If you have been burned by long lines, limited choice and poor customer service in stores, you are likely doing more and more shopping online — a huge problem for brick-and-mortar retailers.
Thanks to digital and mobile technology, consumers have come to expect a level of service — priority treatment for loyalty, for example — that many retailers are simply not equipped to deliver.
As a result, this holiday season e-commerce sales will take a $95 billion bite out of a total of $885 billion in retail sales, eMarketer has predicted. E-commerce sales will rise 17 percent this year, surpassing 10 percent of total retail sales for the first time, the firm has predicted.
The main culprit is Amazon. The e-commerce giant accounted for over a quarter of online holiday sales in 2015, and will soak up even more business this year, according to eMarketer.
Brick-and-mortar merchants need to become more like Apple, Starbucks and Nordstrom and deliver better in-store experiences, said Osama Bedier, founder and CEO of point of service payments (POS) company Poynt. Bedier was also the brain behind Google Wallet.
"You have got to get rid of the checkout lanes and lines and make shopping pleasant again," said Bedier. "Technology has been preventing retailers from doing that."
The next generation of devices, on show at the Money 20/20 conference in Las Vegas this week, are no longer anchored to a checkout counter — they are handheld, Wi-Fi ready and integrate mobile technology to "talk" to shopper's smartphones.
They accept all forms of payment, including credit cards, Apple and Android Pay, for example, and automatically sync with mobile devices through in-store near field communication systems or with the tap of a phone. They come pre-loaded with apps that do things like automatically pull up loyalty programs and customer profiles at check out.
"Loyalty should be automatic — I shouldn't have to remember to enter in a phone number or give you a card," said Bedier.
Merchants can develop and add their own apps to these devices and integrate the new devices with their other infrastructure, for things like managing in-store inventory and online shopping.
Bedier unveiled the Poynt 5, a $199 handheld device that looks like a mobile phone, and is designed as a complete solution for small and medium size business or as an add-on for top-tier merchants who want to modernize existing systems, he said.
"It connects their online and offline experiences, which is where things have to go for retailers to compete with Amazon," said Bedier.
The device's portability allows store associates to check people out anywhere in the store, helping to mitigate the problem of consumers abandoning carts when faced with long checkout lines, said Bedier.
Poynt is in talks with two large retailers and expects to make an announcement in the first quarter of next year, said Bedier.
Incumbent giant Verifone — which processes half of all in-store transactions globally and counts 8 out of 10 of the top U.S. retailers as customers — unveiled its family of next generation smart payment devices this week. The company will start to pilot the devices in February, said Glen Robson, EVP, global head of Verifone solutions.
"We have been rolling out an entirely new product line called Engage, which is more than just a replacement for our old devices, it's bringing the payments system up to the pace of 2016," said Robson. "Think of it more like a ubiquitous, omni-purpose smartphone-like device, rather than something that just takes a payment."
The smallest device is handheld, battery-powered and portable, and can do things like allow restaurant servers to process payments at the table, said Robson. At the top end of the range, a sleekly designed counter-top terminal — also battery-powered to go portable — has two large screens to let merchants serve up video ads while checking consumers out.
Retailers, card processors and payments companies all agree that no one wants to experiment with new technology ahead of the all-important holiday shopping season, which starts in November, so the earliest we could see these new devices piloted will be in the new year.
