Sep 3, 2007

Merchants comment on contactless, and why it is important to make contactless more valuable to merchants

I am often asked where I got some of the merchant comments and data that I use in my conference presentations on contactless. Many of them are from Card Technology articles, which I have commented on already (see London Contactless Launch: Where Are The Merchants and Contactless in America: Slow adoption due to lack of merchants interest - what to do about it?)

Others were from a contactless forum hosted by the Federal Reserve Bank of Boston a few months ago. See the Payments News article here and the agenda and links to presentations here. The key merchant presentations were from Dunkin’ Donuts and CVS/Pharmacy. Here are a couple slides that stand out.

Speed is of course the first item in the list of pros. Increased basket is another benefit, though it appears that this one is still under question. It is important to note that the rest of the benefits are temporary and only relate to the technology being new. The cons are more worrisome. CVS/pharmacy appears to want to dispense with signatures on higher transaction amounts, not just low value purchases. They also are comparing the costs of interchange to the costs of cash. The remaining issues are related to the technology being new.

Here is a slide from Dunkin' Donuts.

In essence, they don't see demand yet from customers, but are ready to include contactless as part of their ongoing upgrades of POS equipment.

Also check out this blog post that shows that when merchants are not excited, deployment plans and forecasts can fail (see Tap and Grow? The Case for Contactless Payments).

1 comment:

mak said...

Great idea for a blog. Keep it up!! :-)

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