One of the main reasons for the variety that exists in the way that vendors package and price payment services is functional capability. The larger the merchant and the more complex the requirements, the more the differences in functional requirements matter – and this can be the determining factor for many leading merchants. Increasingly complex omni-channel requirements require a growing number of payment types or alternative payment methods, support for mobile POS, mobile in-app purchases and global reach. Given these demands, cost is rarely the primary determining factor for vendor selection.
So when it comes to vendor selection, shouldn’t it be a case of finding vendors that tick all the required functional boxes, and then selecting based on price? Some merchants do take this approach, but in the long-run it’s ill-advised. Why? Because this approach can dangerously ignore non-functional requirements (NFRs).
Selecting a payments vendor is not just about functional fit; NFRs have become a critical piece of the puzzle.
How many retail CTOs and IT directors know what plans – and commitments – are in place from their own business units and their payments vendor when it comes to performance? What SLAs (service level agreements) are in place for transaction processing time, for issue resolution and for disaster recovery? What plan will be activated if there’s a security breach or a denial-of-service attack?
These foundational issues might not be headline grabbing – especially when projects concerning digital transformation, new technology and business expansion are far more fun. But a failure to address NFRs can see a merchant in the headlines… for all the wrong reasons.
If a retailer’s system can’t process transactions fast enough, suffers downtime, or if card data is compromised, it quickly becomes a major problem. There’s still a tendency to think “it won’t happen to me” but it does happen. You are only a quick google away from knowing which high street retailer is the latest to suffer the ignominy of being unable to process payments on a busy day of shopping (or not shopping, in this case), or having to admit to a breach resulting in the loss of customer data.
When this happens, explanations are often vague: misconfiguration or a system upgrade, and that the issue is being worked on. But this is where a payments vendor can really earn its stars. Whether it’s built-in redundancy, security procedures or comprehensive disaster recovery, having adequate defences in place should not be taken for granted.
These defences – including disaster recovery (DR) systems that seamlessly respond – are part of those critical NFRs. And maintaining the highest-level NFRs requires payments vendors to invest, which goes some way to explaining pricing variation in the market. The real value of NFRs come into sharp focus when these rare moments arise. This can be the difference between customers not noticing an issue, and it being headline news in national media.
The cost of a service is more than just the sum of its functionalities. It’s about performance and contingency plans. A system outage may never affect you, but you need to know you have the assurances of a vendor that has made the investment and has a proven pedigree if the worst should happen – keeping the transactions (and therefore revenues) flowing. If not, those that pushed cost savings as a priority over these critical NFRs, will have to face the music.
Retailers today need an omni-channel solution that delivers maximum flexibility throughout the world. Find out why the ACI Omni-Commerce solution was named a Leader in Global Merchant Payments by Independent Research Firm Forrester.
