smartyrants
By: Intern July 2, 2012
NFC in the USA: Learning From Japan

“That’ll be $10,” the cinema worker says.

You pull out your mobile device and hold it near the pay terminal. Almost instantly, your payment is processed and the movie ticket downloads to your phone. To get into the theater, an electronic ticket attendant recognizes the ticket on your phone and lets you in. You swipe your phone again before entering your movie, this time over a small sticker on the door. Your phone silences itself, saving you and other moviegoers the hassle.

Does this sound too futuristic? In reality, all these capabilities already exist now: America just hasn’t caught on yet. 

Meet NFC, or near-field communications, technology. It allows two compatible objects to communicate with each other when they are close, usually within a few inches of each other. Because the signal travels such a short distance, it is considered to be secure enough for things like mobile payments and convenient enough to be used for almost anything else.

For marketers, this promising technology serves an obvious purpose. Consumer payments can be made with a level of ease and convenience never before seen. Services such as Google Wallet and Isis are cropping up, hoping to get the mobile NFC payment ball rolling. However, the possibilities for consumer interaction with brands via NFC are endless and could revolutionize marketing efforts everywhere. Imagine being able to tap an advertisement with your phone to get drink specials or coupons. Suddenly, everything is only a swipe away from mobile bliss.

Asia leads the pack when it comes to adopting NFC. Countries like tech-savvy South Korea have used NFC to gain access to public transportation for years, replacing the long lines and waits for metro tickets and passes. Japan accepted the technology with open arms: they’ve been paying with NFC devices for years. Their story of NFC adoption is unique due to the fact that Japan used to be a cash-based society. With our credit card and online payment experiences here in the United States, the jump to wireless payments should be the next logical step. Still, only 3 million devices are NFC-enabled in the States compared to over 70 million in Japan.

While we struggle to catch up, the foundation for further implementation of NFC technology in Japan has begun. Two Gap stores in Tokyo have started a campaign combining the might of NFC and Facebook with the power of persuasion. Customers receive an NFC-enabled bracelet in the store and download a Facebook-connected app to their smartphone. When they see an item they like while shopping, customers can “high-five” the item by touching the bracelet to their phone. The phone cheers and automatically posts a message of approval to the user’s Facebook page. This idea was adopted from Revlon, who takes the NFC bracelets one step further to allow customers to “like” individual products in their stores. If the bracelets become a success in Japan, you can bet they will be tested here as well, especially as NFC technology is more widely adopted.

Samsung and Sony are trying to get American consumers to use the technology with the launch of NFC-enabled stickers and tags. Sony’s Xperia SmartTags and Samsung’s TecTiles are based on the same idea: small, portable NFC tags that can be programmed and re-programmed to carry out basic tasks and commands. For example, you could place a tag at your bedside that puts your phone in a custom “sleep mode” (WiFi off, alarm set, silenced). As of now, the tasks NFC tags can carry out are limited, but there’s little doubt they can save us time. The downside? Samsung tiles can only work with a handful of Samsung smartphones, and the Sony tags only function with Sony’s Xperia line of smartphones.

Will the idea of NFC integration stick with consumers? The potential of NFC is too great for the technology not to stay, but companies need to realize the struggles of getting mainstream America to adopt. I feel it’s too early in the game for corporations to be making NFC tags that only work with their products. For mass technology adoption, something akin to the “Got Milk?” campaign is needed: a broad, industry-based message that transcends brands. Who knows? Maybe some day soon, US consumers will be “high-fiving” the milk moustache.

 

Kearney Erhard attends Syracuse University and interns at TC.

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