Mobile will kill the dedicated Point-of-Sale terminal
The retail point-of-sale (POS) terminal as we know it is going away and may take some POS providers with it.
Smartphones and tablets are poised to fundamentally change the bricks-and-mortar checkout experience. Apple created this trend at the dawn of the iPhone age, when they gave associates iPod Touch devices with a credit card magstripe reader case. Sales associates help customers wherever they are and close the deal on the sales floor instead of making customers line up in queues and patiently wait like livestock. Nordstrom has also untethered associates with a customized mobile device.
Retailers are struggling with a number of converging trends. Multichannel shopping is creating challenges in measuring performance in any one channel. Mobile payments and NFC technology are creating pressure to upgrade POS equipment while there’s considerable uncertainty about which technology is required. Mobile commerce and location-based services are growing dramatically and are impacting sales and shopping behavior in every channel.
Retailers can solve many of these phones with smartphones or tablets. Retailers can build their mobile shopping applications to be the same application as the associate checkout application. Retailers can measure sales regardless of whether the user checks out online, on their device in the store, or by an associate using a device. Shopping and purchasing can happen across all the channels while reducing the number of systems retailers have to maintain and simplifying the process for consumers.
Retailers can remove expensive checkout fixtures and reclaim lost floor space. Exit greeters can ensure shoppers have paid for their purchases as in the current Costco model. Retailers will also likely spend far less on POS hardware while enabling cashiers to spend more time as true sales associates which can increase sales and reduce shrinkage.
The transition will take years but is already underway.
I just returned from Nicaragua Saturday. Among other places, I went to La Chureca, the largest dump in Central America, where over 1,700 people live in about 250 houses. People survive by collecting recyclables and selling useful materials found in the trash. Malnutrition, AIDS, cancer, gangs and drugs all torment their residents.
Even here in La Chureca, one of the poorest places in the Americas, everyone has a phone. Even the illiterate know how to send basic text messages. Residents consider having a phone far more important than a car, a bicycle. Many make the choice to buy airtime minutes instead of extra food.
Meanwhile, most companies in Nicaragua have stopped paying workers in cash or checks. Workers are paid using debit cards. Often employers setup bank accounts and direct deposit for workers to ensure they can pay electronically. Credit cards are accepted in rural mercados and many bodegas. Only the beggars and hucksters consistently insist on cash.
This is why I’m bullish on the future of mobile commerce and mobile payments. Some of the most transformative trends of the last hundred years or more are starting to converge: globalization, the Internet, mobile communications, and electronic payments. Each trend alone has sparked massive growth and development. Now they are converging to change lives in even the poorest and remote corners of the globe.
If the people of La Chureca, in all their misery, rely on cell phones to survive and do their work; how can any company not be bullish on mobile commerce? Soon every business can reach every human being individually wherever they are and provide them a unique offer that helps them with their current needs, whether that’s selling recyclables in Nicaragua, selling a goat in Africa, or finding a trendy new restaurant in New York City.
Take a look at your business and really think about how your products help your customers. Now think of the possibilities of mass customization and real-time offers. Take it a step further and imagine the opportunities of reaching every single human being in the world.
Are you investing enough in mobile commerce right now?
If you mobile commerce investment isn’t more than your Internet investment, you’re probably not investing enough.
