POS as We Know It Is Dead, Long Live POS
By Joe Skorupa
Today, POS as we know it is dying and a new POS is emerging that is neither hardware nor software in a traditional sense and is instead a POS platform. This is the premise of this month's Custom Research report. To paraphrase an old English proclamation when a monarch passed away: POS as we know it is dead, long live POS.
In these disruptive times, pressure from digitally-obsessed shoppers is forcing retailers to rethink their store business models and the core technologies that serve it. Some retailers are thinking digital first, some mobile first, some store first, and some are aggregating of all of the above.
In each case, traditional POS software is being pushed beyond its former limits and a new POS operating environment is being born. In its next iteration, POS platforms will be interoperable with adjacent applications but loosely coupled. They will be less reliant on complex integration schemes and more flexible to support easier upgrades and adding new functions.
However, there is one big problem with this vision – we are not quite there, which is one of the overarching findings in the report. Since the next iteration of POS is ready some retailers have a hard time envisioning it as their next POS platform.
As a result, many retailers are looking forward to creating an improved version of what they have now – separate POS and e-commerce platforms that are tightly integrated (39.1%).
However, a sizable group of visionaries, retailers who want a unified commerce platform for stores and online as their next POS, comprise a quarter of our survey pool (26.1%). These retailers point the way to the future.
Here are some key findings from the report:
- When will the unified POS platform of the future arrive and become generally available for deployment? Most retailers believe it will take two years or longer – 41.3% say two years, 17.4% say three years and 6.5% say longer than three years.
- Many retailers believe they will need to replace their current POS before the next iteration becomes generally available – 26.1% are certain they will need to make a change sooner and 30.4% say it is probable they will have to.
- More than a fifth (21.7%) say they have already begun the process of planning and implementing their POS platform of the future. Within six months another 17.4% say they will begin and within 12 months another 17.4% will begin. So, within a year more than 50% of retailers will have begun some work on their POS platform of the future.
- Most retailers say they are reviewing or planning to review vendors with no preference for their current POS vendor (47.8%). This is probably a normal response level for the replacement of any major IT system in the retail tech stack.
- Only 6.5% say that replacing their current vendor is a priority, which is a low number, but so is the number of those who will give their current vendor either priority status or make it a top preference (43.5%), which can be viewed as a proxy for a customer satisfaction score, where a number in the 90s is considered good in most industries.
POS has seen big changes before, but this one is different. It is a true inflection point. In many ways, the next POS you install will probably be your last in a tradition that goes back to the scan of a pack of Wrigley’s gum at a Marsh supermarket in Ohio in 1974.
For the full report, which has a complete set of charts and analysis, please click here.