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40pc of smaller merchants are using mobile credit card readers

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August 5, 2013

SMBs embrace mobile payments

In a sign that mobile payments are gaining significant traction with small and mid-sized merchants, 40 percent of these businesses report accepting payments at the point-of-sale via a mobile credit card reader attached to a smartphone or tablet, according to a new report from BIA/Kelsey.

Mobile is also playing a key role in the businesses’ marketing efforts, with 32 percent of SMBs using some form of mobile advertising to promote their businesses, up from 28 percent last year. In particular, the findings reveal that professional as well as home and trade services are embracing mobile in a big way.

“Mobile payments platforms are gaining significant traction with SMBs, with 40 percent of those surveyed stating they now accept payments at the point-of-sale with a mobile credit card reader attached to a smartphone or tablet (e.g., PayPal Here, Square, etc.),” said Steve Marshall, director of research at BIA/Kelsey, Chantilly, VA.  “Another 16 percent plan to add this capability within the next 12 months.

“Use of mobile for advertising by SMBs is up,” he said. “About one-third of survey respondents (32 percent) report using some form of mobile for advertising, compared to 28 percent a year ago.”

Social strategies
The report shows that SMBs are increasingly embracing mobile and social platforms for improving operational efficiencies and promoting their businesses.

Attachments for mobile devices that enable retailers to process credit card transactions, such as those offered by Square, PayPal Here and others, have been gaining traction quickly.

In addition to the 40 percent already using mobile for processing credit card payments, another 16 percent plan to add this capability within the next 12 months.

Other findings include that 72 percent of SMBs are using social media to promote their business, 52 percent have a Facebook page for their business and 25 percent have a Google+ Local page.

Gateway to loyalty
The adoption of mobile and social tools is transforming the way SMBs acquire and retain customers, with SMB marketing quickly becoming a two-way engagement rather than a one-way promotion.

For example, when asked how engaged their businesses are with customers on social media through activities such as responding to comments, blogging or tweeting and updating social media content, 66 percent said they are “extremely engaged” or “very engaged.”

For SMBs, the findings underscore the need for these businesses to consider how mobile can support their loyalty efforts as well as their infrastructure.

“Recognize that mobile platforms now make your employees ‘walking POS terminals,’” Mr. Marshall said. “Since the POS terminal has become a key gateway to loyalty and discount programs and CRM, with mobile, this gateway function is being transferred to individual employees, wherever they may be. Think about the implications of this.

“Start thinking of mobile as a key element of your operations and infrastructure – it’s more than just a communications platform,” he said.

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York

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