HITEC 2015: Getting Ready for Mobile Payments

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The fragmented nature of hospitality transactions requires both consumers and merchants alike to think carefully about how services will be paid for in the future. Right now, the easy to use magnetic stripe cards are still popular among both consumers and merchants; however, that is about to change with the deployment of the newer electronic payment protocols, which are designed to be more secure. The year 2015 is critical for this change, as merchants get ready to deploy terminals capable of contact-less electronic payments.

With the electronic payment philosophy changing, it is critical to look at a number of issues that will influence the successful integration of such payment systems. First, it is important to understand the requirements for hospitality organizations. Thus, choosing the right vendor will be key in establishing a seamless, secure payment platform for the organization. In addition, designing the right incentives for the consumers will be critical in re-developing the marketing/revenue strategies of the organization.

Secondly and perhaps the most critical change, will likely be adoption of mobile payments by the consumers. Currently, such platforms are gaining in popularity as: (1) many consumers will bring with them a mobile device capable of mobile payments, (2) organizations will be equipped to utilize such devices, and (3) if the predictions about contact-less card transactions taking slightly longer at the POS terminal are true, mobile payments will become the preferred alternative by today’s consumers who seek ease of use and convenience.

Conversely, there could be challenges stemming from the use of mobile devices for payment. As we know, mobile devices represent an extension of one’s self in the digital world, with unprecedented opportunities for personalization and storage. With so much personalization storage, there comes privacy challenges. Given their mobility and size, mobile devices are also prone to theft or misplacement. They also need to be charged and connected to a reliable network in order to facilitate payment. Understanding the software adoption challenges by the consumers will also be interesting, as of right now, platforms such as Apple Pay seem to be gaining a lot of ground among both organizations and consumers. Will there be others? How convenient, secure, and possibly entertaining could they be?

Yet, when all of these challenges are addressed, mobile payments could represent one of the most versatile, easy-to-use, customizable, and thus valuable platforms supporting modern electronic commerce. Looking forward, a deep understanding of the opportunities and challenges of getting ready for mobile payments is absolutely necessary for any hospitality organization.

This post is the first in a series exploring educational themes that will be explored during the education sessions at HITEC® 2015 in Austin, Tx. The series will run one to two times each month leading up until the conference date in June. For information on how to attend HITEC, please visit the event site.

Cristian Morosan, Ph.D. is an assistant professor of Conrad N. Hilton College at the University of Houston located in Houston, Tx, USA.

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