ISOs and agents have a firm hold on selling payment terminals, but that's not where the real action is. Today, merchant acquiring is about tying payments to things such as advertising, marketing and loyalty programs.

It's a challenge for an industry that's not regarded as being robust adopters of new technology, but Aevi hopes the app store concept and a series of collaborations can help merchant acquirers embrace innovation.

"A merchant should be able to select apps on their phone that they see value in," said Jeff Dumbrell, general manager of the Americas Region for Aevi, a German unit of Diebold Nixdorf that operates a cloud-based white label B-to-B app store called Global Marketplace and a tablet based point of sale system called "Albert." Aevi just announced its expansion into North America.

Jeff Dumbrell, general manager of the Americas for Diebold Nixdorf's Aevi
"A merchant should be able to select apps ... that they see value in," said Jeff Dumbrell, general manager of the Americas Region for Aevi, a unit of Diebold Nixdorf Aevi

The app store is designed to use open development to create a suite of business apps that acquirers offer to merchants. These apps include products such as Alldox, a business document storage app; Epos now, a retail and hospitality data reporting app; Appointedd, a booking tool; and dozens of others.

"It's kind of like a buffet for third party apps," Dumbrell said.

Aevi's North American expansion comes as it enters into a collaboration with Smart Engine International to add loyalty and advertising apps to Aevi's app store. Aimed primarily at retail and hospitality merchants, Smart Engine enables acquirers to build point-based marketing and advertising campaigns that operate across a network of payment terminals, creating an ecosystem of interactive advertisements and offer-based marketing.

For example, the ads can include connections with tailored real-time offers at associated stores within a network of participating retailers, based on a consumer's payment history.

Acquirers can use these campaigns to build bundles for merchants, including a marketing or advertising program with sales performance or human resources—all tasks that are beyond payment processing, according to Dumbrell.

"An acquirer that specializes in restaurants can create a restaurant bundle, with gift cards, a loyalty app, payroll and customer satisfaction surveys, for example," Dumbrell said.

Before its entry into North America, Aevi entered into other partnerships to add breadth to its app store. Last spring, the company allied with Wirecard, Evo and Fime to support contactless payments, compliance and processing. Aevi has also partnered with Commonwealth Bank of Australia to boost acquiring technology.

Aevi hopes the expanding app store can convince merchant acquirers that targeted advertising, cross-merchant loyalty, inventory management and human resources tied to the point of sale system are not a threat from disruptive startups, but an opportunity for traditional merchants.

"I come from a background of working with closed ecosystems and closed operating systems and payment terminals," Dumbrell said. "What we're doing is opening the ecosystem where merchants can add services that make sense to them."

Aevi's operating in a competitive market, where the established payment processors are already adding merchant service apps to web-connected payment terminals. First Data is using technology from its acquisition of Spree Commerce to add flexibility to its Clover tablet point of sale system. And Leaf deployed an app store for merchants years ago, in advance of Heartland's acquisition of the company. Poynt and Verifone's Carbon are also designed to bring elements of mobile commerce to merchant acquisition.

Given the mix of technology solutions available, it's possible for merchants to be overwhelmed.

"The technology may be getting a bit ahead of the implementation," said Thad Peterson, a senior analyst at Aite Group. "In loyalty and promotion it's essential to have clear objectives and a solid economic model to track performance."

New tools like real-time couponing and point of sale loyalty are powerful if they support the merchant's overall business objectives, Peterson said, adding Kohl's integration of promotion, loyalty and payment into its app simplifies things for the consumer and the employee.

"If on the other hand a new application requires significant behaviour change by the consumer or doesn't fully meet the needs of the merchant, then it's entirely possible for the program to fail," Peterson said.