer reviews on restaurants. So to the Paytronix team and to Google Pay, thank you so much. I really appreciate all three of you joining me today on the Payments Dialog.

Andrew Robbins:

Thank you, Peter.

Steve Klebe:

Thanks, Peter. Great opportunity.

Peter Mollins:

Thank you.