It’s safe to say that mobile POS systems have arrived. POS, for those unfamiliar with the acronym, means Point of Sale. It’s the terminal at which money is exchanged for goods, and traditionally, it was a big clunky computer in a supermarket checkout line. Thanks to the birth of Cloud computing, however, mobile POS systems have taken off, allowing businesses to reach customers in a wider and ever-increasing number of settings. Today, the latest wave of POS technology utilizes hardware that most people already have access to, including personal computers, smartphones, and tablets. And that’s just the beginning. Mobile POS systems are expected to do big things in the private sector, empowering individual sellers as well as expanding the options for major corporations. Here’s a look at what we can expect in the next ten years.
What to Look For
The past few years have been tumultuous ones in the world of online and mobile payment systems. New services such as Venmo are making payments more accessible for everyday people looking to split bills and repay debts without the necessity of visiting the ATM every few hours. Bitcoin, an experiment in alternative currency, made waves as the new system gained thousands of followers, only to lose one of its biggest markets at the peak of its height. Companies like Paypal, already behemoths in the online shopping world, have unveiled a wide array of new technologies that put them squarely in competition with top POS providers. Shopify, another major entry, offers tablet-based and highly encrypted POS services, starting at a fraction of the cost of major terminals.
Other corporations have joined the race for POS dominance as well. This field, now dense with competition, promises to benefit the customer and everyday businessman greatly in the coming year. According to Javelin Strategy and Research, a leader in the tech analyst world, over the next five years, mobile POS systems will far outstrip other payment methods in total compound annual growth.
The report goes further than that by predicting the total market share of mobile POS payments for the years leading up to 2018. To no one’s surprise, the growth is quite large, growing from half a billion US dollars in 2012 to an expected $5.4 billion in 2018. That’s a massive change, more than a tenfold increase in the total market share.
The coming years should be a heady time for mobile POS providers, and customers should notice a marked difference in the shopping experience at a variety of different stores. Devices will continue to shrink, and soon, the card reader may be done with altogether, as phones replace wallets and the next wave of technology hits. For now though, mobile POS development is just taking off, and the coming years look bright.
Javelin isn’t the only research firm interested in mobile POS, and for good reason. According to Payments Source, Mobey Forum has conducted detailed studies, finding that the technology is expected to reach 46 percent market penetration by 2017, compared to 17 percent in 2012. For those unfamiliar with the vocabulary, market penetration is a measure of a product’s sales volume compared to all similar products, according to the Business Dictionary. This growth is fueled by a massive increase in the number of POS terminals, which leapt by 111 percent from 2011 to 2012 alone, and is only expected to increase. Currently, estimates place the number of mobile POS terminals at around ten million, which should nearly quadruple in the next 3 years.
Who is Responsible for the Growth of Mobile POS?
Just like any activity on the market, the growth of mobile POS technology is a convergence of consumer demand and business needs. Small businesses have been especially ecstatic to receive access to a wider client base, particularly when those businesses are mobile, traveling to conferences, festivals, or farmers markets. Consumers no longer carry cash around with them on a day-to-day basis, as credit card terminals are ubiquitous at brick and mortar stores. Now, that won’t prevent sellers who don’t have access to a traditional POS terminal from selling their products.
It’s also not just the little guys who are joining the mobile POS world. Mobile POS technology is being deployed by major shipping companies, for one thing. Stores are allowing customers to purchase items where they want, and luxury retailers are investing in mobile technology every day. Another prime example comes from the restaurant world, where servers are greeting diners at the table. While this small gesture may seem trivial, it typically saves several minutes of wait time, allowing diners to spend less unwanted time in the restaurant. And, if it’s a large operation, that speedier time translates to smaller wait times at the door. All in all, restaurant owners are realizing that Mobile POS is a cheap and effective way to make diners happier without sacrificing on quality or ambience, a rare combination. These are just a few examples of the ways that mobile POS should impact the marketplace.Guest post by Daina Anderson