Aurora Fashions and sister business Karen Millen have become the first retailers to launch PayPal’s mobile payments service in store.
Customers can use the PayPal inStore app, available for Android and Apple iOS devices, to pay for products at Coast, Warehouse, Karen Millen and Oasis. The app provides customers with a unique barcode and transaction number, which the shop cashier scans to take payment from the customer’s PayPal account.
What are the benefits of mobile payments in store?
Neil Saunders, managing director of consultancy Conlumino, says that by providing another payment choice for customers, Aurora is improving convenience. It can also help staff provide better service by making the payment process more flexible and allowing staff to move around the store more. “Staff are not necessarily tied to a till area,” says Saunders. “From a service point of view it’s quite helpful,” he says. Martin Gill, principle analyst at Forrester Research, adds that it could improve engagement, particularly among Aurora’s young consumer base.
Will customers actually use it?
“The audience is quite marginal at the moment, but it’s a sensible and savvy move,” says Saunders. Technologies like this start off from a low penetration rate, he adds, but then tend to pick up dramatically once they reach a tipping point and customers become more aware of the service. Gill adds it may take some time and effort on the part of Aurora and PayPal to ensure customers are aware of the service. “You’ve got years’ of people’s habitual use of cards to overcome,”he says.
Is it expensive?
Not particularly, says Saunders. “One of the great things about this is that the customer brings the hardware in the shape of their smartphone.” PayPal will also bear some of the system costs, making the upfront investment not too onerous.
Will it drive incremental sales?
Potentially, says Gill. Using PayPal online will typically bring incremental sales to a website, but it remains to be seen if the same thing will happen in the offline world. It may cause customers to choose Aurora because of the convenience, he adds.
Will it work in other retail sectors?
Saunders forecasts this kind of technology will eventually replace hand held scanners in grocery stores. “It will work in every sector, but will need to be slightly different,” he says. The logistics of the process will need to be figured out for each category, but it’s likely to suit nearly every retailer in some form.