by Adam Bender | October 4, 2022
In recent years, Point of Sale (POS) systems have undergone a transformation. While “POS” used to be a synonym for “cash register,” the point of sale has evolved to become a feature-rich, multifaceted aspect of most business’ operations. And now, with technologies like contactless payments, mobile POS, and machine learning, the point of sale is poised to become a yet more important piece of the puzzle. We’ll be looking at 5 technologies that are assisting in transforming the POS even further.
For decades, sales were closed at the check-out counter, and only at the checkout counter. But while the cash wrap remains an important part of any physical retail operation, mobile POS (or mPOS) systems have been growing in utility and popularity. With an expected annual growth rate of nearly 20% and an average transaction value of US$8.91K per user in 2022, it’s important that all businesses examine mobile POS solutions.
For example, imagine you’ve set up a pop-up shop around an event in your city. Mobile POS software can allow you to run your entire shop off a smartphone or tablet with very little fuss, by arming your staff with easy payment processing and inventory management.
But perhaps you’re thinking of a bigger shift: sending out store associates with mobile POS systems to line-bust in all your busy stores, or maybe arming employees walking the floor with an integrated mobile POS that allows them to look up inventory and collect information about customers.
There are a number of technologies behind both of these examples, but there are a few key ideas that underpin any successful mobile solutions. First, there are dynamic apps, also called runner apps. These applications, typically running on a phone or tablet, empower associates on the floor to notify the back of what they need without ever leaving the customer they’re assisting. They can also function as parts of an inventory management system, by allowing associates to find exactly where an item is on the floor, check if items are out of stock, and even request restocks without ever leaving their customer.
But on the other hand, sometimes customers just want to be left alone. And in that case, a runner app won’t do much for them. That’s where white-label apps come in: self-service apps that customers can install on their phone, which can enable them to locate items on the floor and check availability without needing to interact with an associate.
Both of these software solutions are right for different use cases, and in some cases it may be wise to use both. But regardless, mPOS systems can fit into many different retail strategies, and it’s likely that they will be a good fit for businesses from the smallest corner store to the largest multinationals.
Omnichannel has been a hot word lately; especially with the impacts of the pandemic, retailers have had to learn to be flexible. With customers now expecting an even more convenient experience, and businesses needing to optimize order fulfillment and delivery time, omnichannel retail practices became a common solution. Most businesses now have two arms: the physical and the digital. And it won’t do to leave them separate. With omnichannel tech, the physical and digital aspects of business can be blended together to create a seamless, unified commercial experience.
And it’s no surprise that the POS is a part of this transition. Customers like it when their experience matches no matter which channel they choose, and they want to combine the best aspects of online and in-store shopping. Shopping channels like BOPIS and BOPAC allow customers to use convenient online ordering, and get same-day or next-day pickup instead of waiting for shipping. And Endless Aisle solutions allow physical stores to close sales even when they are out of stock or do not carry a particular product, by enabling customers to order from the company’s e-commerce channels or directly from their global vendors while still in the store.
And it’s not just customers who can benefit, either. Omnichannel Order Management Systems (OMS) allow retailers to automatically support sales from any channel, online or offline. This allows retailers to easily generate order requests and receipts, dynamically manage stock levels, and open up greater data analytics and visibility. All of this information can be generated or influenced by the POS, making it one of the most critical parts of an omnichannel experience.
By synchronizing operations and data with an omnichannel backend, your POS can become a key part of a strongly integrated retail ecosystem.
Another well of untapped potential in POS systems is their ability for target marketing and personalization. Some companies are already experimenting with this. Online retailers will often put up an “anything else?” box before final checkout that fills with recommendations based on purchase history. Using deep customer profiles to power target marketing will enable powerful sales tactics at the POS, encouraging impulse buys, bundles or loyalty engagement.
And speaking of loyalty programs, they’re also due for a transformation. Consumers are responding to different loyalty models now; simple point accumulation and redemption doesn’t seem to cut it anymore. Alternate models — early product access, freebies with every purchase, free shipping and special discounts — are performing much better, and the POS is the key interaction point for many of these models.
Being the center of all things loyalty can make the checkout process fun and rewarding, especially if accompanied with an overall high quality customer experience. This is sure to become a more and more important aspect of sales in the near future.
The Point of Sale can also be an excellent tool for business analytics. All the data generated at the POS is valuable for multiple purposes: inventory tracking, marketing, product insights, and sales statistics are just a few of the ways the data can be used.
By transforming the POS from a simple till into a funnel for transaction data, businesses can take advantage of all the data exhaust they had already been generating. Sales data can be correlated with inventory trends to find problems or hot spots, and could also be used to create upselling or cross-selling opportunities specific to each customer.
Data from the point of sale can also be used for more general purposes, like improving business decision-making or helping marketing match the reality on the ground. And for businesses using machine learning for insight, the volume of data generated at the POS will be invaluable for tuning their models.
Of course, the POS is by definition where sales get closed, and that always involves the customer making a payment. It is the POS’s simplest function. But payment has been changing, too. With only 12% of sales taking place in cash, and well over half of sales using a credit or debit card, it’s clear that the average customer is moving further and further away from handling cash. And on top of that, there has been significant growth in contactless payments — apps or services like Venmo, Apple Pay or Google Wallet — due to our increasing reliance on smartphones as part of our lives, and of course the pressure of the pandemic.
But even more interesting than that is the growth in alternative payment schemes. With the global spending using Buy Now, Pay Later (BNPL) expected to rise to $996 billion by 2026, and gift cards growing 16% every year, POS systems must quickly adapt and begin supporting these burgeoning payment methods.
And perhaps most unusual, cryptocurrency may finally get its moment. Though cryptocurrencies are yet to weather the storm of financial regulation and government interventions, they are already being accepted as payment methods through Visa and Mastercard. And there are even prepaid cards that can be loaded with cryptocurrencies and used just like any other payment type. Savvy retailers would do well to keep an eye on the crypto space and see where it goes.
Do these technologies sound like something your business needs? Jesta is a leader in the POS and omnichannel space, with the Vision Suite boasting robust capabilities, which support the creation of Endless Aisles and mobile POS systems, loyalty programs, customer insights, and more.
Contact us to find out what Jesta can do for you.
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