We use mobile phones for almost everything these days to find our way, for online shopping, or just generally surfing the net so why not pay for fuel with one? There may be a few regulatory hurdles to overcome first but mobile payment on forecourts could be a lot closer than people think.
A number of companies are already exploring the opportunities for mobile payment at the fuel pump. Torex, which became part of Micros in April and officially takes on the Micros name this month, has developed a prototype mobile payments web browsing service, and is trialling the technology, which links to PayPal, at a forecourt in Hampshire. It is a closed loop pilot involving invited users only at this stage, but Micros hopes to go live before Christmas. Development of a suite of apps for all smartphones is also in the planning.
Motorists will be able to log in to a mini website and in the future an app to locate a nearby forecourt offering the mobile payment service. Once a site is selected, a list of available pumps will pop up. The motorist simply chooses a pump and will immediately be linked to PayPal for authorisation before fuelling. Receipts can be viewed on the phone and emailed to the customer.
Jon Dunman, vice president of convenience and fuel solutions at Micros, says: "There’s been a general explosion of people investigating mobile payment technologies right across the market spectrum, not just in the fuel market. However, in the fuel market it is technically much more difficult to deliver because of regulations."
Gilbarco Veeder-Root (GVR) has been prototyping mobile payment technology with the we-e-pay smartphone app. Motorists could set up an account that operates similar to PayPal and, using their phones, scan a QR code displayed on a Gilbarco Veeder-Root multi-media screen and enter a pin code into their phone for authorisation. The technology can display adverts for special offers in real-time, and customers will be able to select a deal and coupons will be stored on the phone to be redeemed in-store. Fuel purchase receipts are also stored on the phone.
Giovanni Carapelli, vice president of global innovation at GVR, says: "This technology gives retailers a new way to talk to their customers. The whole transaction is in the customer’s control and there’s no space for fraud. Mobile payment will come around very quickly customers are already asking us about it."
Seamus Hughes, marketing manager for CBE Software, says mobile devices are set to revolutionise retail in the way consumers shop for products, interact with retailers and transact business. "Mobile devices can be used for paying for goods or services, accepting/redeeming loyalty points or mobile coupons, and searching for and accessing location-based deals," he says.
Near field communication (NFC) technology enables mobile devices to pay for goods or services by simply swiping their device over the payment terminal. As smartphones and tablets become more sophisticated, the concept of built-in wallets will become the norm, adds Hughes. "CBE will be in a position to accept mobile payments when they are launched in the UK market as the CBE contactless payment technology software has been designed to work seamlessly with NFC, which will allow retailers to accept both card and mobile device payments. More and more loyalty programmes are moving away from traditional loyalty card fobs to mobile apps where the consumer simply scans the loyalty code from their phone on the customer-facing scanner at the point of sale. Mobile coupons mean vouchers are much more cost effective to issue and are targeted more effectively, they’re easier to track and uptake is greater. They also create a more highly engaged customer, offer greater immediacy and intimacy, and generate customer loyalty."
Fuel dispenser manufacturer Wayne, which supplies the Fusion forecourt controllor, has developed outdoor payment and electronic payment systems as add-ons to the Fusion 6000 system. One new development is a handheld queue-busting tablet-based payment device that could allow site staff to go out onto the forecourt and take payment from the customer outside. Another is a tagging system using vehicle indentification technology. Motorists who have subscribed would have a tag on their vehicle and there would be a device retro-fitted to the pump nozzle which would communicate with the tag to identify the vehicle. The transaction would then be automatically recorded.
Tim Firkins, Wayne’s project manager for fusion and automation systems, says: "There’s no differentiation between forecourts in the UK they’re all doing similar stuff and nothing has really changed over the years. Some petrol stations can’t justify investment in outdoor payment terminals they’re too expensive to buy and too expensive to run but mobile payment technology means retailers can still offer payment on the fly.
"We are investigating with some retailers how we can use the tagging technology to improve customer experience on the station. It’s good for customer interaction; the operator will get to know a lot about the vehicle and the purchase history of the vehicle. It also stops the problem of misfuelling immediately and is interesting for loyalty scheme purposes."
Meanwhile, John Lewis, convenience and fuel manager for retail software provider PCMS, which has recently developed fuel and forecourt functionality into its Vision BeanStore technology, says mobile point of sale is more interesting than mobile payment, and that the company is developing a Java-based product that operates on an iPad. "There are limitations of making pos mobile in the petrol market," he says. "We are scoping a solution for mobile payment. Outdoor payment for an attended service is going to become very important."
For all retailers, but rural ones in particular, outdoor payment terminals are becoming increasingly important and with customer demand on the rise they are proving to be a particularly effective investment, says Micros’ Jon Dunman.
"Outdoor payment speeds up transactions, removes the need to queue and makes life easier for customers a real plus for business drivers in a hurry, those who don’t want to shop, and customers who may need to pay outside of normal trading hours in rural areas where there is a longer distance between towns and villages.
"What’s more, by offering customers a variety of payment options, forecourts will be able to boost their incomes dramatically. Outdoor payment terminals also help improve forecourt security and staff safety by reducing the risks faced by late night opening and offering convenience for customers who prefer not to leave the safety of their car at night. This technology also helps mitigate against the risk of drive-offs."
Janet Barraclough, group marketing manager at HTEC, agrees: "Integrated solutions and extended hours are key. If you have a busy forecourt with high throughput, customers may be put off by long queues at the till. Tight margins on fuel may mean you want to get your customers into your store but outdoor payment will improve throughput and keep ’splash and dash’ customers coming back. Staffing extended hours and weekends is expensive so outdoor payment can ensure you are not losing business when you cannot or cannot afford to man the site. Drive offs are also growing so retailers can make their most vulnerable lane pay at pump only."
Maximising store sales has become critical to the survival of forecourts so retail technology providers have been developing software that identifies key product lines. Dunman says: "There has been development around ’golden lines’ technology to help retailers increase visibility of the key products. The Golden lines module, Prism 2, focuses on the principal that 80% of profit comes from 20% of product lines, and provides the tools to help retailers maximise their potential.
"Retailers need to change their mind-set on data think of it as an ally rather than enemy and think about using it in a positive way to drive improvements," he adds. "There are many retailers making excellent use of their systems, and we work with them at the leading edge of development to help us improve our systems and innovate.
"But there are only a few out there using their data to its full potential and so everyone can always find ways to improve and grow."
To help retailers get the most out of their retail systems, Micros has been running Profit Clinics, which aim to provide a new level of insight into the powerful functions available within the epos system. And with hundreds of clinics identifying an average of £10,000 extra profit per year, so far only one retailer has been found to be operating at their optimum profit potential.
Meanwhile, Ed Brindley, director of marketing and business development at Wincor Nixdorf, says that while forecourt retailers are beginning to harness the power available in the latest epos systems, there is still more to be done.
"The leading operators are integrating their epos with other IT systems such as workforce management, environmental control systems and stock management, allowing them a holistic view of their operation. Vendors can add value to this exercise by acting as system integrators and by the provision of managed services that allow retailers to concentrate on the day-to-day running of the business."
Car wash promos at the pos
PSD Codax is helping forecourt retailers increase revenues by offering car wash promotions direct from any sales desk. Codax Code Generator the new ethernet version of the Codax system now gives retailers the added option of selling smartcards for multi-buy wash promotions via their point of sale (POS) terminals.
Smartcards are increasingly popular with regular car wash users and fleet operators who can benefit from multi-buy discounts and other promotions. The Codax system plugs directly into the in-store network so that all tills can be used to sell car wash programmes and print customer access codes. POS integration with Codax technology also allows head office managers to collect accurate sales data from any sales desk. PSD Codax is currently working closely with POS providers both in the UK and abroad. They include Wincor-Nixdorf, which is currently integrating Codax Code Generator technology with POS systems to improve revenue reporting and security across all Shell UK forecourt sites.
To help retailers comply with the mandatory Payment Card Industry Data Security Standards (PCI DSS), Phoenix Managed Networks has developed PhoeniXSentry, a simplified solution delivering security to all payment transactions and IT data with its built-in router firewall.
The system, which streamlines IT and payment network security, detects any suspicious activity compromising a network and reports it back to the merchant instantly. It can be easily integrated into an existing system and automatically updates any changes to PCI regulations as PCI is not a one-off exercise, says Alan Stephenson-Brown, UK managing director of Phoenix.
"PCI DSS apply to any organisation that processes card payments, and merchants are required to fulfil a lengthy and complicated assessment process," he says. "Phoenix takes care of all of the technical assessment required leaving merchants to concentrate on their core business.
"PCI is not a choice, compliance is mandatory for any business processing payments. The standards are there to help by setting out the security, technology, controls and processes needed for protecting cardholder data. Account data breaches can lead to catastrophic loss of sales and any breach could result in fines of up to £1,000 per card breached. On top of this when a business is found to be PCI non-compliant, it faces continual monthly fines."