And the ease of use encourages customers to pay
with the cards, which typically means a bigger
ticket. At Kuai, credit and debit card orders
are typically around 16 percent bigger – an
average of $1 more – than with cash.
The biggest obstacle to adoption is the lack of
education and marketing regarding the cards,
Harris says. A few area banks have promoted the
concept to their customers (Wells Fargo Bank,
for instance, has a promotion in which customers
receive an account deposit if they use their
contactless cards three times).
But many customers still don’t know that they
can use their cards for contactless payments –
and worse yet, customers without the proper
cards grow frustrated when their cards don’t
work. Additionally, contactless cards from
several banks in the region don’t work
correctly.
Harris has become familiar with the cards that
have the problem; when Kuai employees see a
customer tapping one of these cards to no avail,
they quickly take the card and swipe it in the
terminal, explaining the problem to the
customer.
Customer loyalty
Contactless payment is an atypical feature for a
quick-service restaurant that is only now
opening its second outlet. “You usually only see
contactless readers in the big-box retailers
because the small to mid-sized chains have not
been sold on installing the terminals,” says
Henry Helgeson, co-founder of Merchant
Warehouse. “The number of cards in the market is
still an issue. [In] some areas of the country
there is a decent penetration, but even here in
Boston you still don’t see many cards.”
Still, that has not stopped some large retail
chains from rolling the terminals out in select
markets, and Helgeson believes their presence
will filter down to the smaller retailers.
“These cards can really speed up the lunch line
and that is a big deal to smaller retailers who
don’t want to risk losing a customer because
their lines are too long.”
And as the cards become more popular, customer
loyalty will become a factor, he says. Customers
used to swiping their cards at the big chains
will seek out other retailers that accept their
cards, and retailers that don’t have contactless
devices will be at a competitive disadvantage.
As store owners begin to use the cards
themselves and see consumers use them in other
stores, “they’ll start to realize how beneficial
these cards are and a light bulb will go off as
to how these cards can help their business as
well,” Helgeson says. |
