Is There a Downside to Mobile POS?

Mobile point of sale (POS) is still in its early stages, but in the past year it's been gaining traction and a great deal of attention. It certainly appeals to many retailers’ intuition that mobile POS provides the opportunity for a better customer experience and increased sales by eliminating or reducing wait time at checkout. But how do we know that's actually true?

Some retailers are without a doubt reaping the benefits of mobile POS. Alex and Ani, an accessories brand, implemented iPod Touches at checkout during the holiday season and saw a 318 percent increase in sales as a result. But still others are slowing their mobile POS rollouts. A recent report by IHL Group, Mobile POS: Hype to Reality, notes that only 28 percent of those surveyed plan to adopt mobile POS by the end of 2013, and 33 percent of retailers have no plans to implement mobile POS within the next three years.

As retailers add mobile POS to their stores, it's critical to understand its impact on sales and the customer experience. There are still so many operational unknowns. Retailers should measure and understand the answers to questions such as the following:

Queue Time

• Is mobile POS reducing average queue time? And if so, by how much?
• How does the queue time reduction spread across the day and week, and in space across the store's floor plan?
• How does this benefit compare to the other ways retailers could spend employee hours or capital expense?

When, Where, How

• When are the right hours to offer mobile POS, and how many devices should you offer?
• Where in the store are mobile POS purchases taking place?
• How does this compare to shopper traffic patterns in-store?

Impact on Sales

• How do purchasing patterns change between mobile POS devices and fixed registers?
• Are key performance indicators (e.g., number of items per basket) consistent, or do they change when mobile POS is used?
• Are impulse purchases or upsell opportunities negatively affected by mobile checkout, and what's the impact on sales, margin and profitability?

This last question is absolutely crucial and one that hasn't been thoroughly tested yet. According to a recent survey by Hanover Research, 52 percent of millennials were more likely to make impulse purchases than any other generation. In contrast, eight out of 10 baby boomers’ purchases were driven by practical decisions. In this age of "shop in the moment," is it time to remove checkout aisles with potential last-minute purchase opportunities?

These are critical questions that must be answered. Otherwise, retailers may be losing precious sales. Savvy retailers will test and measure this important new source of data and strive to understand the effect of mobile POS on their business.

George Shaw is vice president of research and development for RetailNext, a provider of in-store retail analytics.