Mobile POS (mPOS) at retail delivers numerous benefits, including line-busting, managing showrooming, stimulating add-on sales and ordering out-of-stock items. Plus, mobile devices equip associates to run customer loyalty programs, manage inventory and change pricesall from the palm of their hand.
Evaluating accurate return on investment (ROI) of mPOS isnt simple due to the multiple variables and influences in the retail environment. Because this technology is still new, straightforward formulas or a list of critical calculations for merchants dont exist.
However, at retail, mobile devices typically impact ROI in sales, operations, equipment expense and qualitative factors. These four focal points, then, guide data gathering for benchmark statistics prior to mPOS implementation and after deployment. Of course, retailers also must calculate the total investment of mPOS implementationincluding hardware, software, infrastructure, training and mobile device management (MDM)to offer context when analyzing results in each of these four areas.
To assess mPOS impact, measure each of the following 30, 60, 90 and 180 days after mobile adoption: average number of transactions per day per store, average dollar amount per transaction, associate sales per hour, add-on sales and transaction duration
For a comprehensive picture, these figures should be compared with pre-mobile numbers, results in other departments (if applicable) and mobile stores and non-mobile stores. Also, retailers should consider mobiles cross-channel capabilities, such as online sales and sales conversion rates.
In addition to POS, mobile devices can multitask with custom software to conduct operations such as price changes, inventory management, order ability and space management. To yield a sense of ROI, retailers can compare productivity and accuracy of operations using the mobile device with pre-mobile figures. Additionally, they can compare data for stores leveraging mobile technology with those that are not.
With mobile, retailers may experience greater productivity due to ease of use, faster scanning speed and more powerful software, which can lead to staffing adjustments and payroll savings.
Merchants should calculate costs for current legacy hardware, including terminals, printers, signature devices, barcode scanners, and handheld devices for operations
For more accurate results, retailers also should factor in failure rates, maintenance and repair/replacement costs, along with the reduction in essential legacy equipment due to mobile adoption.
Tabulating the total cost of one mobile unit, its components (software, accessories), and MDM per device enables retailers to evaluate legacy figures against mobile solutions, which typically shows savings over time.
Associate morale and attitude can also impact ROI, even though they arent quantitatively measurable. Advanced technology that helps associates perform better can lead to greater appreciation and job satisfaction, along with better customer service and decreased turnover. Utilizing mobile devices for customer loyalty and coupon programs also can add value in terms of greater engagement.
Although benchmark ROI estimates and average industry returns are not yet available as a frame of reference for retailers to assess the performance of their mPOS, measuring ROI is a critical element to helping the business to thrive.
Andrew Graham is the president and CEO of Infinite Peripherals.