As Mobile Checkout Evolves, Companies Like Scandit Find A Place in Payments

7-Eleven Inc. is among the latest retailers to empower consumers to become their own point-of-sale checkout when they use an app on their smart phones.

A central component of that capability is the image-capture tool built into the app. The 7-Eleven Scan & Pay service, which is in tests now and is expected to have greater availability in 2019, relies on Scandit AG image-capture technology to accurately scan a product bar code.

The Scandit algorithm first determines there is an object in the smart phone’s camera view, then it identifies the barcode, Samuel Mueller, chief executive and cofounder, tells Digital Transactions News. The barcode is decoded and converted into a universal product code. That information is sent to the merchant’s backend system for identification and pricing information, which is then rendered on the device, he says. The process happens in milliseconds.

Scandit’s role in payment is its ability to capture the product information via an image. Zurich-based Scandit does not provide the actual transaction function. Instead, most clients use existing payments partners, Mueller says.

The technology will only become more vital as more retailers adopt similar self-checkout services, Mueller says. “If you think about some of the big trends and visible projects in the market, one of the things that comes to mind is AmazonGo,” Mueller says. Amazon.com Inc.’s AmazonGo convenience stores use sensors and cameras to determine which items a shopper picks up and leaves the store with. The payment is made using the consumer’s Amazon payment credentials.

While AmazonGo is limited to a handful of store locations and to consumers with Amazon accounts, and also carries a high cost to duplicate, apps that focus on the consumer stand a better chance for retailer adoption, Mueller says. The trend to enable consumers to check out on their own phones has much broader appeal, he says. That also means self-checkout is available to more store types, too.

“What’s generally the case across these solutions is the shopping happens at the consumer’s own pace,” Mueller says. It also is much more personal, given the consumer may have started the shopping process with a map search or product search prior to visiting the store.

Some retailers may even adopt augmented-reality shopping, he suggests. In this scenario, once a shopper activates a retailer app and points the phone’s camera at products in a store, she could see pricing and product information and filter for size and other attributes. This will result in technology that can seamlessly blend the physical and digital shopping realms, Mueller says.

Others are trying to combine the two shopping environments. Earlier this week, MasterCard Incsaid it was working with Next Retail Concepts on a 3-D shoppable online experience.

Source: http://www.digitaltransactions.net/as-mobile-checkout-evolves-companies-like-scandit-find-a-place-in-payments/

POS Terminal? What’s That?

Cloud connectivity, apps, and features beyond payments are shaping the next evolution of the point-of-sale terminal.

With all the discussion surrounding merchant adoption of point-of-sale systems and integrated payments, one might think the days of the conventional POS terminal are numbered. Their days as an isolated piece of equipment with a sole function as the entry point for payment transactions may be dwindling. But, that does not mean the venerable POS terminal is about to become an historical artifact, as long as it’s not in isolation.

“Any system today, whether it’s a point-of-sale or hardware device, that is not cloud-based is dying,” proclaims Jared Drieling, senior director of business intelligence at The Strawhecker Group, an Omaha, Neb.-based payments advisory firm.

Today, a conventional POS terminal may still sit on the countertop, but with increasing likelihood it’s connected to POS software. It still captures payment data, but now it may act as the citadel, protecting the integrity of the data and sharing only the minimum information necessary with the software. The POS terminal may have a PIN pad or signature-capture capability. It may enable consumers to enter loyalty-program information or redeem offers.

In instances where there is no conventional POS terminal, a merchant likely has a tablet-based POS system in place. Since 2010, when Apple Inc. debuted its iPad and POS software developers flocked to the form factor, tablet-based POS systems have steadily gained favor among merchants.

‘Very Limited’ Growth

At first, the tablet form factor, like the smart phone before it, was innovative and attracted businesses. Then, as cloud connectivity improved, the opportunity developed to bundle other services, such as employee scheduling, inventory management, pricing, and detailed sales reports, making cloud-based POS systems the preference for many businesses, especially small businesses that now could afford them and had a need for them.

That has had a dramatic effect on the market.

Even traditional POS systems, which typically had updates performed when the maker sent a technician to install new software or hardware, are losing ground against cloud-based systems, Drieling says. Some merchants avoided these updates because they might cost thousands of dollars.

“In legacy systems [POS system makers] developed the code and would try to customize it for you,” Drieling says. “Cloud-based POS systems can be integrated with new or existing systems. It allows the developer to integrate other software into that system without having to create software to bridge the two together.”

Such developments mean that the outlook for conventional POS terminals is quickly changing. “Conventional countertop devices are going to be around for a very long time, but the growth of that category is very, very limited,” says Thad Peterson, senior analyst at Boston-based Aite Group LLC.

‘Reactionary Mode’

For sure, Square is one of many to launch so-called smart terminals, which use apps and enable easy integration to POS software. Square chief executive Jack Dorsey even heralded the new Square Terminal during a November earnings call as the replacement for “dinosaur” POS devices. The same month, payments provider North American Bancard Holdings LLC launched its own smart terminal, joining competitor Poynt Co., which debuted its device in 2014.

The common denominator in all these devices is the connectivity. That is a boon to small businesses, which had to forgo POS systems of the past because of the costs. “The most critical point to why these cloud-based systems are growing, primarily in the small and mid-size space, is they allow a lot of integration,” Drieling says.

This ability to integrate payments with software that can run other business functions is much sought-after in retail. In August, for example, payments provider Global Payments Inc. paid $700 million for AdvancedMD, developer of medical-office management software.

This all points to a very cloudy future. For the likes of Verifone Systems Inc., Ingenico Group, and Equinox Payments, which sprang from the former Hypercom Corp.’s U.S. unit, their roles as providers of traditional POS terminals will change, Peterson says.

“The challenge with the Ingenicos and Verifones of the world is they are in reactionary mode,” he says. “But they’re easily disrupted by players coming in with more flexible and lower-cost offerings.”

Going Up Market

It’s not for lack of effort on their part. San Jose, Calif.-based Verifone, which went private this fall, has been emphasizing services revenue for years and launched its Carbon line of smart terminals to better compete.

Paris-based Ingenico, too, has grown its services revenue and made changes. In April, it launched the Moby/C150 ECR that features an Android-based tablet with a 15.6-inch display.

As it adapts to changes among merchants and consumers, Ingenico finds itself examining the point of interaction between consumers and merchants. While Mark Bunney, Ingenico North America director of go-to-market strategy, says there will still be customers for standalone POS terminals, the market is changing.

“Lots of the tablet or mobile POS providers are definitely changing some of the dynamics in the market­place,” says Bunney. “We have to change not only from a hardware perspective, but [in] how it’s going to impact our software and services.”

Bunney points to Apple’s own retail stores and Amazon.com Inc.’s Amazon Go locations as examples of this change. There is no POS station in an Apple store. It’s all mobile, Bunney says. And in Amazon Go stores, the consumer’s own smart phone with the Amazon app is the payment mechanism.

Of the three primary categories of POS-terminal technology—the standalone device, the integrated POS, and mobile POS—demand for standalone devices is declining, Bunney says.

“That’s part of the market migrating to an integrated solution or going to a more tablet solution,” he says. “The other thing we’re seeing in the integrated market is merchants as well as the consumer want to have additional interaction beyond just the payment with the merchant.”

That mirrors what Peterson sees in the market. “The customer experience used to be managed by the merchant,” Peterson says. “Now, the consumer controls their own experience.”

That control has been enabled by the versatile tablet. “Now, the POS could look like a tablet,” Bunney says. It depends on the type of interaction consumers want, he says. “People want sleeker-looking solutions,” he says. “They don’t always necessarily want to have a separate payment device from the tablet.”

That’s not to say that a tablet, or cloud-based POS system, is for every type of merchant. Bunney doesn’t think large merchants would be as satisfied with a tablet-centered POS as they would be with something designed for their complex needs.

Still, some cloud-based POS system providers have made moves to go up market. Square Terminal, with its integration capability, is one example, and First Data Corp. is promoting its Clover POS system for fine dining.

Postponing Extinction

How the POS experience will adapt is uncertain, with its dependence on how consumers shop and the technology they use and how merchants react to these changes.

However it evolves, there will be integration of the payment-acceptance device into the overall checkout experience.

“The standalone device where it’s not talking to the POS is in decline,” Bunney says. Yet he doubts it will disappear completely, despite Square’s claim the older tech is a “dinosaur.” “In some areas, it may not be growing at as fast a rate,” he says. “There is still that interest level.”

The hardware side may not change too much in the near future, Bunney says, with the exception of some devices, like tablets, gaining contactless-payment acceptance. Most POS terminals shipped since at least 2015 by the likes of Verifone, Ingenico, and Equinox have contactless tech built in, if not yet activated.

Better contactless identification marks may be part of future devices, Bunney suggests. “How do you make it easier for the consumer to interact from a hardware perspective?” he asks.

POS software, in all forms, will evolve much faster, he says. Not only will industry standards from EMVCo, which sets the specifications for EMV chip-card acceptance, influence this, so will PCI Security Standards Council standards on PIN-on-mobile, which enables commercially available devices to securely accept PINs.

PIN-on-mobile is one of the trends Peterson sees influencing the evolution of the POS experience. It’s devolving the POS into smart devices that are not POS devices, he says. More use of mobile devices, especially for in-aisle checkout, and increasing awareness and availability of alternative payment methods are two other trends.

The Ultimate Payment

The so-called traditional POS makers will have to evolve, says Drieling. “They need to come out with some competitive products,” he says. “They know the POS industry very well. They probably have the capability to bring out some competitive cloud-based POS products. I don’t see them doing very much in the independent software vendor space.”

The future POS may not even resemble a POS device or tablet.

Even Amazon’s Alexa voice assistant almost qualifies as a POS device, Drieling says. Echo and other in-home devices enable consumers to use their voice to authorize orders. “The next step is unified commerce,” he says, allowing a consumer to start a transaction in one channel and go through others until making the ultimate payment.

 

Source: http://www.digitaltransactions.net/magazine_articles/pos-terminal-whats-that/

Pay-at-the-Table Comes to a Restaurant Group With Ingenico Devices

A restaurant franchiser is deploying Ingenico Group point-of-sale terminals as part of a migration to pay-at-the-table payment acceptance at its TGI Friday’s and Zinburger Wine and Burger Bar locations, Ingenico announced Wednesday.

The deal ultimately will see pay-at-the-table service, where the server brings the POS terminal to diners at their tables, at approximately 80 locations owned by Livingston, N.J.-based Briad Group. Each location will use approximately 10 Ingenico iWL252 devices, which accept magstripe, EMV contact and contactless and mobile payments, Mark Bunney, Ingenico North America director of go-to-market strategy, tells Digital Transactions News. The devices contain printers and a secure PIN pad for debit transactions.

Posera Ltd, a London, Ontario-based payments-software developer, provides its SecureTablePay middleware to connect the Ingenico devices to the POS systems in the restaurants. Installation begins this year and continues into 2019, Bunney says. Briad tested the pay-at-the-table service a year ago at a TGI Friday’s location.

Momentum for the pay-at-the table trend appears to be picking up in the U.S. market. In the Briad Group installation, benefits reportedly include convenience for the diner, better security, and potentially increased table turns for the restaurants. The semi-integrated nature of the system also may reduce Briad Group’s PCI-compliance scope because it segregates sensitive payment data from other software.

The pay-at-the-table routine shortens the typical payment operation from 12 to seven steps. It eliminates the need for the diner to wait for the server to return to pick up the card because the diner uses the POS terminal left at the table to make the payment. The server doesn’t have to walk back to a centralized POS system to input the payment, then return to the table with the receipt. This puts the consumer in control of the payment, Bunney says.

Pay-at-the-table also means the credit or debit card doesn’t leave the cardholder’s hand. That may be important to many consumers because data compromises continue to plague the hospitality industry. Ninety-three percent of the data compromised at hospitality POS systems involved payment data, Verizon said earlier this year.

The other potential benefit is the ability to improve table turnaround times. Bunney says tests by Posera found that, on average, table turns increased by 15%, or nine minutes per table.

Briad also said its chargebacks decreased in its test of pay-at-the-table technology. “Lowering our costs was good enough for us to decide to deploy the SecureTablePay and Ingenico Group solution; the positive feedback we got from customers was icing on the cake,” Tom Cornell, Briad director of information systems, said in a press release. “Our servers like using it too, as it allows them to spend more time at their customers’ tables and less time going back and forth to their terminals.”

Pay-at-the-table technology is not new, having been used internationally for decades. Ingenico itself has shipped more than 10 million pay-at-the-table devices, Bunney says. What makes now an opportune time for U.S. restaurant operators to adopt the technology is a combination of EMV, the surge in digital transactions, both in-store and online, and consumer affinity for mobile devices, he says.

Source: digitaltransactions.net