Last week, global payments solution provider Adyen released its most recent fiscal half-year results that showed net revenue growth swelling 70 percent in North America. Total net revenue for the company jumped 28 percent year-over-year to 379.4 million euros, and processed volume was up 29 percent to 174.5 billion euros.
In a letter to shareholders, the company said, “Amid the constantly shifting environment of the pandemic, we focused on best helping our merchants. We were able to help move volumes online swiftly when stores closed and facilitated safe operations in reopening scenarios, as all our point-of-sale devices enable contactless payments.”
Here, Brian Dammeir, president of North America for Adyen, discusses the company’s growth, what’s driving results and the company’s recent partnership with Dick’s Sporting Goods.
WWD: What do you see driving results moving forward?
Brian Dammeir: While we can’t comment on future predictions, the business has proven to be resilient during the pandemic due to the continuous diversification of our merchant base. We saw substantial growth in verticals like retail, in particular in the area of unified commerce, as well as in digital goods. Regional diversification is also beneficial when looking at growth. Adyen’s North America business saw a 70 percent growth [year-over-year] in net revenue. This reflects Adyen’s focus on merchant solutions that are future-proof and “meeting the moment” during the COVID-19 pandemic.
Adyen has been channel-agnostic from its inception and has been at the forefront of digital enablement for many merchants; these themes were only magnified during the pandemic with more and more merchants putting an emphasis on not only their digital channels but having a unified approach across all channels.
We feel confident that since we are constantly innovating with our merchants, based on changing consumer sentiment, that we will be ready to adapt as the effects of the pandemic on consumer payment preferences becomes clear.
WWD: Do you expect robust online sales and Adyen’s diverse merchant base to continue to bolster topline results?
B.D.: Again, we can’t comment on future predictions, but [last week]’s results have been consistent with past results and we do have a diverse merchant base driving our growth. We expect our merchant base to continue to diversify and expand as we focus on new verticals to innovate with and new markets to expand into.
It’s important to call out that despite the significant impact of the COVID-19 pandemic and related drops in travel and in-store retail volumes, we experienced substantial growth as online retail and digital goods volumes surged. During the closure of physical stores, we helped merchants move volumes online, and in reopening scenario we enabled safe operations as all of Adyen’s POS devices are contactless-enabled.
COVID-19 created relatively few new trends. Rather, it sped up trends that we expected to take five-plus years to manifest. From the shift from cash to cashless, to contactless payments and the digitization of commerce, these changing consumer behaviors were already in the works and we were already focused on helping our merchants achieve success with unified commerce.
We look forward to continuing that focus and being a catalyst for digital transformation with our merchants both now as they quickly adapt under COVID-19 and into the future as new circumstances shift consumer expectations around payments and commerce.
WWD: What was the impetus behind the partnership with Dick’s Sporting Goods? What consumer demands were they looking to address?
B.D.: Customers want a unified commerce experience, and that’s why we are thrilled to be working with Dick’s Sporting Goods to process all U.S. volume across all channels. Dick’s is a technology-first player in the retail space, so it was a natural fit for us to partner together. The clear trend in retail is toward “unified commerce” — taking a holistic approach to technology, payments, and customer experience — to ensure a consistent customer experience across all channels. Dick’s, with its focus on technology and fantastic customer experience, is embracing unified commerce with us.
Working with Adyen will provide Dick’s with a centralized view of transaction data across all channels, which will help them better understand their customers so they can provide personalized experiences. This, paired with Adyen’s unparalleled payment method coverage, POS devices, and online and in-app payment features, means that Dick’s will be able to concentrate more on the customer experience and expand their reach, all while doing so with Adyen’s single platform and integration.
Those experiences are more important than ever for customers who want to be able to pay how they want and wherever they want. Adyen will help Dick’s Sporting Goods set a new standard for consumers across channels and we look forward to seeing what we will accomplish together.
WWD: What do merchants need to know about the consumer demand for cashless and digital payments? Is this a permanent shift in consumer behavior?
B.D.: There are two main trends we are seeing that merchants need to be aware of — digital transformation as a whole and unified commerce. While many consumers may go back to their previous behaviors from before the pandemic, the data shows that large swaths of previously
“digitally hesitant” consumers have adopted these new channels during this time. COVID-19 will have catapulted large groups of people to use digital services as their primary channels and, for a good number of consumers, we expect that to be a permanent shift.
In that same vein, the idea of unified commerce is about offering a consistent platform and experiences to customers regardless of channel. The first change under COVID-19 was that consumers adopted new channels. Importantly, as consumers are getting more comfortable with approaching brands from multiple channels, their expectations around the consistency of experience across those channels has only gone up. This is forcing merchants to not only offer these channels but to evolve past “omnichannel” and toward “unified commerce.”
Consumers expect to have the same level of experience across channels, have their loyalty rewarded across channels, and be able to move seamlessly between those experiences. This is a monumental lift for many merchants to pull off but Adyen’s unified, single platform is there to make that transformation easier.
The focus for merchants should be on continuing to adapt to COVID-19 and what it means now, but also keeping in mind that this is a unique moment to rethink their infrastructure and approach to payments so that they can be future-proofed for the unseen consumer changes to come.