Category: Best Practices for Merchants

Guidelines to execute a bricks-and-clicks strategy

Online retailers are finding the bricks-and-clicks strategy to be an effective way to serve and engage shoppers. Perhaps that is why an increasing number of ecommerce merchants are setting up shop offline. It’s important to note, however, that a bricks-and-clicks business isn’t just about having a physical store and an ecommerce site. For this model to be effective, each channel must complement and add value to the other.

Guidelines to execute a bricks-and-clicks strategy:

Allow Access to Online Account Information in Physical Store

Bridge the gap between bricks and clicks by giving your customers and physical-store staff access to online account information. Doing so can enhance shopping experiences and drive sales.

Integrate Online and Offline Inventory, Fulfillment

Offer click-and-collect services that allow shoppers to buy merchandise online and pick it up at a local retail branch or service station. Many consumers would rather forgo the shipping costs and wait time and instead pick up their items at a time and place that’s convenient for them. Also, use your brick-and-mortar inventory when an item is out of stock online.

Use Online Data for Offline Selling, and Vice Versa

Data pertaining to online sales and traffic won’t just help you optimize your ecommerce site. It can also apply to offline decisions. For instance, if you see an increase in sales for a particular product on your website, you should consider promoting it offline, as well, to your brick-and-mortar shoppers.

Also pay attention to social media data such as Facebook likes and Pinterest pins. What’s trending on social sites can help with merchandising and marketing. Consider something similar in your brick-and-mortar business. Take note of the most liked, viewed, and pinned items online and then leverage that information when making decisions regarding product displays, inventory and more.

You can also use offline information to enhance your ecommerce site. Utilize in-store analytics tools, such as people counters and sensors, to better understand how your offline customers behave and then compare that with online behavioral data to spot patterns and opportunities.

Qualitative information, such as shoppers’ common questions and concerns, can also be used to improve your online shop. For instance, if your physical store associates keep getting the same questions about a particular product, there’s a good chance that online shoppers have similar queries. So you may want to include the answer in that item’s product description page.

Use Smartphone Beacons in Physical Stores

Beacons are Bluetooth-enabled devices that let brick-and-mortar merchants send customized offers and recommendations to their shoppers via their smartphones based on where the shoppers are in the store. For example, if a shopper is in the footwear department, the retailer can use its store beacons to send the shopper a coupon for shoes. Bricks-and-clicks businesses can also use the technology to send tailored offers to shoppers based on their online behavior.

Posted in Best Practices for Merchants Tagged with: account, Beacons, bluetooth, brick and mortar, business, consumers, coupon, customers, data, devices, ecommerce, Facebook, inventory, marketing, merchandising, Merchant's, Online Account Information, Online Data, pinterest, product, sales, shoppers, site, smartphone, social sites, store, website

Point-of-Sale Email Collection

Merchant go into business to make a sale. They go to great length to advertise their business and then they make a sale and don’t track it… They don’t track the very customer they went into business to attract…That seems crazy…But now more companies are embracing the practice of collecting email addresses at the point of sale (POS) and they’re doing so with increasing regularity. An example, when customers are at the cash register, many brick-and-mortar stores now offer to email them receipts 

Confidently collect email addresses at POS:
Your email service provider should be able to implement a text-to-join acquisition program for you that executes quickly and can be built specifically to mitigate the risks around POS data collection.

Instead of relying on sales associates to accurately input email addresses, your customers can use SMS to text their email addresses to your short code.

Customers receive an immediate SMS reply message letting them know to check their email for their receipt.

A mobile-optimized receipt is immediately emailed to the address.

This can be followed by an email inviting customers to join your company’s email program. Offering a purchase discount can increase opt-ins. New joiners can be sent an age verification email, if relevant.

Your welcome email, including discount coupon, is sent and the relationship starts off on the right foot.

Increasing your confidence about POS email address collection, a text-to-join program can increase your acquisition rates. It can engage those customers who prefer to provide their information privately via their mobile devices. It can help protect companies against potential blacklisting because of typos and confirmed opt-ins. It can even reduce overhead costs by saving sales associates valuable time. Understanding these important email address collection issues and adopting the prescribed best practices are critical to ensuring customers have a safe, positive and valuable experience with your company at the point of sale and beyond. 

Virtual Merchant can collect data too, and as a provider we can help merchant use that data. We are committed to providing appropriate protection for the information that is collected from customers who visit the website and use the Virtual Merchant payment system. Policy Privacy is updated from time to time.The website is provided to our customers as a business service and use of the site is limited to customers only.

If the merchant never makes a sale before 10 why do they open at 9 ?? This is only one small example on how collecting data first and then analyzing that data can shape businesses and find money you may be throwing away ….

 

 

 

 

Posted in Best Practices for Merchants, Mobile Point of Sale, Point of Sale Tagged with: brick and mortar, business, cash, cash register, customers, data, discount, discount coupon, email, merchant, mobile, Mobile Devices, payment, payment system, point of sale, policy, POS, provider, purchase, Rates, receipts, sale, service, sms, store's, virtual merchant, website

iPad Point-Of-Sale (POS) System

If your businesses considering an iPad point-of-sale (POS) system, you may be up for a challenge. Not only can the plethora of providers be overwhelming, but you must also remember that not all iPad POS systems are created equal. iPad POS systems do more than process payments and complete transactions. They also offer advanced capabilities that streamline operations. For instance, they can eliminate manual data entry by integrating accounting software, customer databases and inventory counts in real time, as each transaction occurs. With these systems, you get 24/7 access to sales data without having to be in the store. The challenge, however, is knowing which provider and set of features offer the best iPad POS solution for your business. iPad POS systems vary in functionality far more than the traditional POS solutions and are often targeted at specific verticals rather than the entire market. For that reason, it’s especially important to compare features between systems to ultimately select the right system for your business.

To help you choose a provider, here are things to look for in an iPad POS system.

Backend capabilities

One of the biggest benefits of an iPad POS system is that it offers advanced features that can streamline your entire operations. These include backend processes, such as inventory tracking, data analysis and reporting, and social media integration. As a small business, two of the most important time saving and productivity-boosting features to look for are customer relationship management (CRM) capabilities and connectivity to other sales channels. You’ll want an iPad POS that has robust CRM and a customizable customer loyalty program. It should tell you which products are most and least frequently purchased by specific customers at various store locations. It should also be able to identify the frequent VIP shoppers from the less frequent ones at any one of your store locations, creating the ultimate customer loyalty program for the small business owner. If you own an online store or use a mobile app to sell your products and services, your iPad POS software should also be able to integrate those online platforms with in-store sales. Not only will this provide an automated, centralized sales database, but it can also help increase total sales. You should be able to sell effortlessly through online, mobile and in-store channels. Why should your customers be limited to the people who walk by your store? Your iPad POS should be able to help you sell your products through more channels, online and on mobile. E-commerce and mobile commerce (mCommerce) aren’t just for big box retailers.

Cloud-based

The functions of an iPad POS solution don’t necessarily have to stop in-store. If you want to have anytime, anywhere access to your POS system, you can use one of the many providers with advanced features that give business owners visibility over their stores, its records and backend processes using the cloud. The best tablet-based POS systems operate on a cloud and allow you to operate it from any location you want. An iPad POS provider, with a cloud-based iPad POS system, businesses can keep tabs on stores in real time using any device, as well as automatically back up data. This gives business owners access to the system on their desktops, tablets or smartphones, even when not inside their stores. Using a cloud-based system also protects all the data that’s stored in your point of sale so you don’t have to worry about losing your data or, even worse, getting it stolen. Because the cloud plays such a significant role, businesses should also look into the kind of cloud service an iPad POS provider uses. In other words, is the system a cloud solution capable of expanding, or is it an app on the iPad that is not dependent on the Internet? Who is the cloud vendor? Is it a premium vendor? The type of cloud a provider uses can give you an idea about its reliability and the functions the provider will offer.

Downtime and technical support

As a small business, you need an iPad POS provider that has your back when something goes wrong. There are two types of customer support to look for: Downtime support and technical support.

iPad POS systems are often cheaper and simpler than traditional systems, but that doesn’t mean you can ignore the product support needs. The POS is a key element of your business and any downtime will likely result in significant revenue loss. You could, for instance, experience costly downtime when you lose Internet connectivity. iPad POS systems primarily rely on the Web to perform their core functions, but this doesn’t mean that when the Internet goes down, your business has to go down, too. Many providers offer offline support to keep your business going, such as Always on Mode. The Always on Mode setting enables your business to continue running even in the event of an Internet outage. Otherwise, your business will lose money during a loss of connectivity. Downtime can also happen due to technical problems within the hardware or software. Most iPad POS providers boast of providing excellent tech support, but you never really know what type of customer service you’ll actually receive until a problem occurs.

Test the friendliness of customer service reps by calling or emailing the provider with questions and concerns before signing any contracts. This way, you can see how helpful their responses are before you purchase their solution. Your POS is the most important device in your store. It’s essentially the gateway to all your transactions, customer data and inventory. If anything happens to it, you’ll need to be comfortable knowing that someone is there to answer your questions and guide you through everything.

Grows with your business

All growing businesses need tech solutions that can grow right along with them. Not all iPad POS systems are scalable, so look for a provider that makes it easy to add on more terminals and employees as your business expands. Pay attention to how the software handles growth in sales and in personnel. As a business grows, so does it sales volume and the required software capabilities. Some iPad POS solutions are designed for very small businesses, offering very limited features and transactions. If you have plans for growth, look for a provider that can handle the changes in transactions your business will be going through. Find out about features and customization. Does the system do what you want it to do? Can it handle large volume? How much volume? What modules can you add, and how do you interface to third parties? You should also consider the impacts of physical expansion and adding on new equipment and employees. If there are plans in the future for you to open another store location, you’ll need to make sure that your point of sale has the capabilities of actually handling another store location without adding more work for you. If you plan on hiring more employees for your store, you’ll also want to know that the solution you choose can easily be learned, so onboarding new staff won’t take up too much of your time.

Security

POS cyber attacks have risen dramatically over the past couple of years, making it more critical than ever to protect your business. Otherwise, it’s not just your business information at risk, but also your reputation and entire operations. iPad POS system security is a bit tricky, however. Unlike credit card swipers and mobile credit card readers that have long-established security standards namely, Payment Card Industry (PCI) compliance — the criteria for the iPad hardware itself as a POS terminal aren’t quite so clear-cut. Since iPads cannot be certified as PCI compliant, merchants must utilize a point-to-point encryption system that leaves the iPad out of scope. This means treating the iPad as its own system, which includes making sure it doesn’t save credit-card information or sensitive data on the iPad itself. To stay protected, look for PCI-certified, encrypted card swipers.

 

 

Posted in Best Practices for Merchants, Mobile Point of Sale, Point of Sale Tagged with: (POS) systems, accounting, app, business, card, cloud-based, credit, credit card readers, credit-card, crm, customer, customer relationship management, customer support, data, data analysis, database, desktops, e-commerce, inventory, iPad Point-Of-Sale, loyalty program, mcommerce, mobile, mobile app, mobile commerce, online, online platforms, Payment Card Industry, payments, PCI, platforms, POS, POS solution, products, sales, Security, security standards, services, Smartphones, social media, software, tablets, terminal, transactions, web

4 Ways That Ecommerce Merchants Misuse Data

The use of customer data can help you make smarter decisions that can improve your store, enhance the shopper experience, and increase conversions. When used incorrectly, however, data can waste resources and alienate your visitors.

Ways that ecommerce merchants commonly misuse data.

Collecting Unnecessary Data

Big Data analytics and reporting tools can put a lot of information in your hands, but that doesn’t mean you should collect and track every single metric. Don’t waste space and bandwidth collecting information that is not essential in your business. Unnecessary data can create noise that slows down the analytics process. Gathering and analyzing information you don’t need can distract you from the metrics that matter. Collecting too much data can create security headaches. The best defense against breaches is to not have data to steal. If you don’t need it, don’t collect it.

Determine your store’s key performance indicators before collecting any information. A good way of doing this is to examine each metric and ask yourself whether it’s just  nice to know or is something that you can actually act on. While it may be nice to know that a particular customer has a high Klout Score, that metric probably won’t do anything for your bottom line. It’s better to not bother with it. Key metrics vary from one business to the next. For most ecommerce sites, the important metrics usually include conversion rate, traffic sources, and on-site browsing activities.

Creeping-out Shoppers

Most retailers do this inadvertently when they’re trying to customize the shopper experience. A certain amount of personalization can provide value and convenience to users, but you also have to draw the line between cool personalization and creepy. Sending emails with tailored product recommendations is a good way to increase conversions. But you have to be careful with how you execute it, so that you don’t appear too intrusive. The same goes for remarketing banner ads.

Ignoring Qualitative Information

Numbers can produce many insights, but focusing solely on that data can create an incomplete view of your company. Best data strategies make use of both quantitative and qualitative information. Go beyond the numbers to get the pulse of your customers by collecting feedback through social interactions, customer service logs, surveys with open-ended questions and more. Qualitative information can complement and validate the hard numbers.

Using Data to Justify a Decision or Hypothesis

When it comes to data collection, many merchants fall into the confirmation bias trap, wherein they interpret the information to confirm their existing beliefs or to justify their decisions. Using data this way causes you to ignore information or results that aren’t in line with your beliefs and could result in you missing opportunities. Say a company has so much faith in its new marketing strategy that when website traffic improves, the staff deems the campaign a success without looking at the conversion or retention rates. If the staff had ignored initial biases and looked at the big picture instead, they could have identified flaws and found ways to correct them. The key to addressing this is to have an open mind when interpreting information. This can be difficult, especially when you’re too close to your business. Consider a third-party specialist who can remain objective, to help make the right decisions.

 

Posted in Best Practices for Merchants, e-commerce & m-commerce Tagged with: breaches, business, conversion rate, customer, customer data, customer service, data, ecommerce, ecommerce merchants, Merchant's, rate, retention rates, Security, sources, tools, traffic

Leasing or renting a Credit Card Terminal should not be an Option

One of the greatest mistake any merchants can do is deciding to lease or rent a credit card terminal rather than getting one for FREE. While the practice of leasing has declined in recent years in the US it is all they are doing in Canada whether the merchant is renting from a bank or leasing from a sales rep. In both the US and Canada some sales reps will still strive and persuade you that leasing is the perfect choice for you. You’re not obliged to pay any cash up front, or You’re assured a substitute terminal if yours breaks. Those selling statements may sound decent, but they’re not. A terminal lease will end up costing you hundreds, if not thousands of dollars more than what it’s worth. With the fees you’ll end up disbursing to lease a terminal, you could buy that same terminal in a matter of months. If you lease a terminal you could also be forced to buy equipment insurance, which is an additional expense. You may even have to give back the terminal at the end of your lease!

Why Purchasing a Credit Card Terminal is a Good Choice

A terminal lease brings with it a 48 month lease contract. That is a lengthy time to be giving for a terminal that doesn’t cost more than $300 today. Why not just buy one entirely? The cost of the purchase is absolutely tax deductible. Even if you can’t come up with the money to pay cash for your terminal, you can just put it on a business credit card. The interest given is still tax deductible, and let’s says you have a 19 percent credit card rate, if you pay the same amount of $/month toward your credit card balance that you would have paid toward your lease, you’ll have the terminal paid off in less than a year. That’s a savings that can be better channelled into budding and growing your company.

FREE Credit Card Terminal

For those of you, who feels that because of the ever changing technology, they do not want to continue buying new terminals, there are FREE Terminals offers all across Canada. So, with your FREE terminals, there is no out of pocket set up expense and your current processing rate can be the same or reduced significantly.  If your terminal breaks or if there is a better technology that develops, the company automatically ships to you at no charge an upgraded terminal. So, if you can’t buy one, see if your credit card processor will give you one for FREE.

If you’re stuck in a lease, you most likely won’t able to end the contract. A lease term is usually 48 months, so you’ll have to look up when that term terminates before you can leave without a consequence. As an alternative, do your own research and analyze the total expense of leasing vs. purchasing. Better yet, strongly consider the benefits of not having to worry about anything, at one point is that FREE terminal usually has $25 minimum expense to the merchant. Mom taught you there was no free lunch didn’t she? If you decide to return the FREE terminal, you may find a RETURN EQUIPMENT FEE or an EARLY RETURN FEE of that FREE EQUIPMENT.

Posted in Best Practices for Merchants, Credit Card Reader Terminal Tagged with: bank, card, cash, credit, credit card processor, credit card terminal, credit-card, fees, Merchant's, processor, tax, terminal

PCI security on third party guidance

Businesses are rapidly adopting a third-party operations model that can put payment data at risk. Today, the PCI Security Standards Council, an open global forum for the development of payment card security standards, published guidance to help organizations and their business partners reduce this risk by better understanding their respective roles in securing card data. Developed by a PCI Special Interest Group (SIG) including merchants, banks and third-party service providers, the information supplement provides recommendations for meeting PCI Data Security Standard (PCI DSS) requirement 12.8 to ensure payment data and systems entrusted to third parties are maintained in a secure and compliant manner.

Breach reports continue to highlight security vulnerabilities introduced by third parties as a leading cause of data compromise. The leading mistake organizations make when entrusting sensitive and confidential consumer information to third-party vendors is not applying the same level of rigor to information security in vendor networks as they do in their own. Per PCI DSS Requirement 12.8, if a merchant or entity shares cardholder data with a third- party service provider, certain requirements apply to ensure continued protection of this data will be enforced by such providers. The Third-Party Security Assurance Information Supplement focuses on helping organizations and their business partners achieve this by implementing a robust third-party assurance program.

Produced with the expertise and real-world experience of more than 160 organizations involved in the Special Interest Group, the guidance includes practical recommendations on how to:

Conduct due diligence and risk assessment when engaging third party service providers to help organizations understand the services provided and how PCI DSS requirements will be met for those services.

Develop appropriate agreements, policies and procedures with third-party service providers that include considerations for the most common issues that arise in this type of relationship. 

Implement a consistent process for engaging third-parties that includes setting expectations, establishing a communication plan, and mapping third-party services and responsibilities to applicable PCI DSS requirements.

Implement an ongoing process for maintaining and managing third-party relationships throughout the lifetime of the engagement, including the development of a robust monitoring program. 

The guidance includes high-level suggestions and discussion points for clarifying how responsibilities for PCI DSS requirements may be shared between an entity and its third-party service provider, as well as a sample PCI DSS responsibility matrix that can assist in determining who will be responsible for each specific control area.

PCI Special Interest Groups are PCI community-selected and developed initiatives that provide additional guidance and clarifications or improvements to the PCI Standards and supporting programs. As part of its initial proposal, the group also made specific recommendations that were incorporated into PCI DSS requirements 12.8 and 12.9 in version 3.0 of the standard.One of the big focus areas in PCI DSS 3.0 is security as a shared responsibility. This guidance is an excellent companion document to the standard in helping merchants and their business partners work together to protect consumers’ valuable payment information.

Posted in Best Practices for Merchants, Credit Card Security, Payment Card Industry PCI Security Tagged with: banks, Breach, card, card data, cardholder, consumer, data, data security, Merchant's, networks, payment, payment card security, payment data, payment information, PCI, PCI-DSS, provider's, Security, Security Assurance, security standards, security standards council, Service providers, services

For a Five Dollar purchase, Cash or Card?

A cup of coffee, a  pack of chewing gum., a newspaper at the airport. For even the smallest, most casual purchase, credit cards and debit cards are replacing cash as the preferred form of payment. One in three usually uses a credit card or a debit card for in-person purchases of less than $5. Eleven percent prefer credit cards, 22% debit cards and 65% cash, but the generational divide is striking. A slight majority (51 percent) of consumers 18-29 prefer plastic to cash, the only age group to do so. A preference for cash becomes stronger in each advancing age bracket, until at age 65-plus, 82 percent prefer cash.

Survey conducted by landline and cellphone found that: Credit cards and debit cards are used more frequently for small purchases by those employed full time (42%) or part time (34%) than for the unemployed (23%). People with children are more likely to use the cards for small purchases (41%) than those without children (30%), perhaps because parents have less time to wait around for change. Income doesn’t seem to be much of a differentiator, except for those near the bottom of the scale. A combined 38% of those making $75,000 or more preferred plastic for small purchases, compared with 43 percent of those making $50,000 to $74,900, 32% of those earning $30,000 to $49,900 and only 23% percent of those making less than $30,000.

Politically, we’ve finally found something on which we all can agree. Thirty percent of Democrats and a nearly identical 28% of Republicans favor credit cards or debit cards rather than cash for small purchases. Interestingly, those describing themselves as politically independent also were more independent from cash, 40% of them prefer plastic for such transactions.

The casual use of plastic is moving steadily through age brackets and already has a firm grip not only on millennials, but also increasingly on Gen Xers. Crunched another way, the data show that if you’re 49 or younger, you’re almost as likely to pay for a $5 purchase with plastic as you are to pay with cash. Fifty two percent prefer cash, 46% prefer debit or credit cards. Now, if you’re 50 or older, you’re still somewhat unlikely to pay for a $5 purchase with plastic. Seventy seven percent still prefer cash, with 21% reaching for debit cards or credit cards. Those who graduated from or attended college are significantly more comfortable than others with using plastic for small purchases.

A combined 39% of those with college degrees prefer debit cards (21%) or credit cards (18%) over cash (59%). Only 16% of those who have not attended college usually use debit cards for purchases of less than $5, along with only 6 percent who prefer credit cards for that purpose.

The trend is clear. Regardless of some differences in magnitude based on demographic factors, plastic is replacing cash as the currency of choice even for small purchases. Plastic use will increase for small purchases, both for debit and credit cards.

Why the shift to cards There are many reasons:

Technological advancements at the point of sale have made it just as fast to pay by plastic as by cash. Rewards have become a common feature of credit cards, with two out of three credit cards offering rewards, encouraging rewards chasing. Debit cards, with their balances available instantly and online have largely replaced paper checks and tedious manual records.

Financial institutions have spent decades persuading consumers to use and merchants to accept cards universally. Small purchases represent particularly appropriate uses of a debit card, assuming you don’t get carried away and overdraw the card-linked bank account. Why keep going to the bank and then carry cash if you don’t have to? Moving away from cash and moving toward using cards for even small purchases is more convenient.

Debit cards are everywhere already, but because their use can’t be reported to the credit bureaus and thus, they don’t build credit, they should only be used as a matter of convenience. People who frequently use credit cards for small, casual purchases also could overdo it, but probably not to a great degree. It would take a lot of lattes to send someone into credit counseling or bankruptcy court. In truth, we like the idea of using credit cards frequently for small, manageable expenses. This gives users the benefit of an active credit history, but leaves them with monthly bills that are small enough to pay off in full, so they don’t have to pay any interest. It’s getting to the point where, if I’m out and about, I’m using plastic the whole time. It’s just so much easier.

Posted in Best Practices for Merchants Tagged with: account, bank, bank account, bankruptcy, bills, cards, cash, cellphone, credit, credit counseling, credit history, data, debit cards, financial, financial institutions, Merchant's, payment, transactions

EMV A Requirement Not A Choice

EMV, which stands for Europay, MasterCard and Visa, and is slated to be mandated across the United States starting in October 2015 and automated fuel dispensers have until October 2017 to comply. Unlike magnetic swipe cards, EMV chip cards encrypt data and authenticate communication between the card and card reader. Additionally, chip card user is prompted for a PIN for authentication.

Why are those dates important? Companies lose $5.33 billion to fraud today, with card issuers and merchants incurring 63 and 37 percent of these losses, respectively. Under the EMV mandate, merchants who do not process chip cards will bear the burden of the issuer loss. By accepting chip card transactions, merchants and issuers should see a reduction in fraud.

Overcoming Barriers to EMV Adoption

Given the significant barriers to EMV adoption, it may be tempting for merchants to meet minimum requirements for accepting EMV payments. However, medium to large retailers should also consider the bigger picture of customer security and peace of mind.

Some key critical success factors for a payment initiative of this size include:

Business Continuity Architecture: As with all payment systems, it is imperative to have the EMV system running at all times. The solution should preferably have Active-Active architecture across multiple data centers and have a low Recovery Point Objective (the point in time to which the systems and data must be recovered after an outage).

Cost Benefit Analysis: Take a top down approach and decide accordingly on the scope of the analysis. This will ensure that decisions on scope are made on basis of quantitative data and not just qualitative arguments.

Phased Approach: To overcome time or cost overage in a project of this scope and complexity, retailers should try using an iterative approach for development. The rollout can be divided into multiple releases of six to seven months, which will provide the opportunity to review, capture lessons learnt, and improve subsequent releases.

Proactive Monitoring Alerts: Considering the criticality of business function carried out by EMV, tokenization and payment gateway, a vigorous supervising environment must be defined to perform proactive and reactive monitoring. It should take into consideration the monitoring targets, tools, scope and methods. This will provide advance visibility to the failure points and better ensuring maximum system availability.

Resilience Testing: Typically in a software project, the testing is limited to the unit, integration, performance and user acceptance. However, due to the critical nature of the applications and systems involved, robust resiliency testing is vital. This will ensure that there are no single points of failure and the system remains available when running in error conditions.

Stakeholder Identification: This is a key step to ensure that you have varied perspectives from all departments and their support. It will keep your organization from being blindsided and reduce the risk of disagreements in later stages of the program. Key stakeholders should include Store Operations, Card Accounting, Loss Prevention, Contact Center and IT & Data Security.

Organizations should adopt a five step approach to implement a secure, robust and industry-leading payment solution:

Encryption – Point to point encryption will ensure card data is secure and encrypted from the point of capture to the processor. Usually, merchants use data encryption that is not point to point, rendering their organization vulnerable to data breaches. Software encryption is the most common form of encryption, as it is easily installed and quires little or no hardware upgrades; however, it is less secure, may expose encryption keys, and is prone to memory scanning attacks. Hardware encryption is considered more secure but requires more costly terminal upgrades. Hardware encryption is designed to self-destruct the keys if tampered, but is not well-defined as very limited headway has been made in this space. 

Tokenization – Build a Card Data Environment (CDE) that will host a centralized card data storage solution. Only limited applications with firewall access and capability to mutually authenticate via certificates can access CDE and receive card data. The rest of the applications will have tokens which are random numbers. This architecture will ease the merchant’s burden with existing and emerging PCI Data Security Standards.

Payment Gateway – Perform a risk assessment on the current payment gateway and identify gaps in functionality, manageability, compliance, scalability, speed to market and best practices. Determine the alternatives to mitigate the risks. Some of the important aspects of a leading payment gateway solution are support for all forms of credit, debit, gift cards and check transactions. Its ability to work with any acquirer, in-built encryption abilities, support for settlement and reconciliation must also be kept into consideration.

Settlement, Funding and Reconciliation – A workflow-based system to handle chargebacks and the automation of chargeback processing will greatly reduce labor-intensive work and enhance the quality of data used for settlement and reconciliation. Upgrades to the existing receipt retrieval system may be needed.

Card fraud is on the rise in the U.S., and merchants are the primary target for stealing information. With the EMV deadline just over a year away, the responsible retailer must take steps to prepare now. Although EMV implementation might seem overwhelming to merchants, they should start their journey to secure payments rather than wait for a looming deadline. Solutions such as data encryption and tokenization should be used in combination with EMV to implement a robust payment solution to better protect merchants against fraud. By proactively adopting EMV payment solutions, merchants can stay ahead of the regulatory curve and better protect their customers from fraud.

 

Posted in Best Practices for Merchants, Credit Card Security, EMV EuroPay MasterCard Visa, Payment Card Industry PCI Security, Visa MasterCard American Express Tagged with: authentication, automation, card, card data, Card Data Environment, card fraud, card issuers, card transactions, CDE, chargeback, chargeback processing, check, check transactions, chip, chip cards, credit, customer, customer security, data, data breaches, data encryption, data security, debit, EMV, emv chip cards, EuroPay, fraud, gateway, Gift Cards, host, integration, magnetic swipe cards, MasterCard, Merchant's, payment, payment gateway, payment solution, payment systems, PCI, PCI Data Security Standards, PIN, processor, retailers, Security, software, swipe, terminal, tokenization, tools, visa

Unified MPOS?

The move to mobile point of sale (mobile POS) is radically changing the face of customer interactions and payments, as both customers and merchants grow increasingly comfortable with the concept of mobile payments. In the current, crowded marketplace most mobile payment solutions are not compatible with each other. Instead of unifying the payment experience they create islands separated by technology or usage that are tailored to individual providers in the market. Multiple devices are currently needed in-store to process different payment types and the challenge is how they can make payments unified in such a way that only one device is needed in store.

The use of cash by customers also adds a level of complication to the mobile POS story. The removal of IDM terminals, removal of customer queues and ability for customers to simply walk up and pay an assistant or to leave a store and have their bank card automatically debited certainly suits the expectations of customers today, however a large number of customers still use traditional cash methods to pay for goods and services. A number of stores that have gone down the route of implementing mobile POS now have a problem dealing with cash because the wandering shop assistants and personal shoppers can only accept card or web-based payment options. The future for mobile POS has potential to be bright, a dominant player will have to emerge in the market. This will break down the technology barriers and usage barriers between different players. The success to mobile POS lies in the payment process being truly unified with one device in one place and very seamless workflow. This will be very complicated thing to achieve, there have been a lot of attempts and a lot of false starts in the history of mobile POS. MPOS will be the future. Five years from now people will be amazed that they did transactions with landlines. NO child will ever see a telephone with a cord attached. Never a popcorn on top of the stove since we developed microwave ovens. Technology changes, and we are slow to adopt new stuff. Once we change we don’t know how we did without it.

Posted in Best Practices for Merchants, Mobile Payments, Mobile Point of Sale, Point of Sale, Smartphone Tagged with: bank, card, cash, customer, devices, IDM terminals, Merchant's, mobile, mobile point of sale, MPOS, payment solutions, payment types, payments, point of sale, POS, provider's, services, technology, terminals, web-based payment

The push that mobile payments need – iPhone 6

While Apple doesn’t talk about future products,latest report that the next iPhone would include mobile-payment capabilities powered by a short-distance wireless technology called near-field communication or NFC. Apple is hosting an event on September 9^th, that’s widely expected to be the debut of the next iPhone or iPhones. Mobile payments, or the notion that you can pay for goods and services at the checkout with your smartphone, may finally break into the mainstream if Apple and the iPhone 6 get involved.

Apple’s embrace of mobile payments would represent a watershed moment for how people pay at drugstores, supermarkets or for cabs. The technology and capability to pay with a tap of your mobile device has been around for years, you can tap an NFC-enabled Samsung Galaxy S5 or NFC-enabled credit card at point-of-sale terminals found at many Walgreen drugstores, but awareness and usage remain low.  Apple has again the opportunity to transform, disrupt and reshape an entire business sector. It is hard to overestimate what impact Apple could have if it really wants to play in the payments market.

Apple won’t be the first to enter the mobile-payments arena. Google introduced its Google Wallet service in May 2011. The wireless carriers formed their joint venture with the intent to create a platform for mobile payments. Apple tends to stay away from new technologies until it has had a chance to smooth out the kinks. It was two years behind some smartphones in offering an iPhone that could tap into the faster LTE wireless network. NFC was rumored to be included in at least the last two iPhones and could finally make its appearance in the iPhone 6. The technology will be the linchpin to enabling transactions at the checkout.

Struggles

The notion of turning smartphones into true digital wallets including the ability to pay at the register, has been hyped up for years. But so far, it’s been more promise than results. There have been many technical hurdles to making mobile devices an alternative to cash, checks, and credit cards. NFC technology has to be included in both the smartphone and the point-of-sale terminal to work, and it’s been a slow process getting NFC chips into more equipment. NFC has largely been relegated to a feature found on higher-end smartphones such as the Galaxy S5 or the Nexus 5. There’s also confusion on both sides, the merchant and the customer, on how the tech works and why tapping your smartphone on a checkout machine is any faster, better or easier than swiping a card. There’s a chicken-and-egg problem between lack of user adoption and lack of retailer adoption. It’s one reason why even powerhouses such as Google have struggled. Despite a splashy launch of its digital wallet and payment service more than three years ago, Google hasn’t won mainstream acceptance or even awareness  for its mobile wallet. Google hasn’t said how many people are using Google Wallet, but a look at its page on the Google Play store lists more than 47,000 reviews giving it an average of a four-star rating.

The Puzzle

Apple has quietly built the foundation to its mobile-payment service in Passbook, an app introduced two years ago in its iOS software and released as a feature with the iPhone 4S. Passbook has so far served as a repository for airline tickets, membership cards, and credit card statements. While it started out with just a handful of compatible apps, Passbook works with apps from Delta, Starbucks, Fandango, The Home Depot, and more. But it could potentially be more powerful. Apple’s already made great inroads with Passbook, it could totally crack open the mobile payments space in the US. Apple could make up a fifth of the share of the mobile-payment transactions in a short few months after the launch. The company also has the credit or debit card information for virtually all of its customers thanks to its iTunes service, so it doesn’t have to go the extra step of asking people to sign up for a new service. That takes away one of the biggest hurdles to adoption. The last piece of the mobile-payments puzzle with the iPhone is the fingerprint recognition sensor Apple added into last year’s iPhone 5S. That sensor will almost certainly make its way to the upcoming iPhone 6. The fingerprint sensor, which Apple obtained through its acquisition of Authentic in 2012, could serve as a quick and secure way of verifying purchases, not just through online purchases, but large transactions made at big-box retailers such as Best Buy. Today, you can use the fingerprint sensor to quickly buy content from Apple’s iTunes, App and iBooks stores.

The bigger win for Apple is the services and features it could add on to a simple transaction, if it’s successful in raising the awareness of a form of payment that has been quietly lingering for years. Google had previously seen mobile payments as the optimal location for targeted advertisements and offers. It’s those services and features that ultimately matter in the end, replacing a simple credit card swipe isn’t that big of a deal.

 

Posted in Best Practices for Merchants, Mobile Payments, Mobile Point of Sale, Smartphone Tagged with: app, Apple, card, card swipe, cash, checkout machine, checks, chips, credit, credit card swipe, credit-card, customer, debit card, Digital wallets, fingerprint recognition, fingerprint sensor, Galaxy S5, Google Wallet, iOS, Iphone, market, merchant, mobile, mobile device, mobile payment, mobile wallet, Near Field Communication, network, Nexus 5, nfc, payment, payment service, platform, point of sale, products, sensor, services, smartphone, software, statements, swiping card, terminals, transactions, wireless technology