Could Near Field Communication Technology stimulate your Economy?
The concept of contactless payments and Smart Posters appears to be relatively unimportant to many consumers, with very few understanding the potential benefits of the system, and less still able to identify what a Near Field Communications (NFC) device is and how this cutting edge technology works. However mention the success of the Oyster Card scheme in London, which has seen over 10 million contactless payment cards issued, 5 million of which are used every day, and suddenly more people recognise the concept and the benefits of (NFC) Near Field Communication immediately.
We are taking Jersey as an example to show how this concept will work
Fast forward to the summer of 2012:
After a day out, Julie is at the bus stop in St Brelades Bay and needs to get back to St Helier. Using her smart phone that contains a tiny NFC wireless communications chip, she places her handset on a tag on the Smart Poster-enabled timetable and is automatically informed that her bus will arrive in 20 minutes by a message that pops up on her phone screen. Now fully informed of the expected arrival time of the bus, Julie wanders over to the nearby cafe and buys a Jersey Ice cream paying for it by swiping her Smart Phone over the contactless payment terminal at the counter. Julie’s bus arrives and she buys her ticket by swiping her phone over the NFC Reader which automatically deducts the ticket price from the electronic wallet stored on her Nexus S NFC Smart Phone. Although this scenario sounds like science fiction, a similar Near Field Communication initiative is already being tested at 10 bus stops on the mainland in the borough of Poole.
John is taking his new BMW out for a spin, so he places his NFC Smart phone next to the car door which automatically identifies him as the car owner using NFC wireless communications before unlocking. He drives down to Beaumont to visit his mum who lives in sheltered housing and on arrival he swipes his Smart Phone at the gate to gain entry. The encrypted identification details stored on John’s phone are checked by the security system and once verified the gate is automatically unlocked allowing him to gain access. John’s mum has a medical condition that requires regular monitoring by medical staff so he passes his NFC enabled smart phone over her wrist bracelet to collect important information about her condition. The details are collected wirelessly by the smart phone and then sent by text to the doctor’s surgery for analysis. Near Field Communication is already being used by healthcare professionals in Haiti to monitor contamination of water supplies, by doctors in Austria to remotely monitor patients’ blood pressure, and next month an NFC product will be introduced to monitor potential sleep disorders remotely negating the current need for patients to spend days or weeks in specialist units away from home.
The Duvalier family have sailed over from St Malo and spot the Tourist information Smart Poster on the Elizabeth Quay. Claudette Duvalier taps her Smart Phone on the Durell Tag and she collects information on opening times, Alain Duvalier uses his phone to tap on the tag that gives him information about the time of High and Low tides whilst Lysette Duvalier uses her NFC Smart phone to access information about the Jersey Live Festival. All the information supplied by the Smart Poster is automatically stored on the Duvalier family phones ready for them to use at any time. The French have been earlier adopters of Near Field Communication and have positioned NFC Smart Posters throughout the city of Nice. These Tourist information Smart Posters relay information directly to Smart Phones using simple Tap Your Phone™ Technology to help visitors find out useful information such as opening times, prices and also discount vouchers redeemable at various venues throughout the city. NFC enabled devices are already in use across a number of European cities as a way of disseminating up-to-date information to tourists quickly and easily without many of the costs traditionally associated with printed brochures and leaflets.
Lucy is at home in St Clement, she has recently been sent a mini adhesive NFC Smart Poster by her local supermarket which contains a tiny NFC microchip. When she places her Samsung Galaxy 11 Smart phone close to the tag and she gets immediate access to the deal of the day. Using Tap your Phone™ Technology Lucy is able to complete her weekly shop online from her mobile phone and pay for the goods using the credit card details which are encrypted onto her handset. The payment is authorised and processed immediately by her bank saving her the time and effort usually associated with a weekly shopping trip to the supermarket.
Jeff is wandering through St Helier and fancies a skinny latte and a pain au chocolate at a nearby coffee shop. Inside the shop he taps his phone on the Skinny Latte tag and then on the Pain au Chocolate Tag on a Smart Poster which doubles as the store menu, automatically registering his order for the barista to complete. The App on his phone automatically pays for the drink and croissant, deducting the appropriate amount from his electronic wallet that is stored on his handset. Jeff can top up his electronic wallet when he gets home, via PayPal or his online banking account by simply transferring an amount of his choice.
Jackie is in the Zuma fashion store where she has seen a pretty little red dress she likes. She passes her phone over the tag which sends information about the price and the fabric directly to her phone’s screen. She tries the dress on which fits perfectly and when she goes to the checkout she passes her phone over the NFC reader that deducts the payment from her credit card, which is encrypted and stored on her NFC Smart Phone. On the way back to her car she notices a Smart Poster for a gig the following week at Fort Regent. As the smart poster allows her to buy the tickets from her smart phone app she places her Nexus S close to the tag on the poster where the payment is authorised immediately and electronic copies of the ticket are sent to her phone. Not only does the smart poster allow Jackie to buy the tickets immediately, she can also send on her friend’s ticket to their smart phones. Congratulating herself on this time saving benefit, Jackie reaches her car and remembers how she used to have to leave Pay Cards on her car for the length of time she might spend in the car park. Now when she leaves the car park she places her Smart Phone next to the reader at the exit and it deducts the exact cost of parking from her electronic wallet saving her some extra cash as she no longer has to over-estimate her stay. When she entered the car park earlier in the day, the same NFC reader was able to give information about the cost of parking, how many parking spaces were free and on what floor they were. The cost saving and time saving have been beneficial, but Jackie also gets a loyalty bonus delivered directly to her electronic wallet which she can use as credit towards future visits.
Arriving at the gym to attend his circuit training class Jason passes his phone over the tag on the NFC Smart Poster automatically paying for his class and downloading the timetable of his future classes into his phone’s calendar. At the end of the class he is thirsty so he passes his Smart Phone by a tag of a nearby vending machine, out comes a can of Red Bull and the payment is automatically sent to the vending company. Another machine dispenses his copy of the Jersey Evening Post and payment is again extracted automatically from Jason’s phone. On the way to meet his friends for dinner at a local restaurant, Jason notices a Smart Poster advertising the restaurant and passes his phone over the tag which reads ‘Today’s Special’. The offer for today is for either a free glass of wine or a free dessert for every diner in his party. The Smart Poster also allows Jason to browse the rest of the menu, check opening times and provides the facility to book a table all from his mobile phone. Jason thinks to himself how clever these posters are and how much easier it is to access information, pay for items and how much time and money it saves him. The free dessert for each of his friends is sure to keep him popular too!
After a lovely meal Jason takes a stroll through St Helier and stops at the window of a local estate agent. He has been looking for a new flat and sees a suitable property in the window. He passes his phone by the window and the property details are transferred to his Smart Phone screen, with another tap on his phone he requests an appointment to view which is automatically saved to his calendar and that of the estate agents, along with his contact details.
The above examples provide just a few scenarios where NFC Technology has the potential to save customers time and money when making payments for small items or retrieving accurate information about products and services. Google have today announced a partnership to with MasterCard and Citigroup to rollout an NFC payment system using the search giant’s Android smart phone handsets. Citigroup debit and credit card holders will be able to download an app to their phones which will allow them to pay for goods and services without reaching into their wallets to retrieve a plastic payment card. Users of the app will also receive targeted advertisements for goods and services, whilst also being able to manage their account directly from their phones. Google are also expected to be big winners, selling on demographic and purchasing data to other retailers based on the information they gather as part of the NFC payment process.
Interest in wireless mobile payments is also increasing here in the UK, with Sir Stuart Rose, former Chief Executive Officer at Marks and Spencer, being invited to join the board of the Money Mobile Network (MMN). Rose’s appointment to the board seeks to unify the partnership of The Carphone Warehouse founder, Charles Dunstone, Monitise and Best Buy Europe to provide mobile shopping, banking and marketing services across the British Isles called “Simply Tap”. Consumers will be able to see a product in store, enter a code into their mobile phone and have the item paid for and delivered to their home address automatically. 17 of the top 20 UK retailers are already in talks with MMN about rolling out the service; with 750 million mobile subscribers in Europe alone, large companies are taking mobile payments very seriously.
On a more local level, during trials, retailers using NFC Technology have reported that they can boast a more loyal customer base who appreciates the ability to pay for an item quickly and simply. Value added functionality such as loyalty schemes built into smart phone apps and the ability to offer discounts directly to a mobile phone handset via smart posters have also been recognised as a great way of improving customer retention. A six month long trial in the Spanish town of Sitges demonstrated each of the above findings, but most importantly for a local economy, that NFC payment users made 30% more transactions than customers paying with cash or credit cards, and that the average purchase value increased by 23%.
And the London Underground Oyster card system has demonstrated the ongoing success of using NFC for ticketing and payment systems. The logical extensions of such systems are smart posters that can dispense tourist information such as the Nice town tour in France. Tourists are able to access time and location specific information on the city of Nice simply by passing their NFC enabled smart phone next to an NFC Smart Poster. By following the trail of posters, tourists are able to access relevant multimedia information as they view the sights, whilst the smart posters will also dispense relevant information such as nearby accommodation, shops, restaurants and events, helping to encourage the visitor to spend more in the local economy, by providing relevant targeted information.
The use of smart phone apps is almost limitless when combined with NFC Technology. Plastic payment cards or loyalty schemes will no longer be required as the information can now be securely encoded onto a customer’s smart phone. Research shows that people are less likely to forget their mobile phone when leaving the house than they are their wallets; by providing customers an easy way to always have their wallet, in the form of a contactless payment system, businesses are sure to benefit. Businesses should also expect reduced start-up costs when implementing new loyalty schemes or special offers, because the deployment of smart posters and apps is centralised. Printing brochures and leaflets will become a thing of the past as the information powering a smart poster can be updated remotely without replacing the whole poster.
Since October 2008, over 200 trials of NFC technology have taken place with a view to testing the business importance and relevance of the concept.
Paul Lakeman of local business Near Field Communication says this; “Jersey’s size and the close proximity of everything makes it the ideal location to trial and test Near Field Communication a Technology that will undoubtedly affect all our lives and this could position Jersey as an innovative location to test NFC technologies. The implications of how Near Field Communication could benefit Jersey’s economy are plain to see. Large financial institutions are investing heavily in contactless payments, MasterCard have been testing PayPass and Visa has PayWave and systems like these will need extensive backend support and stringent financial regulation. The ramifications for tourist organisations are also very evident and on Island and off Island initiatives should be tested.”
As Rich Pleeth said in his recent article on (NFC) Near Field Communication for “Think Quarterly” from Google, “We are at the cusp of a new era of consumer relationships. The time to act is now; otherwise you’ll be touching into the train after it’s already left the station.”
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