Innovation

Your next in-store checkout may be no checkout at all

June 16, 2021 | By Vicki Hyman

Most of us can instantly conjure an image of our neighborhood candy store — baskets of cellophane-wrapped hard candies, bins of rainbow-hued jelly beans, shelves of throwback treats such as Abba-Zabas, Astro Pops and wax lips. The sweet shops that still dot many Main Streets are a testament to the enduring appetite for nostalgia — but not when it comes to checkout.

Glen Ellyn Sweet Shoppe has been a mainstay of its Chicago suburb for nearly 40 years. But when the pandemic hit, owner Sue Johanson, like many small business owners, looked for a cheap and easy way to help her customers make touch-free transactions without investing in new hardware terminals. Bonus points if the solution was portable, for those who felt more comfortable with curbside pickup.

The answer was in her pocket.

Johanson turned an Android smartphone into a contactless payment device using Mastercard’s Cloud Tap on Phone technology. Customers tap their contactless-enabled cards or mobile wallets against her phone to make purchases. “It makes customers happy to see an old-fashioned candy store experience and be able to take advantage of it with new technology,” she says.  

It can take years for new payment technologies to catch on, but the pandemic propelled a willingness among consumers to embrace new ways to pay. In the first quarter of 2021 alone, Mastercard saw 1 billion more contactless transactions compared to the same period in 2020.

These new technologies are transforming physical checkout, with pen becoming as outdated as carbon-paper receipts. These concepts have the potential to speed up the grocery line during a future visit to your supermarket or let you leave your wallet at home, using just your phone — or your palm — to pay.

Among these new ideas, customized transaction sounds that punctuate the payment now convey a sense of trust for the customer. Cloud Tap on Phone can turn a store owner’s mobile device into an easy-to-use point-of-sale terminal. The new Biometric Checkout lets people pay using face or palm biometrics — no wallet, traditional or mobile, necessary — and is fast becoming a reality. Grab-and-go stores are already integrating computer vision, shelf sensors and camera arrays to dispense with traditional checkout altogether.

People are now much more open to testing out new payment tech. Nearly two-thirds of respondents in Mastercard’s New Payments Index, a global survey, say they tried a new payment method they would not have tried under normal circumstances. Nine in 10 say they will consider using at least one emerging payment method, from contactless to biometrics to crypto, in the next year.

“These innovations are a natural result of a consumers’ desire for simplicity and convenience in commerce,” says Femi Odunuga, senior vice president for Mastercard’s Emerging Consumer Solutions team. “It’s a reflection on the continued convergence of digital and physical experiences.”

Who we are is how we pay

The challenge is in creating these seamless experiences while continuing to instill trust in each transaction, and biometric checkout is a prime example. Biometrics are already considered more trustworthy, with 60% of consumers saying that they feel safer using biometrics than entering a PIN, according to the New Payments Index. 

Biometric verification is already used at some airports and offices, and biometric checkout would follow a similar process: Customers would enroll in-store or through an app, register their biometrics and link their payment credentials to them. Then they can simply use their faces or wave their palms over a biometric reader at the checkout counter rather than taking out their cards or their phones.

Mastercard recently launched a Biometric Checkout program to guide the responsible development of this new technology. It expects to launch pilots in the Middle East and Asia-Pacific region in 2021. “We’ve long believed biometrics is a more secure way than passwords to recognize individuals and verify their identities, and we want to harness that security to create more seamless and innovative ways to pay,” says Chris Reid, executive vice president for Identity Solutions at Mastercard.

Biometrics are extremely difficult to replicate — unless you’ve got the budget of a “Mission Impossible” film — but it was critical that Mastercard apply the same rigors of data protection to the new program, he says. The guidelines safeguard the biometric checkout process and set certification requirements for biometric checkout solution providers, ensuring there’s more confidence and security on both sides of the checkout counter.

Trusting what we can’t see

Technology is edging closer to a truly frictionless shopping experience — one in which traditional checkout disappears entirely. A network of interconnected tech will invisibly validate what’s in your shopping cart, authenticate your identity and authorize your payment. But this requires an even higher degree of trust — that the transaction is even happening, for one.

That’s where sound comes in. “Ka-ching” remains part of our lexicon long after we retired mechanical cash registers. Sound remains an inextricable part of the checkout experience — it’s actually gained more prominence as the transaction has become even more seamless. The ping when your contactless-enabled card or mobile wallet is authorized at checkout without even touching the reader — and often without a cashier involved at all — provides that same assurance.  

Because people process sound so much faster than vision — it takes 50 milliseconds or less to identify a sound — it has outsized power to influence our decision-making. It’s part of the reason Mastercard has been embedding a 1.3-second version of its signature sonic melody at 100 million checkout counters worldwide and counting. It has the potential to deliver that innate reassurance for consumers even after checkout counters disappear, says Greg Boullin, senior vice president for Experience Strategy at Mastercard.

That new experience can be achieved at just about any place, from an airport kiosk to a grocery store to a neighborhood candy shop.

“Like any new technology, it will take time for these interactions to become normalized, but the benefit is there,” Boullin says. “It’s more hygienic. It’s more convenient. It’s more intuitive. It’s exactly the type of experience digitally native consumers gravitate towards, rapidly adopt and will quickly come to expect from the stores they love.”

Vicki Hyman, manager, communications, Mastercard