Mobile Point of Sale: Opportunities for SMBs
Apr 22, 2014
Explosive growth in credit card payments, mobile technologies, and ever-changing consumer expectations are driving retailers to leverage new strategies and applications to deliver a more seamless shopping experience. Eliminating long check-out lines, offering alternative in-aisle checkout and customer service options and even providing self-service shopping opportunities are key focus areas for retailers. From mobile payment acceptance at the countertop to mobile point-of-sale (mPOS) technologies, retailers of all sizes are seeking out new applications and deploying progressive engagement strategies to improve their customer experience and drive incremental dollars to their bottom lines.
At the core of the current retail evolution is mobile. Even with mobile payments still in its infancy in terms of widespread adoption and use, mobile is changing the way retailers and consumers engage.
According to the Interactive Advertising Bureau, more than 73 percent of consumers use mobile devices in the stores where they shop, and 21 percent use digital coupons. Already, 38 percent of smartphone users report that they have used their phones to conclude sales transactions.
Another major advancement fueled by mobile is in the area of point-of-sale (POS). Already adopted by several leading ‘big box’ retailers including Apple, Nordstrom, and Urban Outfitters, mobile POS, or mPOS, technologies are uncovering a myriad of new opportunities for retailers. Often serving as an extension of a traditional POS system, mPOS gives retailers portability of the check-out experience. With mPOS, retail team members can accept payments in-aisle, reducing customer frustration from having to wait in long check-out lines while allowing team members to multi-task (merchandising and assisting customers), yielding incremental savings.
mPOS isn’t just for major chains either. The flexibility of having a tablet- or smartphone-based POS is appealing to small and mid-sized businesses (SMBs) as well. For some SMBs, the mPOS is their entire POS system, replacing traditional POS systems or adding value as a business management tool that they could not previously afford.
According to a forecast from Winter Green Research, sales of handheld POS system devices will hit $3.1 billion by 2018, up from just $1.1 billion in 2011. The market for mPOS systems is vast, but there are considerations that retailers need to keep in mind. Typically the major challenge for retailers, especially SMBs, is cost, but mPOS systems are inherently a lot less expensive than traditional legacy systems. Costs vary, but requirements are typically a hardware accessory (payment processing, inventory, etc.), the tablet or smart device, and the cloud-based software, which is typically modeled as a software as a service (SaaS). Other retailer concerns around mPOS lie in the areas of:
Mobile features and benefits, new technologies, and smaller checkout stations encourage interoperability, mobile proximity payments (digital wallets), and mobile targeting of in-store advertising. Research from Accenture has found that both stores and consumers find increasing value in mobile POS systems that include the following benefits:
Encourage spur-of-the-moment buying and decrease in-store shopping cart abandonment
Monitor and control seasonal demand more effectively
Increase shopping conversions
Allow customers to get help immediately with questions about features, pricing and purchasing details
The research also shows that retailers can mobilize in stages, navigate paradigm shifts in manageable increments, and learn to target customer segmentation and calibrate marketing efforts in ways that both employees and customers appreciate. Retailers of all sizes risk falling behind their competitors or becoming marginalized unless they recognize the new business opportunities being presented by mPOS.