Signbox’s Mark Bartlett gives an insight into how people with NFC enabled smartphones will use their phones in a different way – with paying for goods and retrieving information becoming second nature. He believes that this next generation technology will have the greatest impact in the world of retail.

In recent times the retail experience has become ‘connected’, with companies using digital signage and QR codes to engage with customers via their smartphones. However such technology and devices could soon be superseded by Near Field Communication, or as it is more commonly known – NFC, predicted to make the greatest impact in the world of retail.

Certainly there has been a huge amount of “buzz” surrounding NFC and correspondingly high levels of media coverage, but if most of this has passed you by, you might be wondering “what is this ‘next big thing’?” Simply put, NFC facilitates data transfer between two ‘devices’ when placed a few centimetres apart -swiped or “tapped”. That means your smartphone can be used as a mobile wallet for secure, contactless NFC transactions. As the number of mobile payment users grows to over 375 million by 2015, the demand for devices with NFC, the underlying communications technology behind many mobile payment solutions, grows too. Consumers around the world could generate as much as $50 billion in sales through NFC-based mobile payments by 2014, according to a report just released by Juniper Research.

What it all means is that, in the next few years, people will use their phones in a different way, with paying for goods and retrieving data with an NFC enabled phone becoming second nature – an everyday occurrence.

Research also indicates that NFC chip shipments will surpass 1.2 billion units by 2015, the same year the technology is expected to reach a 30% global smartphone penetration. It is also forecast that the focus of the NFC market is shifting from payment applications and that, by 2016, 70% of NFC tag shipments will end up being used in marketing and promotional applications.

Store owners, brand custodians and campaign managers will be able to embed the technology into a variety of marketing collateral such as advertisements, signs, business cards, stickers and smart posters – the latter probably becoming the biggest marketing use of NFC technology. As the  NFC chip can be pre-programmed with virtually any type of data the smart poster can be used to deliver a whole range of information to target audiences such as an electronic voucher, discount code, list of stores (and directions to the nearest one), website and so on.

With this focus shift, I expect to see more and more retailers begin to pilot programs in 2012, with an unstoppable groundswell towards incorporating smart posters into their future marketing and advertising strategies. This trend has in fact coined a new term – it’s called proximity marketing, and smart posters will be at the forefront of new proximity marketing opportunities.

And it’s not just store owners and campaign managers that will be able to deliver tailored and customised messages direct to target audiences via their NFC enabled smartphones with a simple, fast swipe or “tap” of a poster. As the NFC chip will work when it’s behind glass (or acrylic), someone with an NFC enabled phone could download the details of a property shown in an estate agents window late at night; download the menu from a restaurant to take home for future reference or download an entire bus timetable at a bus stop. When a smartphone becomes a portable NFC reader, the possibilities are endless and very exciting.

Certainly a key driver that will fuel the growth and take up of this technology is that it’s likely to be hugely popular with consumers because by its nature NFC is ‘opt in’, unlike Bluetooth and location-based services, providing consumers with more control and countering any concerns regarding privacy.

With NFC the retail landscape will change – yes, presently it’s a “slow burn” whilst take up of NFC enabled smartphones gathers pace but that’s happening now and retailers should currently be making plans to exploit the amazing opportunities presented by this breakthrough technology.

Mark Bartlett is managing director of Signbox Ltd.

Signbox Ltd

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