Just about everything we do these days is online, from mobile banking to purchasing to signing contracts. Sharing sensitive information, such as your credit card data to a trustworthy, online entity can be safe, efficient, and convenient. With the emergence of encryption and other cyber-security measures, the information we give to a myriad of technology outlets doesn’t have to be at risk.
Consumer trends dictate the emergence of online platforms specifically designed for ease of payment and buyer benefits. Apple Pay, Uber, Lyft, and Airbnb are just a few well-known encrypted apps that safely store customer data to expedite the buying process. Applications, in general, are discovering ways to further enhance the customer experience in all industries, including travel, leisure, dining, and more.
In this post, we’ll explore the benefits of credit card linkage, and its unique benefits for the restaurant sector.
1. Credit Card Linkage Uses “Tokens”
Let’s say a consumer named Sterling decides to use Apple Pay and links their MasterCard. Communication between the two companies about Sterling and his transactional data is done using a “token.”
As Sterling starts using Apple Pay, MasterCard and Apple will only communicate about Sterling via the last 4 digits of Sterling’s card (which allows the companies to represent to Sterling that his card is successfully enrolled), and a “token.” This token — a big string of random letters and numbers — has nothing to do with Sterling’s credit card number. It’s a unique ID that Apple, and only Apple, uses to reference Sterling.
The use of tokens versus credit card numbers produces the extended benefit that a person’s private information isn’t communicated by companies. This secure method of communication makes their private information much less vulnerable to fraud. Because of the use of a token, Apple, MasterCard, and the merchants where Sterling shops never share Sterling’s credit card information. Every single one of Sterling’s credit card transactions remains between him, his bank, and the merchant — just like a normal credit card payment.
Realizing, these benefits, we’ve been using tokens at Thanx since we started out (3 years before Apple started using them!) This particular technology is just one of the reasons we can deliver on a security guarantee of never storing consumers’ credit cards.
One small difference is that Thanx goes the extra mile that other companies don’t — we never see (much less store) a consumer’s credit card information. When a consumer enrolls their card in Thanx, their enrollment goes from their phone, encrypted, straight to the credit card network. Thanx doesn’t see, know, or have any record of private information at any point — unlike Apple and Bank of America who stores sensitive information for other purposes, whether it be iTunes payments or consumer personal bank records, respectively.
2. Credit Card Linkage Offers Exceptional Convenience
Linking credit cards to restaurant or dining apps provides consumers convenience far beyond traditional purchasing. Because the apps track consumer data, they can provide efficient user experiences such as suggesting menu items based on past order history and rewarding loyal customers for repeat purchases and spend thresholds.
Despite that some consumers may worry about exposing their purchasing habits, the idea of doing so is to create an optimal customer experience rather than collecting data to sell to third parties. It’s a value-added part of more personalized and customer-centric experiences that consumers have come to expect and desire.
3. Credit Card Linkage is Safer Than Traditional Purchasing
Sensitive information given to mobile apps is automatically encrypted. Additionally, users are required to log in to access this information with a username, password, and in some cases, their fingerprint. This added layer of security ensures that not only is their information protected via encryption, but accessing the data is virtually impossible by anyone but the user.
Even in worst case scenarios such as a lost or stolen phone, users can instantly freeze their payment credentials to prevent anyone from accessing their financial details. Traditional restaurant buying methods aren’t nearly as secure. It’s common for credit cards numbers to be lifted by unscrupulous staff, or to be left behind, stolen, or susceptible to theft when taking payment over the phone.
4. Restaurants Use Credit Card Linkage to Increase Retention
Apps and loyalty rewards are two key drivers in customer engagement and increasing retention. Tracking customer purchase history via transactional data allows you to reward your most loyal customers and keep them coming back for more.
Loyalty rewards are also a great way to incentivize new customers to sign up for apps, which allows them to access your menu at the touch of a button. It’s a simple way to convert your in-house customers into repeat regulars.
5. Credit Card Linkage is Vital to Remaining Competitive
The restaurant and dining industry is extremely competitive. To maintain a competitive edge, it’s vital that restaurants comply with industry trends. Mobile payment software could net over $500 billion in payments by 2020 which is roughly an 80% compound annual growth rate, according to this research. Now, more than ever, consumers favor mobile payments over traditional ones, especially as the young consumer segment increases.
Realistically, we’re a fast-paced, data-driven world. The fearful idea that credit card data isn’t safe online is quickly becoming an obsolete notion. Encryption, cyber-security measures, tokenization, and other consumer protection measures are making it easier to trade fears for the ease, convenience, efficiency, and rewards of linking credit cards.