Can biometrics in retailing really take off?

Monday, 13 October 2008

Senior vice president at TNS Retail Forward Mary Brett Whitfield looks at the rise of biometric fingerprint payments in the retail sector

Companies have been experimenting for well over a decade with the use of physiological biometrics - unique physical characteristics like fingerprints - as a means to identify individuals.

There are relevant applications in retailing, the workplace, financial transactions - really in any situation where it is necessary to link information or data to a specific individual. Even Disney has used biometrics to track ticketholders.

In retailing, the application drawing the most attention is using biometrics to securely link a shopper's bank account, payment cards or loyalty card to finger measurements and data points. Personal information cannot be lost or stolen.

Shoppers never have to carry payment or loyalty cards. From the shopper's perspective, this could dramatically speed the checkout process and make shopping for both routine and infrequent purchases much more convenient.

A quicker shopping experience also benefits retailers who should be able to generate labour savings at the front-end. Additionally, adoption of the technology will help them combat fraud and identify theft.

With the proper hardware, the solution works online too. It gives Internet users a fast, easy and secure way to identify themselves and interact on the Web. By simply sliding a finger on a sensor, users can securely access their Web-based accounts with no need to remember IDs, passwords and account numbers.

Given the potential benefits of biometrics and the ever-decreasing costs of technology, it would seem likely that biometrics will be commonplace sooner rather than later. However, one of the barriers to widespread adoption is consumer reluctance.

Even though biometrics has a wide appeal, findings from a recent TNS study show that shoppers are reluctant to use the technology when given the opportunity to do so. One of the major concerns may be related to privacy.

Global Variations

Globally, the Chinese and Spanish are most likely to use biometric fingerprint payment technology. In France and the United Kingdom, shoppers are also keen on biometrics. Interestingly, consumers in some of the most tech-savvy countries - Germany, Japan, the United States and Canada - are least likely to use the technology.

This may be because Asian and European shoppers are accustomed to biometrics. Many countries in Asia and Europe are moving towards or have already implemented biometric passports.

In addition, the use of biometric fingerprint identification in banking and in the workplace is more prevalent in Asia and Europe than in North America. Having had more exposure to the technology, shoppers in China, France, Spain and the United Kingdom apparently feel more comfortable with it and might be less concerned about privacy issues.

The UK, for example, already requires biometric data for all visa applicants. Similarly, Spain is using a smart card with fingerprint verification for its National Social Security Identification Card Project (TASS), which is linked to welfare and healthcare benefit disbursements, in order to reduce fraud.

The Chinese have exposure to biometrics because the technology is manufactured there and exported to other markets.

Although Germany is among the first European countries to issue biometric fingerprint passports, personal data protection laws are strict. The new law requiring biometric fingerprints on all passports issued after 1 November 2007 has sparked a major debate around data privacy and created resistance among German citizens.

In the US, the population has less exposure to biometric technology and many Americans are still concerned about privacy issues.

Bottom Line: Technology Poised to Change the Shopping Experience

Regardless of whether biometrics or other retail technologies ultimately see widespread adoption, TNS Retail Forward believes technology will drive more change in the way consumers shop in the next 10 years than it has in the last 20 years.

We know that shoppers are frequently overwhelmed by too much choice and need to shop in minimal time. Biometric payment technologies and other innovations will provide welcome reassurance and help.

But because there are global differences in shopper priorities among countries, it looks like there will still remain a need to tailor stores and experiences to give local people what they want to aid their shopping trips.

10 Oct 2008 - Morrisons takes on checkout technology
19 Aug 2008 - Always introduces new Secure Guard technology
31 Mar 2008 - Torex to showcase convenience technology
11 Mar 2008 - Tesco looks to technology to boost wine sales
04 Oct 2007 - Retailers turn to in-store technology to combat internet thr…

Bookmark

Email This

Comments (2) add comment

Show/Hide comments

James Scott said:

	... To Whom IT May concern; I would like to know how I could become a salesman of this new biometric technology ? Sincerely; JS
	report abuse vote down vote up

October 14, 2008
Votes: +0

Luke said:

	... Very interesting article. It's great to see some mainstream coverage of the benefits of biometrics. I hope one day that everything will be paid for by touch :) http://www.biometrics.co.uk
	report abuse vote down vote up