Happy New Year! Every year around this time we tend to look back at the previous year and then forward to what is to come. This episode will be no different. We will look back at some of the final spend data of 2022 with our resident expert Sean McCormick, Director of Business Development at Moneris. Then we will look forward to 2023 with Jordan Williamson, VP Product Strategy and Data Solutions at Moneris.
Happy New Year!
Every year around this time we tend to look back at the previous year and then forward to what is to come. This episode will be no different. We will look back at some of the final spend data of 2022 with our resident expert Sean McCormick, Director of Business Development at Moneris. Then we will look forward to 2023 with Jordan Williamson, VP Product Strategy and Data Solutions at Moneris.
Also in this episode:
Chapters:
Al Grego:
Coming up on Shop Talk...
Jordan Williamson:
That's any smartphone or tablet to function as a payment terminal without any additional hardware.
Al Grego:
Oh, interesting.
Jordan Williamson:
Yeah, so when we look at the Canadian market specifically, that's well over 30 million devices with the potential to become payment terminals within the next year or so.
Al Grego:
Hello, everyone. I'm Al Grego.
David Litwin:
And I'm David Litwin.
Al Grego:
And this is the January 2023 edition of Shop Talk with Moneris.
Happy New year, David.
David Litwin:
Happy New Year to you too.
Al Grego:
Welcome to Shop Talk podcast.
David Litwin:
Thank you for having me. Did you have a good holiday?
Al Grego:
I had a great holiday. I spent lots of quality time with the family. How about you?
David Litwin:
I spent a lot of time catching up with friends, seeing family, and relaxing. All in all, a great way to rest up and get ready for an exciting year ahead.
Al Grego:
That sounds amazing.
David Litwin:
So, what do you have planned for this month?
Al Grego:
Well, this time of year it's customary to look back on the year that was 2022, and also make resolutions looking forward to the coming year.
David Litwin:
Have you made any resolutions?
Al Grego:
Sure. I want this coming year to be the best ever for Moneris' podcasts.
David Litwin:
That's a pretty tall order considering the award-winning year you had last year.
Al Grego:
Yes. Looking back at 2022 was a great year for Moneris' podcast, but my prediction for this year is that we build on that success.
David Litwin:
And I'm sure you will.
Al Grego:
See what I did there?
David Litwin:
What did you do?
Al Grego:
I looked back at 2022 and then I made a prediction for 2023.
David Litwin:
And that's...
Al Grego:
That's the theme of this month's episode.
David Litwin:
Right. You said that. So who do you have lined up?
Al Grego:
Well, first, I speak with Sean McCormick, he's the director of business development data and our resident data expert.
David Litwin:
Look back?
Al Grego:
At the final spending data from 2022. That's right. Then I speak with Jordan Williamson, VP product strategy and Data Solutions.
David Litwin:
Look forward.
Al Grego:
At his predictions for the biggest payment trends of 2023. You got it.
David Litwin:
Sounds like a great lineup.
Al Grego:
It is. So why don't we get started with my chat with Sean McCormick?
Speaker 4:
By the numbers.
Al Grego:
Joined by Sean McCormick, he's the Director of Business Development Data at Moneris. Sean, happy New Year.
Sean McCormick:
Good to be back, brother. Happy New year to you.
Al Grego:
I hope you had a good holiday.
Sean McCormick:
Yeah, it was outstanding.
Al Grego:
All right, well let's take a quick look back. We don't want to dwell on the past too much, but if we're looking quickly back to the last couple of months of 2022, what is that telling us about what to look forward to this year?
Sean McCormick:
Well, I think that if you look at what happened on Black Friday and Cyber Monday, it doesn't indicate that consumers were pounding the pavement or even pounding their keyboards to be honest.
Al Grego:
Sure.
Sean McCormick:
And I think it in context, you have to consider that inflation means that everything costs between seven and 8% more on average year over year. So Black Friday 2022, things cost seven to 8% more this year than last year, across the board, generally speaking on total spend. So when we look at the data that we saw on Black Friday 2022, and we see that dollar volume versus Black Friday of 2021 was only up two and a half to 3%, to me, that says we took a step backwards and that consumers actually let their foot off the gas a little bit in relation to their fervor for that Black Friday shopping event.
Al Grego:
Sure. That makes a lot of sense with a lot of people talking about coming recession, that that would be happening. Another thing we talked about going into 2022 holiday season was, we were going to see a major return to brick and mortar. So what did the numbers tell us about that?
Sean McCormick:
Well, what I'm going to tell you all is that consumers returned to the stores. The question is, did they transfer those shopping patterns from e-comm to in-store? Did they just shift, or did they just continue to spend in both? What we saw over the course of the year was a reversal. In the summertime, we saw a reversal of the trend where people stopped shopping as much online as they were the year previous in the first part of last year, and they started to pick up their in-store purchases as the pandemic restrictions eased. Now, what we saw this year on Cyber Monday was a tale of two countries, really, two regions of Canada, where Atlantic Canada on Cyber Monday versus Cyber Monday 2021, the growth was actually really impressive, anywhere between 10% and 15% in New Brunswick, versus the rest of Canada, where that growth was actually almost immeasurable between two and 5%.
Right. Again, accounting for inflation, like I said previously, you got to consider inflation accounts for 78%. So what would one hypothesis be on why Atlantic Canada would see growth on Cyber Monday that far exceeds the growth in the rest of the country? I might say that one suggestion could be the remote nature of Eastern Canada. So they're probably Atlantic Canada, so they don't have as many options out there for in-store shopping. Whereas, if there's a store that they don't have in Summerside, PEI, they can go online and they can buy that. Whereas someone in Toronto or Vancouver, Calgary, Montreal, they've probably got five of those stores and they might want to go get that in-store experience at Christmastime. Listen, when I shop for Christmas gifts, I love going in store. I throw the Santa hat on, I go out with my son and we go Christmas shopping. It's fun, it's an experience, but you can only get that experience if the stores are offered where you live. So that's my hypothesis and why I think that the Cyber Monday growth is noticeable in the Atlantic provinces.
Al Grego:
So in terms of trends by industry, what do the numbers tell us from last Black Friday and Cyber Monday?
Sean McCormick:
What I can tell you is, there's one spending category, one business category that stands out as being a key driver of Black Friday and Cyber Monday, and that's apparel. So that's women's clothes, men's clothes, children's clothes. Week over week, dollar volumes for Black Friday, were up 70% in the apparel category, and week over week, volumes for Cyber Monday were up 27% in the apparel category. And this compares to the other categories where they were between three and 10%. The real spike was in apparel.
Al Grego:
Even adjusting for inflation, those are still significant increases.
Sean McCormick:
Absolutely. You take that seven or 8% and apply it to 70% and 27%, you still got a successful shopping event.
Al Grego:
That's great, thank you so much for your time today, Sean.
Sean McCormick:
My pleasure, Al.
Mat Belanger:
At Moneris, we empower merchants to keep doing business their way while we handle the payment processing our way. What way would that be? The safe way, the always connected way, the awesome integrated tools to help you make more money way. We know your business never stops, so you deserve products that never stop working, that's why we're committed to providing our merchants with a payment partner that works just as hard as they do to make every sale. Moneris, proud partner of small Canadian business.
Speaker 4:
Featured interview.
Al Grego:
I'm joined by Jordan Williamson. He's a VP of product Strategy and Data Solutions at Moneris. Jordan, happy New year, and thank you for joining me.
Jordan Williamson:
Thanks so much. Happy New Year to you as well.
Al Grego:
So we just had Sean McCormick on and we look back at 2022, especially the holiday shopping season. So now I have you on to look forward to some of the trends you see maybe happening in 2023. You've come to me with your top three trends, so I appreciate you doing that. So why don't we start with what your number three trend is that you see?
Jordan Williamson:
Yeah, for sure. I could list a hundred of them. So I figured three is a better number.
Al Grego:
Yeah, more manageable.
Jordan Williamson:
What I think is going to be one of the big trends of 2023 goes back to one of the trends of 2022 and 2021, which is buy now, pay later. I'm sure most of us have heard of it, it's in a type of installment loan, in which the payment provider enables the customer to pay for a product or service in small interest free payments. We saw this explode in the last couple years, in the B2C space, the business to consumer. So it's not uncommon to be buying a $20 t-shirt and be offered to pay in four. Where I think the difference going into 2023 is, now that the product is somewhat mature, the growth path is not the same as it was before. So where I think this will go is, I think buy now, pay later will move into the B2B or the business to business space.
Al Grego:
Interesting.
Jordan Williamson:
So businesses who are selling to other businesses could use buy now, pay later to split up larger payments. So not that $20 t-shirt, but maybe a $10,000 piece of equipment.
Al Grego:
So I can see this really benefiting small businesses looking to upgrade machinery or stock or something in those lines.
Jordan Williamson:
Exactly. If you're hit with a not business as usual expense, where you weren't planning for it, this could be a great way to break it up over four months.
Al Grego:
Like an emergency situation.
Jordan Williamson:
Yeah, exactly. So moving into B2B in services, I think that's where the growth will be in 2023 and beyond.
Al Grego:
Interesting. What do you have for number two?
Jordan Williamson:
So number two is one that I'm very passionate about. It's more or less in my title, but it's data as a product.
Al Grego:
Okay.
Jordan Williamson:
So I'll explain what that is. But generally, businesses of all sizes have a growing need to make the best business decisions possible. And the way they do this is through receiving and analyzing, in whatever format that might be, information. And another word for information is data. Historically, large businesses have had access to this data, but for every large business, there are hundreds of small to medium-sized businesses who are competing against them. And these businesses also have a need for data. Just when I came back from the holidays, a colleague of mine shared an article from The Globe and Mail, it was titled something like Canadian Businesses Are Expanding With A Little Help For Data, and that further supported this. What I see is the launch of various data and insight platforms building over the next year or so and becoming a core product for payment providers in the next few years. Basically taking data and making it understandable, actionable for small businesses. So I don't want to look at graphs and complicated Excel spreadsheets, I just want you to tell me what it means and what I should do about it.
Al Grego:
Right. Kind of a data story and provide the right information for what you need to help parse the data basically.
Jordan Williamson:
Exactly. And here at Moneris and part of my team, we're looking to be there to help merchants go beyond outdated and overly complex reports and provide actionable insights to help merchants make the right business decisions and help them grow.
Al Grego:
Right. Excellent. All right, so you've left the best last. What do you have for your number one prediction for 2023?
Jordan Williamson:
I think what we're going to see is app tap to phone. So tap to phone, in my eyes, is going to be the biggest trend or disruptor in 2023. So I expect this to be in the latter half of the year, so nothing in the next couple months, but by the end of the year, tap to phone will allow any NFC enabled, so that's anything that can have a tap on it, so that's any smartphone or tablet to function as a payment terminal without any additional hardware.
Al Grego:
Oh, interesting.
Jordan Williamson:
Yeah, so when we look at the Canadian market specifically, that's well over 30 million devices with the potential to become payment terminals within the next year or so. I believe that this will start meeting the needs of micro to small businesses. So what I'm thinking about is a person who has a side hustle selling sugar cookies or a band who's looking to sell merchandise at a show.
Al Grego:
You're speaking my language there. Yeah.
Jordan Williamson:
Yeah, exactly. And I know this, my brother-in-law is in a band, they always sell these t-shirts. How do we do it? No one carries cash anymore. And we've seen Square move in with the square reader in that space, which was great at the time, but being able to just tap on your phone is going to revolutionize that small to medium-sized business space.
Al Grego:
Sure. The more ubiquitous tapping gets, the less need you need for swiping and or inserting and punching in pin numbers, then you're right. You don't need those devices anymore, a phone or a tablet with NFC will do the trick.
Jordan Williamson:
Yeah, exactly. And I think from those micro to small businesses, I think it'll expand up in terms of merchant size, and that's out the pure convenience of using a device that you already own and one that has multiple purposes. So it's not just a payment device or a POS, it can be everything.
Al Grego:
It could be your menu, it could be your ordering system, it could be multiple uses.
Jordan Williamson:
Yeah, exactly. And I imagine in a few years, restaurants will be using a tablet for not only ordering at the table, but also tapping for payments, and for retailers, seeing the redundancy of having both a tablet for their point of sale and a payment device to collect payments, simplifying down to one device that can do both.
Al Grego:
Amazing. Yeah, I can't wait to see that happen. I almost exclusively use tap as it is with my smartwatch. I almost never carry a wallet around. So the more that happens, I think the easier it'll be.
Jordan Williamson:
And even for people who still are tied to their wallet, tap is the payment method of choice for most Canadians. I know myself, I tap whenever I can. I might still be tapping my physical piece of plastic, but I'm always tapping. I honestly can't remember the last time I had to dip or swipe my card to make a payment.
Al Grego:
It's so much quicker.
Jordan Williamson:
And I think people are seeing that convenience, especially when you see on your payment terminal or sometime in the future, a smart device that says it's a Moneris payment application. You feel confident tapping on that as well.
Al Grego:
Thank you so much, Jordan. It looks like 2023, there's going to be a lot of exciting things to look forward to. I appreciate you taking your time today to talk to me.
Jordan Williamson:
Thank you so much for having me, Al.
Speaker 4:
Save the day. Yay.
Al Grego:
Joined by Ella Urquhart, she's the events manager for the events and ESG team. Happy New Year, Ella.
Ella Urquhart:
Happy New Year, Al.
Al Grego:
So, it's only January, so I don't imagine there are a lot of events lined up for this month, but why don't we talk about what to look forward to in the year?
Ella Urquhart:
The events team is going to have a busy 2023, our calendar is already jam-packed full of trade shows, sponsorships, the next group of e-commerce North cohorts, and we're kicking off the year with a sponsorship on February 6th and a webinar on February 9th.
Al Grego:
That's great. So what are the details for those two events?
Ella Urquhart:
So, Moneris is proud to sponsor Second Harvest Hero Sweepstakes, which will launch on February 6th and will run until March 17th.
Al Grego:
It's great to see our sponsorship of second Harvest continuing. Where can we learn more about that?
Ella Urquhart:
You can visit secondharvestsweeps.ca for more details.
Al Grego:
And Second Event?
Ella Urquhart:
Yes, on February 9th, Moneris will be joined by Visa for a webinar, and we'll be discussing strategies for savings through B2B payments. And if you'd like to register for the webinar, you can find the link in the description of this podcast.
Al Grego:
So you guys are going to be really busy this year. What's the best way people can follow along with the events happening this year?
Ella Urquhart:
Everyone can check out our social channels to get the inside scoop on upcoming events, and be sure to listen to the Save the Date segment at the end of every podcast for more information on how you can see us out and about this year.
Al Grego:
Okay, thank you so much, Ella.
Ella Urquhart:
Thanks, Al.
Al Grego:
And that's all we have for this month, I hope you found this episode informative. If you haven't already, check out Moneris' other award-winning podcast, Yes, We Are Open. In that podcast, I travel the country telling the stories of small Canadian businesses, their origins, struggles, and future outlook. If you like motivational stories of perseverance and triumph over adversity, you'll love, Yes, We Are Open. Here's a little taste.
I have a question for you. What do the following businesses have in common? A cannabis store, an athletic wear brand, dog biscuits, a tech startup, a travel agency, hairdressers, a kid's dentist, and a manufacturer of sound boots. Of course, the answer is, they all have stories of struggle and perseverance to tell, and you can listen to them now on season three of the, Yes, We Are Open podcast. Subscribe now wherever you get your podcasts.
Speaker 9:
Let's go.
David Litwin:
And if you haven't already, you can subscribe to this podcast. And Yes, We Are Open wherever you get your podcasts.
Al Grego:
And if you'd like to support this show, share this podcast with your network or review us on Spotify or Apple Podcasts. And finally, if you have any payment related question you'd like to submit to one of our experts, you can email us at podcastmeris.com.
David Litwin:
Join us again next month for more expert insight and data to help you grow your business.
Al Grego:
Thank you so much for co-hosting, David.
David Litwin:
Anytime, Al.
Al Grego:
On behalf of David, myself, and the rest of Moneris, thank you for listening to Shop Talk, talk again in February.