AnalysisConsumer biometrics falls short

A few years ago, retail biometrics had what seemed to be a very bright future. The technology promised superior security and a permanent CRM association. If that customer switched credit cards, moved to another state, changed their name, or changed cell phone companies, the fingerprint would still allow all purchases to be associated with an individual customer. Eweek’s Evan Schuman writes that in making its case to retail managers, biometric vendors —especially market leader Pay By Touch — did not stress security or CRM. Marketers opted to focus on biometrics as the world’s coolest line-buster. They argued that that retailers could do without the delay of customers reaching into their wallets or purses to pull out and swipe a credit card. Instead, a customer would simply scan their finger and they would be authenticated and associated with whatever credit card they had on file.

There were problems from the start. Some consumers did not like the idea of using their fingerprints. Moreover, fingerprinting is the cheapest and least intrusive biometric methods, but also the least accurate of the major biometric methods. The biggest problem, however, turned out to be the surprisingly rapid acceptance of contactless payment credit cards, which essentially usurped the speed and convenience argument away from the biometric people. Current contactless payment devices are almost as fast as a finger swipe and next-generation, longer-range versions expected next year could easily be even faster. If this was not enough, mobile payments also added to the biometric problem, although the mobile payment approach of an RFID chip embedded inside a phone really turns that phone into a contactless credit card with ringtones.

Biometrics still has a robust future in many verticals outside of retail. Indeed, even within retail but outside payments (for example, timecards, approvals, and shipment acceptance). Some may point to Disneyworld, which has recently began using fingerprint biometrics at the entrances to all of their parks. By all evidence, consumers from around the world submitted to the biometric frisk at Disneyworld without complaints. Does this mean that consumers will accept biometrics more willingly than we thought? Expert say “No”: Disney is an exception, having spent decades building up consumer trust levels in the Walter Cronkite neighborhood. Supermarkets are simply not going ever to get that.