Meet the Monkey Awards Nominees – NFC in the High Street

Today we’re looking at those nominees that have done the most either through rollout or trials to bring NFC technology right to the very heart of metropolitan commercial centers. You and I know it as our local high street. It’s true that the high streets in questions range from Dublin to Zurich, from Stiges to Bangalore but hey, it’s local to someone, right? Without further ado – let’s meet the nominees for NFC in the High Street and look at why they were nominated.

  • NFC Stickers for loyalty – Zapa Technology (Ireland)
  • Farm shop NFC trial – e24 (Switzerland)
  • NFC trial in Sitges – La Caixa (Spain)
  • NFC Trial by Citibank in Bangalore – ViVOtech (India)

In August 2009, the coffee chain Insomnia Coffee became the first group in Europe to launch a contactless loyalty programme using ZAPA Technology’s Near Field Communication (NFC) solution. Zapa wanted to show that NFC applications could work in the real world without having to wait for NFC handsets and, more importantly, are quick to point out that this was not a ‘pilot’ but a real working implementation

Having experienced many challenges with their old paper based loyalty programme, Insomnia Coffee sought to replace it with a system that was easier to monitor and control and delivered greater pay back in terms of in-depth reporting on consumer trends as well as earning and redemption behaviour. Insomnia Coffee launched ZAPA’s loyalty programme using electronic NFC tags and contactless readers in each of their 32 stores nationwide. ZAPA’s end to-end loyalty solution has provided Insomnia Coffee with a more customer centric solution with increased control and flexibility, whilst also delivering high level reporting on sales activity and customer behaviour.

The ZAPA TAG Loyalty Solution provides Insomnia Coffee with access to a customer database ideal for future tailored and personalised advertising and promotion campaigns. This feature, combined with the ZAPA platform’s detailed reporting ability enables them to develop their product offering to satisfy consumer demands more effectively.

To complete this project ZAPA specified and deployed an end-to-end contactless solution, which included:

  • NFC tags
  • Retail point of sale readers
  • Integration with the customer’s point of sale hardware and software
  • The NFC transaction management platform
  • Web and mobile based customer account and reporting tools
  • Merchant reporting and analysis solution.

The interactive and universal nature of the tag has made loyalty easy and accessible for Insomnia’s customers. No longer do they have to remember to bring their card each visit – or remember to redeem it when full – with the ZAPA TAG, earning and redeeming loyalty points happens seamlessly and automatically. There are readers in all 32 Insomnia Coffee stores and so far, 40,000 NFC tags have been distributed to Insomnia customers with average weekly taps reaching 17,000 across the chain. To roll out the loyalty programme, Insomnia Coffee integrated their 35 point-of-sale (POS) systems with ZAPA’s contactless platform to launch the new service. To replace the old card system, each store was supplied with a quantity of NFC smart tags that, were given to customers free of charge.

Up next is e24 (Switzerland) with their farm shop trail. This was an NFC trial carried out near Zurich utilising access control and payment in the retail environment. The company tells us that unlike other trials, this project combines the strengths of the mobile phone in providing multiple services: access to the store, reading of pricing information and payment. The trial shows a strong partnership among the multiple players. Touchnpay is a self-service shopping concept, based on contactless mobile payment enabled by NFC technology. The touchnpay self shopping process with a NFC enabled mobile phone follows the following five steps: registration, entrance, shopping, payment initiation and confirmation.

  • Step 1: The first step is customer registration with a mobile service company. The payment clearing and settlement rules are stored and the customer profile is activated.
  • Step 2: Contactless self service shopping at a mini market is now possible. The door at the mini market entrance can be opened 24/7 by positioning the mobile phone in proximity of a touch point.
  • Step 3: The NFC enabled mobile phone must be brought in proximity with desired product tags to store product and price information. The total shopping amount is calculated continuously during shopping.
  • Step 4: Once shopping is completed the customer touches the “checkout tag”. The payment process is now activated.
  • Step 5: The system confirms the successful payment and the customer receives a receipt per SMS.

To date about 80 phones have been distributed and all experiences and results from the project will be collected and analyzed by the University of Applied Sciences from Northwest Switzerland to retrieve important information for a later real implementation.

Our third finalist is the Spanish bank, La Caixa (Spain) and their nomination was for an NFC trail that has only just begun. This will be a SIM based NFC trial that will start in Spring 2010 and run for 6 months in the city of Sitges. This large scale SIM based NFC trial will really test the potential for actual implementation – no so much on the technical side, but more the business model

The implementation will consist of providing a new Samsung NFC phone that will replace their current phone (consumers will be able to have all their existing data backed up and restored in the new phone), to a selected group of 1,500 consumers who are La Caixa and Movistar customers. The consumer will be able to perform step by step in a simple way the installation OTA (Over the Air) of the La Caixa Visa payment application and start to use their mobile immediately at the selected locations within the city of Sitges. Sitges itself is a city 30km south of Barcelona where La Caixa has a large market share among customers and merchants who acquire Visa transactions. As a result, the acceptance infrastructure will be very extensive among all the merchant locations.

Partners involved in the project and their roles are defined as such:

  • La Caixa, who is the sole issuer in the project.
  • Sermepa will act as a TSM preparing all the financial data from La Caixa, which will then be loaded through OTA.
  • Samsung is the sole provider of mobile phones for the project. The phone model will be the same as the one used at the Mobile World Congress 2010 pilot
  • Visa is providing the payment application, which is fully interoperable (the Sitges users will be able to pay in Europe and US with their application)
  • Ingenico is in charge of the terminal infrastructure for the Sitges project and various combinations of terminals will be used (Integrated and with separate readers)
  • Telefónica is developing the “wallet” where the payment application will be loaded OTA and following the end to end process which will be performed OTA
  • Gemalto is the SIM provider for this pilot

The mobile phone is one of the simplest payment experiences and La Caixa want to use this pilot to validate the payment experience with a significant sample of customers across several products within their portfolio. The pilot is effectively seen as a pre-commercial launch where payment experience and business models will be validated. To enable this about 1,500 mobile phones and circa 500 merchant locations are included in the project.

La Caixa have told C-ITV that they have no idea about what the usage will be, but considering that the ecosystem will be geographically restricted to the size of the town (around 30,000 inhabitants) and the fact that the trialist will be local residents, they expect usage to be very high. Only one card will be stored in the wallet during this phase but depending on the La Caixa consumer, there will be credit, debit, gold, and other specific card products downloaded to the consumer device at a later date.

Finally, subject to the findings on the pilot, this project may be extended geographically and considering the involvement of Telefónica as major technology provider, we do not exclude that the model will be extended to other banks and countries.

Our final contestant is ViVOtech in Bangalore who are running an NFC pilot along with their partner, Citi Growth Ventures

Citibank ran an NFC trial in Bangalore for 26 weeks, starting in June 2009 and a white paper written by Edgar Dunn giving thorough details about the pilot can be downloaded here.

Citi was nominated for this category because it was a reasonably large scale pilot with a good cross-section of the public trying out NFC for the first time. It shows a strong partnership between all the players and it help gives Citibank an innovative image

In their own words, Citi said that, ‘the “Tap and Pay” mobile proximity payments pilot project in Bangalore, using Near Field Communications (NFC) technology, represented a watershed event in the recent intensive history of Mobile Financial Services.”

It was the largest pilot program of its kind to date. It identified positive consumer demand, reliability of available technology, and growth in purchase volumes. It demonstrated that with confirmed commitment and investment from industry stakeholders, mobile NFC proximity payments have the potential to generate growth in payments, create value for stakeholders, and help convert cash transactions to electronic payments.

The project was envisioned and planned by Citi’s global Growth Ventures unit in partnership with Citibank India who led the marketing and communications program and offered the product proposition to eligible customers.

Eligible Citibank credit cardholders could buy an NFC enabled Nokia 6212 handset from participating Nokia shops where store staff assisted them in setting up the service so that they could walk out of the store with a “payment ready” mobile device. The mobile payment infrastructure deployed by ViVOtech allows pilot participants in India to easily download OTA a personal Citibank MasterCard Credit card to their mobile phones.

Cardholders also enjoy promotional offers by tapping their NFC phones on smart posters, and receive coupons in seconds. When ready for a purchase, participants just tap their mobile phones at ViVOpay contactless payment readers to redeem coupons and make payments with credit or debit cards.

For this pilot, ViVOtech provided a complete NFC mobile payment and marketing solution – including the following software, hardware, and services components:

  • Citi Wallet Software distributed with Nokia 6212 NFC mobile phone
  • OTA & Trusted Service Management Software (Control Server) installed in Vodafone data centre
  • OTA card provisioning software (Issuer Server) installed in Citi India data centre
  • Mobile promotion coupon and smart poster management software
  • Smart posters with ViVOtag technology installed in various places in shopping areas and merchants
  • NFC contactless readers installed at merchant locations
  • Local support during the trial period

So here we are. At the end of the NFC in the High Street (somewhere in the world) category. Winners? Losers? You’ll have to be there on the 29th April to know for sure. Or alternatively read this blog on the 30th…

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