USA Technologies : USAT Hosted the First Annual USAT Retail Round Table at NAMA OneShow

USAT Kicked off the 2017 NAMA OneShow in Vegas by hosting the first annual USAT Retail Round Table, a discussion of how the vending business is paving the way for retail to embrace technology by way of mobile payments, advertising opportunities, and digital displays. Our panel, kindly sponsored by Chase, and Grab and Go, consisted of an eclectic group of industry thought leaders representing key facets of the unattended retail marketplace. Panelists included, Greg McCall of Five Star Food Service, George Yost of Premier Services, Jenny Skidmore of J&J Vending Inc., Judy Chan of Urban Airship, and our own Maeve McKenna Duska. The conversation was led by David Card, an industry analyst for StreetFight.

Judy Chan of Urban Airship opened the discussion by citing a few things are happening in retail that are causing a need for great change. First, over the past few years, there has been intense focus (and scrutiny) on EMV - how it works, what the the challenges of implementing at the POS have been and finally, what the public reaction has looked like thus far. Second, we've seen traditional brick and mortar retail take a massive hit, which in turn, affects the economy due to new business models taking a piece of the pie (Amazon and other online retailers); and Third, most of the industry agrees that there has been a steady drum beat around figuring out how loyalty plays into the modern economy and whether it is simply the 'price of doing business' with millennials or are there ways to leverage loyalty strategically to create mutual value for both operators and consumers?

David polled the crowd to understand who had a smartphone and what type of phone. The majority of the audience had a smartphone with Apple leading the preference of phone in hand. He also asked how frequently those in the audience were using their mobile wallet and ironically, almost everyone had made a payment with Apple Pay at least once. He noted that this is an exception as mobile payments have been slower to take off then expected. Given these observations, David turned to Judy to ask about a recent survey the company conducted to understand how consumers are adopting mobile payments.
Urban Airship recently conducted a consumer survey across 2000 respondents across the U.S. and the U.K. to better understand what consumers want in a mobile wallet. The survey found
that millennials and individuals representing higher household incomes were the top users of mobile wallets. It also emerged that 77 percent of all respondents were happy to have loyalty points and rewards automatically added to their mobile wallets - which means repeat business for vendors. Judy believes that both convenience and unattended retailers have a ripe opportunity to set the tone for the payment options being provided to consumers and that as more points of sale offer quick and simple mobile payment mechanisms like Mobile Wallets and biometrics as an option, we could very likely see the millennial demographic skip credit cards all together.

Maeve McKenna Duska of USAT agreed and noted that the advent of mobile payments offers a big opportunity for the unattended retail market to emerge as a leader, especially when this kind of payment technology can be layered with increased access to accurate, instant product information and products that are tailored to the population. With higher household incomes and millennials as the first to adopt mobile payments - the opportunity to change things up in the vending market has become more clear. For example, you can sell higher quality products with greater variety at a higher price point. If you can suggest to these consumers that mobile payments are an option at unattended retail locations, you begin to drive purchasing behavior, create the perfect storm.

Maeve went on to discuss the recent Apple Pay study that USAT conducted. The study showed that Apple Pay messaging at the point-of-sale drives a 135 percent increase in mobile payments usage and 36.5 percent increase in overall sales. She noted how unattended retail has the opportunity to become a 'gateway tap' to greater adoption of mobile payment technology as consumers are much more likely to try making a mobile payment when they are not under the scrutiny of others to see if the technology functions as expected. Further, consumers are more likely to test out the tech with a small purchase like a soda or snack that will be less painful to manage if there is a problem, increasing the likelihood that once they gain confidence in both the security and simplicity of the process, they'll create a habit of the new purchasing mechanism.

Premier Services' George Yost noted that in the unattended retail market, it's taking some time for consumers to change behaviors when it comes to vending and micro markets. Cash is still king when it comes to vending machines but in micro-markets, George is seeing up to 80 percent of the purchases being made with a credit card surmising that it is likely because of their ability to touch and inspect a variety products before making the purchase and creating more of a 'shopping cart' mentality while giving the operator that ability to merchandise higher-priced items. 'The opportunity to inspire change is there, it will just take some consumers a while to realize they have more payment options available to them from what they're used to.'

Judy continued to share that although Urban Airship is not specifically focused on the vending world, she believe that the 'unattended market' is tapping into the cool factor of automation and Ai. With anything from makeup and shoes to expensive headphones now being offered in vending machines, it is obvious that retail is pushing itself into the unattended fray.

Our moderator, David Card mentioned that traditional retailers are also looking at expanding their payment options with plans to upgrade POS systems. He stated that a big reason for lack of mobile payment usage from consumers is due in large part to the lack of mobile pay options available in retail. This is not to say that mobile payments aren't on the roadmap for SMBs and retailers across the spectrum - because this group also recognizes that there are other additional benefits to supporting mobile payments, such as loyalty programs.

Judy talked about how Urban Airship is helping brands rethink mobile. 'So many businesses think they need to have an app. But if you don't have an app, what do you do? Businesses want to figure out how to fit into the mobile ecosystem but need to take a close look at how they can create a relationship with the customer. Because wallets are native to the phone, you can create a relationship with the customer without asking them to download another app.'

Jenny Skidmore of J&J Vending talked about how her company has been an early adopter of loyalty programs. Her company has found that offering this type of program has been helpful in getting new business, by showing operators that there are compelling promotions that can be used. It has been a great way to showcase how businesses can reward their employees who routinely use the machines.

Greg McCall of Five Star Food Service made a critical point by expressing his concern that, if not executed well, consumers quickly get fatigued with loyalty apps. He pointed out that we, as an industry, need to make it simpler to reward and build real, actionable loyalty with consumers, especially in the workplace channel, where the fast paced environment and captured population makes it more important than ever to have employees locked down, recognized and sufficiently rewarded with a loyalty program.

Maeve added that when you think about the space, we all have on our phones, and these low value 'loyalty apps' are often the first to go during 'app triage' - meaning, when you remove apps to make space for photos or other things on your phone. Businesses and brands need to make it easy for consumers to enroll, make it clear to them what the value of the program is to them today, and tomorrow. Through USAT's work with Apple and Urban Airship, they have reduced the enrollment process to a clicks - and by provisioning a living pass to the Apple Wallet, consumers get visibility into the value of the program and operators can reach out and incentivize for enhanced engagement. Giving unattended retail businesses an upper hand for creating the long term consumer 'stickiness' that is the ultimate goal for loyalty providers.

Judy pointed out that these kind of loyalty programs that are automatically tethered to Apple Pay should be help up as the gold standard. Not only is it a more frictionless registration process than consumers have seen in the past, it is also a direct channel for businesses to market in a way that wasn't possible before. Today, most loyalty programs require a consumer to fill out a lengthy form including contact information and an email address. Because consumers are being inundated with these types of programs and the advertising noise that comes with it, they tend to be skeptical from the onset. This type of skepticism is well founded as many loyalty programs offer negligible value at registration then sputter off, never providing the engagement and ongoing rewards that consumers feel would be commiserate with the amount of effort expended to register.

The conversation moved on to digital advertising in the retail space and Maeve discussed the opportunity that unattended retailers had to raise revenue by promoting lucrative payment technology like mobile wallets while opening up new opportunities to grab new revenue streams by Advertising and cross marketing brands and businesses right at the POS.

Judy discussed how, through sophisticated mobile wallet integration, brands can send updates to their loyalty programs right to a consumer's home screen. This is presents an incredible opportunity for businesses to build a relationship with the consumer but could quickly spin out of control and become 'spammy' if used incorrectly. Judy pointed out that successful businesses that use this kind of tech carefully consider the frequency, messaging and overall strategy to ensure that they have the right balance for communicating to their unique consumers.

George added that one of the critical components of growing a business is understanding your consumers well enough to ensure that they get excited about the programs you offer.

Jenny remarked that her company has seen the dramatic effect of cashless payment technology firsthand and has come to understands that going 100 percent cashless is just the first step, they are looking forward to begin testing the effects of advertising on the digital screens out in the field in the coming months.

Greg discussed how the Five Star Foodservice organization is making a big push to transform their vending business into more of a retail model through modern technology. Through modern technology, they have more control than ever over affecting same day sales and offering payment flexibility. Their recent investment in digital touch-screens and advanced readers allows them to give discounts, introduce loyalty programs in new and innovative ways and expand the variety of payment options they offer to consumers. Through the enhanced tech, they are well positioned to quickly react to consumer trends and get higher priced products, energy drinks, high-end sandwiches into the market to test and analyze quickly. Through digital screens, they can test messaging targeting everything from payment mechanisms to specific product lines while highlighting the benefits of their loyalty program. These technologies are what is helping make the vending industry more retail-like and what is making retail want to be more like the vending industry.

Maeve closed by making the point that EMV's awkwardness is going to help push consumers toward mobile payments. The more consumers use EMV and understand the challenges, the more likely folks out in the marketplace are apt to try mobile wallets. By layering access to loyalty, payroll deduct programs and campus cards via the mobile wallet, we are helping consumers move toward a future where they can walk out the door with just a phone. The unattended industry is helping to make mobile payments easy and giving consumers a taste for tomorrow's tech by making mobile payments easy and accessible.

Overall, the panel agreed on one key theme - it is time for the unattended industry to start thinking more like traditional retail and provide consumers with the experience, the products and the rewards for their shopping.

Tags: #NAMAOneShow2017, NAMAOneShow