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Forrester exec: NFC has more use cases than payments

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October 26, 2012

PayPal recently introduced NFC peer-to-peer payments

AUSTIN, TX – A Forrester Research executive at the Mobile Shopping Fall Summit this week said that marketers need to focus on how near-field communication can be used to increase in-store engagement.

The Forrester executive spoke about the key ways that technology is transforming retail in the “Incorporating Mobile Solutions In Store To Provide A Seamless Shopping Experience” session. Additionally, the session presented examples of companies that are using mobile and digital to improve the in-store experience.

“We’re obsessed with thinking about NFC in terms of payments,” said Peter Sheldon, senior analyst at Forrester Research, Cambridge, MA.

“As we think about NFC, don’t just think about payments,” he said. “In fact, don’t think about payments. Think about what else NFC can be used for or to enable interaction in a store environment.”

Multichannel retail
One of the main challenges for multichannel retailers is sifting through the massive amounts of technologies available to decide which will be most helpful to improving both the in-store experience for consumers and ROI.

Forty-four percent of total retail sales will be influenced by the Web by 2016. With consumers actively relying their devices as a shopping tool to price compare, research and buy, this presents a strong case for mobile Web and applications.

The need to have a product immediately is a key driver in why consumers prefer to go into a store to shop, per Mr. Sheldon. However, retailers such as Amazon and Walmart are increasingly looking at same-day online shipping, which will be a trend to watch in 2013.

Digital touch points – such as mobile and tablet – are the glue that hold together the digital world to the bricks-and-mortar world.

Although the idea that consumers use mobile devices in-store is not new, there are key business metrics that retailers are using as they think about investing digital into the in-store experience.

For example, during the holidays, consumers often know exactly what they are looking for and want to get in and out of stores as fast as possible. Mobile point-of-sale systems allow retailers to empower associates to line bust.

Other uses including “clienteling” help retailers upsell and create a stronger one-on-one relationship between retailers and consumers.

Efficiency becomes one of the main reasons that retailers use digital in-store technology.

Over time, consumers have become more empowered with their smartphone in-hand while they shop than store associates.

Additionally, consumers expect to have mobile in-store experiences such as Wi-Fi and being able to scan QR codes.

Per Forrester’s research, 17 percent of consumers have used a self check-out aisle. Although the percentages of consumers that have used an in-store technology is small, there is a sizable interest from consumers to use the technology.

When it comes to showrooming, the key is to put the power in retail associates’ hands.

Mobile examples
Mr. Sheldon used several marketers as examples of how mobile is being used for in-store engagement.

For example, Clinique is using tablets as digital displays to let consumers learn more about products at the brand’s beauty counters in department stores.

Other retailers such as Walgreens are incorporating mapping into mobile initiatives to combine an optimized shopping list with getting in and out of the store as quickly as possible.

Sephora, on the other hand, is active in trialing in-store technology. Satisfaction in-store can be a more powerful measure of success than ROI, per Mr. Sheldon.

Additionally, Burberry has pushed digital in-store innovation in its flagship store in London.

NFC chips have been implemented in every product in the store. Interactive displays then let consumers learn more though features such as video that are triggered through interacting with the NFC chips.

Beyond mobile and tablets, touchscreens also open up huge opportunities to marketers. For instance, virtual gestures can be used to try on clothes while in-store.

Retailers have a plethora of technologies to choose from when deciding how to use mobile to change in-store engagement. However, all initiatives need to be brought back to consumer use case.

“The thing for retailers is to curb the enthusiasm and look at this holistically with the end-to-end challenges that you’re trying to solve – how is this helping the consumer lifecycle?,” Mr. Sheldon said.

Final Take
Lauren Johnson is associate reporter on Mobile Commerce Daily, New York

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