One rapidly growing use case for barcodes in retail is in-store payment—specifically, using consumer apps that can generate a QR code, which can then be scanned at checkout to transfer payment information.
Why is this particular workflow gaining steam? To start, scanning barcodes is one of the fastest, simplest ways to transfer information between devices. In addition, there’s an insatiable need to sync digital systems and physical environments in order to improve customer experiences and reduce friction. This is leading retailers to find creative ways to simplify transactions and interactions with shoppers, and barcode scanning is an easy way to achieve that.
Using QR codes and other barcodes for payments may be relatively new in the United States, but it is already in wide use in other parts of the world. In China and Japan, for example, QR codes processed $1.65 trillion in purchases in 2016 alone.
To dig into this trend a little more, here are some of the major retailers adopting QR codes to enable better payment experiences for in-store shoppers.
The nation’s largest retailer was an early adopter of self-checkout technology, and they’ve been ramping it up ever since. Now, through the Walmart Pay app, shoppers can scan and bag their items via one of the store’s self-service registers, then scan the provided QR code with their smartphone to pay.
For the frugal shopper, Walmart also prints QR codes on their receipts which price-match your purchases with other local retailers, building a cashback-like balance that can be redeemed at Walmart at a later date.
In 2017, Target launched Target Wallet, an app similar to Walmart Pay that combines couponing, gift card management, and payments via scanning a code at checkout. Target claims the app will help streamline checkouts and save shoppers money via their REDcard discount.
According to their Target Wallet announcement, “With Wallet, guests can pay using their Target REDcard and save with Cartwheel—all in a single scan of their phones at checkout.”
The recently re-designed Dunkin’ Donuts app makes it easy to place mobile orders that you can pick up in-store, cutting minutes off your morning commute and letting you earn points, redeem offers, and scan to pay at checkout.
The app lets users add payment methods to the app which are automatically charged when a QR code is scanned from their smartphone at checkout.
Like Dunkin’ Donuts, Starbucks also utilizes QR codes for mobile payments. The main difference is that customers pay with Starbucks cards that they can load in advance and use to earn Stars that give them free drinks down the road.
Starbucks has also started experimenting with QR scan-enabled augmented reality at their roasting facilities to enhance the experience of visitors.
With one of the fastest expanding footprints in brick-and-mortar retail, Dollar General is planning a number of expansions in the near future (including opening 900 new stores). Part of the planned expansion includes a new scan-and-go system. Similar to those at other food-carrying retailers, it lets shoppers scan items with their smartphone camera via the Dollar General app. At checkout, shoppers simply scan a QR code to pay.
Amazon Go/Whole Foods
We would be remiss to not mention Amazon and their (as of this writing, two) Amazon Go convenience stores. Like other automated stores, Amazon Go utilizes QR codes to log shoppers at entry and exit while the in-store sensors do the heavy lifting of tracking items in the cart at checkout.
At Whole Foods, for instance, Amazon Prime members can scan the QR code on their smartphone at checkout to receive their Prime benefits (5% off all purchases). In addition to Amazon’s recent acquisition of Whole Foods, Kroger’s newly announced partnerships with retail technology innovators and Ahold’s implementation of scan-and-go and deli-ordering kiosks signal a strong uptick in innovation as grocers adapt to compete on customer experience.
Before the CVS Pay app came along, customers had to either enter their phone number or give the cashier their CVS card to earn rewards. Then, they had to take out another card to pay. This process tied up customers and associates for the process of verifying information—name, phone number, signature, PIN, etc.
Now, customers can collect rewards and pay faster with their CVS app by grouping verification and payment into one scan of a QR code via the customer’s smartphone. This consolidation creates a simpler checkout process, saving customers time through a streamlined experience.
The new Kohl’s app lets users gather their offers, rewards, Kohl’s Cash and Kohl’s charge card all in one place. At checkout, shoppers use the app to scan the QR code on the payment terminal and all of their rewards, offers, and payment options will appear in the app on their smartphone, consolidating each step of the payment process into one.
Created as an AI-driven software platform, Zippin recently opened a cashierless concept store in San Francisco that hints at what the future of in-store shopping could look like. Complete with “overhead cameras that follow customers’ movements as they move around the store,” Zippin shows that QR code scanning even plays a role in the technology-driven stores of tomorrow.
When customers enter the store, the first thing they do is scan a QR code from their phone at a glass turnstile. What happens next is a complex interaction between weight-sensing shelves, motion-sensing cameras, and a virtual shopping cart where everything is tallied up.
Zippin isn’t the only company creating “automated,” cashierless stores. Inokyo is another startup focused on creating, “the most effortless and enjoyable shopping experience. Ever.”
Inokyo combines body-shape, body-size, and clothing-tracking cameras with QR code scanning upon entry to create a seamless shopping experience. Once you’ve selected your items, there’s no need to scan them or to check out, you simply walk out of the store and wait for your receipt in your inbox.
Bonus: Venmo & PayPal
While they aren’t retail stores, Venmo and PayPal enable millions of people to make simple payments each year. Roughly 250 million people use PayPal and Venmo, peer-to-peer mobile payment providers, to send money with a few taps on their smartphone. Common in offices, colleges, and now in Uber cars, these are fast, secure, and intuitive ways to transfer payments without sharing sensitive information.
Venmo and PayPal both provide the option of using a uniquely identifiable QR code to streamline the payments process. So, if you picked up the lunch bill at the office, you can send out this QR code via Slack or email, and your colleagues can simply scan the code to pay you back.
This process is giving millions of consumers confidence in the ease and security of using QR codes for payments. By increasing adoption of QR code-based payments, this is driving scan-to-pay in stores forward.
QR codes are just one of many barcode symbologies that are creating exciting new opportunities in retail and beyond. Combining simplicity, ease of use, and increasing adoption, barcode scanning is driving innovation and improving brick-and-mortar shopping experiences.
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