Marks & Spencer Gains Big With Contactless By Making It A Big Deal

Department-store chain Marks & Spencer has rolled out contactless and mobile payment in 644 of its roughly 700 U.K. stores, Mobile Payments Today reported on Tuesday (May 7). The retailer said it now processes more than 230,000 contactless transactions each week, which includes 14 percent of the chain's under-$30 transactions.

That makes M&S one of the biggest investors in contactless point-of-sale technology in the U.K. Despite a big push for contactless use during last year's London Olympics, most retailers have been unwilling to spend on new POS terminals so soon after the introduction of chip-and-PIN.

But compared with U.S. chains, many of which have contactless PINpads on every counter but virtually no contactless transactions, M&S's success with the technology is striking. The chain says that's in part because contactless makes sense for quick, cheap purchases that don't require a cashier. For example, 25 percent of M&S's contactless payments are made at self-checkouts in food departments.

However, the biggest reason for the chain's success with contactless is probably that M&S has made a big deal of it. The fact that it's not just sitting on the counter but is actually being promoted is the most likely driver for an average of more than 300 contactless transactions per store per day. If retailers make alternatives to swipe a big deal, some customers will try it. If stores make those payment alternatives all but invisible, customers won't.

In many ways, it comes back to why Starbucks (NASDAQ:SBUX) has far more customers using mobile payments than any other U.S. chain: Starbucks made holding up a phone to pay for a latte a big deal. Nobody else has bothered to.

For more:

- See this Mobile Payments Today story
- See this Finextra story

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