With the right preparation, an independent sales organization or agent can have an effortless conversation with a merchant about new payment technology.
Merchants, however, often hesitate to accept new payment technology because they do not understand the potential benefits, industry insiders say. But a salesperson can benefit down the line if he or she can explain the technology in simple terms while showing the advantages to the merchants.
Training, as one ISO found, helps.
"Our sales team receives regular training on a weekly basis even if we're not introducing new products," says Henry Helgeson, president of Boston-based merchant- services provider Merchant Warehouse. Not everyone has the same luxury because training experiences differ from company to company.
Some salespeople already have a thorough understanding of new technology and can almost immediately learn the intricate details of a product. Others may struggle even when training is provided.
Either way, failing to understand a new piece of equipment can be damaging for an agent.
Do Your Homework
If an agent cannot explain to a merchant how a wireless payment terminal works, he may lose a sales opportunity or damage a relationship. That failure opens the door for a competing agent to come in and properly explain the benefits of that same piece of equipment.
Dave Proy, a merchant-level salesperson for Long Island, N.Y.-based EVO Merchant Services Inc., says he is still trying to get over the learning curve of new technology after five years in the industry.
"For someone who is not technical with things," Proy says, "there is a problem trying to explain [to merchants] how it interacts with their computer and how it interacts with their bookkeeping."
Providers of new equipment sometimes can be at fault when a salesperson is having trouble understanding new technology. Vendors often assume the salesperson has a knowledge of technology when he does not, he says.
"We're trying to get that across to them so they understand that we don't understand some of the stuff they are trying to put across to us," Proy says.
A salesperson cannot always tell a merchant, "Well, it works—trust me," he says. "A lot of business people want to see a demonstration of how it's going to work."
Independent contractors often have to train themselves to understand new products and technology, says Proy. It is frustrating but a crucial part of being successful, he adds.
"The people that are going to stay in this business and flourish need to know how things work and how to work it to their advantage," Proy says. "If they don't dig and find these things out for themselves, they are the ones that are going to be lost."
Jon Perry's background puts him on the opposite end of the spectrum when it comes to understanding new technology.
The managing partner of Fort Worth, Texas-based ISO 888QuikRate.com was a corporate executive for more than 12 years and has a firm understanding of technology. Perry's job often is to simplify technical jargon so that salespeople and merchants can understand the features and benefits of new equipment.
"The days of just putting out a terminal and not fully understanding how it works are done," Perry says.
Agents at Atlanta-based ISO Priority Payment Systems LLC have training opportunities similar to those of Merchant Warehouse. President and CEO John Priore says a company like Vivotech provides online seminars and attends sales meetings to introduce and demonstrate new technology.
"On-site demonstrations can be anywhere from quarterly to semi-annually," Priore says.
Selling Benefits
After the salesperson understands the technology, he or she can schedule a sales call.
ISOs that handle larger merchants usually use a team approach to introduce new technology, Priore says. For example, NCR and MasterCard or Visa visit an ISO to demonstrate a contactless reader that will be used in Wal-Mart. Then all three show Wal-Mart how the contactless reader will work for them.
"At that level," he says, "it's very targeted. Not only the training, but the demonstrations."
The most important part of introducing new technology to merchants, according to Merchant Warehouse's Helgeson, is demonstrating how the retailer would benefit from using that technology.
"I see a lot of ISOs out there pushing new payment technologies to merchants who would never benefit by using them," he says.
Perry uses a call center as an example of how a merchant can improve with the help of new technology. A call-center employee can waste valuable minutes by leaving his or her workstation to process a credit card transaction.
"So what we've done is install a Java virtual terminal right on the desktop," Perry says, "so then they are talking to a client, and everything is done at the desk."
The virtual terminal is a software program written in Java that handles financial interchange regardless of the platform used, such as Linux or Windows. A program shortcut sits on a PC desktop. The program can interface with a USB-connected magnetic-stripe reader on a PC.
The product enables a worker to save two to three minutes per transaction, Perry says.
"When you are doing over 100 transactions per day," he says, "it's good for that particular business."
Most salespeople take a consultation approach when introducing new payment technology to merchants.
"What we try to do first is understand our customer base and what it is we believe they are looking for," Perry says.
"We don't go to a customer with a preconceived notion that they need a virtual terminal or pay-at-the-table," he adds.
A salesperson also can help the merchant use what they already have. For example, a WiFi-enabled coffee shop benefits from a WiFi-enabled payment terminal.
"I think when we explain to clients that credit cards now interface in your environment rather than you having to create something new in your infrastructure, they are very excited about the new technologies," Perry says.
Large merchants also indirectly help an ISO or agent introduce new technology.
Most small to mid-sized merchants are aware of what larger merchants are doing. Smaller merchants may pick up the phone and ask their agent about new technology if they see contactless readers, for example, are benefiting large merchants like McDonald's restaurants and 7-Eleven convenience stores.
"Large, multi-lane merchants drive the new technology," Priore says. "When it becomes cost- effective for the small- to mid-size merchant, or if there is a special application, that's when you are going to have a shot to bring in that [new technology]."
But pushing new technology just for its own sake can be damaging, says Proy.
"You are not going to walk away from a merchant and say, 'I'm not going to process for you if you don't change you're equipment,'" he says. "Then it looks like you're just trying to hustle equipment."
Proy says he tried that method once and paid the price when his competitor told a merchant new equipment was unnecessary.
It is sometimes necessary for a merchant to upgrade because of outdated equipment, most of which has a lifespan of three to five years, Perry says.
Proy refuses to sell new technology he believes is inefficient and points to products for mobile merchants as an example. Mobile merchants are most likely to use wireless terminals, and Proy has seen instances where the technology did not work properly.
"I don't pick up the first thing that comes out because sometimes it just doesn't work," Proy says. "[Technology providers] have to prove it to me."
The Payoff
ISOs and agents may have to wait and see how new payment technology pays off for them in the long run. Merchants may ask for new technology as such products as contactless readers, pay-at-the-table and wireless terminals increase in popularity.
"It takes time for new technologies to catch on and produce a return," Helgeson says. "[Internet protocol] is just now starting to catch on with the masses and is now a very profitable part of our business."
In the meantime, a salesperson still can introduce the most up-to-date equipment available to build customer loyalty.
"In an environment where a customer has multiple choices, they will choose the person they can learn the most from," says 888QuikRate.com's Perry.
"If they believe that they can learn something from you and gain knowledge from you, then they'll stay with you," he says.
Priore of Priority Payment Systems says new security features also ease merchants' minds, which can help ISOs retain clients.
"You can go to a merchant whole-heartedly," Priore says, "and bring them a secure piece of equipment that is going to benefit them as PCI (Payment Card Industry Security Standard) becomes more apparent in the small to mid-sized market."
