INFORMATION TECHNOLOGY
NFC payments
How retailers and banks can seize the opportunity
A
ccording to Strategy Analytics’ forecast and Eurosmart
reports, 115 million Near Field Communication (NFC)
handset owners worldwide will spend just over
$48 billion using their NFC phones in 2017. About
930 million contactless smart cards were shipped in
2013, an increase of 41% in 2012. With smartphone manufacturers now
committed to NFC, consumer enablement will pressure retailers to
accept NFC.
BE PREPARED TO EXPLOIT NFC PLATFORMS
By being NFC-enabled at the outset, retailers can gain considerable
competitive edge with customers, and also benefit from close working
partnerships with key industry players before the market becomes too
saturated.
REMEMBER POS IS NOT JUST ABOUT PAYMENTS
NFC delivers two-way, real-time communication between the
merchant and the consumer at the Point of Sale (POS). With NFC,
merchants and retailers of all kinds can turn their point of sale into
a much more valuable point of interaction that provides customers
with intelligent and ultra-secure checkout capabilities.
GET CREATIVE AT THE POS
Mobile will open up new opportunities for loyalty, promotion and
brand building. This requires a new level of creative input, and the
involvement of marketing and communications functions. Ensure all
relevant departments across the organisation are engaged and up to
speed with mobile commerce, and what it means to them and their
activities.
Retailers and banks may also need to consider additional investment
or re-allocating marketing budgets into new promotional activities that
can leverage mobile commerce as a communication and fulfillment
platform. For example:
• Programmes that allow consumers to use virtual e-gift cards,
participate in loyalty schemes and earn rewards at the POS;
• Materials and apps designed to exploit two-way communication
between the handset and POS device or NFC stickers in store to
transmit e-vouchers, loyalty rewards, payment and promotional
messages;
• Provision of links for social media and group discount offers;
• Gathering customer data efficiently through various payment devices
for improved consumer analytics; and
• Enabling alternative payment methods to create mobile POS.
BE SOCIALLY ACTIVE
Social media can help brick-and-mortar retailers reach out to
customers and increase brand awareness, but also gauge interest.
Group buying websites bring awareness to a company’s brand
while taking advantage of promotional activity.
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Social media also empowers retailers. By listening to customer
feedback, both good and bad, retailers can find the right target
group for products/services and learn which innovations will
appeal most.
CHOOSE A PARTNER WITH PROVEN ABILITY
For mobile commerce to reach its potential, many payment devices
currently in the field will need to be upgraded. It isn‘t simply an
issue of adding an NFC reader, it requires deep software richness
at the POS to interact with customers and manage a services-based
model encompassing new applications and deployments. Retailers
should be wary of new supplier and integrator entrants who may
be attracted to the size and volume of the market, but who may
lack the necessary knowledge, financial stability or longevity to see
their projects through successfully. By opening up discussions with
established vendors, retailers will be better placed to understand
the impact on existing operations once NFC goes live.
LEVERAGE EXISTING SPEND
Many retailers are currently replacing their POS estates in order
to comply with the latest payment card industry (PCI) standards.
Stores with regular, low-value, high-volume cash transactions may
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2013/12/19 4:36 PM