January 15, 2016
By Mark Goodstadt, Co-founder and CEO, Thinaire
With CES kicking off the new year, it is clear that we are living in a time of great disruption for the payment space. Unexpected players are starting to make their way into the payment world, creating substantial new opportunities for building up new smart infrastructure for peer-to-peer payment.
GM kicked off the year with a $500 million investment in Lyft, with plans for self-driving cars; Starbucks launched a digital skip-the-line payment system in Canada; Physical retailers are driving incremental sales through retargeting; and brands like Chase and Walmart are all launching their own pay product. What do all those event have in common?
At their core, they are highlighting a fundamental realignment of how consumers interact with companies and brands. In the payment space, we can see an increase the need to highlight the right payment form at the right time. Uber, for example, has built a model that ensures that payment for their service is completely frictionless: By storing payment details on their own servers and clearing transactions without user input and based solely on the recent experience, Uber (and its competitor Lyft) are driving forward a new era of frictionless payments.
Starbucks, which is now driving over 20% of its transactions through mobile payments, has started experimenting with Mobile order and Pay, a new approach allowing users to order before they are at their location, pick up their coffee of choice when they get there and walk out without stopping by the register. Payment and loyalty points associated with the transaction are settled in the background. Other Quick Serve Restaurants are now considering rolling out similar solutions to increase customer satisfaction.
In the retail space, competition from online sales has led many retailers to reassess their strategy in increasing incremental sales. As a result, they are increasingly looking at driving incremental sales through retargeting based on location data coming off components like beacons and smart displays.
And this year, Chase and Walmart are looking to roll out their own payment wallets, fighting with Paypal, Apple Pay, and Android Pay, for a share of the customer mindset. To differentiate themselves, they will have to open up their app in the right place at the right time.
Driving these types of experience requires the application of a fair amount of location data that can be gathered n a number of ways, ranging from using a Phone’s GPS (an inexact approach) to leverage nearby WiFi hotspots are beacons near the locations where such transactions occur. Unfortunately, many of those data sets or implementations require cobbling together multiple systems to drive context into a payment infrastructure. As more and more sensors appear in physical locations under the Internet of Things (IoT) banner, expect more payment workflow to integrate context.
To simplify these integrations, Thinaire is normalizing data coming from any IoT sensors and providing a context-driving exchange customers can leverage to drive contextual payment automation. By taking data sets from both the online and offline world, Thinaire can help customers trigger experiences on mobile devices that get them one step closer to clearing and, when integrated in a larger offering, delight customers in new ways.
Attaching context to a payment workflow and driving automated checkout based on contextual data will drive the next integration of digital and physical and some of the leading brands in the world, ranging from global brands like Carrefour and Starbucks to software vendors like Google Pay and Samsung Pay are increasingly using context awareness to drive transaction and it is easy to expect this trend to continue growing through 2016 and explode beyond that. Is your business ready to take advantage of it?
Recently, the IBM Chairman and CEO talked about Thinaire's Watson Integration in her Keynote