A POS, or point-of-sale, system is an invaluable tool for businesses of all sizes. It’s replaced the traditional cash register with constantly evolving, tech-driven solutions. It offers business management features that go beyond administering in-person transactions such as click and collect, loyalty programs, bill splitting, and more. Below, we look at seven POS trends and how they impact small businesses everywhere.
1. POS Systems Are Untethered From the Checkout Counter
In the traditional retail environment, transactions happen at one location: the checkout counter. But with modern POS systems, you’re no longer tethered to the counter. Instead, associates can meander about the store, interact with customers, and complete sales on the spot.
This untethering is enabled by:
- Cloud POS technology: Today’s POS software is often cloud-based (this means you can access your POS software and all of its data from any compatible device at any time). In fact, the cloud POS market size surpassed $1.5 billion in 2018 and is expected to grow to $6 billion by 2025.
- mPOS systems: Many cloud POS options also have a mobile component, or an mPOS, so associates can meet customers where they are and make sales on the floor.
Retailers who leverage mPOS technology see almost a quarter increase in sales over those who don’t. Using a mPOS also allows you to sell at events like pop-ups, temporary markets, and trade shows.
In the restaurant environment, this flexibility allows for tableside ordering and payments. Customers can expedite their dining experience with self-serve options that make it easier to flip tables and serve more customers.
2. Businesses Can Provide Seamless Omnichannel Experiences
Omnichannel isn’t a new trend by any means, but POS technology continues to empower retailers to create a more seamless customer experience across all touchpoints.
Specifically, POS systems help retailers build:
- Non-linear paths to purchase: Today’s shoppers don’t use a linear path to purchase. For example, someone might initially be introduced to your products on Instagram, then browse your store one day, then actually make a purchase through your website. The buying journey is increasingly complex, even for traditional brick-and-mortar businesses.
- Ecommerce as an extension of brick and mortar stores: In the week ending Dec. 29, 2019 (during peak holiday shopping), ecommerce made up 14% of total omnichannel retail sales in the US—and online sales accounted for 63% of omnichannel growth during the same period.
- Click and collect strategies: Customers can shop online and come to the store to finish the transaction by paying in-person, taking advantage of buy online, pickup in-store (BOPIS), or curbside pickup. BOPIS is also on the rise and has grown by 43% from 2015 to 2017 and accounts for up to 30% of total online revenue for 29% of businesses
More than 90% of retailers have an omnichannel strategy or plan to invest in one soon, and 87% agree it’s important for business success. But only 12% believe they have the technology they need to pull it off. This is where your POS comes in handy.
POS technology providers make it possible for small businesses to accommodate these complex buying behaviors, allowing them to compete with larger companies that have bigger budgets. Square POS and Shopify POS, for example, allow shoppers to start a basket online and complete their order in-store—and vice versa.
3. Consumers Demand Alternative Payment Methods
We continue to move away from being a cash-based society with card payments on the rise. However, it’s more than just credit and debit cards taking its place—consumers have an ever-increasing number of ways to pay:
- Mobile/contactless payments: Nearly 40% of Americans used mobile wallets in 2017, a number expected to climb to 56% in 2020. This could include Google Wallet, Apple Pay, PayPal, Venmo, CashApp, and other apps and services.
- BOPIS: Almost 70% of shoppers have used BOPIS (buy online, pickup in-store). We see this a lot in curbside pickup models that have been introduced in response to the COVID-19 pandemic.
- Payment installments: If a customer doesn’t want to pay for an entire purchase at once, you can use a POS that has installment payment options. This is particularly ideal for consumers who don’t have traditional credit options, so offering these payment plans can improve conversions, average order size, and retention rate.
- Saved payments: For returning customers, you can use your POS to securely store their payment information for a more seamless checkout experience—encouraging repeat purchases and increasing customer satisfaction.
- Bill splitting: Especially handy in the restaurant environment, this gives customers the option to pay for a single ticket with multiple payment methods.
- Gift cards: Shopify POS, for example, has an omnichannel gift card experience—cards purchased online can be used for in-store purchases and vice versa.
- Loyalty and rewards program: 64% of internet users in the US belong to a loyalty program of some sort. These programs encourage repeat purchases and increase customer lifetime value by offering incentives for customer retention.
- Cryptocurrency: E-currencies like Bitcoin, Tether, and Ethereum can be a viable form of payment if you’re willing to accept it. To give you an idea of how widely adopted cryptocurrency is, there were almost 300,000 daily Bitcoin transactions in Q4 2019.
When you accommodate additional payment methods with a flexible, tech-forward POS, you can accommodate more customers—and encourage more sales in turn.
4. Upgraded POS Hardware
POS industry trends are also seeing developments in the hardware businesses use—things like tablets and smartphones, bar code scanners, receipt printers, cash drawers, etc. In fact, hardware upgrades are the top POS priority for 36% of businesses. We’re moving away from the traditional cash register and toward more mobile, flexible, and advanced registers.
In addition to more mobile and wireless hardware, modern POS industry trends incorporate Bluetooth technology. This allows businesses to connect mobile card readers and other peripherals without hogging Wi-Fi bandwidth and increasing internet expenses.
5. In-Store Shopping Becomes Personalized to Consumers
Personalization is a top priority for 53% of retailers. POS industry trends are addressing these challenges head-on, as they make personalization easier and more accessible to small businesses at scale.
Having a POS that can provide personalized shopping experiences is important because:
- Shoppers expect it: Consumers not only benefit from but are actually coming to expect personalized experiences. They know the technology is out there, and they know their data is as well. Now shoppers are demanding they benefit from this information-sharing.
- Customers are willing to share data: According to one survey, 63% of consumers want personalized recommendations, and most are willing to share their data in exchange for automatic credits for coupons and loyalty points (64%), exclusive deals (60%), earning points and rewards (56%), or receiving special offers for items that interest them (53%).
- Buyers will shop elsewhere: Personalized service from retail associates is an important factor in choosing which store to shop at for 79% of consumers, according to another survey.
- You can increase your prices: Better experiences mean you can charge higher prices, which in turn increases profit margins. In fact, 47% of consumers are willing to pay more for an improved shopping experience.
POS software captures this information with every transaction, so you can build customer profiles to learn more about them. Over time, you can build personalized campaigns that are automated through your POS, and your associates will also have the profiles on hand at checkout or on an mPOS.
6. Rise of POS Data Analytics
Half of consumers are willing to save purchase history, preferences, and personal details if it means the checkout experience is easier and they get relevant offers. But POS data is valuable for more than just getting to know your customers and how to connect with them. The metrics from your POS can reveal information about your staff, your products, your store layout, your foot traffic, your returns rate, and so much more.
And now that POS data analytics have been around for a while, businesses are finally understanding how to best use this information to boost their bottom line.
7. POS Security
With the rise in POS analytics also comes a greater responsibility for data security. In fact, network security is the top consideration for more than three-quarters of businesses when choosing a POS system.
To protect customer payment data, 61% of retailers have implemented end-to-end encryption with their POS technology.
Point-of-sale systems have come a long way since they were first introduced a few decades ago. Now, they’re more than just a way to take payments and make sales—modern POS trends have added features and capabilities that turn each system into a virtual command center for your entire business. With increased mobility, data analysis, and security, POS technology is becoming an integral part of every retail business.
If your business could benefit from the increased flexibility and insight current POS technology provides, read our guide on the best POS systems for small businesses to find a solution to match your business needs.