2014.18 | iOS8 for retail

CaptureiOS 8 will be released this week.  Among many changes to the operating system for apple mobile devices, there are a number of changes that are worthy of consideration to retailers.

Apple Pay – The moment Apple Pay was released, a flood of POS providers showed their support and ability to enable Apple Pay on their platform (my own employer among them).  Apple are releasing the program in the US with support from a number of well known tier one retailers.  While there is no way of knowing whether showing an apple logo on the retailer’s door will get people to finally jump to a mobile wallet, it’s a good strategy to keep options open in the event it becomes a commonly requested payment method.

apple-pay-retailers-iphone-6-announcementRetailers in Canada that implemented new pinpads for EMV  over the past few years enabled NFC on those pinpads as a matter of course.  With that NFC capability, they should be well placed to enable Apple Pay when it becomes available in Canada.  US based retailers that do not currently have NFC capability and are working through EMV certification would do well to include NFC and Apple Pay integration as part of that process.    The incremental cost of enabling Apple Pay as part of an overall EMV effort is likely to be minimal.  While it would be optimal to deploy quickly to take advantage of consumer interest, EMV takes time and if the devices onsite do not have NFC capability, a deployment of new devices will be necessary.

It will be important for retailers to track where and how Apple Pay gains traction.  The area of focus may vary – hospitality and small transactions could be the sweet spot, but perhaps it will be popular with shoppers at luxury retailers.  Retailers should watch closely and ensure that their shopper’s preferences are fulfilled.

Photo 2014-09-15, 9 09 00 AMScan Credit Card for eCommerce – While much was made of the ability of scanning scan credit cards to add them to Passbook, the ability to scan credit cards into Safari for eComm purchases is also a nice addition.  As someone who makes eComm purchases on my mobile devices for items such as movie tickets, making a purchase is an effort.  Shoppers must TYPE their full name, credit card number, expiration date and card security code.  I have those memorized, and it’s still clunky to do on a mobile.  For some retailers one also must type in a verified by visa password.   If that whole process can be replaced by a scan from my phone, or an autofill from my safari keychain, it saves a whole lot of typing and removes obstacles from mobile purchases.  Retailers who enable this function are likely to drive more sales through their mobile channel with the removal of obstacles.

Capture2Location Based App Shortcuts – On earlier versions of iOS, Passbook provided a lock screen notification for Starbucks if you were in a store.  Passbook also provided a lock screen notification for a plane or movie ticket if the time for the ticket was approaching.  While this was a convenient workaround an unnecessary pin code entry, it also required some setting changes.  For Starbucks, users had to identify “favourite” sites that enabled Passbook to provide the lock screen notification for Starbucks payment.

iOS8 provides a non-Passbook lock screen shortcut in the bottom left of the screen based on your GPS location.  Users have noted that their iPhones with apps from Vons, Tesco, Starbucks and more  show an app icon in the bottom left of the lock screen.  When users swipe up on the icon at bottom left, the app is opened with out a PIN [Update: you still need your PIN to access the full app.  Passbook = no PIN).    While it may appear that beacons are at play, it sounds like it may be driven by GPS as some users had no connectivity at the time.  One user also indicated that a Costco icon showed at the bottom left even though they did not have a Costco app installed.

Retailers stand to benefit from reduced barriers for shoppers to use their mobiles once again.  Making an app easier to access while actually at the retail location is a great idea.  Providing a visual cue right on the lock screen is even better.  This access sets the stage to enable retailers to bring online and stores together with some unique functionality.

CaptureHey Siri! – The latest iteration of Siri allows users to access the personal assistant without having to push a button.  iPhones can now listen for users to ask for help.  Siri is also finally going back to its roots with integration to more services.  Siri is able to listen to songs for you with Shazam to find and purchase the name of the song/tv show/movie you are observing.

While Siri will be a great sales tool for Shazam and iTunes to sell it doesn’t help other retailers much on the surface, but it does indicate a possible door widening to integration with other services.   When Siri was originally launched, it connected to 45 services, but after Apple bought them, it connected to only 12.  The founders of Siri are working on another service – viv – that promises to take the personal assistant to another level – and ideally connect it to a plethora of services that can access it via natural language.

Retailers that can make their transaction engines available to channels like AI personal assistants will be exposing their products and services in a new way.

Privacy – In past iterations, mac addresses were easily harvestable from idevices by pinging them with a wifi signal.  In essence, ‘free’ consumer tracking was possible.  With iOS8, iDevices provide a pseudo MAC address until consumers actually establish a connection with the wifi network.  This means that retailers and other consumer facing organizations will need to track consumers via an iBeacon option or even through accepting a wifi connection with shoppers.

Making the MAC address data private is the right thing for retailers and shoppers alike.  All retail programs should be opt-in and retailers and all consumer facing organizations should be clear on data tracked, for what purpose, and allow shoppers the right to opt out of anything they are not comfortable with.  Selling is a two way street and being as honest and straightforward is possible will have the best returns in the long run.  Shoppers who are willing to provide their data for improved service are not hard to find, and everyone appreciates an honest trading partner.

CaptureIndoor Positioning –  Apples latest offering enables indoor maps and wayfinding to be more easily implemented by shopping centres and department stores.  Apple has made iPhone motion sensors available to their API.  With that API update and a more powerful processor, indoor systems can access phone data to make navigating large venues simpler.

Retailers that leverage any tool possible to provide access to their products and services make themselves more readily available to shoppers.

iOS 8 looks to be a landmark release with lots of new features and functions.

Check out a longer list of deep dive functionality, and please share any retail oriented features discovered at release!

2014.04 | january linkdump

CaptureGet me there – eCommerce could really meet stores if Google follows through on their latest concept.   The idea is that advertisers may find a transaction valuable enough to foot the bill to pay for a potential client to come to their store.  If an advertiser signs up for this service, a “take me there” button appears on the ad that can be clicked and a taxi can pick up the user to take them to the store.  Their patent even considers a self-driving car being used to pick up potential clients.   Great idea in theory, but there’s lots of room here for people to try for free rides. 

Anticipatory Shipping – Amazon apparently filed a patent for shipping product before clients order it. The idea is that items that are likely to drive demand in an area are shipped to that area and redirected to a person who orders it to minimize shipping time.  I haven’t decided if this is genius or lunacy.

Miserable Men – If you happen to visit instagram, check out Miserable Men – an account full of images of unfortunate gentlemen who appear to be experiencing a sub optimal shopping experience as a shopping partner. While it’s comedy, and we’ve all been there, there has to be some opportunity here for cross-selling, or at least retailers could attempt to entertain or otherwise reduce the pain inflicted on these poor souls.  The account would be better named Missed Opportunities.  IF we are so hyped about the customer experience, here is an area ripe for improvement.


Apple Payments –  There have been ripples again recently that Apple is making moves to attempt to enable mobile payments in the real world.  With the base of devices they have, they could certainly make an impact.  However, changing payments to mobile devices is rife with challenges.  Google failed at it.  Square was expected to be a big deal at Starbucks and so far hasn’t made any noise beyond the small business level so far.

There are so many opportunities for failure with mobile POS payments between two parties in a store.  To succeed, there are changes to retailer software, changes to retailer devices, training cashiers, training consumers, data connectivity, user interfaces, security, and much much more.  Those are only the initial technical challenges.  You also need to establish consumer confidence in your payment system and make it as universally available as possible.  You also need to get credit card companies on board in some way, and find a way to make money on transactions that are already laden with fees from various players and find a way to do it without charging consumers.

As an early adopter, I would be excited to see an Apple payments system, but it’s a challenging initiative.  As a retailer, it’s best to keep your payments options as flexible as possible to ensure that if something does come along, that your solutions are in a position to enable new tendering options as easily and quickly as possible.

2013.32 | iOS 7 for retailers

iOS 7 was released on September 19 to a great deal of fanfare.  With so much change in one release it can be easy to miss some of the details.  Hidden among the flat icons, control center and iRadio are some intriguing OS elements that could be leveraged by retailers to enable enhanced shopping experiences.    Check out some of the changes:

ibeaconsiBeacon – All of us in the retail technology world can expect to hear much more about iBeacon in the coming weeks.  Scores of articles are popping up on this little noticed item nestled into the long list of changes in iOS 7.  If you search the Apple corporate site, there is no information published on it, but it may finally unlock the mobile interaction nirvana that other attempts (nfc, shopkick and many more) have struggled to attain.   iBeacon is a technology that allows sensors to identify when consumers are in a very localized site – much more exact than GPS can ever be – and workable indoors.  This makes it possible to provide information to a mobile device in proximity to a beacon.

MLBVisit-360x640MLB has been working on a demo with Apple since early in the year.  In this use case, using a venue specific app on the mobile device will cause different actions to occur on the mobile based on the users location in the stadium driven by proximity to sensors that the app can identify.  When users near a ticket gate, their tickets pop up on the screen.  When they pass the ticket gate, detailed directions to their seat are on the screen.  When they visit a hot dog stand, purchases can drive an on screen loyalty card that with a buy 10 get one free type scheme reminiscent of the old Subway Sub club.   All in all, it’s possible to provide a custom experience for park visitors.

It’s not a real stretch to see where this sort of technology can be a game changer for retailers.  Not only is it possible to provide pinpoint location in a store, the user is known via the app.  The experience can change for every user depending on how the retailer wants to drive the conversation.  If you have a VIP client, perhaps you invite them to ask for their free bottle of San Pellegrino directly on an app to give it that sense of magic.  Perhaps one client gets a 10% off coupon for shoes, but another gets 20% off on leather goods in the same area.  Add to the personal touch the ability to tell who is taking you up on the offers and you’ve got a winning formula for selling in store.

While this technology is an enabler, I see serious complexity and tracking challenges for retailers on these beacons.   This is an incredible opportunity to improve and customize a customer experience, but it’s going to take time to get it right and figure out the rules to win over customers.

frequent locations

Frequent Locations – In iOS 7, Apple has built a tracker to indicate a user’s frequent locations.  The idea being that contextual location data can be provided to anticipate the user’s needs.

With this information it would be easy to identify a user’s regular visitation of a particular branch of a major retailer and leverage that data in apps.  Notifications of upcoming events at those locations could be highlighted to the user if they opt in to messaging.  Perhaps users could be prompted for their favourite stores for Passbook instead of having to identify them on things like their Starbucks card, or even better, it could just add favourite stores automatically based on the invidividual user’s data.

keychainKeychain – Mac Users are accustomed to keeping a mini database of their logins, passwords, and credit card information on their OSX systems.  Google chrome has similar functionality in it’s autofill functionality.

Keychain has been ported to iOS 7 and can store local passwords.  Earlier test versions seemed to indicate that Keychain was going to leverage iCloud to centrally store all of this information, but it was cut in the late stages of release.

While this isn’t fully implemented through iCloud, this move towards central and secure storage of credit cards provides a potential workaround for all of the in store payment scenarios that wreak such havok and drive up time and cost on deployments.

Consider a shopper with an app that allow them to scan items in the store.  Instead of having to go to a self-checkout, a pay station, or a regular POS, what if the app could ask for permission to use a stored card on the mobile for payment based on a PIN?

Photo 9-29-2013, 11 45 24 PM

Passbook  – Using passbook has always been a bit of a disappointment to myself and others.  It’s not intuitive to use, but the update made it a bit less annoying by removing the shredder that kills old tickets.

Uptake from retailers is picking up (there are 17 passbook apps on the Canadian app store as of this writing  Longos, Starbucks, and Sephora are the only non-travel and entertainment type apps).  I’ve used Starbucks, Cineplex, and Air Canada quite often and they’ve all worked well.    I just don’t see people using it much in the wild as you can also use the regular apps to pay for starbucks or to present your ticket barcodes for scanning.

Where the iOS 7 improvement comes in is a small change that incorporates the camera as a scanner.   One of the shortcomings of using coupons with Passbook in iOS 6 is that you had to find an offer that had the add to Passbook button and now add it.

Apple has now made it possible for consumers to cross from the world of paper to the mobile world.  Much more work needs to be done on Passbook.  Retailers and Apple need to find a symbiotic way to get customers comfortable with it, but this is a decent addition.

iOS 7 is an interesting study.  For myself, the interesting part of iOS 7 is watching users grapple with changed features, unforeseen glitches, and losing functionality to which they may be accustomed.  I’ve listened to my share of complaints on iOS 7 from my family and friends and acted as remote support on a few challenges so far.

As mobile devices become fundamentally ingrained into society and into everyone’s lives, these changes become personal and incredibly widespread.  Working in retail technology for many years, I’ve grappled with these challenges with retail clients over the years, and there are many parallels to updates applied across stores.  The important lesson is to embrace the change and look for the opportunities to leverage the potential for improvements that drove the change in the first place.  Retailers and consumers have much to gain from the ideas here, and everyone will have to learn together how to benefit.

2012.37 | Shazam | Popup Mobile Shop | EasyPay

Shazam @ Hbc – Shazam started off as a service to link users to music they want to purchase by recognizing a tune on the radio.  They moved on to recognizing TV episodes.  Now they are mining commercial territory more directly by allowing tags to direct advertisement listeners to content on mobile devices.

Hbc’s iconic Bonnie Brooks spoken radio ads are now entering the canon of audio that the Shazam app will recognize.  While Bonnie’s dulcet tones ring through the radio waves, savvy mobile users can open the Shazam app and ‘touch to shazam’.  The audio in the radio spot will be tied to the advertisement for the special offer in question, opening a link to the Bay website with details of the offer.  I haven’t been able to catch the latest ads to confirm or deny that it works or shows usefulness. My biggest issue is that I usually listen to the radio in the car.  In the car is not the time to whip out the mobile and open an app.  Whether anyone does it or not, it’s a shrewd move by Hbc to get some potential airplay out of showing some willingness to think outside the box. (thanks, Mike B!)

Walmart Canada Popup Store – Walmart Canada is also thinking outside of the box in November; and outside the store completely.  With help from Mattel, Brandfire Marketing and IMA Outdoor, Walmart has set up a virtual popup shop in the Toronto underground for this month only.  Customers can use their mobile devices to scan tags on products in a display to add them to their shopping carts on the Walmart Canada eCommerce site and have them shipped home at no charge.  This is a clever and cost effective option to let technically inclined commuters with a grasp on mobile technology to get their Christmas shopping done while it’s fresh in their minds.  As with the example above it’s also a great way to get some play in the news. (thanks, Sandra!)

Self Scan @ Apple – Apple Canada recently updated their iOS app to enable Easypay for use at the Apple Store in Canada.  Available for some time in the US, Easypay allows customers to scan and pay for their purchases in store with their iPhones.  All the app shows at present is an ad that Easypay can be used in stores.  Try it next time you are in an apple store and tell me about it!

Based on past experience you will need to connect to the store wifi to be recognized and then shop away.  I’ve always had qualms about such a service, as it can be difficult for store staff to validate who is actually paying for something and who is not.  That said, providing complete channel neutrality and being open to change are terrific for retail in general.  The hard part is always sorting out the operational issues that arise. I look forward to seeing how it works out and who adopts such a scheme next!

2012.22 | Tablets

While the iPad is certainly the standard for tablets, two new releases over the past couple of weeks may lift the bar for the essentially non-existent competition for everyone but the nerdiest of users.

Microsoft Surface – Leveraging the upcoming release of Windows 8 with its interface that works with desktop and tablets, Microsoft made a relatively big splash with its “Jobs-like” reveal of the soon to be released Microsoft tablet.  While some will deride Microsoft Surface as the Zune of tablets, there is some potential behind Surface. While much of the Surface tablet is speculative at present (price, release, user experience) Microsoft does have some things going for it.

Magnetic Cover with Keyboard –  iPads are not optimal for data entry and entry intensive uses.  While there are a number of bluetooth keyboard options, most of them mar the sleek look and profile of the iPad. If the keyboard included with the Surface tablet works well, it overcomes a missing element on the iPad without sacrificing the look and simplicity of the unit.

Windows 8 –  While iOS receives well deserved attention for its simplicity and ease of use, the OS has not changed a great deal in years.  Those who haven’t seen the look and feel of Windows 8 or seen a recent Windows Phone OS will be impressed.  In my opinion, the dynamic, configurable tile based interface leapfrogs the iOS interface in both ease of use and looks.  Another small item that might be useful in a tablet from a retail perspective is NFC capability.  Windows Phone 8 has NFC enabled and that may provide a way for retailers to get past dongle after dongle issue for payments in Windows 8 if that functionality can be ported to Surface.  It would certainly help here in Canada where EMV readers for tablets are hard to find thus far.

Display Size – It isn’t a massive difference, but the Surface unit has a 10.6 screen with a 16:9 ratio.  It’s slightly bigger than the iPad which is helpful for using the iPad as a shared screen.  Most video is wide format now, so it could display more full screen for demos in a retail environment.

Productivity Applications – While Apple came at tablets from the mobile side, Microsoft comes it from a desktop perspective.  Microsoft Office apps are much more feature laden and better for most business than Pages, Numbers and Keynote.  Much as Apple has some incredible templates and wonderful toys (using iPhone as remote for Keynote), they lack the depth of features that Office has.  If Microsoft ports Office to Surface with full functionality, they will be much more useful in a business environment and have a broader following in business.  Whether this is useful in a retail environment will depend on the application.

Surface may not have the cache of iPad.   Surface may not be the tablet the customers at Starbucks are using, but it may well represent the evolution of the computer at work. From a retail perspective it provides another potential low cost option with a slightly larger beautiful screen. The ability to add data entry without sacrificing usability and portability for client based solutions will help with some applications as well.  Add the ubiquity of Windows as a platform in retail in North America, and Surface could find a foothold in retail applications.  There are lots of details to shake out, but don’t discount it without investigation.

Google Nexus – Google also announced a new tablet recently.  One of many interesting releases from Google this week, the new tablet is made by Asus.  Much different from the iPad and Surface, the new Nexus tablet is a much smaller and low cost unit.

Priced at $199, the unit seems a more fitting competitor to the Kindle Fire.  Like the Fire, it is more of a paper back sized device purpose built to consume media – read books and magazines, watch video, play simple games and browse the Internet.  Like the Kindle Fire, the Nexus is closely tied to a content ecosystem in Google Play.  Nexus leverages the latest version of Android for Tablets  – Jelly Bean.

While not as feature laden as the iPad and Surface, tablets like this will continue to drive expectations of low cost devices that can be harnessed for many uses.  This relatively sophisticated technology is being driven closer and closer to a $0 item used as a loss leader to drive consumption of media, lowering the desire for consumers to pay without clear benefits.

The impact of this device on retailers is more on increased competition for the likes of Amazon, Kobo, and Kindle for electronic media.  It would be surprising to see these devices used in a retail environment as a selling or transactional tool, but that could all change tomorrow.

2012.12 | The End of Money?

Having finished The End of Money last week, I can recommend it as a useful overview of all of the issues concerning a move to a cashless (or cash “less”) society.   I was particularly taken with the concept that all of us perceive and hold true the “value” of paper money, though effectively it is our faith in monetary instruments like cash that gives us that perception of value and nothing more.

We are so close to our money and monetary system, that we rarely stop to think about it.  The book underscored that point for me more than any other.  Money and gold are really just proxies of value that we perceive as instruments that can ‘hold’ value for us over time and make value transferable.  Taking the time to think about it, it’s quite incredible that we have somehow all agreed to this arrangement as a society; but we have.

I was also deeply affected by reading ‘Digital wallet’ will transform smartphone and how we spend in the Globe and Mail last week.  While the article revealed nothing new and was sketchy on details, the vitriole in the 335 comments was somewhat disconcerting.  Many of the comments from unsurprisingly anonymous accounts expressed outright hostility towards the idea.

While I have been enthusiastically anticipating and already using digital alternatives to cash, there are many individuals who are vehemently against a digital wallet.  As described in “The End of Money”, there are massive and pervasive concerns around this technology in the general public.

Some concerns outlined in the 335 Globe and Mail comments included:

  • being forced to use a particular payment network
  • transactions being tracked by banks, government, network owners and others
  • no privacy for transactions
  • account numbers and value being stolen
  • being forced to have and use a mobile device
  • being forced to use a mobile network like Rogers, Bell or Telus and paying them a cut of transactions
  • providing no additional value to citizens
  • ‘hackers’ taking over the system (by the way, the terms hackers and cyber anything have to be removed from the common lexicon – this is not the age of the information superhighway)
  • criminals stealing account information just from proximity the owner (NFC)
  • what to do when there is no electricity or your mobile device has no power
  • corporate organizations usurping or becoming a crucial transport to the sovereign responsibility of government for currency
There are many rational arguments in this list.  Almost all of them are issues today based on debit and credit payments.  Replace mobile device with card or mobile carrier with bank or processor, and the concerns are almost identical, be it a mobile wallet or a debit or credit card.
And yet, as I also found in The Future of Money, cash is not a panacea.  While cash can potentially provide anonymous, electricity free portability and ease of transaction in a way that no current widely used electronic format can, there are many issues around the complexity of cash – though they are more apparent to retailers to consumers.
In Canada we have had numerous reminders of the complexity of cash, but most consumers don’t think about them as complexities.
  • On March 26, a new $50 note was released to reduce counterfeiting of large denominations and increase acceptance of these notes.
  • Last week it was announced that pennies will be no longer be minted, and will be removed from circulation in Canada to save the cost of producing them – which has exceeded their value for some time.
  • The Royal Canadian Mint is in the midst of releasing new versions of the $1 and $2 coin (okay, loonies and toonies) which replace nickel composition with steel – once again, to reduce the cost of minting.

For most, these are news items for discussion with friends and colleagues.   For retailers and other consumer facing organizations, these are logistical issues that have to be carefully considered and dealt with.  Vending machines, self-checkouts, self service kiosks, cash drawers, cash counting equipment, counterfeiting measures, store associate training, taxes on purchases, rounding to five cents on cash purchases, end of day balancing procedures, and more all have to be considered.  All of them require time, effort, and more cost.

While the average consumer may consider these issues irrelevant to them, these are costs that are passed on to them one way or another.  If a retailer can find a way to deal with transacting more cheaply in a way that suits a target market, they should do so, tradition or no, and use that competitive advantage to win business.

So, what is the answer?  The answer is choice.

The issue I had with the comments on the Globe and Mail article was that people were basically responding as though they are being told cash is being eliminated and they have to use an electronic wallet.  That is not the case.  There will be cash, there will be debit and there will be credit for the foreseeable future.  There will also be electronic wallets.  These digital modes of transaction are currently options; not requirements.

There are all sorts of people and transactions in the world, and they should all be able to transact in the manner that they wish.  Cash, Debit, Credit and eWallets can all play a role.  [Don’t believe the eWallet hype? – check out mPesa.]

Electronic wallets are imperfect for many reasons.  It’s absolutely true.  So are debit and credit cards.   There is fraud, there is theft, there are many inconveniences associated with using cards.  And yet 65-70% and more of many Canadian retailers’ transactions are made via debit and credit.

Somewhere, somehow, somebody is going to evaluate the list of bullets in this post and see opportunity; see a missed chance to do things better.  With emerging technologies, and changing consumer attitudes to mobile and electronic transactions, it’s only a matter of time until mobile digital wallet options become a bigger proportion of the payments people make.

As retail technology professionals, we should ensure that all of the infrastructure we put into place provides the flexibility to accommodate future payment modalities – whatever they may be.  Reading “The End of Money” provides a great background on why we should be ready for these new payment models.  Understanding the history helps to drive us into the future.

From my perspective, the Government of Canada is responsible for the money supply including the Bank of Canada and the Royal Canadian Mint.   They should be considering how Canada can move from a cash based society to a cashless society.  They should remember that they are not printers or minters – they represent monetary value in Canada and should continue to play that role electronically if it suits their constinuents.   They have already made a jump moving to polymer from paper.  Perhaps their next move should be silicon.

All of the national banks around the world should be considering this or find a way to harness private enterprises in this effort – before AppleSquareGooglePaypalStarbucksBumpPayGeodeWallet or others do it for them.

Update:  The Royal Canadian Mint has obviously been thinking the same way.

2012.06 | Apple iTV

Last week in Canada we had some local news on the mysterious Apple iTV.  An article in the Globe and Mail indicated that Bell and Rogers – Canada’s two largest wireless and telecommunications carriers – are in talks to be partners with Apple on the launch of the hotly anticipated Apple iTV device.

While I understand the rabid interest in all things Apple, I have to question the real potential of this future solution.  I unsubscribed from cable TV over 3 years ago.   I have an AppleTV and I love it to death.

Instead of spending $100 per month for programming I don’t want to see in various packages that don’t appeal, I can pick and choose show by show what I want and just buy it on a pay per use basis.  There are way more shows than I could ever buy.  I can watch all NHL highlights for free the day after the games on demand.  I can rent movies from home – no late fees, no out of stock, no calling home to see if my family wants that film.  I use the costs saved on cable for faster internet access and large download ability.  It’s a great deal at $100 and it exists today and works with my plain old LCD TV.

I have some doubts around iTV seeing the light of day as it is currently described in the media.  There are some serious questions around it:

  • Apple has maintained that AppleTV is still a ‘hobby’.  While they have sold millions of units, it remains a niche product in many ways.  I’ve had to physically show people how it works before they go and buy one.  People don’t seem to get it.  They are confused by where the content comes from and how.  My less technical friends get a pained look on their face when I explain how it works.   We need a paradigm shift to move your average consumer to something new like this.
  • The solution offered here is a 42″ maximum screen.  Not exactly going to win the spec war there as screen sizes are only growing.
  • Making a TV a giant iPad?  Not the same thing.  Remember Nick Bilton’s theory of varying interfaces for mobile, internet and TV being 1′, 2′ and 10′.  Different needs, different interfaces.
  • The rumour is that they will use a Siri like interface to control the iTV.  I really can’t picture that happening.   Siri doesn’t really blow my mind as it exists on iPhone.  It doesn’t work for all functions in Canada, so why should we expect it to be different here?  Ever try dictating on Dragon Dictation?  It works, but it’s different than selecting buttons.  Going through menus by speaking out loud like an automated voice driven IVR?  No thanks. Significant culture shift to make this take off.
  • Youtube like video feature?  Youtube is on AppleTV already to watch videos, and adding my own videos to Youtube is one button click on an iDevice.  What’s the win?
  • Why do they need local Canadian TV providers to support it?  Live programming?  Perhaps, but do they need a TV to do that?  No.  A device similar to the AppleTV could do that given the right web interface.
  • What is in this for the local Canadian TV providers?  Winning back the dissenters of cable like me?  Hardly a winning proposition, and not significant revenue winner.  It may in fact move people from cable and reduce their revenue and perceived value.

In today’s market, a winning device needs content and  I don’t see Apple getting that here beyond what they already have.   AppleTV already does this.  If they are looking to sell a better cable box or TV, they could do that, but I think that would dilute the value of their brand, and their history of late indicates they would try to do more.  I’ve been wrong before, however, so we will have to wait and see what they do.

What has this got to do with retail?  The AppleTV already has won 100% of my video rental dollar, and the dollars of all of those who see it at my house.  I don’t rent older movies anymore for any price because I can watch them on Netflix.   I’ve started subscribing to TV shows on it as well.

Canada has almost no DVD rental left in my area.  Blockbuster is gone.  Rogers is moving away from DVD rentals.  The mom and pops are rare.  I’m sure retailers are selling lots of $5 DVDs these days for those of us without the fancy toys and high speed internet.

The AppleTV is just one example of how consumer needs and desires are changing.  Wise entertainment retailers will watch for situations like this and think hard about how to make take advantage of these channels.  Others will be left by the wayside.

2011.34 | eReceipt Retailers in North America

I’m not sure what is driving the sudden interest, but there has been a small run on eReceipts in the news.

New York Times | Consumer Reports | NPR | ….and many others weigh in

I had a recent request from a reader asking if I knew of an online list of retailers leveraging eReceipts and I do not.  What better way to address such a shortcoming than putting together a list right here.  The following are retailers where I am aware of an eReceipt option being available.  These were gathered from various articles online, corporate websites and various personal experiences.  Strangely, few of them have any information on this option on their corporate websites.  I expect a comprehensive list will eventually be a list of all retailers.

Apple Store – Apple store has offered eReceipts for some time, and have a slight advantage over may retailers in that many customers have an iTunes account online with a credit card number on file.  This allows for a receipt to be sent automatically based on the credit card number swiped.  No need to take down an email address.  I have used this option numerous times personally and the difference between this and an iTunes receipt is effectively nil.  The solution works well, and the eReceipt is a good fit for their business model and customer segment.

Gap / Old Navy / Banana Republic – The banners for Gap certainly offer eReceipts in the US and Canada, though I have only personally had experience with Old Navy in Canada.  Seems to work pretty flawlessly, though telling someone your email address or typing it onto a pinpad seems to open up opportunities for errors, meaning a receipt might be lost.  That said, I find Gap brands seem to be quite liberal with returns as long as items are in sale-able condition anyway, so not having a receipt isn’t the end of the world, but the system could use improvement.

Hertz – Not a retailer, but as a consumer facing business that offers receipts, they qualify.  Their site works very well, allowing search on drivers license and credit card numbers and are sortable by date.  Quite often you don’t want to wait at a travel counter for a receipt and you end up losing the paper anyway.  Very handy.

Nordstrom – I know Nordstrom is piloting a mobile devices, and I personally feel eReceipts are the best option for those devices to keep up throughput and to simplify the process.  Paper receipts are still available and always should be, as customers should always have that option if they want it.

Patagonia – One of the companies profiled in the NYT article, Patagonia began offering 9 months ago, with only one third of customers opting in.  Frankly, in my mind, removing one third of paper receipts is a significant impact to the business.

Sears / Kmart – In the US, the Sears organization has some leveraged some relatively forward thinking technology, and eReceipts are among those ideas.  Kmart is apparently offering electronic receipts as part of the Shop Your Way Rewards program.  I also have friends and colleagues that have opted for eReceipts at Sears in the US.

Whole Foods – Working with MyReceipts, some Whole Foods sites can now offer electronic receipts.   MyReceipts indicates it also supports electronic receipts for retailers including Wegmans, Office Depot, Best Buy, and Walmart.

I am a proponent of getting paper out of the equation given the number of shopping trips many of us complete in any given week.   I truly feel we can have an incredible impact on paper usage and cost in much the same way that we are impacting plastic bags – in Canada at least – the number of bags you see are way down. Personally, I think it would also help to unclutter everyone’s lives.  I already scan all of my paper receipts and paper mail and shred the rest.  This saves me a step and might make things slightly more searchable.

What are the potential challenges of moving to eReceipts?

Potential POS throughput impact – Asking every customer for an email address, mobile number or other unique identifier can slow down the queue in a store if not implemented correctly.  Allowing customers to connect their email address or eReceipt provider/account via their credit card number or loyalty card number on a retailer website or opting in at the POS once would minimize errors and ensure consistent POS throughput.  Ideally an NFC wallet that can provide payment and receipt functionality down the line would avoid the problem of registering altogether.

Receipts not provided – If an email addresses or other unique identifiers is entered incorrectly, this can cause complications and confusion for the customer – potentially around returns.  It is important to have a simple yet solid method to validate the correct path to deliver the receipt.  The other potential link in the chain is connectivity to the internet.  That concerns some, and yet I would argue that internet connectivity up-time seems to be pretty solid in most areas, and even if it goes down, the transactions can pile up and be sent when the store is online once more.

Shrink / Security Issues – Security has been simplified for years by just checking to see if customers had a shopping bag – secondary security check is a receipt.  With increasingly few customers carrying shopping bags, and now with no receipt, it can become more challenging for store staff or the Shrink team to identify thievery vs honest purchases with no receipt or bag.

Privacy – Of course the papers highlighted everyone’s concerns around privacy, but I have to ask what privacy they actually feel is being violated?  The credit card companies can see everything that you buy.  The retailers can already see your basket and know what you buy.  You are going to be targeted for advertising, so why not let it be for something you might actually want?  If it isn’t for what you want, there is always an opt out with all of these top tier retailers, and there are codes of ethics for marketing associations to not spam their customers – and it’s just bad business anyway.  I feel that this opens us up to a better world – imagine you need to return something and instead of digging through your George Costanza wallet to find your receipt you tell the customer service person your email address and approximate date of purchase.  Return done simply and without paper. Why are we still carrying this stuff?

Bottom line – I like eReceipts, and it’s going to happen.  There is value to the customer (convenience) and to the retailer (less paper logistics, no roll replacements, less paper work, no forged receipts) and for the environment (less garbage).  In the end, however, like all other consumer facing situations, it is all about choice and retailers should be sure to provide options, not requirements.  If customers don’t want an eReceipt – give them a paper receipt.

So who did I miss?  I know that there are various providers who provide an ereceipt capability to Mom & Pop stores, and small chains, but these are the big ones I know about.  Let me know who else has an eReceipt option – some online details to back it up would be appreciated  – and I’ll add them to the list.

[Note – if you truly want an eReceipt solution today across all your purchases, you can go the route I did – Purchase a Fujitsu ScanSnap S1500 or like product, and have the images automatically transferred online to Evernote via their PC client software.  Set a notebook for receipts, and off you go.  A fully searchable database of receipts that you can access from your Mac or PC, your tablet, your mobile device, or anywhere you have an internet connection.  Added bonus of no paper in your house!. – Inspired by Mark Fraunfelder via Boingboing]

Update 9/16 – @fornaom indicated Anthropologie, Banana Republic and Urban Outfitter provide eReceipt options.  I have also seen these online in various places.  Also confirmed through purchase that Gap banners are asking for email addresses, and when you use your credit card, they validate your email address with you on the pinpad so you get your email receipt.  Strangely I received both paper and email receipts.  This seems like a waste, but also know that debit/credit may require a paper receipt at least.

2011.21 | Google Wallet Could Work

I’ve derided attempts at a mobile wallet for some time.  I want it as badly as anyone, but it has been an elusive dream for years.

If you look through the blog you can see my reasons for this skepticism.  It’s never been about the technology – that capability has existed for years.  It’s about the infrastructure, consumer readiness and not adding fees for the service.  I’ve been thinking about last week’s announcement around Google Wallet, and it could work – in Canada at least.  Let’s discuss just a few reasons why their model could work.

NFC acceptability at POS – While articles I have read about the US and Europe have indicated that they have not adopted NFC strongly, numerous Canadian retailers have built NFC into their infrastructure as they were forced to spend millions on getting EMV in place.  The EMV upgrade caused thousands of pinpads to be replaced, and untold hours of software changes and testing.  It only made sense to include NFC in that process to make best use of the investment.

This investment places Canada in a solid position on the number of POS sites that can accept NFC payments.  Not convinced?  Consider just a few of the major retailers that accept contactless in Canada: Tim Horton’s, McDonald’s, Loblaws, Sobeys, Cineplex and probably many more where I haven’t used my NFC cards yet. (Let me know if you’ve seen it elsewhere in the comments!)  More sites where an NFC tender can be provided means more potential purchasing locations where a Google Wallet can be used, which drives potential use, and therefore more potential adoption.

One PIN to rule them all – Canadians have become accustomed to Chip and Pin over the past few years.  The unforeseen challenge of this new and more secure system is remembering PINs for multiple cards.  I have relatively few cards, but have 3 credit cards and a debit card.  Try keeping 4 pins straight in your head for whichever card you are using.  Using the same PIN for all four?  If you get filmed entering your PIN, you could be scammed on all of your cards.

If you use an NFC credit card, most retailers don’t require a PIN for purchases under a pre-set amount – generally $50 or so – particularly for their own cards.  I like using them for that reason alone.  Not entering a PIN at every transaction is a convenience to users and can speed throughput for retailers.  At the same time, having a single PIN on the Google Wallet means that the card could not be used unless that PIN  has been entered, providing an extra layer of security for an NFC transaction.

Usability – I’ve highlighted that any new payment solution needs to be extremely simple to use.  Your most novice user needs to be able to do this in 5-10 seconds flat in front of a queue of impatient people and a bored cashier.  The Google Wallet with NFC appears to get closer to this nirvana than other solutions.  My technologically challenged mother uses NFC cards regularly and loves it.  You “Tap n Go”.  Consumers can use the current pinpad at the POS just like they have done for years.  It’s comfortable.

Contrast this interface with Square as one example.  Square is an awesome idea and it looks slick, but is my mom going to use it?  Nope.  Too foreign.  It also requires the use of a solid data connection to work every time as transactions are completed via the network.  Anyone want to be held up relying on your local wireless coverage to complete a transaction? NFC gets around that by allowing the use of NFC which just requires the mobile device to be on.

Will my mother use this solution?  Probably not right out of the gate.  But a mobile wallet needs to be this simple to get widespread traction in the marketplace.  For those of you who may deride this need saying that our Gen Y digital natives are more sophisticated, watch your average mobile user at any point of service.

Many citizens (I didn’t say all – and they aren’t the only ones!) of this segment are so busy checking texts, talking on their mobile, or zoned into their own world listening to their iPod that they are often loathe to interrupt to complete a transaction. Mobile wallet usage needs to be so simple that one can open the app while they complete other activities while distracted.

I would also argue that Gen Y, while potentially more comfortable and trusting of technology than older consumers, are still subject to the needs of a simple user interface.  They are not necessarily any better at using technology.

Increasing Mobile Usage – While Canada lags behind the US in mobile technology, we are catching up.   99% of the 18-34 set have a mobile phone.  We are up to almost 25% of mobile phones with a data plan.  A target market of 25% of the population isn’t a bad starting point, and it will only grow.  This increasing use of mobile is also driving increased comfort with downloading apps like the mobile wallet.  Android is also gaining market share – providing a potential foothold.

The Google Factor  – Past attempts at mobile wallets in Canada have been pilots inevitably involving a mobile carrier, a credit card company, and a bank. Sometimes a credit card processor and/or a retailer got into the mix. All parties have been trying to figure out a way to split the profits for years – nobody has made it work.

Neither consumers or retailers will pay a significant fee for the privilege of carrying their phone instead of a piece of plastic. There has been no large monetary benefit to these parties to add additional cost and risk into the mix for the returns they have found or we would already have mobile wallets.  The carriers and handset manufacturers have not included NFC into the mobile handsets as they had no incentive to do so, and importantly – no universal application to leverage NFC if it were there.

Another problem is the issue of consumer acceptance.  Carrying a mobile wallet for every credit card, bank or other institution adds complexity, it doesn’t remove it.  Having a mobile wallet from some Silicon Valley start up you’ve never heard about – not going to do that either.

The difference here versus the past is that Google is looking for an edge over Apple and RIM.  They want and need to provide something the iPhone doesn’t have.  The handset manufacturers also want in on that.  NFC is a viable option they can provide.

To use that hardware, a universal mobile wallet from a trusted source is needed.  Google is a verb now – who doesn’t know Google.  The name Google Wallet doesn’t make you nervous – it makes you want to download the app.  They also provide the corporate clout needed to deal with the major banks and credit cards.

They are providing the hardware we could never get in the past, and a universal app that could allow us to use all of our credit cards in one trustworthy mobile wallet. These two elements, along with the benefits above, may just push Google Wallet into mainstream usage.

This isn’t even remotely a slam dunk.  At present this is going to be used in two test markets.  It only works with one phone.  It’s not offered in Canada yet.  There is no guarantee the credit card companies will get on board.  There will always be security issues.  EMV could force you to pull out your card anyway for a larger purchase.  If your battery is dead you have no wallet.

Many hurdles need to be overcome, but Google is moving us closer to the mobile wallet than ever.  Perhaps they could offer it on other platforms like Blackberry and Apple’s iOS.  Ideally Google’s initiative will drive other organizations to come up with their own wallets.  Paypal – perhaps.  Apple is likely to get in on this as well.  Having organizations like this behind a mobile wallet initiative can only move the ball forward.  After all, what’s left to add to our mobile gadgets?

2011.04 | NFC Mobile Payments

Image Source - Cult of Mac

The previous blog post on Starbucks 2D Barcode Mobile Payments drew questions from readers and colleagues around Near Field Communication (NFC) payments, specifically, why would Starbucks have implemented a 2d Mobile Payment solution when NFC is just around the corner?

The Starbucks solution with 2D payments is a perfect fit for the unique Starbucks situation and does not preclude them from accepting mobile NFC payments.  However, the 2d barcode payment is not one I would recommend for any other retailer unless they were have the same characteristics as Starbucks and their solution outlined in the previous post, and there are few if any retailers or consumer facing organizations in that position.

In order to provide NFC mobile payments, it is necessary to have the following elements: NFC at Point of Service, NFC enabled mobile devices, and most difficult of all, Credit Card Company and Credit Processor cooperation.

Point of Service Interface – Retailers that wish to accept mobile NFC payments require NFC enabled pinpads that already work with NFC credit cards.  The most common units in place so far in Canada are the Verifone vx810 and Ingenico i3070c.  These pinpads would provide the interface in stores for NFC ready mobile devices, and are, in fact, already widely installed by many tier 1 Canadian retailers as part of recent EMV efforts.

NFC Mobile Devices – According to rumour, both RIM (Dakota) and Apple (iPhone 5, iPad 2) have NFC ready devices coming out in 2011.  If that is the case, then we may indeed finally be looking at the long awaited electronic wallet, as we now have an encrypted and relatively secure electronic interface from mobile device to point of service device.   Apple and RIM’s massive base and marketing power, as well as their ongoing competition, certainly has the potential to drive massive traffic.  So the mobile devices might be coming, but this has been the expected for at least 4 years.  We’ll call mobile NFC devices a strong maybe.

Credit Card Company / Processor Cooperation – My thoughts on contactless payments are well documented on the blog under NFC if you want to pick it from the tag cloud. The problem isn’t the technology, it’s how the payments get processed and who gets paid to do it. See my posts here and here, as well as a recent article published on StoreFront Backtalk.  The credit card companies, and the various payment processors already get their slice of the payments pie, while all of the mobile carriers have been trying to figure a way to get theirs for years now. Both Canada (Enstream) and US (Isis) mobile carriers have established collective organizations to deliver on mobile payments.  It isn’t that all of these organizations don’t want mobile payments, it’s just very difficult to sort out, and there is really no extra potential revenue in it for them unless consumers or retailers will pay more for some reason.  Some may point to startups like Square and Twitpay, and they may take a bite out of mobile payment in the future, but it doesn’t look like it will happen in the immediate future.  Getting these organizations on board, extending a very successful and secure closed network to the uncertain security of millions of devices is a long short in the near future.

NFC mobile wallets can and should happen (you can already stick an NFC tag on your phone if you like), but sorting out who gets paid how, and how funds will stream through a secure system will take some time.  Nobody knows when that will be.

Why did Starbucks implement a 2d Barcode Payment System instead of NFC?  Only they can answer that, and much of it may be marketing, but in the end, they can drive an ROI.  With a 2D system implemented TODAY, Starbucks potentially gets more consumer card usage, drive more ‘deposits’ on their stored value card, and a quick tender.  Consumers get the convenience of paying with their phone, and the kind of bleeding edge fun many Starbucks customers enjoy.

Starbucks avoids the complex mess of processors, EMV, PCI, and dealing with the processors and credit card companies altogether by taking no the risk themselves.  They have made a good gamble on the fact that they can attract early adopters with relatively very little investment, and by the time mobile payments are mainstream, their system will have already provided a good ROI.

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