Using mobile point of sale solutions to enhance the customer experience


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Many retailers are piloting new technologies in their stores, but one type in particular has the potential to forever change how a transaction occurs between a business and its customer: mobile point of sale.

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Using mobile point of sale solutions to enhance the customer experience

  2. 2. MOBILE POINT OF SALEMANY RETAILERS ARE PILOTING NEW TECHNOLOGIES IN THEIRSTORES, BUT ONE TYPE IN PARTICULAR HAS THE POTENTIAL TOFOREVER CHANGE HOW A TRANSACTION OCCURS BETWEEN ABUSINESS AND ITS CUSTOMER: MOBILE POINT OF SALE.The process of checking out in a store hasn’t changed going to even the playing field, they must embracemuch since the 1950s: Shoppers choose the merchan- a seamless experience between online and in-storedise they want to purchase and then approach fixed destinations.counters and store associates to pay for the items. As consumers evolve their shopping behaviors andStarting in the 1970s, retail began a transformation expectations, retailers are experimenting with differ-with point of sale (POS) terminals replacing cash regis- ent channels to ship and sell their merchandise. Forters and credit cards becoming the norm. However, the example, during the 2012 holiday season, a number ofprocess of selecting items and going to a fixed place retailers tested different options to fulfill orders. Somein the store to pay for them largely remained the same. relied on local stores to ship merchandise orderedThat is, until retailers began introducing mobile POS. online to reduce shipping time and costs. To address the omni-channel shopper, other retailers tried new for-These solutions give the retailer the ability to process mats. For example, to kick off the 2012 holiday season,payments anywhere with any card type, including the craft marketplace Etsy took its sellers’ merchandisedebit, credit, loyalty and gift cards. to a pop-up store. Also, Bonobos, a men’s online-only apparel store, and Piperlime, a Gap, Inc. online store,Mobile POS solutions consist of a handheld mobile opened their first brick-and-mortar locations in or device with a payment card reader and Without existing infrastructure to worry about, suchcompact, portable printer. Once the store associate retailers can implement mobile POS solutions as theyswipes the card, the data is encrypted and sent over test different formats.a wireless network. After the charge is authorized, theshopper signs the screen on the device and the associ- It also opens up opportunities for organizations withoutate prints a receipt on the spot. four walls. It can be found in places such as farm- ers markets and on food trucks as well as on deliveryJC Penney, Sephora and other major retailers an- trucks and trains. It’s used not only for queue bustingnounced initiatives in 2012 to use tablets, smartphones in a store or tableside payments in a restaurant, butand other devices to employ mobile checkout, with also for utility billing and route sales receipts.some such as AT&T stating they plan to eliminateall counters and stationary POS systems in the next Technically, it could even be used in places where cashcouple of years. or check payments are the primary option today, such as a home delivery business. Mobile devices bring theThe growth potential is tremendous. Internet anywhere – meaning online payments can happen just about anywhere as well, including placesAccording to Lee Holman, lead retail analyst for IHL where building a traditional IT infrastructure might be aGroup: “More than three-quarters of retailers are ex- challenge.pecting to increase their 2013 spending on mobile POSover 2012 levels. To put it in perspective, big data is A complete solution eases integration, enabling mer-the next most sought-after major technology in retail, chants to quickly move from installation to application.and the expected increase for mobile POS outpaces While this is just the start of the mobile POS journey,that for Big Data by 20 percent.” the potential to forever change the way a business in- teracts with its customers and customers interact withForward-looking retailers understand that if they are a business is tremendous.A Zebra Technologies White Paper 1
  3. 3. BENEFITING BOTH THE CONSUMER AND THE BUSINESSMaking a Transaction More Personal and payments anywhere with any card type, includingProviding a Better Shopping Experience to Build debit, credit, loyalty and gift cards.Customer Loyalty Mobile POS solutions consist of a handheld mobileThe process of checking out in a store hasn’t changed computer or device with a payment card reader andmuch since the 1950s: Shoppers choose the merchan- compact, portable printer. Once the store associatedise they want to purchase and then approach fixed swipes the card, the data is encrypted and sent overcounters and store associates to pay for the items. a wireless network. After the charge is authorized, the shopper signs the screen on the device and the associ-Starting in the 1970s, retail began a transformation ate prints a receipt on the spot.with point of sale (POS) terminals replacing cash regis-ters and credit cards becoming the norm. However, the JC Penney, Sephora and other major retailers an-process of selecting items and going to a fixed place nounced initiatives in 2012 to use tablets, smartphonesin the store to pay for them largely remained the same. and other devices to employ mobile checkout, withThat is, until retailers began introducing mobile POS. some such as AT&T stating they plan to eliminate all counters and stationary POS systems in the nextThese solutions give the retailer the ability to process couple of years.INCREASING ENGAGEMENT, CREATING NEW EFFICIENCIESAND BOOSTING SALESEngage More. “Mobile is the new face of engage- formation, check inventory, verify prices, and quicklyment,” according to a report published by Forrester and conveniently check out a shopper. Mobile POSin 2012.1 The enabled store associate is the differen- can empower the store associate as he freely movestiator, connecting with shoppers no matter when or around on the store floor. It also gives the retailer vis-where they shop. ibility into assets and transactions, which in turn gives them visibility into opportunities to create new value.When Home Depot announced its mobile POSinvestment and rollout in 2010, its CEO Frank Blake Be More Efficient. Mobile POS can create new ef-described why the company called its program First ficiencies. Some studies show that mobile POS ter-Phone: “We call it the First Phone because its core minals can speed up the transaction time, cutting thepurpose is to reduce tasking time for our associates average transaction time in half and making contact-so that they can instead focus on customer service.” 2 less credit card payments five times faster than those requiring a signature. 3 When shoppers get ready toWith a handheld device that combines a variety of check out, they are ready to go, not ready to stand inuses, such as inventory management, label printing a long line.with POS and a walkie-talkie, the home improvementretailer wanted to help its customers – whether do- Also, with less counters in the store, it frees up spaceit-yourself or professional ones – by delivering better for other uses. Based on changing shopping trendsservice in the aisle in real-time. and needs, the retailer can “reset” a store without be- ing concerned about fixed wires and stations.Today’s consumers are knowledgeable and reliant onmobile devices to research prices and read reviews Mobile POS also can eliminate checkout “deserts,”right in the aisles of the store. When armed with their especially in big-box stores. Research shows that theown mobile devices, retailers never have to leave a leading retailers in the U.S. have at least 25 percent ofshopper’s side. They can look up a customer’s in- their store floor space in such “POS deserts.”4 ByA Zebra Technologies White Paper 2
  4. 4. providing quicker access to checkout, it enhances the other locations, completing the transaction and givingcustomer experience and potentially increases sales the shopper a receipt right on the spot. Thirty-twoas shoppers may be less likely to abandon carts. percent of U.S. consumers expect retailers to have the ability to place an online order. 5 Mobile tools mayAdditionally, mobile POS has value during peak shop- even provide visibility into the supply chain, equippingping periods such as the holidays. Depending on the the associate with the ability to look beyond store lo-season, retailers can supplement their fixed terminals cations and determine when additional stock will shipwith mobile POS in specific departments that typically and reserve items for consumers.have increased transactions during certain seasons. Outside of retail, event venues are finding value in mo-Sell More. Using mobile POS can help retailers com- bile POS. For example, one stadium now uses them tobat the trend of “showrooming” in which shoppers vis- process debit and credit cards in the stands or any-it physical store locations to see and touch products where in the park. Also, onsite payment processing isin person, but then leave the store and purchase them beneficial to route sales operations because it reducesonline. Such technologies help the store associate the resources needed to support them. Billing depart-provide an experience the shopper may not receive ments have fewer invoices to process and customerthrough an online store. service has fewer calls to resolve because custom- ers can review and approve invoices with their routeWhen associates are armed with information, they can sales. And finally, some restaurants now offer table-help increase sales – whether that’s through closing side payments, creating more efficiencies for waita sale faster, upselling related products or pointing staff who can turn over tables faster while increasingout an item the shopper may need with her planned security of credit and debit cards for consumers be-purchase. They can also help make a sale even if the cause they never leave the table.item isn’t located in the store by checking inventory inIMPLEMENTING MOBILE POSCompanies are aggressively looking at new and bet- checkouts? Capturing more sales? What is the con-ter mobile and in-store payment options, and new so- sumer experience it wants to create?lutions are continually in development. For example,in 2012, VISA launched, a cross channel digital Then the retailer should think through the entirewallet. Additionally, PayPal rolled out a new pay- implementation, considering both the technology andment system in Home Depot stores throughout the process. It starts with the infrastructure it needs andU.S. that lets users store their PayPal information on goes through to the actual use of the solutions on thetheir mobile phone or on a PayPal Card. There is also floor.Google Wallet, which uses near field communication(NFC) technology, letting users pay for items by tap- If there is a legacy system in place, it’s important toping their phone on special terminals at checkout. ask: What will the impact of mobile POS have on the IT infrastructure? There are various options to con-While the idea of mobile POS may be exciting, it can sider. For example, mid-sized merchants can leveragebecome easy to get caught up in the “cool factor” of mobile POS as a lower cost alternative to a traditionalhow it’s being used in a store today such as Apple. In POS system. In some instances, mobile POS may notApple’s case, the retailer did not have legacy infra- make sense to use exclusively, such as in high itemstructure so its planning and implementation looks volume/low value retailers. Larger and enterprise mer-quite different than a retailer that’s been in business chants may use mobile point of sale as a complimentfor 50 years, for example. to their existing POS systems, at least initially.The retailer needs to first think through the business As part of the planning process, the organizationneed or business case for the technologies. What is needs to consider how the solution becomes partthe value proposition it can offer customers? Faster of the sales process, including how employees willA Zebra Technologies White Paper 3
  5. 5. interact with customers. Will they move around the with the steps that go beyond scanning an item andstore? Stand in one location and have customers ap- processing the payment.proach them? What will they do as customers line upbehind or around them? Will there be central printing Also, in implementing mobile POS as part of its strat-with strategically placed desktops or kiosks? Or will egy, the retailer should consider what additional train-the focus only be on handheld printing devices? And, ing its staff might need as it incorporates technologyas checkouts can happen any place in the store, how into the sales process. With consumers’ shopping andwill the retailer monitor items that the customers have buying habits evolving, the retailer needs to help itspaid for and minimize theft? associates sell; a shopper could leave a store at any time after seeing the item to search for the best priceAdditionally, there are two ways to use mobile POS. and purchase it online. Store associates may needFirst, the retailer can scan items in the shopping to be incentivized to sell items that are not physicallycart before they reach a fixed POS terminal and print located in the store.out a barcode that another associate uses to scanand check out the customer, eliminating the need to After the initial investment, one of the largest costsremove items from the cart. Or, the retailer can use in a mobile technology deployment is the day-to-daymobile POS as a complete payment station to check management of such devices. Using central manage-out the customer on the spot. In that case, how will ment simplifies software updates and the rollout ofthe retailer handle removing hangers, folding items, new applications. Remote monitoring and trouble-removing security tags and putting the items in a bag? shooting can help resolve any issues quickly, andSome retailers have movable stations that can help maximize uptime and employee productivity.ADDRESSING THE SECURITY CONCERNSMobility means an “untethered workforce.” It also and data encryption to protect both the data on themeans bringing devices such as tablets and smart devices as well as in transit.phones into the work environment that were originallydesigned for the consumer. There are also more technologies coming in the near future, which will continue to enhance security onWhile this use empowers workers with technologies such devices in the workplace.that they are comfortable using in their day-to-daylives, the challenge is that such devices on their own Beyond concerns about keeping the data secure,may not be the most secure. For example, smart- some retailers may wonder how to monitor whatphones and tablets have open architectures. Any data items have been paid for and what ones haven’t. Forthat’s stored on the devices or transmitted wirelessly those who don’t use security tags, one recommen-must be secure and encrypted. Other devices pro- dation is to introduce mobile POS slowly – first invided by mobile computer suppliers like Motorola are departments that have less theft, reducing risk.largely compliant with PCI regulations and encryptsensitive information.6It’s important to address the security – not just forthe sake of the retailer’s reputation – but also tocomply with the Payment Card Industry Data SecurityStandard (PCI DSS) as well as any local or regionallaws. For tier 2 and 3 retailers, becoming PCI compli-ant can take some time – two years on average – tocomplete the proper auditing and certifications. Theretailer should make sure only authorized users canaccess the devices, data and network to help complywith PCI. 7 There are solutions that create a firewallA Zebra Technologies White Paper 4
  6. 6. ORCHESTRATING MOBILE POS – JUST ONE PARTOF THE RETAIL EQUATIONOf course, it’s not just about checkout – other tech- installation to application.nologies are important to consider in making a dif-ferentiated experience. Additionally, with many retailers operating in infor- mation siloes, being able to combine a variety ofIn other words, investments in new technologies information from past purchases to preferences onshould connect to the enterprise system to ensure customer service in one database – and then makingthey are scalable and work together seamlessly. This that available on a mobile device – would further em-includes both e-commerce and point of sale systems. power the store associate. An Aberdeen study noted top retailers are moving toward integrating their POSFrom self-service kiosks that empower shoppers to systems with other critical areas such as customerRFID inventory accuracy solutions that improve vis- relationship and inventory management systems.8ibility to customer loyalty offerings that help retailersincrease repeat shoppers, new technologies can It would also help meet the needs of today’s omni-create greater efficiencies and more loyal customers. channel shopper, which expect to have the sameFinding a provider who has a robust partner network experience with a brand whether it’s online or in theand portfolio to offer a complete solution eases store.integration, enabling merchants to quickly move fromLOOKING AHEADFinding ways to connect the offline to the online – merchandise from an online-only store to a physicalnot only in terms of the brand’s channels but also to location, others are reinventing retail all together andsocial networks – can help differentiate the company. going beyond the traditional four walls. For example,Now being called the “fourth retail channel” in the food isn’t the only item being sold on trucks; someomni-channel experience (with the third being mo- boutique retailers are going on the road to sell theirbile), social media helps retailers get in front of their outfits and other merchandise and create an interest-customers. However, the real impact comes when ing experience in public places or at private events.a shopper makes a personal recommendation on aproduct or advocates on a brand’s behalf. Enabling technologies will continue to make that pos- sible, particularly with the Internet of Things. As retail-As e-commerce and social media continue to grow, ers connect “things” to the digital world, they will findthe offline is still important and evolving. Some retail- new benefits such as creating improved customerers are using e-commerce distribution centers to get experiences and having even greater visibility into theproducts while others that traditionally have been supply chain. 9only online are bringing their brand to physical loca-tions to give people the opportunity to see and touch Retailers who adopt mobile POS today are taking atheir items. Without an infrastructure in place, some first next step to creating a better customer experi-of these traditional e-tailers don’t have restrictions on ence. For those who do adopt them, they will dohow they operate and mobile POS may provide them well with their customers, while those who don’t willwith a good solution. seem outdated as consumers come to expect service when and where they want it, whether that’s inside orOverall, innovations in mobile technology are en- outside four walls.abling the retail store of the future, today. While someare extensions of existing brands, such as bringingA Zebra Technologies White Paper 5
  7. 7. 1 ”Mobile is the New Face of Engagement,” by Ted Schadler and John McCarthy, Forrester, February 20122 “Home Depot’s $64 Million Mobile Investment Rolls Out to 1,970 Stores,” by Adam Blair, RIS News, December 7, 20103 Craig Conklin, “NFC and the mobile payment initiative,” January 17, 20114 ”Making Mobile POS Happen, Five Ways Stores Can Better Compete and Grow,” Accenture, 20125 North American Technographics Retail Online Survey, Q1 20116 “Growing Retail Adoption of Mobile POS,” Richa Gupta, Analsyt, VDC Research, July 20117 ”Revolutionize the Customer Experience in Your Store with Motorola Mobile Retail Solutions,” Mobility in Retail, Motorola Application Brief8 “The New Point-of-Service (POS): The Core of the Retail Store,” Aberdeen Group, December 20109 ”Building Value from Visibility: 2012 Enterprise Internet of Things Adoption Outlook,” A Commissioned Study Conducted by Forrester Consulting on behalf of Zebra Technologies, June 2012A Zebra Technologies White Paper 6
  8. 8. Corporate Headquarters Asia-Pacific Headquarters EMEA Headquarters Latin America Headquarters +1 800 423 0442 +65 6858 0722 +44 (0)1628 556000 +1 847 955 2283 Other Locations / USA: California, Georgia, Illinois, Rhode Island, Texas, Wisconsin Europe: France, Germany, Italy, the Netherlands, Poland, Spain, Sweden, Turkey, United Kingdom Asia Pacific: Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand, Vietnam Latin America: Argentina, Brazil, Columbia, Florida (LA Headquarters in USA), Mexico Africa/Middle East: Dubai, South Africa©2012 ZIH Corp. All product names and numbers are Zebra trademarks, and Zebra and the Zebra head graphic are registered trademarks of ZIH Corp. P1047069 (01/13)All rights reserved. All other trademarks are the property of their respective owners.