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The iPhone 6 and Apple Watch: First Steps Toward an Incredible In-store Customer Experience?

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Sep 15 2014, Posted by Carl Davis
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Last week Apple unveiled two new iPhones and the long anticipated Apple Watch. The surprising part, at least to me, was not so much the products or the actual payment system, but rather, the extent to which the payment system, Apple Pay, will be integrated into retailers right out of the gate. Using near field communication (NFC) technology, the iPhone 6 and the Apple Watch will soon allow you to make purchases at Babies“R”Us, Bloomingdale’s, the Disney Store, Macy’s, McDonald’s, Staples, Subway, Walgreens, and Whole Foods to name a few. And, VISA, MasterCard, and American Express have all pledged support for this payment type. What’s more, it has been unofficially confirmed that the Apple Watch will also support an NFC experience.

But, what does all this mean for the future of NFC in retail and in-store customer experiences?

As I wrote last Friday, Apple will only include NFC for payments if they have a good solution for security. That said, while there are still a few unknowns about how the NFC protocol is implemented, specifically if it is encrypted between the device and the reader at the register, it seems that Apple has in fact delivered on addressing initial security concerns. What we do know is that much like a fingerprint, card information will be stored in an encrypted area of a dedicated chip, which Apple calls the Secure Element. Apple also brings tokening—a unique code for that transaction and that transaction only—into the equation. Additionally, it appears that the NFC connection can only be initiated through engagement with the TouchID fingerprint scanner, reducing the chance of someone within proximity of your device somehow gaining access to any NFC-related information.

In light of recent data breaches at major retailers Target and The Home Depot, these security measures will likely be very important in winning over hesitant retailers and customers alike. And, if NFC is really to make an impact on retail in a big way, winning over widespread retailer and customer adoption is a must. Besides adoption, another potential speed bump for NFC, surfaces in Apple itself. Whether Apple will open up the NFC system to third-party developers is still unknown. However, if Apple does indeed open up the NFC system and it receives strong support, look for a host of potential for in-store mobile experiences, not just for payments, but also for some brand experiences that do not require removing your phone from your pocket. Imagine walking up to a display and being able to trigger content changes on the screen. Imagine if the display knew who you were. Imagine a simple way to continue the shopping experience once you’ve left the store. NFC could take us there.

For example, let’s say that a customer looking at a printer inside a Staples location has the Staples app on their phone. If the display for the printer contains NFC technology, the customer could receive an enhanced engagement tailored to that product through their mobile device. And, since Staples would then know that this customer was interested in that printer, if the customer still needed some time to shop around or think about it, the Staples app could later prompt the customer with additional information about the printer or upcoming promotions in an attempt to get the customer to return to a nearby store or complete the purchase right there on their device via the app.

This is just one simple example of how NFC technology could enhance the customer experience. However, the possibilities for NFC are virtually limitless, and the iPhone 6 and the Apple Watch are some definite steps toward an incredible in-store customer experience. What ways can you envision NFC technology enhancing the customer experience in-store?

  • Kristin Harripaul

    Kristin

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