Michael Koploy of Software Advice in Austin, Texas recently posted a blog about the potential for NFC in the city. The blog is at http://www.softwareadvice.com/retail/. In it, Michael outlines five ways NFC could develop. This is an interesting take on the subject and here are my thoughts.
From Michael’s blog, it’s clear that Austin is an early adopting location in the US, with high tech companies, a large university, and a technology friendly population. It’s also one of the two cities where the new Isis NFC mobile wallet joint venture between AT&T, T-Mobile and Verizon is launching. Here are Michael’s five points, with my comments on each, particularly in relation to the UK:
1. Spread the Word with Festivals and Conferences
This is certainly an area of great potential for NFC, including payments. Fenbrook and partners have been working closely with MasterCard for 2 years on the possibilities for contactless payments in festivals. It’s clear festival organisers are very interested in this, and not just for the benefits of removing cash. Virgin Media, organisers of the V-South festival in Chelmsford, reported that 75% of festival goers last year had smartphones. OK, these were not NFC enabled, but Virgin Media sees huge potential from being able to target customers with special offers in a relevant context, and have them able to make impulse purchases immediately.
2. Find Innovative Ways to Integrate NFC With the University
Universities everywhere have huge potential for NFC, for cashless payment, access control, attendance monitoring, and other applications. A number of these institutions in the UK are looking at NFC. However, until all students have NFC enabled smartphones, it’s difficult to introduce NFC services. I think the solution is to introduce contactless card systems and migrate these to NFC as students get the phones. Given the other services being delivered, and student propensity to use mobile phones, I don’t expect this to take longer than about 3 years.
The other way to look at this is as students as a demographic body, across multiple universities, rather than from the institutional point of view. If you do this, you can integrate purchasing in student bars, location based marketing, social media, and even festival attendance.
3. Create NFC Purchasing Habits at Hip Food Venues
I think the big opportunity for NFC at Hip Food Venues is through Location Based Marketing, so customers can get ready access to special offers from nearby outlets, share messages and tips with their friends, and use the NFC phone to pay, thereby creating a rich source of data which merchants can use to encourage further spending. Fenbrook and Near Field Solutions have written a white paper on this subject at http://www.fenbrook.com/white-papers.
4. Integrate NFC into High-End Supermarkets
I saw the Korean subway scheme where busy commuters can “shop” using QR codes on pictures of grocery items, scanned to their smartphones, to order from a supermarket and have the items delivered to their homes at the end of the day. This is a great idea, and one I would expect to catch on quickly in other busy Asian locations. Will it catch on in Europe and the US? I think more research is required to understand this, and it would be interesting to talk to the major supermarket chains to see if it’s on their radar.
5. Attract the NFC Crowd in Merchant Neighborhoods
Most definitely, I think the convergence of social media interaction, product browsing, “likes” and reviews are going to change the way people shop. Amazon has this model off to a fine art for online shopping; I think NFC brings the same possibilities to the physical/on the move world. Again the white paper discusses this in more detail.
In summary, I think NFC deployment will be all about critical mass. If Austin has several NFC strands going, which feed off each other, it could be well placed to be an early adopter city. The French government is doing this in Nice, with its Citizi initiative. This is rather a top down approach, whereas I expect Austin to be bottom up. Both will have their place and it will be fascinating to see what unfolds.
Fenbrook Consulting advises businesses about the commercial opportunities and technical requirements of Near Field Communications