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[20 comments]

Paper is Out as Retailers Opt for E-Receipts

November 7, 2012

If Apple is doing it than it must be good. The "it" in this case is the use of paperless receipts. The Apple Store began giving consumers the option of having a receipt emailed to them rather than getting paper documentation back in 2005.

Today, a wide variety of retailers are offering e-receipts with purchases. According to a study by Epsilon, 35 percent of retailers offer an alternative to paper.

Jim Sluzewski, a spokesperson for Macy's, told USA Today that e-receipts currently account for 12 percent of transactions at the chain's stores. The small percentage of consumers availing themselves of the e-receipt option suggests that many consumers are more comfortable sticking with paper.

A variety of reasons including cost savings, greater customer insights and interactivity are driving retail adoption of e-receipts.

The one area of apparent disagreement on the benefits of e-receipts is in the fraud/security question.

A piece from last December on the website of STORES argued that e-receipts pose a risk. Tom Rittman, vice president of marketing for The Retail Equation, told the magazine, "A digital receipt can be transmitted instantly to multiple mobile devices across the city [or farther] and re-printed on all means of paper with no control by the retailer. Now, retailers can be hit with rapid and massive return fraud before having time to react. With e-receipts, retailers are more susceptible to organized retail crime."

Another article on the Bronto Software acknowledges security concerns, but suggests there's a fix. "The best way to avoid these issues is include a barcode in the email that links to the transaction in your commerce platform. Combining this with other unique identifiers can add another layer of fraud protection."

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Discussion Questions:

Why have we not seen more rapid adoption of e-receipt technology at retail and among consumers? Do you think the fraud issues have been/will be sufficiently resolved? What do you think are the greatest advantages associated with the use of e-receipts?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How long will it be before the majority of retail transactions in North America are confirmed with an e-receipt?

Comments:

Consumers' resistance to e-receipts is not just a security issue, but also a privacy concern. It requires sharing your e-mail address, possibly to retailers who don't already have this information -- and can trigger unwanted e-mails and data mining. As far as the fraud issue is concerned, it would be worth seeing some facts -- not just speculation -- that this is really a problem, any more so than the widespread use of credit cards already.

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Dick Seesel, Principal, Retailing In Focus LLC

Some the resistance to e-receipts by customers may be generational. Consumers who grew up with paper receipts have a process that they utilize to store and file them. Some have a great methodology and others not so much, but it is something they have done for a long time and are comfortable doing.

E-receipts mean learning a whole new system. Where did I "file" that? How do I retrieve it? What happens if I mistakenly delete it? More importantly why should I have to learn a new system when I'm happy with the old one? I expect this will not be adopted as quickly as other transitions from paper to electronic, like boarding passes.

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Steve Montgomery, President, b2b Solutions, LLC

Retailers' adoption of e-receipt technology has been consistent with retailers' adoption of new technology in general: they are slow. Retail is still merchant-driven and nowhere near a marketing-, customer- or (especially) an IT-driven business.

As RSR Reserach so aptly points to as its #1 takeaway in its most recent Marketing report (found here), "The timeline that retailers are currently following for creating a true customer-focused executive is too slow."

While there are certainly risks in terms of fraud, these risks can be mitigated with process and technology solutions, along with customer marketing leadership and prioritization.

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Phil Rubin, CEO, rDialogue

Retailers are notoriously slow to adopt new technologies, even with the rapid pace retail technology has taken. Additionally, there's still a big segment of the market that is uncomfortable with digital transactions and surely, retailers know that.

Security is a non-issue to me if a retailer has a well integrated POS system. With the proper infrastructure that voids returned merchandise via a unique transactional identifier, fraud is eliminated. One issue George didn't mention is the problem of undelivered e-receipts. If a consumer walks out of the store with no receipt and for whatever reason never receives the e-mailed receipt, they are at the mercy of the merchant as to whether they can make a return or not.

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Ken Lonyai, Digital Innovation Strategist, co-founder, ScreenPlay InterActive

Phil Rubin of the BrainTrust says it the best -- retailers' adoption of technology is S L O W. The major shopping groups -- the "Millennials mass" -- are ready for more text, more email and less paper. Retailers have just moved slow in this area. Simple.

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Tom Redd, Vice President, Strategic Communications, SAP Global Retail Business Unit

While I can't address fraud issues being sufficiently resolved, I believe the bigger reason more companies haven't adopted paper receipts is because they have not yet set up the system to do so. As for advantages, the customer feels good about being green and accepting an e-receipt. And some customers really appreciate the company for the same reason. Then there is the convenience factor: Finding that receipt via searching my saved messages is much better than wondering if I threw away the receipt by accident.

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Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC

Retailers may also be concerned about the freedom of this kind of data in the market. Could competitors gain access to consolidated e-receipt data and learn about products, promotions and customer needs and use it against you?

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Matthew Keylock, Senior Vice President, New Business Development and Partnerships, dunnhumbyUSA

I agree with the comments posted. Retailers are slow to adapt to change. It reminds me of the cereal commercial where if Mikey liked it, the others would eat it. In this case, if others are doing it successfully and the consumer wants it, retailers will get on board.

I also see this as partially generational. Many older shoppers, used to paper records, will be reluctant to this change.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

Yep, retailers are SLOW and adoption by consumers is likely generational. The jury is still out on the fraud issue. IMHO.

Lee Kent, Brings Retail Executives Together to Meet.Learn.Profit, RetailConnections

I am sitting at my desk and on my desk there is a pile of 8 or 10 credit card receipts. I assure you, it is a pile with no semblance of organization. Maybe I will get to it sometime and organize each one properly. Or, more likely, after a time I will just throw them out.

Last week I came into contact with my first e-receipt. I made a pretty significant purchase (and in buying, I was already considering returning because it was probably too expensive.) The salesperson asked me if I would like paper or be emailed a receipt. For me it was a "no-brainer." "Email me the receipt!" One less piece of paper to deal with or lose. I could start a file of receipts on my computer and know where they all are. Heaven!

Who would not want to do it this way?

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Gene Detroyer, Professor, Independent

E-receipts require technology investment, and that is why more retailers have yet to adopt this. If we can have mobile banking, the fraud issues with e-receipts can be resolved.

Some of the benefits of e-receipts are customer contact in the store...a guaranteed touch point for the retailer. Also, collecting data and email addresses of customers isn't a bad thing.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

Aside from the fraud/privacy/convenience issues -- which of course shouldn't just be dismissed out of hand because they may be sufficient to sink the whole concept -- I think the ultimate spread of e-receipts is dependent on the size of the sale. Buy a car, computer or sofa...e-receipt? Sure, a pack of gum or cup of coffee...probably not. (Who wants ten e-mails a day that they're going to just delete anyway?) And I suspect the majority of retail transactions are more like the latter than the former (by number of transactions if not $ volume).

'notcom'

Retailers will continue to pursue the adoption of e-receipt technology because it is more convenient for the consumer and lowers store operating costs. The technology does create a whole new business opportunity for retailers. They once again have the consumer purchase information marketers want and are willing pay for. So for those retailers willing to take advantage of this technology and be an early adopter, it could be new profit center to leverage.

Thomas Palombo, Pres, The InStore Group

I disagree with: "The small percentage of consumers availing themselves of the e-receipt option suggests that many consumers are more comfortable sticking with paper." It is more indicative of the violation of trust many brands and retailers have created with their shoppers. Most shoppers are unwilling to provide their email address to retailers even for the value of e-receipt because so many abuse this privilege of engaging their shoppers. Research tell us shoppers prefer a 2-4 times per month contact, yet many retailers are on daily or even multi-times daily email tracks.

The assumption should be that those who are willing to give you their email address for a receipt are your loyal customers and they should never receive an email blast to that address. Rather they should receive custom emails based on shopper data.

michael bigley, Director of Creative Technology, RGI Inc

Great thread. Consumer convenience, merchant marketing opportunities, elimination of waste...it's all good, and I expect that this is another thing that Millennials and others will simply expect in the next generation shopping experience. It'll be interesting if the e-receipt providers include digital signatures or some other mechanism to prevent fraud/chargeback issues. This was a big idea years ago that hasn't really seen the light of day yet.

Jeff King, Head of Strategy, Partnerships, eBay, Magento

It is a matter of consumer behavior and the privacy issue of giving the retailer an email address. I use it personally at Nordstrom all the time and love it. As long as it is tied to the credit card, return is just as simple since it is tied back to the transaction that way. As people are comfortable with e-receipts for e-commerce, they will get more comfortable with e-receipts for physical purchases.

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Kenneth Leung, Director of Enterprise Industry Marketing, Avaya

Too easy to lose the data and not have a way to return an item. E-receipts would make me uneasy because they will then have my email address and I want to limit access to that info.

'Starfire61'

The greatest barrier to adoption of e-receipt technology is the cost. Consumer adoption of technology for payment is already pervasive, as evidenced by the growth of e-commerce, which, of course, is all executed with e-receipts.

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Mark Price, Managing Partner, M Squared Group, Inc.

Getting these email addresses is fantastic for marketers. Even if they only put marketing messages in the receipt email it could be a boon: encouraging people to sign up for special offers, review the product they have just bought, or promoting related products. There's also potential to link previous website activity to in store sales, which has all sorts of benefits.

This potential alone should offer a strong economic incentive for retailers to roll out this technology.

'shaunryan'

I would agree with Dick Seesel's comment that the barrier with customers opting in to e-receipts is not a fraud issue but rather a privacy concern. People may be reluctant to provide their email address out of fear that they will be spammed. That being said, the environmental and convenience benefits (no more lost receipts for returns, refunds, warranties, etc.) of e-receipts definitely outweigh the perceived costs.

Christopher Krywulak, President and CEO, iQmetrix

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