NASHVILLE, Tenn. -- Barriers inclusive of transaction costs and lack of technology standards may keep cellphone payment out of stores for a while, but paying without even having to go to the checkout line will definitely be a hot topic at next week's NACStech show.
As part of a preliminary series of articles prior to the national c-store technology conference next week, CSP Daily News is tackling several of the more prominent issues surrounding technology this year.
Mobile payment is certainly one of those hot topics. Part of the heat comes from consumers' growing use of cellphones for entertainment, memories and social connections. "Consumers are spending 23% of their time on mobile devices," said Mike Finley, chief technology officer of mobile solutions for NCR Corp., Duluth, Ga. "So much of what consumers do is centered on mobile and retailers are [only] spending 1% of their media budget on mobile."
Speaking last week at a CSP CyberConference (see Related Content below), Finley said payment is part of an "ecosystem" of capabilities retailers will soon need to offer customers as the use of smartphones becomes ubiquitous.
That's not to say that mobile payment will be fast in coming. Important issues still remain. One of them is cost, Finley said. Mobile payment is currently a "card not present" transaction, similar to paying for something over a landline phone. As a result, credit-card companies charge a higher interchange fee, saying it's a higher-risk transaction.
Some payment technologies like near-field communication (NFC)--or "radio waves" that handle payment wirelessly--bypass the fees, but still, the larger paradigm or technology standard for mobile payment has yet to solidify.
For instance, Mountain View, Calif.-based Google and New York City-based ISIS, the phone-carrier founded entity, both use NFC technology embedded in cellphones. So does online payment giant PayPal, San Jose, Calif. But Seattle-based coffee retailer Starbucks is going a route that doesn't need the NFC technology.
"No one standing still," Finley said. "The main thing to realize is that the different choices and ways to pay are rapidly evolving."
Other suppliers add credence to the growing strength of mobile payment. Officials with Greensboro, N.C.-based Gilbarco Veeder-Root told CSP Daily News, "Retailers continue to be eager to adopt mobile technologies that allow them to enhance the effectiveness of their loyalty and marketing programs."
The Gilbarco spokesperson said that on a related note, retailers making the investment in forecourt marketing, such as display screens at the pump, are reaping the benefits, while those who have yet to invest are "seeking out ways they can reap the same benefits."
For Finley of NCR, that option resides with mobile phones, where everything from payment to video advertising can occur on the customer's cellphone.
Mobile capabilities appear to be influencing both sides of the counter, with Drew Mize, COO of Arlington, Texas-based The Pinnacle Corp., saying it will introduce a new line of mobile-handheld inventory solutions at NACStech this year. "[It has] receiving, price verifying and audit capabilities."
In the end, Finley of NCR said that he believes that merchant cellphone applications or "apps" with payment integrated will dominate. "The consumer will think of your brand at the store," he said. "They won't think specific method of payment. They'll start your app and payment is part of that, like loyalty and advertising."
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