Mattress retailer Sleepy’s is fluffing its pillows for an uptick in sales as it begins rolling out contactless mobile payment terminals in all of its bricks-and-mortar stores, suggesting that more brands should streamline in-person checkouts with NFC capabilities.

Sleepy’s is teaming up with payment solution provider Ingenico Group to complete the implementation, which is being groomed to save processing fees for the mattress marketer as well as offer a more seamless purchasing process for consumers. Integrating contactless payment terminals into major retail stores could be a smart move for brands expecting large amount of holiday in-store traffic, as customers will be able to easily tap their smartphones to pay, eliminating the need to rifle around for cash, coupons and credit cards.

“NFC isn’t nearly as important as a good night’s sleep, but this is a positive move by Sleepy’s,” said Jeff Hasen, founder of Gotta Mobilize and author of The Art of Mobile Persuasion. “I wonder if anyone will make a determination on where to buy a bed based on whether a retailer has contactless payment, but it is a convenience that many enjoy and look for at checkout time.

“I’m sure we’ll be able to purchase a mattress the so-called old-fashioned way for the foreseeable future – and then some.”

Improving customer experience
Sleepy’s is integrating Ingenico Group’s iSC Touch 480 terminals into all of its stores by the end of this year, which will enable the brand to accept EMV chip cards, debit cards and contactless payments from consumers. Touch-screen displays on the terminals will also allow signature capture to take place.

As more consumers grow comfortable with the notion of making payments with their smartphones, contactless terminals will become much more widespread among national retailers.

The terminals’ ability to accept debit cards will help Sleepy’s reduce costs on gateway and processing fees. Furthermore, the use of a terminal management system enables the brand to manage all terminals remotely, consequently reducing maintenance charges.

Customers will also enjoy an improved checkout experience, as they may now select from a variety of payment options. Sleepy’s consumers may prefer to pay digitally rather than use cash, due to the high prices that mattresses can sometimes fetch.

Additionally, Sleepy’s is ramping up to offer an extra layer of security to customers by integrating with a third-party solution. The brand has already leveraged tokenization to shield credit card data.

“When payment fraud happens, the party with the older technology will bear the liability,” said Thom Jordan, CEO of Ping Mobile, New York. “This means non-NFC/EMV-compliant retailers will be now responsible for the fraud amounts.

“Retailers can still use the old ‘swipe and sign’ method, but they will be liable for any fraudulent transactions if the customer has a chip card,” he said. “If the retailer has a NFC/EMV terminal, but the consumer’s bank hasn’t issued a chip and PIN card to the customer, the bank would be liable.

“This liability shift will force issuers and retailers to upgrade to NFC quickly to mitigate fraud in unison. Retailers such as Sleepy’s need to leverage this mobile strategy to limit fraud liability and remain competitive as mobile and mobile payments become much more accepted, available and ubiquitous here in the U.S.”

Sleepy’s could experience an increase in sales following this national rollout, especially among millennial customers or mobile-savvy consumers seeking to purchase new bedroom amenities.

Contactless payments’ rise
Retailers are not the only ones taking notice of the streamlined customer experiences offered by contactless payment terminals.

Last August, MasterCard attempted to help drive adoption of new payment technologies among golf fans at The Barclays in New Jersey by offering its cardholders a 10 percent discount upon using their MasterCard cards at contactless terminals or leveraging Qkr! with MasterPass to order ahead (see story).

Terminals could be lucrative implementations at major events, especially as fans clamor for quick checkout experiences at concession stands in between program breaks.

However, MCX may not be following the same upward trajectory.

As contactless payment cards finally begin to take off in the United States, a failure by retailers to partner with leading card networks for the MCX CurrentC mobile wallet is shaping up as yet another problem for the already struggling solution (see story).

“Sleepy’s is getting into the game at the right time,” said Michael Becker, managing partner at mCordis, San Francisco. “It is still relatively early days and Sleepy’s can begin to learn and adopt to these new payment technologies requested by shoppers today.

“According to eMarketer, 9.6 percent of mobile users used contactless mobile payments in 2015, a number that is expect to grow to 15.3 percent in 2015 and reach 27.3 percent by 2019,” he said. “Not everyone will use mobile payments, in fact the majority will not, but those that do will delight in its availability and appreciate the secure and frictionless payment method it affords them.

“To service today’s shopper is to cater to that shopper’s individual preferences. By leveraging the Ingenico infrastructure, Sleepy’s is building in a payment acceptance model that not only accepts contactless payments, but a wide range of methods so that it can meet the needs of the majority, if not all, of its customers.”

Final Take
Alex Samuely, staff writer on Mobile Commerce Daily, New York