Mobile payments set to transform retail landscape
April 23, 2013

The popularity of mobile payments among consumers has soared in the past year, and new research predicts the transaction platform will change how people shop in brick-and-mortar stores. Large and small businesses alike have begun implementing portable devices in stores for various uses, but purchasing goods with these gadgets is estimated to be the most significant change.

Mobile payments may revolutionize POS
The prevalence of apps and email accessibility on smartphones has allowed consumers to use digital coupons, stay updated on sales and accumulate points for gift cards, and mobile payment processing is set to change the way clients use their portable devices in stores even more. A recent report by Javelin Strategy and Research examined the future of mobile payment processing within retail and found that while portable purchasing software only amounted to 0.01 percent of total POS volume in 2012, it may reach upwards of 13 percent, or $5.4 billion, by 2018.

The "2013 Retail POS Forecast: Mobile and Prepaid Opens New POSsibilities" report found debit cards have essentially replaced cash among younger generations and plastic payments continue to surpass cash in usage. Purchasing in stores rather than online currently accounts for 93 percent of total retail volume in the U.S. and the study suggested transactions in retail locations will become more mobile.

Handheld scanners may replace traditional checkout lanes as sales associates start to strategically place themselves around the store to increase the opportunities for customer interactions and impulse purchases. By integrating mobile payment processing around the store, businesses may need to hire more employees to connect with every customer to drive sales, as the lack of team members helping consumers may reduce revenue if consumers can only purchase products through a limited number of workers. Traditional check out lanes make shoppers wait in line, decreasing the chance of customers walking out the door, but developing the same POS line may be difficult without designated purchasing areas.

The report suggested POS mobility may not be universally adopted until 2015 and expected mobile payment processing technology will advance to the point where it will be the main option for retailers. 

Electronic payment systems may become integrated into portable platforms within the next few years, and businesses using mobile transaction processing to accept debit and credit card purchases may see an increase in consumer awareness about the purchasing method. 

Nexus: G-WEBCD2