Biometric Revolution in Retail Business

Online shopping has given opportunities for retailers to identify, understand and engage customers as they go through the process of product purchasing. The analytics can provide not only customers’ personal information but also insights what they’ve browsed for, how long they’ve spent clicking around, and which items they’ve put into their basket. However, for in-store retailers, it’s hard to monitor visitors’ behavior and collect such massive and precise data. Hence it’s essential for them to find a new way of gathering that information to enhance consumers’ shopping journey. In recent years, biometrics emerges as a key to revolutionize the way retailers engage with their consumers.

Iris recognition retail payment

Biometrics is the measurement and analysis of physical or behavioral human traits and characteristics such as fingerprint, face or iris. Biometric technologies have been rapidly developed over the last decade and have reached the point of high usability and low cost to apply across commercial sector. Moreover, the introduction of biometrics into mobile device which is one of the smartphone’s most significant hardware developments is considered a key driver to boost the implementation of biometrics in retail sector. Customers have always been bogged down by endless password lists and credit card PINs. The transition to biometric payment systems will simplify payment process, reduce queue-busting and therefore they want to adopt this technology for authorizing their payments.

One of the biggest concerns when making payment is security and privacy of personal data. Applying biometrics is adding an extra layer of security; prevent buyer identity fraud of using credit card. An imposter may use a stolen card to purchase a product from a merchant. By the time the real cardholder discovers the fraudulent charges, the fraudster already has possession of the goods. In order to protect both the merchant and customer, using biometric authentication or biometric-enable mobile when making payment will make sure the cardholder is the rightful person.

User acceptance in biometric technology has also increased over time. The Worldpay Consumer Behaviour and Payments Report found that 63% of consumers want to be able to use a biometric scan to authorize payments in-store. James Frost, UK chief marketing officer at Worldpay, said: “As biometric identification increasingly becomes a standard across smartphone devices, the combination of these two technologies is starting to win the battle for hearts and minds when it comes to simplicity, convenience, and seamlessness across all channels.”

On the retailer side, biometric applications will be a great help to reduce shrinkage, payroll losses while improving productivity. The 2016 National Retail Security Survey (NRSS) reports that retailers say inventory shrink accounted for 1.38% of sales, or $45.2 billion in 2015. By adding biometric system to authenticate employee while accessing to computers, cash registers, and other resources, retailers can prevent a significant risk of financial loss. Furthermore, data generated from biometrics like demographic qualities of shoppers are now enabling retailers to deliver personalized and memorable shopping experiences that encourage repeat business and – crucially – brand advocacy.

The “Global Biometrics Market in Retail Sector 2016-2020″ report predicts that the global biometrics market in the retail sector will grow at a CAGR of 21.30% during the period 2016-2020. The potential of biometrics in retail sector is huge as it enhances customer’s shopping journey; offer significant opportunities to achieve the right balance between convenience and security and help retailers better manage their staffs and products while improve their marketing campaigns.