It’s hard to imagine a world without cash. It puts a value on things we buy and sell, and it’s tangible. But the days of no cash are dawning at a faster rate than most of us can imagine. Soon, says Jackson Lewis, assistant editor with Technomic in Chicago, everything will be held on our smartphones, including all our payment information and ID.
Most of us have heard of Apple Pay and Android Pay, but what many of us don’t know is that Walmart Pay is now close to overtaking the market in mobile payment usage, as tens of thousands of consumers sign up for it every day.
Here’s what else we can expect from cashless retailing in years to come:
Close ties to loyalty programs
“As cashless systems expand, it will be much easier to sign up customers onto loyalty programs,” says Lewis. This will mean people’s online experiences will be much more customized, as each consumer will be marketed to specifically. “You’ll automatically get coupons on your phone based on your past purchases,” he explains.
Device-less shopping
Having everything on one small device is pretty revolutionary, but there’s already technology that surpasses that. One company, Keyo, has developed a palm POS system, through which customers rest their hands on a scanner to pay, having already linked it with their credit card online. Another company, Token, allows payment through a similar method, via a ring worn on one finger. In South Korea, a 7-Eleven store is testing a payment method that recognizes customers through their veins and lets them pay with an assigned credit card.
RFID ready
We’ve been expecting RFID (radio-frequency identification) to take off for years, and it will, Lewis says. This is already up and running at the new Amazon Go store in Seattle, where customers load items into a cart, and the store automatically charges their credit cards as they leave. “The rings and palm readers are the middle step between where we are now and the Amazon Go model,” he says.
This technology couldn’t have been imagined years ago and it’s almost here, but what does this mean for convenience stores and their shoppers?
It will impact labor, Lewis say, “and people could be upset at the loss of jobs.” And losing labor also means a loss of customer service, though he admits that some people, looking for a quick in-and-out at a store, may see this as a positive.
And, it could lead to higher basket costs, as consumers easily lose track of what they’re spending. That sounds good for the c-store initially, but won’t be successful long-term if customers aren’t happy.
There’s also the question of security, Lewis says. “If everything is sharing our private and personal information, it needs to be encrypted in every part of the process. And even if it is encrypted, our financial data mustn’t be stored in these devices. Cyber crime through devices is a real threat and as technology gets more advanced, if we’re not more careful, we’ll be making ourselves more vulnerable.”
And the problem with security, he says, is who to blame. The retailer? The credit card company? The POS manufacturer? “Often, it’s easiest to put the blame on the retailer because that’s who had the data.”
For retailers interested in diving into cash-less retail, it’s time to start weighing the pros and cons.
This post is sponsored by Harbor Industries