NASHVILLE - Exclusive CIO curriculum at NACStech continued yesterday with two workshops that delved into the future of mobile payments and building a consumer-centric technology strategy. In the first session, Gray Taylor, executive director of PCATS, presented a thorough analysis of current payment options in the industry, detailed the disappointing impact of the Durbin swipe fee reform, and mapped out the dozens of mobile payment providers jumping into the market.
Taylor described mobile payments as "a business altering technology," and noted that the payments landscape was at an "inflection point." Traditional card companies are at risk, Taylor said, and market forces can play a role in determining the ultimate winners and losers in the burgeoning arena of mobile payments. And, above all, Taylor noted, technology is the catalyst for these changes.
Taylor also discussed the expected reactions of the major credit card companies and big banks that will fight to maintain their monopoly on payment transactions. Currently, VISA is pushing EMV, a dynamic chip that replaces the traditional magnetic stripe on cards. He said that this contact and contactless EMV, essentially a "chip and signature" card, exists to perpetuate the VISA brand.
He also outlined the competitive moves by MasterCard and Discover as well as the pros and cons of new service providers including Google Wallet, ISIS and PayPal, which has a huge online following and is now being tested in the c-store channel.
PCATS, as the technology advocate for the c-store industry, is striving to improve its relationships with government regulators and agencies, said Taylor, and will drive for an open and comprehensive mobile wallet while lobbying the Federal Reserve for revisions of loopholes in the Durbin Amendment that have hurt retailers.
In the following session, Dae Kim, NACS vice president of research, discussed the implications of emerging technology trends on retailers. Using both retailer and consumer research, Kim pointed out that there are many millions of dollars in sales opportunities that retailers are missing by not meeting consumer expectations. The most significant example was the lost opportunity in packaged and fountain beverages, in which c-store retailers "have left an estimated $101 million on the table" by consumers not purchasing their planned intentions.
Another interesting fact is that when prepared food is purchased on impulse, the buy has little to do with price or promotion. "Taste and smell" were the two biggest reasons consumers said they made an unplanned prepared food purchase, said Kim. Another fact that should perturb retailers: 37% of failed purchases result from the consumer not finding what they were looking for.
Kim wrapped up the session with an open discussion on emerging technologies, particularly mobile marketing.
Look for complete coverage of NACStech in upcoming issues of CSNews and NACS Magazine.