News & Events

Atlanta’s Midtown merchants enlist beacons for mobile loyalty program

BY: Caitlyn Bohannon November 20, 2014

Source: Mobile Commerce Daily

S
H
A
R
E

A handful of merchants located in Atlanta’s Midtown district are participating in a new beacon-based mobile rewards and payments program to meet the needs of the neighborhood’s young, tech-savvy residents.

Sionic Mobile is powering the launch of Midtown Loyal. By leveraging Sionic Mobile’s Ion Loyalty and Rewards apps, Midtown Loyal merchants can create their own promotions, reward customers and accept mobile payments.

“Midtown Atlanta is home to many leading finance and mobile technology companies and is quickly gaining a reputation as Innovation Central in the U.S. market,” said Ronald Herman, CEO and founder of Sionic Mobile. “We want to help further elevate Midtown Atlanta by connecting more merchants with more consumers through mobile devices than any other geography in the country.”

Driving business
Sionic Mobile believes Midtown Atlanta is the perfect location to test its new rewards and payments initiative.

An early adopter of the program is Zocalo Mexican Kitchen and Cantina, located at the intersection of 10thStreet and Piedmont Avenue.

In the coming months, Midtown residents and visitors will be able to download and use the Ion Rewards app to view promotions from Zocalo, pay their bill through the app and receive rewards based on the amount of their bill.

When users earn rewards, they are delivered in the form of Ions. Sionic Mobile’s Ions can be spent like cash at participating merchants. These rewards never expire.

The technology works alongside any existing POS system and requires no upfront cost or additional equipment. Sionic Mobile believes the system can be set up in 30 minutes or less.

The Woodruff Art Center and Mystic Lotus Salon are a couple other merchants that have signed on to the program. Sionic Mobile expects 200-300 total Midtown merchants will enroll between now and Dec. 5.

Local business owners interested in participating can register at MerchantCenter.IonLoyalty.com.

Beacons on the rise
Retailers of large scale are starting to deploy beacons more extensively.

Following a successful pilot of iBeacon technology, Hudson’s Bay Co. will be rolling out the program to 50 Lord & Taylor stores in the United States and 90 Hudson’s Bay locations in Canada by the end of the month.

Lord & Taylor and Hudson’s Bay rolled out iBeacons to 10 stores this summer to engage shoppers with content and offers on a hyper-local basis and with results to date exceeding expectations, the retailer is looking to bring the program to more stores before the holiday shopping season kicks into high gear.  The move follows Macy’s expansion of its beacon-enabled program with shopkick in September and Urban Outfitters’ recent launch into beacon marketing (see story).

An increasing number of retailers are already using beacons, according to a recent Adobe report.

In a reflection of how quickly marketers have embraced beacon technology, 18 percent report that they are using beacons today in tests or active deployments, according to new research from Adobe.

Beacons and location awareness are adding another dimension to in-store digitization, with high expectations for their impact this holiday season. The research found that 55 percent of consumers find it useful to receive promotions on their mobile device while in a physical store (see story).

Final Take
Caitlyn Bohannon is an editorial assistant on Mobile Commerce Daily, New York

Sionic Mobile Launches Midtown Loyal, Beacon-based Mobile Rewards, Mobile Payments Initiative

BY: Business Wire November 18, 2014 10:07 AM EST

Source: Business Wire

S
H
A
R
E

ATLANTA–Sionic Mobile today announced the launch of Midtown Loyal, a mobile rewards, payments initiative for merchants located in Atlanta’s Midtown district. Leveraging Sionic Mobile’s ION Loyalty and ION Rewards applications, Midtown Loyal merchants create compelling promotions for nearby smartphone consumers, accept secure mobile payments and reward customers instantly based on their purchase amount.

“Given Midtown’s young and tech savvy workforce and residents and concentration of restaurants, arts and culture, retail and entertainment venues, we believe Midtown is the perfect location to test drive Sionic Mobile’s new rewards and payments initiative,” said Kevin Green, CEO and president of Midtown Alliance. “Midtown provides a rich environment and a living lab for cutting-edge initiatives like ION Loyalty and ION Rewards that can help enhance the customer experience.”

Ronald Herman, CEO and founder of Sionic Mobile, added, “Midtown Atlanta is home to many leading finance and mobile technology companies and is quickly gaining a reputation as ‘Innovation Central’ in the U.S. market. We want to help further elevate Midtown Atlanta by connecting more merchants with more consumers through mobile devices than any other geography in the country.”

Business owners who wish to participate in Midtown Loyalty can register at Sionic Mobile’s website. Sionic Mobile is waiving its success fee to all Midtown Alliance members enrolling in ION Loyalty during the Midtown Loyal program. The technology works alongside any existing POS system, requires no upfront cost or additional equipment and typically may be setup in thirty minutes or less.

Zocalo Mexican Kitchen & Cantina, a Richard Sandoval restaurant located at the intersection of 10th Street and Piedmont Avenue, was an early ION Loyalty adopter and is now participating in Midtown Loyal. Soon, Midtown residents and visitors will download and use the ION Rewards app to view Zocalo promotions, pay with the app at the table or bar and receive IONs instantly based on their check amounts. IONs spend like cash at ION merchants (1,000 IONs = $1.00) and never expire.

“We are pleased to be an early participant of Midtown Loyal,” said Keith Morrison, general manager of Zocalo. “We’ve been serving the Midtown community for more than 15 years, and this is an excellent opportunity for us to recognize our long-time, frequent diners, as well as attract first-time visitors.”

About Sionic Mobile

Midtown Atlanta-based Sionic Mobile markets to smartphone consumers and rewards them for every mobile checkout. The mCommerce company utilizes mobile devices, Bluetooth® beacons and the cloud to connect merchants with nearby, ready-to-spend consumers. The company is the maker and provider of ION — the first, fully digital mobile promotions, gift cards, payments and rewards apps for phones and tablets. Merchants use ION Loyalty® to increase traffic, sales & margins, reduce credit card fees and get good customers back more often. Consumers use ION Rewards® to earn IONs at every checkout, then spend them like cash on anything at any time at over 40,000 retail locations nationwide. The free apps support iOS and most Android devices.

For Sionic Mobile

Anna Stanley, 678-781-3072
anna@williammills.com

or

Kathryn Farmer, 678-781-7208

kathryn@williammills.com

Donate to Nonprofits Without Spending a Dime – Simply Buckhead

BY: Mickey Goodman Nov 12, 2014 2:41PM EST

Source: Simply Buckhead

S
H
A
R
E

Buckhead resident Ron Herman, CEO of Sionic Mobile, has dual passions: technology development and helping charities. He discovered a way to con- nect the two by applying smartphone technology to help nonprofits create awareness, raise funds and keep more of each donation.

“So many organizations are struggling to stay afloat,” Herman says. “We wanted to tap into the growing $300 billion e-commerce market to aid in fundraising, engage current donors and attract new supporters.”

The result is Shop2Give, a free application launched in July that lets supporters shop both online and at their favorite stores, pay with the app during checkout and automatically trigger a 2-percent donation from Sionic Mobile to their favorite non-profits without additional cost. A number of major Buckhead stores have signed up, including Lowe’s, Barnes & Noble, Staples, Brookstone, GameStop, Hyatt Hotels, Sephora, Papa John’s and more. Users select the organizations they want to support.

Atlanta Ronald McDonald House Charities is one of the first nonprofits using Shop2Give to raise funds for a new house for the families of hospitalized children. “In addition to the 2 percent we donate, supporters can use the app to give any amount at any time to their nonprofits,” Herman says.

For more information, visit s2gnow.com

ION Rewards Users Now Earn and Spend IONs at Nearly 40,000 Retail and Restaurant Locations

BY: Business Wire November 06, 2014 8:49AM EST

Source: Business Wire

S
H
A
R
E

ATLANTA–Sionic Mobile, a mobile loyalty and payments leader, today announced ION Rewards® app users may now earn and spend IONs at nearly 40,000 retail and restaurant locations nationwide. Most recently, JC Penny, Dell, Legal Sea Foods and Regal Cinemas joined the growing, diverse network of merchants that accept the ION Rewards app for purchases.

To use ION Rewards consumers simply download the app, set up an account and link one or more payment methods. Users can then use their smartphone or tablet to pay for purchases in two taps or less at participating merchant locations. In return, users are instantly rewarded with up to three percent in IONs that spend like cash, never expire and can be used at any participating ION merchant online and in retail locations. Additionally, users can locate nearby participating merchants, receive unique promotions and offers, as well as send and receive digital gift cards directly from the app.

“We have achieved a significant company milestone,” said Ronald Herman, CEO and founder of Sionic Mobile. “When we launched ION Rewards, we took a radically different approach by focusing on the customer experience and removing layers of restrictions that hinder traditional rewards programs. Giving users the ability to use IONs at a wide variety of restaurants, shops, big brand retailers, as well as for entertainment, is critical to ensuring an exceptional experience. No other loyalty application allows users the luxury of not only paying with their mobile devices and earning instant universal rewards, but also having choices and control over how they redeem those rewards.”

About Sionic Mobile

Midtown Atlanta-based Sionic Mobile markets to smartphone consumers and rewards them for every mobile checkout. The mCommerce company utilizes mobile devices, Bluetooth® beacons and the cloud to connect merchants with nearby, ready-to-spend consumers. The company is the maker and provider of ION — the first, fully digital mobile promotions, gift cards, payments and rewards apps for phones and tablets. Merchants use ION Loyalty® to increase traffic, sales & margins, reduce credit card fees and get good customers back more often. Consumers use ION Rewards® to earn IONs at every checkout, then spend them like cash on anything at any time at over 40,000 retail locations nationwide. The free apps support iOS and most Android devices.

Contacts

Sionic Mobile
Anna Stanley, 678.781.3072
anna@williammills.com
or
Kathryn Farmer, 678.781.7208
kathryn@williammills.com

Will Apple Pay Pay Off? – investmentu.com

BY: Rachel Gearhart Thursday, September 18, 2014

Source: Investment U

S
H
A
R
E

Analysts predict that mobile payments could grow from $1 billion last year to more than $58 billion by 2017. Needless to say, the mobile payments industry is gearing up to be a hotbed for profits.

But as other companies’ troubled attempts have shown, getting into the payments business is no easy task – even for a company like Apple (Nasdaq: AAPL).

So when Apple released Apple Pay – a “seamless payment experience” driven by decades-old near-field communication (NFC) technology that has yet to gain traction in the U.S. – investors, customers and analysts raised a critical eyebrow.

With countless other mobile payment startups currently struggling to gain adoption, various security concerns, and only 5.5% of U.S. retailers currently accepting Apple Pay, investors are asking, “will Apple Pay pay off?”

Even the world’s most valuable brand and Apple rival, Google (Nasdaq: GOOG), has struggled with its own NFC-based payment services.

As explained in a recent Investment U article, NFC technology utilizes secure and instant wireless communications, allowing NFC-enabled devices to be “swiped” against others to complete financial transactions.

Many large retailers like Walmart and Best Buy have passed on the NFC technology that payment services rely on due to the cost of maintaining the NFC readers.

Because of this, in March, Google announced that Google Wallet users will be able to access Google Wallet Instant Buy using Sionic Mobile’s ION Rewards app. The move will lessen Google Wallet’s dependence on NFC technology in favor of bar codes or QR codes.

Many large retailers such as Lowe’s, Sears, Gap and RiteAid are embracing an NFC alternative that uses QR codes, CurrentC.

The Google Wallet still requires merchants to accept NFC, but the integration transitions the Wallet into QR code technology, which has more traction in retail locations.

“I think NFC has held the mobile payments industry back as a whole,” said Ronald Herman, CEO of Sionic Mobile. “As a technology it just never gained traction here. It’s not so much the technology itself; it’s the participants and the environment.”

Apple’s use of NFC chip in the iPhone 6 also comes with its share of security concerns – ones that will keep it closed off to developers for a while.

For at least the next year, Apple says that the NFC chip will be locked for only Apple Pay. Locking the chip will prevent iOS users from using it to pair with other electronic devices and transfer contacts and files. And potential security threats.

Once potential security kinks are worked out, the company may allow developers to adopt the chips for other purposes just as it did with Touch ID (a fingerprint reader that verifies your identity to unlock your phone, confirm purchases and install apps) in iOS 8.

But Apple Pay should still be more secure than traditional credit cards.

Apple Pay relies on payment tokens meaning that it randomly generates numbers that mobiles devices can use for transactions instead of your credit card number. Therefore, if someone hacks your token number, it only existed for one transaction and your credit card number wasn’t involved at all.

As an additional security feature, you’ll have to verify your identity with the Touch ID before using Apple Pay.

Regardless of the challenges, there have been some payment breakouts such as Stripe, Braintree (now owned by eBay’s PayPal) and Square.

Even if Apple can relieve security concerns with its use of tokens and Touch ID and NFC technology gains traction in stores, Apple Pay doesn’t currently work for the 1 billion Android phone users. And that’s a huge group of untapped consumers.

Sionic Mobile adds Visa Checkout to ION Rewards

BY: Business Wire October 30, 2014 10:22AM EST

Source: Business Wire

S
H
A
R
E

ATLANTA–Sionic Mobile, a mobile payments and loyalty leader, today announced it has added Visa Checkout as a safe and convenient payment option to its ION Rewards® application for smartphones and tablets. ION Rewards enables consumers to link their preferred payment, pay for in-store and online purchases with the app and earn IONs instantly at every checkout. IONs never expire and can be used like cash at more than 30,000 retail locations and online stores, including GameStop, Lowe’s, Papa John’s Pizza, Staples and many other big brands.

“Consumers are faced with an overwhelming number of mobile apps promising loyalty rewards and payment options,” said Ronald Herman, CEO and founder of Sionic Mobile. “The problem is the majority of these apps are based upon upside-down business models that do not have consumers’ best interests in mind, resulting in a subpar user experience and low adoption rates. Our goal has always been to provide ION Rewards users with a fast, intuitive and rewarding checkout experience. Adding new, convenient payment options like Visa Checkout is another example of our commitment to continually enhance that experience whether shopping in-store or online.”

Visa Checkout is a digital payment service designed to simplify the checkout experience using secure, single sign-on across channels and devices using a customer’s preferred payment method. ION Rewards users can complete a full mobile checkout in seconds using the Visa Checkout feature and instantly receive IONs on every purchase. All transactions are extensively monitored for fraud using Visa’s advanced real-time security tools, including device fingerprinting and Visa Dynamic Network Analytics scoring.

About Sionic Mobile

Midtown Atlanta-based Sionic Mobile markets to smartphone consumers and rewards them for every mobile checkout. The mCommerce company utilizes mobile devices, Bluetooth® beacons and the cloud to connect merchants with nearby, ready-to-spend consumers. The company is the maker and provider of ION — the first, fully digital mobile promotions, gift cards, payments and rewards apps for phones and tablets. Merchants use ION Loyalty® to increase traffic, sales & margins, reduce credit card fees and get good customers back more often. Consumers use ION Rewards® to earn IONs at every checkout, then spend them like cash on anything at any time at over 30,000 retail locations nationwide. The free apps support iOS and most Android devices.

Contacts

For Sionic Mobile
Anna Stanley, 678-781-3072
anna@williammills.com
or
Kathryn Farmer, 678-781-7208
kathryn@williammills.com

Fuel loyalty platform adopts Bluetooth beacons – thewisemarketer.com

BY: The Wise Marketer Friday October 24, 2014

Source: The Wise Marketer

S
H
A
R
E

In the US, Sionic Mobile’s ‘ION’ m-commerce platform has been adapted by convenience retail and petroleum technology firm, Pinnacle, to provide a new mobile loyalty and payments platform for fuel retailers.

The combined solution uses Bluetooth beacons inside the store and at pump islands to facilitate cloud-based payments and instant rewards for smartphone consumers.

The Pinnacle-ION system helps convenience stores (c-stores) avoid some of their credit card fees for fuel purchases, and encourages repeat business by providing customers with instant rewards based on in-store checkout amounts.

Using Bluetooth beacons for pump authorizations, customers can quickly and easily pay for fuel with a few taps on their phone handset. Leveraging fully encrypted and tokenized mobile payments, the process is more secure than traditional card swipe methods, protecting both the user and fuel retailer against fraudulent activity.

The beacons can also be used to deliver compelling and relevant promotions to customers, further boosting in-store traffic and driving higher-margin sales.

“Our priority was to deliver tools that can automate the whole spectrum of c-store operations,” explained Drew Mize, Pinnacle’s chief operating officer. “We were pleased to partner with Sionic Mobile to integrate our Palm POS platform with their mobile payments and loyalty platform.”

Consumers can simply download the ION Rewards app (available in both the Apple App Store and the Google Play store for Android devices), create an account, and then use their smartphones to pay for fuel at the pump. Users then receive an instant US$0.10 per-gallon discount on every fuel purchase at any ION-enabled fuel retailer. ION Rewards users also earn from 1% to 3% in rewards for every in-store, non-fuel purchase.

Tech Companies Woo Gas Retailers as EMV Looms – Payments Source

BY: DAVID HEUN OCT 15, 2014 12:01AM EST

Source: Payments Source

S
H
A
R
E

Fuel retailers may shudder at the potential costs of upgrading gas pumps for EMV chip-based card acceptance, but they are a prime target for vendors offering mobile payments and deeper fraud-screening analytics.

Gas station owners have until October 2017 to be EMV compliant or face a liability shift in fraud costs. That’s two years longer than other companies, which have until October 2015. During that gap, gas stations may choose to adopt other new payment technology to reduce fraud before EMV takes hold.

P97 Networks announced a partnership with Zipline to operate decoupled debit, a popular option for gas stations, through P97’s mobile commerce and marketing platform. In a similar vein, Sionic and Pinnacle are pushing the use of beacons at gas pumps to send promotional messages to customers’ mobile devices, encouraging more spending at the station.

“Everyone will have to upgrade to EMV at some point in time because they don’t want the liability, but mobile in itself creates a much safer environment,” said Don Frieden, president and CEO of P97 Networks.

P97 offers fuel retailers the mobile wallet-agnostic PetroZone mobile commerce platform, which utilizes a cloud-based token vault to hold encrypted data when a customer is using a mobile phone to pay for gasoline. P97 provides the white-label app for oil or marketing companies to brand. PetroZone represents a viable option for station owners not able to absorb the expense of EMV pump upgrades that have been estimated to average about $3,000 a pump, Frieden said.

“The stations will upgrade to EMV because they don’t want to leave any customers behind, but our hypothesis is that they may just upgrade a few pumps, or one side of the pump line, making one row for EMV payments,” Frieden said. “The other pumps would be for mobile payments or cash, but you could give incentives to use mobile.”

PetroZone users submit a four-digit passcode to enter the app, then enter the code again at the pump’s PIN pad when prompted to begin fueling.

P97 is testing PetroZone and will announce clients and an official launch in the coming weeks and months, Frieden added.

VeriFone Systems Inc. last week unveiled RubyCi, a site controller and point-of-sale software for average-sized convenience stores and petroleum dealers. RubyCi is designed to manage various aspects of the fueling business, while also readying the stations for EMV upgrades. RubyCi combines aspects of the site controller and POS system that larger convenience stores and gas stations use, allowing smaller operations to be EMV ready while carrying out loyalty programs and general station operations.

In the meantime, Visa Inc. is reminding station operators that its Visa Transaction Advisor, operating through the VisaNet network, provides fraud prevention analytics at the gas pumps to decrease fraud incidents even before an EMV upgrade ever takes place.

The transaction advisor can “complement EMV” as a bridging technology to the chip-based smart cards, said Mark Nelsen, vice president of risk products and business intelligence.

“We definitely recognize that it is going to take a little more time for the gas stations to upgrade to EMV technology, so this gives them additional intelligence as well as an ongoing measure when they do upgrade,” Nelsen said.

Obtained through an acquirer, Visa Transaction Advisor does not call for any hardware or software infrastructure changes on the station’s network. “The service is part of the normal authorization request they send in with transactions today,” Nelsen said.

The analytics tool looks over “500 pieces of data in milliseconds” that includes Visa’s global view of fraud data and trends in authorizing or flagging transactions at the pumps, Nelsen added.

Chevron Corp. tested the system at 300 of its stations for two months and enjoyed a 23% reduction in fraud expenses, said Chevron spokesperson Braden Redall.

“There were no costly infrastructure upgrades or disruption to our customer experience, which was really important to us,” Redall said. As a result of the successful tests, Chevron now uses the analytics tool in about 8,000 stations across the country.

Though it is not really a part of Chevron’s overall EMV strategy, Redall acknowledges, “It is a great technology for the system that we currently have.”

Visa realizes that the transaction advisor could allow some station operators to wait even longer to convert to EMV, but that is not entirely a bad thing, Nelsen said.

“Even in Canada, which has had EMV for years, there are still merchants who don’t have chip terminals,” Nelsen said. “We see the same thing happening in the U.S. in low-risk fraud areas if they don’t have a fraud problem and their terminal still works.”

The transaction advisor “gives them additional tools and intelligence to help make that EMV decision without being negatively affected from a fraud perspective,” Nelsen added.

Some are not ruling out the possibility that EMV could pass by the fuel retailers altogether. “I think it makes sense for a petroleum retailer to engage in mobile and forget cards at the pump,” said Bill Deichler, payments industry expert and former payments manager for Murphy USA oil company.

Some mobile solutions at the pump could even carry the less expensive card-present rates in the future because of tokenization and encryption methods, Deichler said.

With three years left before the EMV liability shift hits, fuel operators may “get to the point where they might even pull the swiper out of the pumps by 2017 and go only mobile and cash,” Deichler added.

How your mobile payment app can cost you customers and ding your reputation

BY: Ronald Herman Oct. 9, 2014

Source: Fast Casual

S
H
A
R
E

A popular restaurant chain grabbed headlines earlier this year with the launch of its mobile payments application. It happens to be a chain that I visit on occasion, so I decided to download the app and try paying with my phone on my next visit. Once I downloaded the correct app (this particular chain has more than one app in the app store), I followed the steps to create an account, linked a credit card and loaded the minimum $25.00 in the app – at least I thought I loaded $25.00, but the sliding keypad feature caused me to accidentally load $75.00.  I’ll save the experience of requesting and eventually receiving the $50.00 refund for another time.

Now with the correct amount, $25.00, in my account, I visited the nearest location, ordered a meal and notified the cashier I would be paying with their new mobile app.  I expected to encounter some issues as the technology was new (for this chain.). What I didn’t expect was the front-line employee to be completely unaware of the new payment option and even more disturbing, share her frustration with me as the customer.

By the time the manager was located and informed I was paying with my phone, the process was easy and my purchase completed with just a few taps. From download to first payment, the process was frustrating and anything but convenient. I explored the app further and realized that in addition to the cumbersome load and use process, the only other incentive or value offered was to inform me the featured item of the week contained 940 calories.  Needless to say, I deleted the app that evening.  After multiple phone call attempts to customer service to refund my account balance (could never get an answer on the 24-hour customer service hotline), I now have $20.00 floating in cyberspace.

Mobile payment/loyalty apps have been heralded as the future of retail promising consumers a faster, more convenient and secure checkout experience. The intense competitive pressures have heightened the sense of urgency for restaurant chains to quickly launch a mobile app, and the result is hundreds of standalone apps that are lackluster at best, less convenient than traditional payment methods and are often vulnerable to security breaches and fraudulent activity.

The amount of resources and money required to develop, deploy and maintain a standalone app is a staggering investment for most restaurant operators, and the majority yield very little if any return.  To date, there are literally thousands of mobile apps claiming to have a payment or loyalty component. This number continues to rise, so cutting through the noise and actually reaching the target audience is extremely difficult. Even with success in gaining downloads, research indicates that 95 percent of apps are deleted within the first 30 days. With more than 75 percent of Americans now using a smartphone, the mobile channel is a vital customer touchpoint, but the current standalone strategy is proving ineffective at building brand loyalty or increasing customer acquisition numbers.

An alternative approach, a singular, consolidated mobile platform, is quickly emerging as a preferred strategy both by consumers and merchants alike. The key to success is ensuring the platform is built around customer engagement, combining robust loyalty offerings with mobile payment options. Having the ability to send relevant/tailored promotions, rewarding  users with instant incentives and finally, providing industry-proven security thresholds to protect both the user and restaurant from fraudulent activity are critical components of a successful shared platform. Leveraging a consolidated platform enables operators to focus on what they do best, running restaurants, yet still connect with customers and guests via the mobile channel.

Conclusion

Today’s consumer demands a seamless mobile experience, and failing to meet those expectations can be devastating to a brand. Experts agree mobile-driven loyalty will be critical in garnering consumer adoption of mobile apps. The QSR chain I described above recently announced it had completely re-designed and re-launched its mobile payments app due to the overwhelmingly negative feedback and response it received from its customers. Unfortunately, the chain faces an uphill battle to re-gain the confidence of consumers. Fortunately, the rest of the industry has the unique opportunity to learn from their growing pains, and avoid making the same costly mistakes. At the end of the day I may have lost $20.00, but it cost the QSR chain much more. They missed the opportunity to convert an occasional diner into a loyal customer.

Ronald Herman is CEO and founder of Atlanta-based Sionic Mobile, the maker and provider of ION Rewards and ION Loyalty applications. Herman has more than 25 years of experience (ranging from early-stage start-ups to Fortune 500 companies) in developing and deploying consumer-facing technology solutions.

Image courtesy of magic_quote via Flickr. See license.

Where’s my (your) money? Overcoming mobile payment growing pains

BY: Ronald Herman Oct 9, 2014 ET 10:10AM

Source: QSR

S
H
A
R
E

A popular restaurant chain grabbed headlines earlier this year with the launch of its mobile payments application. It happens to be a chain that I visit on occasion, so I decided to download the app and try paying with my phone on my next visit. Once I downloaded the correct app (this particular chain has more than one app in the app store), I followed the steps to create an account, linked a credit card and loaded the minimum $25.00 in the app – at least I thought I loaded $25.00, but the sliding keypad feature caused me to accidentally load $75.00.  I’ll save the experience of requesting and eventually receiving the $50.00 refund for another time.

Now with the correct amount, $25.00, in my account, I visited the nearest location, ordered a meal and notified the cashier I would be paying with their new mobile app.  I expected to encounter some issues as the technology was new (for this chain.). What I didn’t expect was the front-line employee to be completely unaware of the new payment option and even more disturbing, share her frustration with me as the customer.

By the time the manager was located and informed I was paying with my phone, the process was easy and my purchase completed with just a few taps. From download to first payment, the process was frustrating and anything but convenient. I explored the app further and realized that in addition to the cumbersome load and use process, the only other incentive or value offered was to inform me the featured item of the week contained 940 calories.  Needless to say, I deleted the app that evening.  After multiple phone call attempts to customer service to refund my account balance (could never get an answer on the 24-hour customer service hotline), I now have $20.00 floating in cyberspace.

Mobile payment/loyalty apps have been heralded as the future of retail promising consumers a faster, more convenient and secure checkout experience. The intense competitive pressures have heightened the sense of urgency for restaurant chains to quickly launch a mobile app, and the result is hundreds of standalone apps that are lackluster at best, less convenient than traditional payment methods and are often vulnerable to security breaches and fraudulent activity.

The amount of resources and money required to develop, deploy and maintain a standalone app is a staggering investment for most restaurant operators, and the majority yield very little if any return.  To date, there are literally thousands of mobile apps claiming to have a payment or loyalty component. This number continues to rise, so cutting through the noise and actually reaching the target audience is extremely difficult. Even with success in gaining downloads, research indicates that 95 percent of apps are deleted within the first 30 days. With more than 75 percent of Americans now using a smartphone, the mobile channel is a vital customer touchpoint, but the current standalone strategy is proving ineffective at building brand loyalty or increasing customer acquisition numbers.

An alternative approach, a singular, consolidated mobile platform, is quickly emerging as a preferred strategy both by consumers and merchants alike. The key to success is ensuring the platform is built around customer engagement, combining robust loyalty offerings with mobile payment options. Having the ability to send relevant/tailored promotions, rewarding  users with instant incentives and finally, providing industry-proven security thresholds to protect both the user and restaurant from fraudulent activity are critical components of a successful shared platform. Leveraging a consolidated platform enables operators to focus on what they do best, running restaurants, yet still connect with customers and guests via the mobile channel.

Conclusion

Today’s consumer demands a seamless mobile experience, and failing to meet those expectations can be devastating to a brand. Experts agree mobile-driven loyalty will be critical in garnering consumer adoption of mobile apps. The QSR chain I described above recently announced it had completely re-designed and re-launched its mobile payments app due to the overwhelmingly negative feedback and response it received from its customers. Unfortunately, the chain faces an uphill battle to re-gain the confidence of consumers. Fortunately, the rest of the industry has the unique opportunity to learn from their growing pains, and avoid making the same costly mistakes. At the end of the day I may have lost $20.00, but it cost the QSR chain much more. They missed the opportunity to convert an occasional diner into a loyal customer.

Ronald Herman is CEO and founder of Atlanta-based Sionic Mobile, the maker and provider of ION Rewards and ION Loyalty applications. Herman has more than 25 years of experience (ranging from early-stage start-ups to Fortune 500 companies) in developing and deploying consumer-facing technology solutions.