In the most recent wave of retail technology, the push toward mobile payments is leading the way and could be poised to change the purchasing process as merchants and consumers know it. There is good reason for this, as smartphones and tablets are increasingly being used to perform a variety of tasks, which now include payment transactions. Recent research has found that the trend is expected to keep rising over the next few years and perhaps eventually replace traditional purchasing methods within the retail industry.

Next five years to be big for mobile payments

Retailers can expect mobile transactions to become mainstream in the very near future, according to a recent study by Juniper Research. Fierce Mobile Content cites the findings from this research, which anticipates that by 2017, the total value of mobile payments will reach $730 billion worldwide.

"We have already moved towards a multitasking, multimedia environment which offers brands the opportunity for far greater engagement with consumers than was previously the case," said report author Windsor Holden. "Mobile is increasingly being deployed at all touchpoints in the retail process – product discovery, product purchase, customer retention."

For the research, Juniper looked at companies and brands that currently operate within the mobile transaction landscape. This data, coupled with the expectation that retailers will lead the way for mainstream adoption, gave industry experts the expected numbers, states the source.

Another study by IBM found that in 2012's second quarter, mobile retail commerce experienced much success, while sales through social media fell. Customers who completed purchases with their mobile devices grew by 15 percent for retailers, and is anticipated to keep climbing.

Retailers need to offer speed with mobile transactions

Although the numbers for mobile payments are steadily increasing, retailers should make some considerations, writes Internet Retailer. Providing speed with mobile transactions should be a primary focus for companies, as shoppers could be turned off from a site or transaction that takes a considerable amount of time. This could even result in the consumer going to competitor, decreasing loyalty and revenue for the original company. The source recommends that businesses ensure their mobile payment systems are providing the speed, as well as the accuracy, that consumers are looking for (and expect) from their retailers.

With the impending release of Windows 8, Microsoft is reportedly looking to advance its retail footprint. According to NBC News, the computer company is expanding its reach in the retail industry in an effort to compete with the iOS and Android mobile operating systems.

"They’ve got to give customers a reason to go out there and upgrade," senior analyst for MKM Partners LLC, Israel Hernadez, told the news network.

Tech media website,The Verge, reports that recent job ads are indicating that Microsoft plans to open pop-up stores in major markets such as San Francisco and New York City. These stores would serve as a showcase for the company’s new Surface tablet as well as the new smartphone operating system.

Microsoft had previously announced that it would only sell the Surface tablets through brick-and-mortar stores and online outlets, but the company is reportedly looking to cash in on the holiday shopping season.

While the Surface tablet and the Windows 8 operating system might seem like a step in the right direction, Hernandez doesn’t believe the "limited time offer" approach is going to work. "I think they’ve got a lot of work to do in terms of convincing consumers," he told NBC news.

As Microsoft begins the release of these new products, it could see a spike in sales. In order to help with inventory and store merchandising, Microsoft could benefit from the Point of Sale software offered by Retail Pro.

Just like with most things, gift cards seem to be going the way of mobile. Many retailers are increasingly offering these types of digital programs for mobile shoppers, as it can increase customer satisfaction and loyalty while bringing in more revenue.

Internet Retailer reports that recent research from Aberdeen Group found that 61 percent of retailers surveyed said they plan to provide mobile gift cards as an option for their mobile-conscious consumers. These programs can work by providing links via text message or email for customers through which they can access downloadable codes that can be used in the store. Of the retailers surveyed, 51 percent stated the main reason for providing gift cards through mobile was convenience, and 42 percent said they offer them because they are available for shoppers to use anywhere and at anytime.

According to the National Retail Federation, the trend of mobile gift cards among retailers has increased significantly over the past few years, reports Retail Technology. Additionally, more consumers are purchasing gift cards for a variety of reasons, not just for the holiday season or other special events. Research by First Data revealed that gift cards are being reloaded more, with $211 being the average price put on them in 2011, up from 2010's average of $161.

Europeans are increasingly using their smartphones to make mobile payments at retailers across the continent, as the new purchasing trend begins to become widespread in global commerce. Mobile devices can now be used for a variety of different tasks, including completing transactions at retail stores, and the traditional purchasing method is getting a makeover, as are retail store operations.

Europe turning to mobile purchasing

According to recent research by comScore, consumers in five major countries – France, the United Kingdom, Spain, Germany and Italy – are increasingly turning to their mobile devices to make purchases from online retail websites. One in eight smartphone users have utilized their devices to complete transactions with retailers, and one in six have visited retail sites and applications on their phones. These numbers are a significant increase from 2011, when the numbers of users was half the amount it is today. In May of this year, 75 percent of consumers who had accessed retail sites with their devices ended up making a purchase from the company.

"We are now observing a rapid increase in the emergence of m-commerce, where consumers visit retail sites or use dedicated apps and ultimately make on-device purchases,” said comScore's European mobile product manager Hesham Al-Jehani.

Retailers are in turn responding to shoppers and their mobile needs. ComScore found that Spain has the most growth in mobile retail commerce. In the past year, there has been a 141 percent increase in the number of smartphone users who access sites and apps on their phones, which is currently estimated at 1.9 million. The U.K. ranks highest in regard to the largest number of mobile users, with a total of 6.5 million. Germany comes in second at 5.8 million, states the research.

Retail mobile payments to increase in Europe

The recent numbers highlight the growing significance that the trend of mobile payments is currently and will continue to play in the retail industry. The Information Daily reports that recent research from Forrester estimates that mobile spending in Europe will increase elevenfold by 2017. This equals a total of €19.2 billion ($23.6 billion) within five years. In 2011, approximately €1.7 billion ($2 billion) was spent through retail mobile purchases, which equals 1 percent of total online sales. Mobile payments in Europe will account for 6.8 percent of sales by 2017. 

Inventory management extends beyond simply buying what's popular and scaling back on what's not – a lot of time and energy needs to go into developing an effective inventory management strategy. If retailers don't carefully plan out their initiatives, they may tie up capital in excess inventory, create picking errors in the warehouse or even miss sales opportunities in out-of-stock products.

"Inventory management is a continuous, concentrated effort – and a process that shouldn’t be handled solely at the operations level," Multichannel Merchant explains. "A successful inventory plan should also involve your marketing, catalog, ecommerce and merchandising departments. By managing your inventory against a master promotional calendar, everyone wins."

Focus on communication

When it comes to inventory management, communication between employees at any given merchant and with vendors is absolutely pivotal. On a store level, employees in different departments need to be able to convey which products they need to meet demand. This enables the person in charge of procurement to order enough stock to satisfy the needs of customers.

Furthermore, clear communication channels are needed between vendors and the retail brand itself. Open communication is crucial for any successful working relationship, and when vendors are able to understand the needs of retailers, they will also be better able to comprehend their inventory management plan as well, minimizing any shipping or stocking errors.

Standardize operating procedures

Establishing a regimen is crucial because it creates a standard that can be followed. By developing policies with vendors that must be adhered to, merchants can ensure their products will be shipped, received stocked and picked efficiently and accurately. Creating these procedures also helps to create a sense of regularity that minimizes the chances of merchants being left high and dry without key merchandise.

"For example: If you sell a product in packages of five, it’s critical to let your order fulfillment provider’s receiving staff know so they don't spend precious time breaking down the items into individual units, only to have the pick and pack staff re-kit the items before shipment," the news source adds.

Retail Pro offers a comprehensive inventory management solution that enables merchants to carefully monitor current stock, while also giving them in-depth sales information that provides insight on best-selling merchandise.

Technology is being used to improve store operations at major retailers throughout the globe. For example, Lowe's has an inventory management system that can be accessed from mobile devices, enabling sales associates to quickly and efficiently look up information about products and their availability.

"It's been a great tool for helping customers right there on the spot," Chad Wallace, an assistant store manager at the Gaithersburg, Maryland, Lowe's told The Washington Post. "A lot of customers are impressed that we're able to use the phone to scan something on the shelf and find out the quantity."

That specific Lowe's location has more than 25 mobile devices that can be used as inventory management tools. Other applications allow employees to conduct point-of-sale transactions, look up competitor pricing and complete other tasks, all without disengaging the customer.

Retail Pro offers retailers a highly competitive solution that enables them to track inventory. This software can also be used to monitor fast-selling products, keep tabs on slow sellers and otherwise help their purchasing decisions.

Smartphones have gone mainstream, with recent data from comScore suggesting approximately half of the United States' mobile subscribers – 107 million consumers – own the devices. With the power of the internet firmly in shoppers' hands, they are now using these devices to influence their shopping decisions, a recent report from Deloitte reports.

According to the Deloitte research, approximately 5.1 percent of annual retail store sales – or $159 billion in forecasted 2012 sales – are influenced by smartphones. To come to these conclusions, Deloitte examined in-store sales driven by store-related smartphone activity, ranging from price comparison to mobile application use.

Moreover, this number is expected to grow as time goes by and more customers upgrade from feature phones to smartphones. By 2016, Deloitte expects smartphones to play a part in nearly one-fifth of sales (19 percent), accounting for $689 billion. At the same time, approximately $30 billion will be spent on direct mobile commerce, highlighting the growing utility of smartphones as shopping companions.

"Mobile devices' influence on retail store sales has passed the rate at which consumers purchase through their devices today," said Alison Paul, vice chairman of Deloitte. "Consumers' store-related mobile activities are contributing to – not taking away from – in-store sales, and our research indicates that smartphone shoppers are 14 percent more likely to convert and make a purchase in the store than non-smartphone users."

Mobile application as the key

With more customers using their mobile devices to shop, it's growing increasingly apparent that retailers need to utilize these devices as engagement tools. Merchants shouldn't lose prospective customers because they don't have a mobile presence to interact with them.

As Deloitte notes, 37 percent of customers who use smartphones as shopping companions utilize a third-party mobile shopping application. Additionally, nearly one-third of respondents said they used the mobile app of the brand they were shopping with. While that's a substantial number, it does suggest a number of merchants aren't offering their own mobile devices, which could lead to shoppers finding better prices elsewhere.

Some brands, such as Best Buy, are hoping to improve store operations by installing mobile devices throughout the store and enabling consumers to do their own research. Best Buy will offer price matches if shoppers find an item offered for less money elsewhere.

Electronics retail merchant Best Buy is hoping to fight lost sales from "showrooming" – the practice of checking out an item in-store only to buy it online later – by deploying employees with tablets to enable customers to do more research.

Employees at Best Buy stores will be given tablet devices that customers can use to research a product. If they find a different merchant with a better price, the employees are allowed to match the price. Mike Mikan, interim CEO of Best Buy, believes this strategy will improve the customer experience by showing customers the chain has their best interests in mind.

At the same time, Best Buy is also focusing on developing a stronger ecommerce presence.

"We can no longer just focus on the box," Mikan said at the shareholders meeting, as quoted by Internet Retailer. "We must focus on both the physical and virtual customer experience, and our capital investment must reflect that."

Retailers are leveraging tablets to improve store operations in a number of ways, ranging from point-of-sale (POS) payment processing to inventory management.

Retail theft is a billion-dollar problem that merchants throughout the world are faced with. Fortunately, the issue is getting better for retailers, with a recent report from the National Retail Federation suggesting that theft rates declined in 2011.

The NRF's Retail Security Survey suggests that retail shrinkage (which includes inventory loss stemming from employee theft, shoplifting, supplier fraud and paperwork errors) decreased to 1.41 percent. However, that still translates to $34.5 billion worth of sales, highlighting the severity of retail shrinkage.

"Retail theft continues to plague the industry, with billions of dollars of merchandise walking out of the store every day without ever being paid for," said NRF vice president of loss prevention Rich Mellor. "Fighting these self-serving and unethical criminals has been a tedious battle, but we remain resolute in our efforts and our partnerships with law enforcement to combat this growing problem."

Many companies supplement their store operations by leveraging technology to detect shrink. These tools can help them better monitor their inventory levels and identify when merchandise has gone missing.

As computers and other modern technologies become more mainstream in India, retailers are reacting and launching their own multichannel shopping experiences. Indian IT services firm Wipro believes the growth of ecommerce in the country will further drive retail growth, the Economic Times reports.

Srinivas Pallia, senior vice president for the Wipro business unit, explains that the proliferation of the web is enabling more shoppers to buy online. As a result, both domestic and international merchants are looking to integrate new solutions that improve store operations while also extending brands' presences to the web via ecommerce.

"Big retail houses are investing in technology solutions that integrates various channels, both offline and online," said Pallia.

"Digital natives are coming," he added.

In particular, technology and analytic software will be focus points of many Indian retailers as a means of delivering a better retail experience, one that will make shopping easier for customers but also more profitable for merchants.

Retail Pro's software solutions are being used by many merchants in India and the Middle East. One of our business partners in the global Retail Pro Community is even located in Bangalore, India.