Retailers considering mobile point-of-service (POS) solutions should evaluate key considerations to ensure success. Seamless integration with existing retail systems is important, as is utilizing similar business processes to the existing POS. Solutions should adhere to payment security standards and allow for cost-effective implementation and maintenance. Addressing these factors will maximize returns on mobile POS investments.
1. 8834 Capitol of Texas Hwy
Suite 280
Austin, TX 78759
Going Mobile in the
512-237-7746 Phone
www.Infogain.com Retail Environment
Considerations for selecting a
mobile POS solution
ExECutivE SuMMaRy
Retailers considering the investment in mobile point of service (POS) solutions
should evaluate a number of considerations as part of their up-front planning and
assessment process in order to ensure the best fit solution and optimal success of
their projects. As with any IT-oriented project, both total cost of ownership and
expected return on investment should guide the decision-making process. Beyond
these, primary considerations include seamless integration with existing retail
systems, utilization of standard business processes, adherence to payment industry
security standards, and implementation and maintenance of the solution inclusive
of mobile POS hardware devices. A solution that incorporates each of these items
1
will deliver the best return for retailers’ mobile point of service investments.
2. iNtRODuCtiON
The impact of the Internet on the retail industry was unforeseen. It began with
the fundamental listing and search of catalogs online—reducing the marginal
cost of reaching a new customer to near zero, as compared to the high cost of
Apple transformed its
physical catalog processes. With the governance and support of the major credit
own retail franchise card companies, online transactions quickly became standard business practice
for most large retailers. Today, we are seeing the convergence of i-retailing and
by empowering its in-store processes, with retailers setting up kiosks for centralized inventory
store associates with searches and product delivery, as well as customers reserving products online but
managing pickup and returns within the stores.
hand-held iPod touch-
Just as i-retailing is more than e-commerce transactions alone, m-retailing, or
based POS systems— mobile retailing, is more than just enabling shoppers to transact via their mobile
effectively enabling full phones. Innovations on mobile consumer devices are making them prime
targets for in-store retail applications that would normally be the purview of
customer service from only expensive, retail-specific hardware. A great example is the mobile point of
service capabilities for smart phones and other mobile consumer devices. Apple
anywhere in the store. transformed its own retail franchise by empowering its store associates with hand-
held iPod touch-based POS systems—effectively enabling full customer service
from anywhere in the store. The impact has been profound. Lengthy shopping
lines can now be avoided; customers are able to move from product search, to
information gathering, to full check-out in less time. Establishing an electronic
relationship with customers has become part of the standard process, enabling
direct interaction for improved loyalty.
A recent Gartner survey notes that, across
all retail segments, customers cited
faster check-outs as a top three priority
Establishing an while shopping.1 However, a customer
electronic relationship walking away from a sale due to long
lines or inadequate service is an avoidable
with customers has opportunity loss for retailers whose
operations are well-suited for mobile point
become part of the of service solutions. These solutions can not
standard process, only enable fast and effective line busting,
but they also help to increase average ticket metrics and overall sales.
enabling direct
Retailers considering the investment in mobile point of service (POS) solutions
interaction for should evaluate a number of considerations as part of their up-front planning and
improved loyalty. assessment process in order to ensure the best fit solution and optimal success of
their projects. As with any IT-oriented project, both total cost of ownership and
expected return on investment should guide the decision-making process. Beyond
these, primary considerations include seamless integration with existing retail
systems, utilization of standard business processes, adherence to payment industry
security standards, and implementation and maintenance of the solution inclusive
of mobile POS hardware devices. A solution that incorporates each of these items
will deliver the best return for retailers’ mobile point of service investments.
1
Hype Cycle for Retail Technologies 2010, Mim Burt, Gartner Publication ID G00201570, July 26, 2010 2
2
3. MiNiMiziNG COStS / MaxiMiziNG REtuRNS
Customer expectations for the shopping experience have grown tremendously
in the past decade with the proliferation of internet-based retailing and the
empowerment of the consumer to comparison shop using ever richer detail and
instantaneous information. The more recent onset of mobile phone-based retail
integration has served to raise these expectations even higher, with consumers
demanding fast and superior service from anywhere and at any time. This
consumer mind-set extends itself full circle back onto the shop floor as well, with
“The success of the customers expecting to find what they need and get information on products
mobile channel by immediately, and to be able to complete the transaction quickly and securely.
2013 should not Mobile technologies have the potential to make a consummate impact on the
landscape of retailing. In the U.S. and the U.K., major retailers are investing in
be determined by mobile solutions both as an alternative channel for consumer access as well as
to streamline store operations. In developing countries, the ubiquity of mobile
its percentage of
phones as compared to Internet connections makes it the clear choice for retailers
overall sales, but by looking to enhance sales through digital channels. Gartner, in its recent retail
predictions report, identifies that the mobile
the sales uplift it can channel will exceed direct sales capacity of other
create across all the offline channels, such as catalog and call center
sales, within just two to three years. They also cite
retailer’s channels.” that mobile technologies will drive significant
sales indirectly and may have an even greater
HuNG LEHONG impact than e-commerce by the year 2013. With
Gartner analyst this is mind, Gartner recommends a multi-channel
mobility strategy for retailers.2
November 2010
The use of mobile point of service devices helps retailers provide superior service to
customers from anywhere on the shop floor. With mobile POS, retailers can:
l Implement effective queue busting, reducing checkout lines and customer exits
l Increase conversion rates and average ticket metrics
l Empower sales associates to influence the sale during the most critical decision
point of the buying process
l Increase POS capacity without using floor space
l Enable fast, easy price and inventory checks
l Improve customer satisfaction
l Establish a digital e-link with customers for direct interaction and increased loyalty
l Improve the productivity of sales associates
On the cost side of the equation, one problem mobile solutions have in the retail
space is that the relatively low number of units manufactured makes the individual
units very expensive even when purchased in bulk. The market leader for retail
mobile POS devices for many years was Symbol Technologies, which has since
been purchased by Motorola. Typically, the retail-specific hardware devices cost
approximately twice as much as an iPhone, even when purchased in bulk.
2
Predicts 2011: Consumers Push Emerging Retail Channels Into the Mainstream, Hung LeHong, Gartner 3
Publication ID G00208590, November 16, 2010
4. However, consumerizing IT can make a significant impact on the cost implications
for mobile POS. Today’s smart phone is much more powerful than the latest
generation of purpose-built handheld mobile computers and, because they are
consumer technology, they are manufactured in sufficient quantities to drive
down per unit costs. When combined with the hardware sleeve that provides a 2-d
barcode scanner and an MSR, the total hardware cost is still less than half that of its
industry counterpart. The smart phone has proven itself to be a viable competitor
to the purpose built retail devices. In addition, because of the user-friendly and
intuitive interface of the smart phones as well as the likelihood that employees are
Retailers considering already familiar with the look and feel of the device, training costs and user error
will be minimized.
the investment in
Retailers considering the investment in mobile POS solutions should therefore
mobile POS solutions
consider options that support the use of consumer device-based implementations,
should consider options such as the Apple iPod touch or smart phones, in order to further increase returns
and reduce overall costs.
that support the use
of consumer device- SEaMLESS iNtEGRatiON witH yOuR ExiStiNG POS
based implementations,
such as the Apple iPod “We’re trying to use [technology] to animate activity
touch or smart phones, and personalize their store visit.”
in order to further StEvE FiNNEy
Senior vice President of Global Operations
increase returns and Disney Store
reduce overall costs.
Newly revamped Disney Stores are leveraging Oracle technology to facilitate mobile
sales via iPod touch devices and portable printers. Store associates can look up products,
print gift receipts and suspend the transaction if the customer needs to complete it at the
traditional point of sale. During the holiday season, in the 40 stores that implemented
mobile POS, mobile sales accounted for 15-18% of total sales. Disney expects to have
140 of the 200 U.S. stores outfitted with mobile POS by the 2011 holiday season.3
Empowering sales associates to close a transaction without being at a physical
checkout counter is only one component of the opportunity that mobile POS
offers to retailers. Arming them with full access to the rich information and custom
business logic of the existing POS from anywhere on the shop floor means they
can provide superior service and help influence the sale directly during the
most critical part of the decision-making process. For some types of retailers,
this integration will be extremely important. Electronics retailers, for example,
will benefit greatly from direct integration for full order management including
merchandising, pricing, warranty contracts, etc. For all retailers, integration enables
richer interaction with the customer to build loyalty and customer satisfaction.
In order to achieve this, however, the mobile POS system must be a true extension
3
Disney Sees 2.5% Increase in Comp Sales with New Oracle POS, Retail TouchPoints, January 13, 2011 4
5. of the retailer’s existing POS system, with seamless integration. The mobile
interface, therefore, should be just another view into the retailer’s traditional POS
environment.
Direct integration between multiple front-end devices and back office systems
implies considerations both for security as well as management and support.
An ideal solution would incorporate an abstraction layer that acts as a mediator
between the two environments both to provide isolation as well as to simplify
deployment of enhancements or changes on either side. This approach will enable
the greatest agility for the retailer to get started quickly with core functions and to
seamlessly roll out additional capabilities over time.
An ideal solution
would incorporate an
CASE STUDY: Global Apparel Retailer
abstraction layer that
An industry leading global apparel retailer with headquarters in the US rolled out an
acts as a mediator iPod touch-based mobile POS solution with tight integration into their Oracle Retail
Point of Service (ORPOS) environment across several stores. Their solution leveraged
between the two Infogain’s Mobile POS solution components and services in order to isolate the back-
end and mobile environments while at the same time simplifying the full integration
environments both between their mobile and fixed POS systems.
to provide isolation By empowering sales associates to provide better and broader guest services and
administrative functions, the client realized an immediate increase in customer
as well as to simplify satisfaction. The client is also able to demonstrate the value of assisted selling and
tendering at the point of interaction from anywhere on the shop floor, rather than just at
deployment of the register.
Associates are able to perform the following functions from their hand-held iPod touch
enhancements or POS devices:
changes on either side. l Scan or Manually Enter Items
l Delete Items
l Cancel Transactions
l Tender the Sale
l Credit Card Tender (swipe/manual)
l Electronic Signature Capture
l Print or Email Receipt
l Suspend and Retrieve Transactions
l Item Lookup and View Item Details
l User Authentication and Security
l Gift Card Issue
l Gift Card Inquiry and Print Balance
l Gift Card Reload and Activation
l Credit Card Hard Stop
In addition to increasing the efficiency and effectiveness of your sales associates,
a mobile POS solution that is tightly integrated with your existing POS will greatly
reduce your support and maintenance resource requirements. If the mobile POS
solution is a completely different system that integrates peripherally, then you’ve
effectively doubled the number of POS systems you have to support and maintain.
Ideally, the new mobile POS system will be able to leverage all of the special
5
6. business rules and business processes encoded in your existing POS application
without having to do any serious modifications to multiple code bases.
While mobile POS implementations are on the rise for certain retail segments,
there are a few barriers to entry preventing a more immediate uptake. One
of the primary concerns retailers have is the lack of integration of the mobile
POS with their existing POS environments.4 Retailers should ensure the system
CASE STUDY: Global Merchandise Retailer
A mobile POS solution A global retailer of consumer products, including toys, home décor, books, magazines,
interactive games, food and beverages, stationery, electronics, and fine art, has rolled out
that effectively their iPod touch-based mobile POS solution in less than 12 weeks. Infogain is currently
working with the retailer to extend mobile POS functionality to additional POS and non
mimics the existing POS functions.
POS environment will As an early adopter of mobile POS solutions, the internationally recognized retailer
is already seeing a return on its investment. Since deployment, the company has
simplify the process and experienced improvement in shopping patterns through increased average sales and
larger basket metrics. Their solution was implemented with minimal cost and resource
add to the efficiency, outlay, and:
l Utilizes an average of five mobile POS devices per store
effectiveness and l Integrates seamlessly with their Oracle Retail Point of Service (ORPOS) application
confidence of the in- l Incorporates loyalty and remote print capabilities through Infogain’s VPOS
application framework
store sales associates. l Adheres to payment application data security standards
they choose not only offers the functional capabilities they require, but also
seamlessly integrates with their traditional check-out process in order to increase
effectiveness and reduce maintenance and support resource requirements
NEaR iDENtiCaL wORkFLOw aS ExiStiNG POS SyStEM
Customers will expect sales associates to be able to provide full service to them
from wherever the interaction takes place, whether out on the sales floor or behind
the cash counter. A customer may interact with a single or several different sales
associates with their mobile POS devices on the shop floor and then decide to
shop around more before going to the checkout counter. Ideally, a sales associate
is able to move seamlessly between mobile POS and static POS. The mobile POS
solution should, therefore, at least closely approximate the standard POS work flow
in order to minimize confusion, decrease training requirements, and ensure the
highest levels of customer satisfaction.
With the convergence of technologies in the multi-channel retail environment of
today, the instance of a transaction that spans Internet or mobile retailing as well
as in-store POS is very real. An example would be a customer who adds items to a
4
Hype Cycle for Retail Technologies 2010, Mim Burt, Gartner Publication ID G00201570, July 26, 2010 6
7. shopping cart either online or with their mobile phone and then enters the store
to see the items first-hand and make the final buying decision. In this example, a
number of scenarios arise:
l The customer will expect the sales associate to be able to read the shopping
“If the payment cart order and locate the products.
l If the products are not in stock at this store location, the customer will expect
application sends, or
to get as much information on the product as possible and potentially locate
facilitates sending, another store where the product is in stock.
cardholder data over l If the stores offer “online only” products, the customer may still expect sales
assistance from within the physical store in order to get information and close
public networks, the the transaction.
payment application The sales associates must be able to move easily between these environments
must support and deliver the superior service customers expect once they’ve entered the store.
A mobile POS solution that effectively mimics the existing POS environment will
use of strong simplify the process and add to the efficiency, effectiveness and confidence of the
in-store sales associates.
cryptography and
security protocols SECuRity
Security is always a consideration when implementing
such as SSL/TLS and
a point of sale solution. With static POS, the primary
Internet protocol concerns are employee access to registers, adherence
to credit card security standards, and securing the
security (IPSEC) to saved credit card numbers in the database through
safeguard sensitive compliance with data protection standards. When
migrating to a mobile POS environment, the concerns
cardholder data are the same. However, the mobile device will operate
during transmission within a Wi-Fi network in the store.
over open, public Capturing customer payment card data and transmitting using Wi-Fi network is
inherently risky. The Payment Card Industry Data Security Standards (PCI-DSS) have
networks.” specific provisions and additional processes that must be implemented in order
for a retailer to be allowed to take credit and debit cards as tender using a mobile
PCi Pa-DSS POS system. The network should use strong encryption through HTTPS and should
adhere to the PCI-DSS standard protocols to manage the transaction. Employee
REQuiREMENtS
authentication to the mobile device should be robust and tracked through to the
July 2009 transaction level. Once the transaction is complete or cancelled, the system should
delete the card number from memory. From this point, the transaction should
be under the management of the standard POS device workflow if true system
integration is in place.
“If the payment application sends, or facilitates sending, cardholder data
over public networks, the payment application must support use of strong
cryptography and security protocols such as SSL/TLS and Internet protocol security
(IPSEC) to safeguard sensitive cardholder data during transmission over open,
5
Payment Card Industry (PCI) Payment Application Data Security Standard, Requirements and Security 7
Assessment Procedures, Version 1.2.1, July 2009
8. public networks.” PCI PA-DSS Requirements, July 2009 5
Retailers considering mobile POS solutions should ensure that each application
layer operating their mobile POS environment is aligned with these standards in
order to prevent any security breeches. In addition, retailers should make sure
the mobile POS applications integrate fully with the existing POS environment for
Corporate security seamless, secure end-to-end transactions.
and policy compliance
must be implemented
DEviCE MaNaGEMENt
across all devices as Deploying hundreds or even thousands of mobile point of sale systems to your
they will have access to retail enterprise is an opportunity for business growth, but can also present a
maintenance, security and support challenge for your IT department. Corporate
enterprise resources. security and policy compliance must be implemented across all devices as they will
have access to enterprise resources. In addition, because the mobile POS devices
will perform transactions, appropriate user authentication and tracking is of
utmost strategic importance.
Retailers considering the move to a mobile POS environment can leverage the cost
advantages of consumer devices, such as the Apple iPod touch, as long as they also
invest in the appropriate remote management software solutions that are available
on the market today. Several reputable companies offer solutions for security and
remote control and management of the iPod touch
and smart phones. These offerings not only simplify the
deployment and maintenance of enterprise applications
across the devices, but also offer comprehensive
asset tracking. In some cases, the advanced software
solutions even enable tracking through GPS in order
to ensure devices do not leave the premises unless
warranted.
When considering the use of a smart phone or iPod
touch device for mobile POS, retailers should consider
investing in a device for which established tracking,
monitoring and managing solutions are readily
available. As long as the software enables adherence to corporate standard
policies, the results will be increased IT efficiency, reduced support costs and
improved employee satisfaction.
8