Wednesday, September 26, 2012

Groupon Joins the Crowd in Mobile Payments

Groupon, the popular deal-of-the-day website, recently announced that it will now join the already crowded waters of mobile payments. With the launch of Groupon Payments, merchants are now able to accept credit and debit cards by swiping through a card reader attached to a smart device.

In an almost mirror proposal to its leading competitor, Square, Groupon touts that their service will guarantee the lowest rates possible, or match the lowest available. The new rates systems are structured in three tiers:

 • Swiped transactions — MasterCard, Visa and Discover (1.8 percent plus 15 cents) and American Express (3 percent plus 15 cents)

• Keyed-in transactions — MasterCard, Visa and Discover (2.3 percent plus 15 cents) and American Express (3.5 percent plus 15 cents)

• Non-Groupon merchants can also sign up for the service, however, they will be charged slightly more (2.2 percent plus 15 cents for MasterCard, Visa and Discover) Square offers 2.75% on all transactions or a flat $250 per month fee for businesses that generate less than $250,000 a year in revenue.

The new Groupon Payments Service also introduces a Merchant App. The app allows the merchant to accept daily deals, update business reports in real time, and also to scan and redeem Groupons which could attract those who already participate in offering Groupons to customers. The app will primarily be operated by the merchant until the customer will need to designate a tip and sign a digital receipt with their finger as they would any ordinary credit card device.

After the transaction is complete, the customer will receive an email with an electronic receipt. Payments through Groupon will have a quick turnaround. Merchants will be able to view transactions online immediately, and will be receive cash in their bank accounts from transactions of the day overnight.

As far as physical card swipers, Groupon has developed two methods to attach the reader to smart phones; a card reader dongle attachment, and a sturdy phone case. The card reader dongle attachment in appearance is like any of the ubiquitous card readers that are offered by Square and other services. The phone case reader is just that, a phone case that is attached to the smart phone in a sturdy non-intrusive package. The dongle is free when merchants sign up for Groupon Payments, the phone case on the other hand is available for $100.

In an interview with AllThingsD, Mihir Shah, Groupon’s VP of Mobile and Merchant Products, noted that he doesn’t think that Groupon Payments will compete with Square, rather it is targeting existing “Groupon merchants, who are running a brick-and-mortar restaurant business, like a restaurant or spa, and have already been accepting credit cards for a long time, and have high volumes,” he said. “The thing that comes up again and again is credit card processing, and we think they are paying too much.”

Though Groupon (NASDAQ: GRPN) stock price has dipped in recent months they aim to diversify their revenue streams by entering the already crowded waters of alternative mobile payments market. As the mobile payments space grows, services will attempt to one-up each other in order to become more appealing to, the real benefactors of their efforts, merchants and customers.


Phil Ng is a Social Media Analyst at IIR USA with a specialized focus on technology and technology culture. He may be reached at

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Wednesday, September 19, 2012

How Restaurant Technology Innovation is Driving Revenue

A MenuPad, a new application used for ordering
 meals and wine and even paying the check. 
The ecosystem of the restaurant experience is ever evolving. As technology advances, and customer habits grow increasingly impatient, diners are continuously seeking methods to streamline the interactions they may encounter as they search for their next meal. Businesses on the low tech side of the spectrum have begun to reevaluate the restaurant  recommendation revolution to drive revenue. 

While the main source of traffic to new restaurants are derived through word of mouth or favorable mention from friends and family, diners are now embracing a modernized approach when they consider to experiment with a new restaurant experience.

In the information age, knowledge and research are vital in making informed decisions. For many smartphone wielders, Yelp is no stranger and has become an essential tool. In Q2 2012, Yelp received traffic of 78 million unique visits, while users contribute 30 million reviews. Of these reviews 23% consist of restaurants.

The research phase continues with a wide array of websites and apps that have painstakingly collected, organized, and made available large catalogs of menus from surrounding restaurants. MenuPages collect and update thousands of menus (monthly) from nearly 30,000 restaurants in eight major markets. The interface is clean and simple while provides filters such as neighborhoods, price ranges, take out and list of other features. MenuPages also features the option to order directly through Seamless, the largest online food ordering company.

While the majority of restaurants accept walk-ins, operating the back of house becomes much less of a wild card if patrons develop the habit of making reservations before they dine. Digital reservation services, such as OpenTable, have streamlined the process to book your table for available time slots. A one-two combination partnership with Yelp, OpenTable is the reigning champion in the digital reservation service for restaurants. Having grown their customer base to over 13,000 restaurants in 50 states and multiple countries, it is hard to imagine there would be an emerging challenger. 

SeatMe, a San Francisco startup, has begun to step up to the plate and take a bite of that market share. SeatMe allows management of reservations, guests, and staff floor plans straight from a tablet or smart device. SeatMe’s guestbook also tracks unique schedules, performances, and tastes with nice design, easy usability, and good integration. SeatMe does not provide a stark distinction from OpenTable, but there are a host of differences as an alternative to look out for.

The inaction of waiting in line to be seated has even taken a turn for the tech as select restaurants have adopted a waiting list management system. NoWait is a Pittsburgh based startup that has developed an iPad app where customers may leave a name and number with the front of house, or host, and opt into receiving a text message when their table is ready. Customers can also check their status in line through a provided link via text message where they can access, “What’s My Place”, in the line. Acceptance of the NoWait system ideally organizes hosting duties in a manner where customers can inquire where there their position is in line without inundating the host or hostess with line status updates.

Once seated, the item selection has also stepped in to the technology retrofit. Restaurants are opting to do away with physical paper menus with tablet and smart device interfaces. Plate replaces a paper wine list or entire menu with a software format displayed on tablets. These “smart menus” are fully customizable to restaurants that have adopted the Plate platform, and can display notes, photos, and even pairings of particular wines to food items. Plate reports that with a few extra minutes playing with the menu can increase a diner’s order by 10-15%. 

For restaurants with a budget and cannot afford to distribute upwards of 10 tablets at any given time, SecondMenu offers a similar experience. Instead SecondMenu presents a restaurant's menu through the diner’s own smartphone. The SecondMenu web app is not activated via native apps which must be downloaded from an app store; rather it is through visiting or more easily in the form of a QR code.

Alternative payment methods have also managed to make its mark in efforts to accelerate the checkout process. With increasing support for NFC, or Near Field Communication, customers can simply tap their smart devices or use an app to pay using Google Wallet, PayPal, LevelUp, Square, or a slew of emerging payment services. Experimentation with BitCoin has also been recorded, in such with a restaurant in Berlin. Room 77, located in Berlin, serves Southwestern American fare, from burgers to burritos. The decors of the restaurant are reflections of a Texan steakhouse that we are all familiar with. 

One differentiation that Room 77 has over any other restaurant in Germany is that it is the only restaurant in Germany that accepts BitCoin. “When someone pays with by Bitcoin, either through a computer or smart phone, the Bitcoin is sent encrypted to ensure it can't be hacked. There are no transaction fees, and you can exchange a Bitcoin for real currency.”

There are a wide array of tools and new technology to incorporate in order to excite customers, while also differentiating your restaurant from conventional competitors. Adopting new methods to streamline management, or keep customers engaged, can improve the overall dining experience for patrons as well as the staff.

About the Author

Phil Ng is a Social Media Analyst at IIR USA with a specialized focus on technology and technology culture. He may be reached at

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Wednesday, September 12, 2012

The Future of Alternative Payments

Research was conducted to figure out where exactly card-based e-commerce and alternative payments were going around the world. Whether it was trying to figure out if (when?) alternative payments will eclipse card-based e-commerce or whether new innovations would decrease or increase, the results of the study painted an interesting picture for the future. 

The research was conducted by Bain Capital and Advent projects that e-commerce transactions will grow at an annualized rate of14 percent from 2010 to 2015 rising from USD $942 billion. In addition to this, there is something that is somewhat staggering: Alternative payments are actually behind card based e-commerce. But not to worry about such numbers, alternative payments are expected to pass card based e-commerce by 2015. 
BERLIN, GERMANY - SEPTEMBER 05:  A patient pay...
BERLIN, GERMANY - SEPTEMBER 05: A patient pays a quarterly consultion fee while handing over her Allgemeine Ortskrankenkasse (AOK) health insurance card on September 5, 2012 in Berlin, Germany. ( Getty Images)

The US and UK have the highest amount of e-commerce penetration rates at 77 and 60 percent respectively. In Netherlands, e-commerce growth is underpinned by an electric payment called iDEAL. iDEAL allows people to make bank transfers without entering their credit or debit information online. WorldPay estimates that there are as many as 230 alternative payments providers. 

Some believe that there can be an AP provider which can challenge the established e-commerce players. They also predict that there will be growth a 50 percent a year annually in China and Poland. Among the developed nations, Japan is expected to have a growth of 20 percent. And with the growth of other nations, prepaid may take off in ways that would turn society into more a plastic card carrying world than it ever was before. 

About the Author

Adam Wells studies English at Pace University.

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Wednesday, September 5, 2012

Cashless Food Trucks

Have you ever wished that whenever you get something to eat at a stand or a truck on the side of the road, you wouldn't need cash to pay for your purchase? Wouldn’t you love to just use your debit or credit cards to pay for that two-dollar frank or fifteen-dollar lobster roll? 

Well, gourmet food trucks are now allowing the use of debit and credit cards. They are now equipped with tablets and smartphones for credit card payments and email receipts to paying customers. 

Red Hook Lobster Pound truck
Red Hook Lobster Pound truck (Photo: mediageek)
Global transaction will increase from $241 billion in 2011 to $1 trillion in 2015. Gourmet trucks used to be a cash only operation but with the prices and the times changing, it was only a matter of time for the use of credit cards. 

Gourmet trucks are using Square and with that attachment, the business can then accept the payment. The other fact that works with the usage of credit cards is that the business can adjust the state taxes accordingly. 

Red Hook Lobster Pound Truck is one of the trucks that are utilizing this aspect of card transactions. This allows the trucks to travel through each state and adjust the taxes. 

But one of the problems with accepting electronic payments is the wireless connection. The hope for trucks to combat the connectivity disadvantage is that carriers continue to improve 4G LTE networks. Even though NFC seems to have a bright future in the way people receive payments, there are downsides to it. A merchant must acquire NFC readers and consumers have to buy NFC-enabled phones. 

The efficiency of mobile payments is still improving but there is something there. Businesses can integrate their mobile-payment transactions with QuickBooks, which unifies bookkeeping. Of all the innovations that are moving from cash to plastic cards, who would've thought the last item that would be on the list would be a food truck?

The food truck concept is already a great convenience for someone who does not want to pay a whole lot of money (unless you want lobster rolls) and keep on going. But now that some truck owners are going to use modern devices so that you can now use your cards it is even better. 

About the Author

Adam Wells studies English at Pace University.

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