Report • 06.12.2017

“Just walk out“: the invisible payment process

Pay automatically with zero-click payment and smart store technologies

Retailers are constantly looking for solutions that make payments easier and more automated. After all, an easy payment process also makes it easier to spend money, at least when it comes to small amounts and quantities. According to a study by Juniper Research, that’s also why technologies like zero-click payment – also called “invisible payment“ – are capable of making a lasting impact on the retail industry in the coming years.

In the case of so-called zero-click payments, the payment process is automatically triggered and happens in the background without disrupting the user. As a part of omnichannel strategies, this time-saving payment option we know from subscriptions is designed to make shopping more attractive.

“Invisible or zero-click payments are definitely on the rise. Customers enjoy shopping – but not the payment process,“ explains Ralf Ohlhausen, Business Development Director at PPRO, a Fintech service company. “I personally think the potential is huge. Wherever it is technically feasible – and this trend will advance rapidly – retailers will eliminate the cumbersome payment process.“ According to Juniper, transactions in excess of 78 billion dollars are expected to be processed using “invisible” payment technologies by 2022. This estimate is based on the expected 9.8 billion U.S. dollars in retail revenues in 2017.

Online retailers and their web stores have shown how convenient payments can work. Thanks to stored account data and settings, the payment process can be completed with just one click. Brick-and-mortar stores use cameras, sensors, and artificial intelligence to facilitate automatic payments.

Do mobile devices make cash registers obsolete?

Oftentimes, customers already carry the technology for cashless payment processes in their pockets by way of mobile devices such as smartphones, tablets or smartwatches. According to Juniper Research, over the next five years, these payment solutions will cover more than 5,000 retail outlets. Over the same period, the number of consumers who scan their own purchases via checkout apps will increase from just shy of 4 million to more than 30 million transactions.

Amazon and its pilot project Amazon Go, a supermarket that has no checkout stations, also intends to replace the physical checkout method in retail. The customer checks into the store with his/her smart device, takes the desired items from the shelf and leaves the store without having to pass through a checkout system. Cameras and sensors identify the products the consumer is purchasing. When customers leave the store, payment is made via the Amazon account.

Having said that, the opening of the first Amazon Go store in Seattle has been delayed since its originally scheduled launch date in March 2017. The technology still encounters some issues once the number of customers in the store exceeds a certain number.

“Needless to say, this endeavor must not come at the expense of security, that is to say, both the customer and the retailer must have the assurance that the store doesn’t overcharge or undercharge.“ (Ralf Ohlhausen)

Automatic payment in online retail

The zero-click payment solution is not just interesting for brick-and-mortar retail. The e-commerce sector is also striving to make the payment process as automated and simple as possible. One example of this is the Amazon Dash Button, which lets consumer order everyday items such as detergents or trash bags at the push of a button. Once the customer presses the plastic button, the preprogrammed item is reordered and paid for via the registered Amazon account.

Photo: Hand holding smartphone with Dominos Zero Click Ordering App on display;...
The Zero-Click-Ordering-App from Domino's Pizza with order timer
Source: Domino's Pizza, Inc.

Domino’s Pizza also offers an invisible payment option with its zero-click ordering app. Once you open the app, your favorite selection is automatically ordered unless you cancel the process within ten seconds.

Having said that, so far, these solutions only facilitate purchases of only one preselected product. Shopping carts containing more than one item or product changes cannot be processed using an invisible payment option. That’s also why invisible payment processes are still a niche in online retail.

Meanwhile, the zero-click payment method is successfully used for services. For example, in the case of the online ride service provider Uber in the U.S., owed fares for rides are automatically paid via PayPal using the smartphone app.

Retail revolution or cautious trend?

In its report titled “Future In-store Retail Technologies: Adoption, Implementation & Strategy 2017-2022“, Juniper Research concluded that the cost and complexity of infrastructure integration will constrain deployments of invisible payments systems in the short term. It argues that initially, two other retail technologies would take root in brick-and-mortar retail: checkout apps and automatic scanning.

Photo: Virtual surveillance camera image of people with shopping carts;...
Source: panthermedia.net / ndul

“All told, it can be expected that Germany will likely continue to play catch-up with the adoption of new end-user technology.“ (Ralf Ohlhausen)

These two solutions have lower upfront costs and can be used as information and promotion platforms. Juniper Research estimates that these technologies will drive an average increase in revenue of over 300 U.S. dollars per shopper annually by 2022.

These precursors, where customers scan their own purchases and pay via an app on their smartphone, could pave the way for invisible payment processes. However, they could also bring technical issues or data protection concerns to light. For example, the Amazon Go store has many critics who caution against unrestricted in-store customer monitoring. Especially in Germany, consumers still prefer methods of payment where security takes priority over convenience.

Ralf Ohlhausen believes that zero-click payment solutions are likely to first be adopted in China’s or the U.S. retail sector where there is less concern about new (payment) technologies and the sharing of sensitive information. “Especially as part of the ’Internet of Things‘, this will definitely have to be the case. After all, if cars are able to buy gas and refrigerators purchase milk, they should also be able to pay for these items on their own.“

Author: Julia Pott, iXtenso

related articles:

popular articles:

Thumbnail-Photo: Improving performance with video training
19.06.2019   #personnel management #video

Improving performance with video training

Video tutorials for inventory management or customer service excellence

Smart Retail Solutions (SRS) has announced their ProfitTrax Platform is now including Best Practice Video Training in its Advanced Analytics Suite. Their team has successfully implemented the update because they believe the key to profit improvement ...

Thumbnail-Photo: Internal communication via app at Modehaus Ramelow...
03.06.2019   #personnel management #app

Internal communication via app at Modehaus Ramelow

Mobile chat works as a bulletin board

What's new at Modehaus Ramelow? The fashion retailer’s employees can check PIA - and share information to their heart’s content. PIA is an app for "private information exchange".More and more internal communication ...

Thumbnail-Photo: “Carbon” – The future of payment transactions by InterCard...
18.03.2019   #payment systems #Trade fair special EuroCIS 2019

“Carbon” – The future of payment transactions by InterCard

Customer-oriented processes beyond standard market solutions

Thumbnail-Photo: New innovative hybrid POS solution for small businesses...
20.05.2019   #pos systems #cashpoints

New innovative hybrid POS solution for small businesses

Posiflex presents a new innovative Hybrid POS solution for small businesses

The Retail market is always evolving, and so is Posiflex. Posiflex continually stays attached to the market and identifies ahead what the market really needs. Posiflex is honored to present its latest innovative Hybrid POS solution, WT-3007A, to the ...

Thumbnail-Photo: Digital Signage Summit Europe - 30 % discount...
07.06.2019   #customer analysis #marketing

Digital Signage Summit Europe - 30 % discount

Many of the world’s foremost digital signage experts, thought leaders and leading technology and service suppliers will come together to present a unique mix of keynotes, conference channels, awards and exhibition showcase.

Now in its 14th year, DSS Europe is the leading European strategy event exploring the business and technology of Digital Signage and DooH - here is a 30% code for our readers – 415839The theme of this year’s conference is ‘Customer ...

Thumbnail-Photo: E-commerce: AI-powered translations revitalize business...
29.04.2019   #online trading #e-commerce

E-commerce: AI-powered translations revitalize business

Interview with Boris Zielonka, Director Marketing & Sales, Eurotext AG

Retailers who set up an online store can expand their business – especially if they create a multilingual content strategy.As a language and translation service, Eurotext AG supports retailers in this endeavor. From this conversation with ...

Thumbnail-Photo: Why digital signage pays off big!
03.06.2019   #digital signage #customer relationship management

Why digital signage pays off big!

The right content can increase sales and customer loyalty

The strategic use of digital signage can unquestionably lead to increased sales, a boosted impact of the sales floor, a new shopping experience, and a stronger brand image. However, emphasis is too often placed merely on technical innovations that ...

Thumbnail-Photo: Well cooled shopping entertainment, please!
15.07.2019   #refrigeration cabinets #refrigerated counters

Well cooled shopping entertainment, please!

What about modern refrigeration technology?

Pierluigi Schiesaro and Gian Paolo Di Marco from Arneg, a company focusing on food service equipments, talk about refrigeration systems as "shopping entertainment".They also tell us what sustainable refrigeration could look like and why ...

Thumbnail-Photo: Goodbye paper receipts: All documents stored in one app...
16.05.2019   #epos systems #cashpoints

Goodbye paper receipts: All documents stored in one app

What happens when the Receipt Provision Ordinance takes effect? We digitize!

They create a lot of work and endless waste: tons of paper receipts from cash registers end up with customers or the waste bin every day. In early 2020, all consumers must be given a purchase receipt in Germany. That’s what the law mandates. ...

Thumbnail-Photo: Digital Signage Summit (DSS) Europe
07.05.2019   #digital signage #digitization

Digital Signage Summit (DSS) Europe

iXtenso readers receive a 30% ticket-discount!

The two-day event comprises a comprehensive mix of twin-track conference programme; hands-on workshops; exclusive presentations; numerous networking opportunities and a vendor and service supplier exhibition area.In 2019, DSS Europe returns to the ...

Supplier

APG Cash Drawer
APG Cash Drawer
4 The Drove
BN9 0LA Newhaven
Delfi Technologies GmbH
Delfi Technologies GmbH
Landgraben 75
24232 Schönkirchen
LANCOM Systems GmbH
LANCOM Systems GmbH
Adenauerstraße 20 / B2
52146 Würselen
ROQQIO Commerce Solutions GmbH
ROQQIO Commerce Solutions GmbH
Harburger Schloßstraße 28
21079 Hamburg