One of the undeniable hot topics at SXSW Interactive this year is the mobile wallet. No wallet, no problem…courtesy of NFC (near-field communication) technology. Until SXSW I’ve had a singular view of how NFC actually works, not from a technology perspective, but from the value it gives consumers beyond the purely transactional aspect of the quick and easy tap-to-pay function. We get what tap-to-pay means. And, according to industry experts, we are on the brink of mass adoption once the trinity of consumer, financial and merchant communities align to make mobile payments happen in a meaningful way (well, beyond Starbucks, that is). Google Wallet, the Isis mobile payments venture (a collaboration between the major mobile carriers) and even rumblings of an iWallet show that the industry is poised for rapid growth. Oh, and for those in the ATX, we’ll get a preview of NFC sooner than most others as Isis recently chose Austin as a pilot city for their mobile wallet application. Yay!
What intrigues me most about NFC coming out of the SXSW conference is NFC’s capability beyond enabling a simple purchase transaction. NFC has the potential to serve as a gateway to a rich, immersive, relationship-building experience between brands and consumers, similar to what 2D barcodes (QR codes) have provided for years, despite the often clunky user experience of QR and the multiple actions required by users to make those black and white boxes come alive.
Think about tapping on a product to learn more about it…tap a banana to learn where it came from. I don’t know if tapping fresh produce is possible, but it’s fun to think about…and it feels very Willy Wonka. Tap a movie poster for the trailer and to purchase tickets. Tap a car at a dealership for a virtual brochure and to compare it to other models. The possibilities for NFC-enabled content in retail environments as well as on-site experiential events are endless.
Given QR codes current popularity as a marketing tool, will NFC eventually replace QR codes as a quicker, more seamless way to facilitate consumer engagement? For now, and for the foreseeable future, both NFC and QR codes can and will coexist based on their unique technologies. While NFC clearly wins in the user experience category, it requires a chip or sticker on every piece of physical media or product. This can be pricey if hundreds of thousands or millions of units are involved. I guess the bananas are out. NFC also requires extreme proximity to activate a tagged object. 4 centimeters in fact. This would make for an awkward, not to mention dangerous, tap of a highway billboard, for example. Despite QR code user experience issues and their failure to fully capture consumer interest, they do provide a relatively cheap and broad (almost all smartphones can handle 2D barcodes) way to bridge the offline and online worlds. But given the quickly developing NFC ecosystem, as demonstrated at SXSW, NFC will be a very viable and appealing alternative to QR codes in situations where it makes sense. Success in activating physical media through the use of QR codes or NFC will require a thoughtful, strategic approach based on budget, proximity and environment.
Until then, I look forward to tapping into all that NFC has to offer!