Security breach

However, he does reveal doubts over the potential of
e-wallets, even for the major players. “The task of changing
consumer behaviours that have existed in western economies
for decades isn’t trivial,” he notes. “Over the last 15 years,
the story of mobile payments has been one false start after
another. The logic has generally been sound, the technology
merchantable, it’s just the public who’ve found it hard to
embrace the idea of using a mobile phone to make payments.”
Queue busting
Others, on the other hand, are much more positive about the
potential benefits for retailers. Ben Gale, regional vice president
western Europe at NCR, observes: “The number of people using
them is still in its infancy, but it’s about changing the way people
experience the world of interaction so it adds value to them –
and only then will users vote with their feet, or rather fingers,
and start using mobile wallets.
“A consumer may start a transaction in one channel, at home
on the internet, and can update that on their mobile, before
completing the purchase in a store or on the internet, nearby on
a phone or in store on a tablet or self-service kiosk.
“This allows you to do a lot of queue-busting.
“If a consumer is looking at something while logged into their
account, if they come near the store maybe the store should
recognise that and send something to them, like a voucher drop
into their e-wallet with a QR code.
“That encourages them back into the store and then they can
pay using PayPal or a card.”
As well as sending vouchers or coupons straight into a
consumer’s ‘wallet’, retailers will also be able to promote brand
loyalty with digital loyalty cards.
According to Justin Fraser, sales and marketing director for
Europe at SecureTrading: “At the most basic form, merchants
can run campaigns. So when driving loyalty PayPal can work with
merchants on marketing campaigns using their service and offer
discounts or to accrue loyalty points whenever PayPal is used.
“From a merchant’s perspective, they have access to e-wallet
consumer base. You can have a logo on your website that will
come up on Google and may be seen as a more trustworthy site,
which means you are more likely to be used regularly and have
customers spend more money.
“People have learned that taking a card or cash from their
wallet to make a payment. This is an evolution, not a revolution,
especially as we have a younger generation growing up in a more
cashless environment.”
If e-wallets do take off and attract consumers in the way
many believe it will, it will have huge implications for retailers,
both in the way they work, the way they collate data and the
technology and software they may need to adopt.
SellerDeck’s Rothwell says new bits of hardware are already
available that handle contactless payments and the biggest
changes will be to the software.
multi-channel payments supplement
“Over the coming years we’ll see more development designed
to optimise the capture of customer records and its subsequent
analysis,” he adds.
“Currently, this is only available in larger retail operations, who
have the clout to operate loyalty cards, but gradually, companies
like my own, SellerDeck, will make this available at the bottom
end of the market.
“In the UK we are a long way from the time when supporting
mobile payments is absolutely essential. However, as we have
seen all too clearly in recent months, survival on the High Street
now depends on how well your online and in-store businesses
work together. Whether you like it or not mobile payments
is going to become a factor in this equation, building an
understanding of the value it can deliver is essential for plotting
future strategy.”
However, some feel the need for retailers to embrace
e-wallets and mobile payments is far more urgent, such as
Martin Smethurst, general manager of retail, UK and Ireland,
for Wincor Nixdorf – who launched their own ‘Wincor Wallet’
this year. “Over the next 12 months we will be inundated with
ewallets, like we are with credit cards. Customers may be
confused and end up with lots of them,” he comments.
“It seems a no-brainer that people will want to be in and out
of stores quickly so the convenience of contactless makes me
surprised it hasn’t taken off already.
“Everyone will have an e-wallet, and then it will be driven by
the consumer who will determine which ones survive and which
ones don’t. People are already happy to use Google Wallet or
PayPal on the internet, I don’t think it’s a huge leap of faith for
use it on the High Street. I think it will start slowly but within
three years it will be very prevalent.”
So if the next 12 months to three years is going to see such a
change is shopping attitudes, what do retailers have to do to be
ready? NCR’s Gale believes you must get your technology right
so you can be an attractive proposition for customers.
“Retail is consumer-to-business now, not business-toconsumer,”
he observes. “They tell you how they want to buy
and pay, so you have to look at the consumer and see what
the trends are. Today’s students will be trained on iPads and
have technology we never had, and as their consumer power
increases those who recognise and cater for that will be the
ones who win.
“I think e-wallets will thrive in the future and how quickly
will come down to people like ourselves creating value for
consumers.” But it isn’t just accepting payments in-store to
think about – if mobiles are going to contain e-wallets, then
consumers have to be able to use them, and if you lack WiFi, 3G
or 4G coverage, frustrated buyers may head elsewhere.
NCR, Gale says, have looked to tackle that in Dartford Town
Centre, where they have installed WiFi on every CCTV camera in
the area, guaranteeing coverage when and where it is needed,
with no blackspots.
RS
February - March 2013 RS 25