The Future of Payments: Which Game Changing Technologies Will Affect the Retail Industry

by Erick Kobres 0

From autonomous vehicles to ambient biometrics: the innovative technologies that will bring exciting new opportunities for consumers and businesses

Well before current advancements in electronics, mobile technology and the internet, point of sale systems have existed in some form. The early days of cash boxes and microprocessor-controlled cash registers evolved to barcodes,mobile payments, and cloud-based POS technology. The evolution of POS systems is once again gathering pace to dramatically change the landscape and this shift is made possible by the development of some of the most innovative technologies for the retail point of sale industry. Key technologies catalysing this industry shift include autonomous cars, augmented reality, artificial intelligence, and ambient biometrics.  

Possibly the most dramatic claim on the future of retail opportunity comes in the form of autonomous and self-driving cars. Although this concept is not new, car companies are now hinting at the amazing opportunities to be introduced by the next generation of electric and self driving cars arriving around 2020-2025.  According to Loup Ventures research, by 2040,  it is expected that over 90% of all vehicles sold will be highly and fully autonomous systems. These advancements in automobile technology as well as an uptick in adoption due to the related change in consumer behavior brings about exciting retail opportunities for convenience shops.  A typical gas car nowadays takes about 5 minutes to refuel – a quick in-and-out process which doesn’t leave the customer much time to hang around and browse. However, electric cars can take 15-30 minutes to charge, presenting an extended waiting period for retailers to capitalize on. Customers will be more likely to sit down to have a meal rather than grabbing a snack on the go, or they may feel more inclined to browse through a store and go shopping instead.

Convenient retail opportunities are also presented via the cloud connection of electric vehicles, which is good news for consumers. With the ability to ID a person and vehicle that is already attached to a pre-existing profile, consumers can be authenticated for purchases through their car, offering a quick and seamless process for payments. To some degree, the first example is Tesla where the manufacturer already has the user’s card number. This means there is no need for a user interface on the supercharger because it identifies the car through the charge port; the user interface is the car itself. That means a lot of new opportunities for convenience within the retail space and tighter integration between the purchasing establishment and the in-car infotainment experience. In the next 1-3 years we may also see the advent of a new voice ordering experience which allows consumers to  converse with an app in their car’s infotainment system. Technologies such as Apple’s CarPlay and Android Auto are already in use, helping the quality of experience to improve and evolve. Convenience retailers will build on this in order to make payments, customer verification, and the loyalty experience seamless.

A strong foundation has already been built for technology advancements in mobile payments and the future of the retail industry as a whole. Over the next few years, consumers will see an increasingly prominent presence of Augmented Reality (AR) in retail. When merged with payment technology, AR will more fully enhance the customer buying experience by encouraging consumers to research and experience products in greater detail. Take location services for example, AR can empower retailers to route customers to a specific location in store for queuing or order pickup, or to participate in an in-store special. This concept is a game changer for granular location-based retailing.

There are also a few interesting use cases for food trucks and AR e.g. by using AR capabilities, the queue in front of a food truck could see the menu items, prices etc on their phone and order right off the camera view before stepping up to the window. Users could also see the pickup window of the truck animate when their order is ready. This can bring order to the sometimes-chaotic flow around food trucks. In general, there are a number of interesting ramifications for pop-up retail beyond food trucks that we may see in the years to come.

Ambient biometrics is another technology that we believe will be an important part of the future of commerce. Biometrics is here to stay, and these experiences will consistently improve and become more frictionless. Face ID was well executed by Apple where the user authenticates via facial recognition, and Apple has proven that biometrics can get more convenient e.g. touch ID is already phenomenal. In a retail context, we envision a handoff where the user authenticates a purchase and puts their phone back in their pocket while remaining authenticated. Users can remain signed in for frictionless use cases as we have seen with proof of concept trials at Amazon’s brick and mortar store. With “always on” biometric authentication, users will be able to take an item from a store or leave after a meal in a restaurant with the assurance that the transaction has seamlessly and automatically occurred.

However, due to infrastructure and security requirements this capability may be farther out in the future. The way the credit card processing system works today is complex and may hinder progress here. There is a lot of complexity involved in the EMV chip and NFC (tap) use cases, but more certificate-based payment options will eventually start to make their way into the payments ecosystem. For example, Apple pay is EMV-compliant because it’s currently an industry mandate – but these specifications are already over a decade old and are just now being rolled out in the US. You can imagine getting rid of that last step where you  tap on the payment device – we are probably another five years away from that.

POS systems have evolved considerably over time and they continue to become even more efficient and seamless. The next exciting era of POS will provide new levels of experience for the customer and the retailer, pushing the boundaries of innovation. We look forward to playing a significant role in these exciting new developments.

Erick Kobres is the Chief Technology Officer of Revel Systems with 27 years of experience in the Consumer Transaction Technology space. He began his career developing back-of-house and POS applications for the convenience/petroleum space using the first generation of Intel-based open-systems retail technology. Erick has been a serial innovator and has a portfolio of 38 published and granted US and international related patents.