Mobile POS to Cannibalize 12.4% of Traditional POS Market by 2016

 In iMobile3

Even though a full 33% of all retailers have no plans to adopt mobile POS, the technology is still having a significant impact on the point-of-sale market. According to the new IHL Group study, Mobile POS: Hype to Reality, mobile POS will cannibalize 12.4% of traditional POS shipments in North America by 2016. The highest replacement rates will be seen in department stores and specialty soft goods retailers.

“This doesn’t mean that traditional POS shipments will decline; it means that they will not grow as fast as they otherwise would,” explains IHL Group president Greg Buzek. “This cannibalization takes into account the fact that mobile devices initially deployed without mobile POS capability will be upgraded or replaced to enable it.”

Other key findings from the research include:

· Nearly three in 10 (28%) of retailers plan to adopt mobile POS by the end of 2013.
· Tablet shipments will experience high double-digit growth over the next few years.
· Specialty retailers are deploying about 45% of all tablets shipped to retail for POS. They are most popular in small independent retailers and large mall-based specialty chains.
· Over 85% of larger retailers suggest that for the next three years, mobile POS will serve as additional transaction points in their stores rather than as replacements for traditional fixed POS stations.

“Overall, the data we see in this study leads us to believe that retailers have slowed down the aggressiveness of deployment that they planned a year ago,” says Buzek. “We believe the main reason is that some retailers have deployed the technology and started walking through the problem-solving phase of getting the devices integrated into their operational plan.”

For example, retailers have spent millions of dollars annually on security systems and video cameras tied to fixed POS terminals. “Much of that goes out the window with mobile,” says Buzek. “There are similar issues with printers, cash drawers, security tags, etc.”

Mobility is also being more closely integrated into retailers’ omnichannel efforts: “Mobile is part of the overall strategy shift on software and getting to a single transaction platform that is cross-channel, so that they use the same transaction logic,” notes Buzek.

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