The Internet of Things is ready to take off in modern retail in the coming year, spurred by a growing connection to consumer payments.

Payments will bring Bluetooth Low Energy beacons, wireless technology, retailer apps and mobile wallets all together to work in the land of Internet-connected devices.

Many in the payments and location-based marketing industries are trying to "Uberize" their approach to payments and service by making the payment an almost invisible part of the consumer interaction (much like ride-sharing app Uber handles payments in the background of its service).

It won't be long before consumers will be able to preorder and pay for items with buttons embedded in their home appliances, eliminating the need to wait in line at a store, said Michael Martin, chief technology and chief information officer for nfrastructure, a New York-based company that helps retailers design, build and operate modern retail technology.

This reality is already creeping into some homes in the form of's Dash Buttons, which are WiFi-connected plastic buttons that can reorder a specific product, such as toilet paper, as soon as it is pressed.

"Brick-and-mortar retail will have to compete with those frictionless ways in which consumers can make purchases at home online or with Dash Buttons from Amazon," Martin said. "The Internet of Things raises the bar for brick and mortar retailers."

Merchants and technology providers immersed in location-based marketing understand that Bluetooth beacons, which are currently used to push offers to shoppers' mobile phones, will eventually be used to accept payments.

The advancement of the Internet of Things (IoT) brings the capture of payment credentials to the forefront of the retail purchase process, said Richard Crone, chief executive of San Carlos, Calif.-based payments consulting firm Crone Consulting LLC.

"Payment is now the starting point for a relationship with a service provider or retailer, whereas before, it was the conclusion of that relationship," Crone said. "IoT sets the stage for a new customer relationship management model."

The key to that model's success will be a retailer's ability to streamline the collection of consumer payment credentials, or encourage the easier process of integrating the accounts  consumers already use for mobile commerce and mobile wallets, Crone added. "You have to have a way to register and retain those credentials over time."

Beacons essentially operate like a sonar device to "ping" consumers carrying apps on their mobile phones capable of interacting with those beacons in the stores. They open the door to numerous scenarios in which consumers can decide to select and pay for an item through a phone's screen.

A sports arena could use beacons to contact attendees to upsell them to a better seat during the event, nfrastructure's Martin said. The potential for seat upgrades "might also be a reason to download the arena's or team's app because you get promotional prices on available seats," Martin said.

A similar concept for selling tickets at concert arenas was developed by Rik Blacow, a senior product and innovation analyst at Sage Pay, during Vocalink's 2014 ZappHack hackathon.

Grocery store operators who have an app with a customer loyalty card included could store a shopping list and use beacons to guide shoppers to each item, Martin said. The next step would be to add payments to that process.

"About five years ago, there was a trend at some supermarkets to let shoppers use an actual scanner to scan items as they placed them in baskets," Martin said. Those shoppers would put the scanner in a cradle at the point of sale and swipe a credit or debit card to complete the purchase.

"With mobile wallets and apps, you certainly don't need that personal scanner anymore," he said.

Ultimately, merchants want to keep close tabs on their customers to determine the best time to deliver targeted offers. In effect, many in location-based marketing view the consumer as a moving point of sale that can initiate a mobile purchase just about anywhere.

"The glue, or the foundation, and the one thing that is common across all of this will be the payments registration," Crone said. "You will see announcements in the first quarter of next year around Bluetooth LE from all of the legacy players, setting the stage for a new wave of embedded payments."

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