2010.49 | Mobile POS at the Gap

Reports last week indicate that following in the shoes of the Apple Store, The Gap is piloting the use of Apple iPod Touch units for mobile checkout within the store

This concept has fascinated me for some time.  It takes away the counter between store associate and customer.  It also allows customers to buy where they are shopping, and can allow for more flexibility in a store, allowing potentially every associate to be a cashier, and provide at least the potential for improved service. 

I’ve always thought it worked well in the Apple store, and I hope it does well here, but some hurdles will need to be cleared in order for this to work in a traditional apparel retailer environment like Gap.

Security – One of the biggest logistical hurdles in an apparel store like the Gap is EAS.  How will they deactivate the security tags?  All clothing at Gap has tags that will set off the gate at the front of the store.  Deactivation could still work.  The main concern would be that many of the deactivators now are either behind a counter where only store staff can access them, or they only deactivate on a valid barcode scan.  Both of these are tricky to manage without losing the benefit of having the mobile POS in the first place.  I expect that associates will need to have kiosks around the store with deactivators and tag removal systems unless they wear one of these on their belt too, but this gets a bit awkward, and what if someone steals it? They don’t have EAS at the Apple Store, so it isn’t an issue there.

Operationalization – Let’s assume the application itself is quite simple.  Apple apps are made for the masses, and your average cashier is a step above that.  The issue that may arise is how do you accept a customer’s purchase, give it back to them in a presentable format and accept payment.  Consider the following: You go to the apple store, you pick up an iPhone case, you hand it to your nearest Genius, they scan it and give it back to you.  You give them your credit card, the scan it and give back to you and you are effectively finished.  That’s in an Apple Store.  Go to the Gap.  You already have 2 bags from other stores.  You pick up 1 pair of jeans and find a Gap associate on the floor.  You had them the jeans, they scan them, and then hand them back to you, but you have 2 bags.  This is workable, but a bit more awkward depending on the situation.  Can they fold them first?  They do that at the counter, but what do we do standing in the middle of the store?  This will definitely only work for small basket sizes.  What about bags?   I don’t need it for an iPhone case, but generally only a small portion of the population will have their own bag, and if they do, what else were they putting in that bag?  This can work, but it will require changes to the processes in stores.  I expect mini kiosks will have to be placed in the store to accommodate the EAS situation, and may provide a small station to quickly fold an item and present it to the customer.

EMV – While swiping a card will work in the US, there is a sizable portion of the Western world that requires EMV verification on a purchase, which means a pinpad is required.  Looks like Canada and the UK would be on the outs for this without a hardware upgrade.  I’m sure there is one out there or in the works, but I’ve not seen it yet.

Receipts – While I fully believe paper receipts should be on the way out, the situation needs to be dealt with.  The Apple Store will email you a receipt based on your email address and if you use the same credit card, will know you based on iTunes.   The issue I see here is that the Apple Store attracts a certain demographic that is fully comfortable with this.   There will be a demographic at the Gap (decreasing, of course) that will either want a paper receipt, will balk at an email address, or will be spooked by the fact that the Gap has your credit card number in a database with your e-mail attached to it.   The Gap will also need to look at returns for this system as well.  A transaction number can probably be used from an emailed receipt, but this will be a change from the Gap’s usual mode of operation.  Once again, the Gap is very different from an Apple Store.  I expect returns are far more common at the Gap, due to sizes or changes of mind.

I fully expect mobile POS to become more common, and it’s encouraging to see Gap getting behind it.  That said, I expect that like any other paradigm shift for processing transactions in a store (self-checkout, kiosks, point of sale layout) mobile POS will requires some serious thought and changes to operations to integrate it correctly into the processes of a reatailer as well as the store experience.  At present, it appears to suit a small basket transaction without EAS and an email based receipt.  There are definitely ways of working around the challenges, and they are likely to be as varied as the retailers that attempt them.

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2010.47 | Retail Mobile is Exploding

Not that it’s a surprise to anyone, but the movement to mobile for retail is really picking up as of late. While many retailers are experimenting with their own apps, those that don’t take part are likely to get dragged into the mobile world whether they want to do so or not.

Paypal is piloting a mobile payment scheme through their PayPal Local program in partnership with Bling Nation. Under this program, NFC stickers are mailed out to those who enrol and those NFC tags are connected to Paypal accounts, effectively allowing users to link their payments to their mobile device instead of their wallet.  While the program is only a trial it’s an interesting potential workaround to the usual debit and credit electronic payment infrastructure.  To simplify the process, Bling Nation users activate through a Facebook App.  Interesting choice.

Self Scanning apps like ShopSavvy and RedLaser are upping the ante with new functionality and Amazon’s own app is scanning now too to allow customers to price match in stores.

Sounds like consumers want mobile websites too.  The trick is figuring out what that means.

2010.42 | Scanning Barcodes From a Mobile Screen

Misconceptions abound about scanning the screens of mobile devices.

There are a number of different ways of passing data from a mobile device to another platform in a store environment – 2D barcodes, Microsoft Tag, NFC, Bluetooth, and via Apps – the possiblities are quite broad and are dependent on the application.

Applications in a store environment most often involve passing loyalty or coupon information from a mobile device to a point of sale (POS).  The method that arises most in conversation is that which would seem most intuitive to the general population.  Can one scan a barcode from the screen of a mobile phone with a scanner at the point of sale?

The answer: it depends.  Consider the following examples:

Example 1: A customer approaches a Point of Sale in a store with an Apple iPhone.  The customer has scanned an image of their loyalty card into their phone complete with a traditional linear barcode from the back of the physical loyalty card.  The cashier has a Handheld Scanner at the POS and attempts to scan the customer’s screen to enter their loyalty information into the system…  It won’t work.   A traditional handheld or even bioptic scanner will not reliably capture a barcode from the screen of a regular mobile device’s screen.   I have personally attempted it many times, in many retail situations with various scanners and mobile devices and screens in stores and in lab environments.  The screen is too reflective or does not pick up the contrast in the bars and spaces, no matter how large or bright the image may be.  (It may give a positive scan once in a while, but not consistently.) I’ve heard that some iPhone apps get around that by showing the images in certain ways, but I’ve never seen it work live or via any online searching.


Example 2: A customer approaches the boarding gate at an airline terminal with a Blackberry Torch.  The customer has downloaded an electronic boarding pass to their phone complete with a 2d barcode.  The boarding agent has a Handheld Scanner with a 2d Imager built into it.  The customer holds out their device, and the agent scans it with the imager.  It will work.   In this instance, though the situation appears exactly the same as the first example, the big difference is the the use of the 2d Imager and 2d barcode.  A 2d Imager is essentially a camera – better suited to identifying the 2d barcode on the mobile device.

The implication of the formulas above is that the great majority of technology in place at current points of sale will not read barcodes from a mobile device.  Most retailers wishing to take advantage of barcode reading from mobile devices will need to invest in new scanning devices.

NOTE:  The imager will also read a 1D traditional barcode from the mobile screen.  The barcode does not have to be a 2D barcode.

2010.27 | Queue Busting at POS

I’ve had various queries as of late around queue busting.   The general concern I’ve heard from local Canadian retailers is particularly around stores with small footprints that experience much higher traffic during a tourist season.  There may only be 2-3 lanes in some rural / small town sites, which are unable to handle the load over the busy summer months.  The people in those stores are looking for relief in the ability to handle more customers, but there is little or no additional space for additional point of sale or staff.

Queue busting is a valid option.  Traditionally queue busting has meant the use of a (relatively) small handheld device by a store staffer to scan all of the items in a customer’s basket, suspend the transaction, and the customer would then pay the regular cashier as they followed through the queue.  The idea is that using these handheld scanning devices would shorten the time spent by customers at the point of sale.  Let’s consider potential issues that need to be addressed by such a solution in a grocery environment:

  • Basket size – A queue busting solution could work well in a small basket size situation – say up to 8 items at the very most.  Unless there is special bagging area established in front of the register, and items are placed into bags, there is a high probability of items being missed, or scanned twice, which will hamper throughput and lower customer satisfaction.  A handheld solution is probably cumbersome for sites that have larger basket sizes, or queues other than an express lane.
  • Scanning Power – Wireless handheld scanners that are connected to the back end do not scan easily.  The technology has certainly improved over the years, but has not come close to the ability of bioptic scanners or even handheld units connected to a POS for speed.  There is greater effort required to orient the products to ensure a correct scan.  This will slow the queue a bit, but may be a valid tradeoff over waiting in line reading the tabloids.
  • Weighed Items – If a customer has produce that needs to be weighed to calculate the price, they cannot be accommodated by a handheld device.
  • Receipts – Need to ensure the handheld can print a receipt.
  • Electronic Article Surveillance (EAS)–  If a customer has an item like a pharmacy item or an item from the meat counter, there is no way to deactivate the security tags with the handheld unit.
  • Coupons – In Canada, most coupons are not scannable, and need to be entered manually.  This would be cumberson on a handheld device which is primarily a scanner and not a data entry platform, and could p0tentially require integration into the POS platform beyond the standard scan and suspend requirement of a queue busting platform.  Coupons are not used as much in Canada, so this may not be a fundamental problem.
  • Loyalty – Customers will expect that they can use their loyalty card can be scanned as normal, and this should be accommodated as normal.  It shouldn’t be a problem with the handheld.
  • Queueing– It is important to consider the operational aspects of a queue busting solution.  Will the attendant have an extra basket or cart to which they move unscanned items into after they are scanned?  This will require additional space.  Customers are accustomed to queuing in certain ways in stores, and any adjustments will have to be simple and made clear to the current clientele to avoid impact on the current queueing structure. 
  • Shrink – If a store associate scans items and then passes the customer on to the clerk accepting payment, it will be important to watch customers to ensure that items are not added to the basket or swapped out after the scan. 
  • Tender Time and Throughput– Consider that tendering is the longest component of any transaction.  Now consider that every tender must be handled by the person in each lane with the most powerful scanner and flexibility on the POS.  The fastest scanners would not be used on every transaction – only some of them.  Will this really speed the queues?

I would suggest that a few other options are likely to provide a better outcome by simplifying the process, and eliminating some of the issues presented above:

  1. Full Function Handheld POS – A number of devices are now available that can scan as well as accept payment.  For a smaller retailer, an iPhone touch or iPhone could be used, though EMV is an issue.  For larger retailers, this Motorola unit has an option for an EMV payment device to clip on to the handheld to accept payments directly on the device.  The user can even flip the unit towards the user without having to let go of the device.  Using payment directly on the unit can avoid shrink problems between the scan and payment, and avoids users having to go to a second queue.  Weighed items and EAS are still an issue.
  2. Small Footprint POS – POS manufacturers such as the one I work for generally have smaller footprint hardware platforms.  There is the potential to place a complete POS platform on a power cart to add additional lanes in the store in a very small footprint.  This would eliminate the weighed item and EAS issues, and could simplify queues, but does require a bit more space.
  3. Small Footprint Selfcheckout – Self-checkout platforms are getting smaller, particularly those that accept debit and credit payments only.  Give the high usage and adoption of electronic payment in Canada, a small selfcheckout unit could provide 3-4 checkouts in place of one.  With a bit more space, full payment options are an option as well.

2010.26 | Fast Scanning at the POS

While traveling in the US over the past couple of weeks I was fortunate to visit a number of retail stores and have a first hand look at some banners that aren’t established in Canada. It was an enjoyable opportunity to see how technology is being leveraged a little differently.

One retailer I found particularly interesting was Aldi. I had heard from some industry colleagues that they had very quick throughput through their front end in Europe and I took some time to take a first hand look at one of their US stores.

As their website indicates, they print multiple barcodes in various orientations around the items to allow checkout clerks to scan items quickly, with minimal presentation of any item to the scanner.

This very simple idea allows product to be hurled over scanners one after the other with a positive read. Aldi is able to drive this packaging requirement as most of their product are private brands. That said, I’m a little surprised that some of the bigger players haven’t tried to force the CPG folk to attempt the same strategy.  Full credit to Aldi for recognizing that while having the right technology at the front end, the other side of the equation – the barcode itself – can be influenced.  Rather than considering this an IT issue, it’s been taken on as a business solution.

 

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