PRINCETON, N.J. -- A flood of mobile application solutions have been developed, and more will soon compete for your attention. Notable entrants include mobile apps that allow the consumer to buy in the store without standing in line (line busting); automated fuel-dispenser activation from the consumer's mobile device; decoupled debit applications that eliminate interchange fees; apps for loyalty rewards; employee scheduling; apps that seek out nearby discounts and competing offers; and many that advertise the benefit of payment credentials "in the cloud."
For an industry designed to provide convenience retailing for immediate consumption, it appears that the eventual connection of c-stores with mobile apps will develop rapidly and permanently. We doubt that even 10% of the apps in use in five years have even been conjured up yet. Mobile apps are going to change your life. Will you observe what happens, make it happen--or wake up one day and wonder what happened?
It is a testament to our free-enterprise system that the many entrepreneurs in this space keep innovating; however, c-store owners, operators and managers are calling for practical guidance for evaluating and assessing mobile applications that fit their objectives. This is important: The question isn't "if"--it's "when."
Understand Operational Effects
It is important to understand how a consumer purchase made in-store using a self-checkout application from a smartphone will integrate into the operator's point-of-sale (POS), general ledger and inventory systems. Finding convenience for the consumer and promoting fast checkout comes with other considerations. It is advisable to explore with the app developer how sales data will integrate into management and operational reports. There could be third-party discussions with point-of-sale and inventory system providers and even additional costs and timelines to plan around.
A good indication of the ease of integration to other critical business systems is to ask the providers if they use standard interfaces to POS, inventory, general ledger and other management systems. Good examples of industry bodies developing these standards include the National Retail Federation's Association for Retail Technology Standards (ARTS) and the Petroleum Convenience Alliance for Technology Standards (PCATS). The NRF's ARTS standards strongly emphasize mobile-application integration that mobile solution providers should know. This tip cuts both ways: When considering future POS and inventory management systems, be certain to ask about the incorporation of standardized interfaces.
Mobile-app vendors may underemphasize the effects on store operations. Loss-prevention procedures for self-checkout on mobile devices and mobile pump activation require thoughtful design. Expect to add new training for managers and employees to answer consumer questions about the apps, how they are used, and especially how to respond when the apps just don't work the way the consumer expected.
Data Privacy & Security
The enthusiasm of introducing "cool" mobile apps to your customers or team members tends to crowd out the practical concerns. When considering the fit of a particular mobile application into your operations, it is imperative to evaluate the terms and conditions the consumer will agree to when they download the application. The consumer will associate their experience with the application with your brand, so ensure the application provider's disposition on data privacy is acceptable to your enterprise.
Also, the application provider should be able to clearly identify the data it is collecting about the consumer's purchases or other behaviors. Be sure you understand what data pertinent to your store's operation the app collects, how the data is stored and protected, and ultimately the retention and destruction cycle.
More concerns arise when a mobile application is also facilitating payment. Many aspects of mobile commerce and payments defy traditional classifications and regulations; regardless, keep vigilant on how your customer's data is protected from unauthorized access and how your operations can prevent the fraudulent use of stolen data. The same standards you may apply to payments made in person at the POS are worthy to review for mobile applications. Be mindful of how enabling acceptance of emerging mobile-payment types will affect the cost of acceptance in every scenario you engage in with the consumer.
Mobile applications are finding their way into all aspects of commerce and store operations, and rightly so given the undeniable growth in consumer and enterprise adoption of mobile devices. Our present challenge is to cultivate solutions that offer the best fit between growing a business and efficiently operating it.
Sarah McCrary contributed to this column.
Bob Carr is chairman and CEO of Heartland Payment Systems, Princeton, N.J. You can reach him at bob.carr@e-hps.com.
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