Keith Cowing

Keith Cowing

Product guy. Entrepreneur.
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How will your data from mobile payments and eReceipts really be used?

October 10, 2011

The world of retail is changing faster than it ever has before. Nobody had heard of flash sales, group buying, or NFC three years ago. One of the most exciting changes will be the adoption of mobile payments and eReceipts, which will combine to provide a paperless way to checkout and manage your expenses. But when mobile payments and eReceipts become widespread, who will own your purchase data and how will they use it? Here are some key points to consider.

We are in uncharted territory
Online advertising, email marketing, and eCommerce have become mature technologies with standard privacy practices (see the CAN-SPAM Act of 2003). Retargeting has recently thrown a small wrench in the system, but most people have accepted targeted ads on the web as routine and non-invasive. If I view Sneakers on Nike’s website and later get a Nike ad on espn.com, that’s not a big intrusion. However, digitally tracking purchases that are made in the physical world has a very different feel to it. Nobody wants to read the morning news and get targeted ads based on their recent pharmacy purchase. So how do consumers know what mobile payments and eReceipts actually mean to their privacy? The experience of getting an eReceipt instead of a paper receipt is new to everybody. Retailers, tech companies, and consumers are collectively learning how to implement a solution that works well for all parties. It is important to realize that these processes and technologies have not existed before and there will be road bumps (like Facebook’s beacon disaster), but ultimately it comes down to trust. People trust Apple so everybody loves when the Apple store provides eReceipts at checkout. Likewise, other top retailers are focusing on privacy and consumer trust when rolling out their digital solutions. Earning that trust first is what will ultimately make the technologies successful.

Technology moves faster than regulation
Government regulation will always be a step behind. The CAN-SPAM act came in 2003 even though spam and email marketing started long before that. Technology constantly creates dynamics that never existed before and governments have to play catch up. California’s recent law that prohibits brick-and-mortar retailers from collecting zip codes is a great example. Retailers are quickly adjusting and preparing for what comes next. When it comes to privacy and trust, you want to do the right thing for your customer and not push legal boundaries. Ethics and consumer privacy should be the driving force, not antiquated laws that didn’t predict a future where consumers pay with their phones while checking into Foursquare, claiming loyalty points, posting on Facebook, and Tweeting about their purchase. Who owns that data?

There is a fierce battle for the consumer
Retailers want to own the consumer. Mobile wallet providers (Google, PayPal, etc.) want to own the consumer. Wireless providers want to own the consumer. Everybody wants to own the consumer. The companies that maintain direct interaction with customers and get their explicit consent to a privacy policy will be in a strong position. Somebody will ultimately break down the business and cultural barriers required to digitally manage ALL of your purchases. We are still years from that happening, but the value is incredible and a mobile payments war has begun. The investment required to play on this turf is significant, so the ultimate winner will be a big player with a large consumer presence. En route to that outcome, consumers should read the privacy policies that come with new products. Consumers will ultimately decide which payments and eReceipt platforms are successful and therefore will choose their own destiny regarding security and privacy.

Transparency is the key to trust
The Internet and social media have brought an unparalleled level of transparency to the business world. People will find the truth whether you like it or not, so the best companies are embracing transparency and being open about their business practices, their values, and even their mistakes. If you tell people exactly what you are doing and why, you may not always be right, but nobody will doubt that your statements are true. This provides room for honest errors because you can own up to them, improve and move on. The days of old boys clubs that dominate business based on their exclusive access to people and information are waning. Information is open and you can either run from it or embrace it. Businesses that embrace it and provide transparency to their customers will be the ones who are ultimately successful. If you want to know what somebody is doing with your data from mobile payments or eReceipts, then simply ask. If you get a clear, consistent, human answer, that’s a good sign. If you get a fuzzy answer or messages are mixed behind cryptic legalese, maybe you should think twice. Transparency leads to trust and trust leads to long-term loyal customers.

Customer experience trumps all
At Seamless Receipts, we work with a variety of high-end retailers and brands. The most successful ones think about customer experience first and view it in an all-encompassing way. When a customer visits your website, walks into your store, makes a purchase, gets an eReceipt, or talks about your brand on Facebook, these are all touch points in an ongoing customer experience. Your brand is represented by every step along the way and doing the right thing for your customer is doing the right thing for your business. When it comes to mobile payments and eReceipts, providing a convenient and simple solution is part of the customer experience. Retailers should create an operational flow that makes sense for the sales associate and the customer. Retailers should also send a clear message about privacy and data usage. Every sales associate should give the same, simple answer when asked.

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