Mobile Payment is Taking Over the Airwaves

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Mobile payment terminals of all shapes, sizes and speeds are becoming a mainstay in high-end, family and quick-serve restaurants, theatres, arenas and campuses, as well as food trucks and outdoor markets. Even tablets and smartphones are morphing into self-contained payment processing devices.

From an investment standpoint, depending on the setup, all it takes is a connection to an existing Wi-Fi or cellular network — not to mention the low cost of devices such as tablets and smartphones — which goes a long way towards keeping capital and operational costs down.

“Five years ago, any kind of [mobile] technology in the restaurant space was seen as gimmicky or cheesy,” says Chad Clark, operations director, Hawksworth Restaurant Group in Vancouver. “You can’t go without wireless PIN pads in Canada today and now there is software and operating systems that make systems so much more efficient. It’s a new era of how we interact and do things.”

Getting into mobile doesn’t have to be complicated. Cineplex’s VIP Cinema concept, for example, has been using mobile ordering and payment systems since 2007. The company deploys Windows-based tablets armed with POS software from New Zealand-based Vista Entertainment Solutions that handles both ticketing and foodservice requirements.

Staff place orders through the tablet and use a mobile-payment terminal to process payments on the spot. “The whole intent was to take care of all the pain points in the theatre, from ordering to payment. This system allows us to take orders efficiently and handle all their needs,” says Brad Park, executive director, Merchandising National Operations at Cineplex Entertainment in Toronto.

The turning point for more advanced mobile capabilities in Canada was the big push towards the EMV (Europay, MasterCard and Visa chip and PIN) card around 2008. It was a move that allayed people’s fears about security and opened the doors to new mobile-payment options in a big way. Customers quickly got used to contactless (or tap) payment, where a simple wave of their card would pay for their coffee and muffin within milliseconds.

According to Rob Cameron, chief product and marketing officer for Moneris Solutions Corporation in Toronto, “When you shift to mobile payments the behaviour is similar. Rather than tapping your card, you simply hold your phone over the same part of the terminal.” Cameron notes that 95 per cent of Moneris terminals deployed today support contactless payment, which also means they are already primed and ready to accept payments from mobile devices.

The biggest action in mobile payment has been in the QSR segment, where there has been a large number of activations, says Derek Colfer, head of technology and digital innovation for Visa Canada in Toronto. “These are businesses that are really concerned about throughput and getting people to pay as quickly as possible. And today, 70 per cent of Canadians wouldn’t leave home without a mobile device. They have become ubiquitous. So there is nowhere to go but up with mobile payment.”
Craig Hunter, general manager for Ritual, a Toronto-based developer of mobile order and pay apps, agrees the biggest activity for mobile device payment is in the coffee merchant and QSR sectors — and for good reason. “Those are businesses where time is very valuable. Everyone wants to get on board with mobile order and pay options.”

The highest profile player in that space is Starbucks Canada, whose Mobile Order & Pay app launched in Canada last October. The latest iteration bundles its payment and loyalty programs with an ordering system, so customers can pre-order and pay before they reach the store.

According to Jessica Mills, director of Brand Communications, Starbucks actually launched its first mobile payment app in 2010 with its loyalty card program. “While the fundamentals of the mobile payment experience have been similar, there’s a lot of differentiation in terms of the utility and content of the app. Customers can also use the app to find a store, get product information, track and map their rewards.”
Mills reports that overall usage of mobile apps for payment (in-store or remote) accounts for 20 per cent of Starbucks’ transactions. Usage is highest in high-traffic urban areas, transit hubs and operations in facilities such as hospitals and campuses.

QSR may be on a roll, but uptake for mobile payment will take a bit of time on the restaurant side, says Ziv Schierau, senior account executive with OpenTable in Vancouver. A recent OpenTable survey shows that only five per cent of respondents already use mobile payment in restaurants in Canada. “Another 47 per cent have shown an interest in trying
it, but haven’t used it yet,”
he explains.

Although restaurant operations may be slower to the table, Hawksworth’s Clark says the time is right to engage. “It’s a really interesting time for restaurants because it’s the first time that technology is really starting to align with operations. [With mobile] we can easily break down barriers when it comes to POS options.”

That wasn’t the case when they opened a café five years ago and decided to try out handheld terminals to take orders in a lineup. “It was a black brick, tiny screen and plastic pointer — you would laugh at the technology today.”
With a new restaurant set to open soon (the name has not yet been announced), Clark says the difference is unbelievable. Going mobile provides an added advantage in that it will allow Hawksworth to transition to a full paperless model, he adds. “We won’t need printers. We can email bills. It’s going to be a really fun technology.”

Ultimately, however, mobile devices as we know them today are not the end game, Colfer says. “When you think about the digital evolution, payment is more about mobility of the Internet and form factors. It just so happens that the focus is on mobile devices today, but that could turn to other devices
very quickly.”

Written By: Denise Deveau

Volume 48, Number 11

 

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