'Reinventing The Register' May Take Time For Square
ROBERT SIEGEL, HOST:
Now, the cash register re-imagined. Paying for things online with your mobile phone can be as easy as paying with cash. But digital payment companies, like PayPal and Square, think the big money for them is still at the register. So they're rushing headlong into brick-and-mortar retail, eager for new ways to make old-fashioned money.
From member station WHYY, Zack Seward has the story.
ZACK SEWARD, BYLINE: Federal Donuts, in Philadelphia, is a fusion restaurant - a fusion of doughnuts and fried chicken. For many customers, that is a first. Manager Brien Murphy says for some, that's also the case with Square.
BRIEN MURPHY: They're open to it, believe me. When they get it in front of them, they're wowed by it. And they say, this is so cool, this is so neat; I feel so hip. And it gives them the sense of like, hey, I'm in with like, the newer, hipper crowd.
SEWARD: As of just a few days ago, Federal Donuts joined about dozen other trendy food spots across the country, trying out Square's latest bid to, quote, "reinvent the register."
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FARYL URY: And now, we look at this as the register re-invented. And we have a sleek, white, Square Stand that holds an iPad, and allows businesses to accept credit cards on their countertop.
SEWARD: Faryl Ury is the spokeswoman for Square. The San Francisco-based company, which was started by the co-founder of Twitter, already has its own card reader, compatible cash box and software. But now, Square is doubling down on hardware. Ury says its new Stand represents a shift from what most people picture when they think of the company.
URY: A mobile device; so a food truck, or a person at a jewelry craft fair, or a farmer at a farmer's market, using it to take payments on the go.
SEWARD: Ury says quick-service restaurants, like high-end takeout or coffee shops, are becoming an important cash cow for Square. The company makes its money by getting a 2.75 percent cut on every purchase. But Square is far from the only player in town. The announcement of its new Stand came on the same day competitor PayPal announced its plans for killing the register.Square's Ury says more merchants are beginning to ditch traditional systems.
URY: It's really catching on.
SEWARD: So are you guys getting in the business of becoming a cash register company?
URY: Well, I think we're trying to imagine it as the register reinvented. And that's what we're talking about with the Square Stand. So we're totally revolutionizing the way that people think about commerce.
SEWARD: But some experts are a little more skeptical.
DENEE CARRINGTON: A card reader is not revolutionary, from a consumer perspective.
SEWARD: Denee Carrington is an analyst with Forrester Research, who follows digital payment companies. She sees the new Stand from Square as a useful and neat accessory, not a game-changer.
CARRINGTON: I think it's yet to be seen really how Square is going to achieve broad acceptance and achieve scale, either on the processing side or on the wallet side.
SEWARD: She acknowledges it's a hot marketplace with new technology. But it doesn't really matter, if consumers aren't yet comfortable ditching their credit cards or cash to pay for their purchases. An incremental revolution, in the form of a simple stand with a credit card reader, may be less sexy - but could be more profitable.
For NPR News, I'm Zack Seward in Philadelphia.
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