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Retailers Brace for e-Theft

Mobile phone technology is raising new security issues for the retail industry.

Cutting-edge mobile phone technology is revolutionising the way we shop, but it’s also raising new security issues for the retail industry according to Dr Emmeline Taylor of the Australian National University.

In a report commissioned by Efficient Consumer Response Australasia, Taylor looked at the benefits and risks of new mobile technology in retail, with a particular focus on how new technology will impact on the loss of stock due to shoplifting, employee theft, fraud and paperwork errors.

“The introduction of any new technology, service or process will generate a range of risks, vulnerabilities, security issues and training needs,” Taylor says. “We saw this with the introduction of self-checkout in Australian retail, which redefined the retailer customer dynamic, but also increased the number of ways retailers suffer losses. We can expect similar hiccups with the introduction of new mobile scanning and mobile payment systems.”

Taylor said that retailers could see fraudsters start to use mobile phone technology because the security protocols were not as mature as e-commerce or in-store payment systems. “Retailers will need to ensure that any potential security risks are anticipated and safety measures are put in place,” she said.

Some examples of new mobile technology we may see in Australian stores in the near future include:

  • customers using an app to convert their smartphone into a scanner. When they’re finished shopping, the list of scanned items is downloaded at a paystation, and customers can then pay by cash, card or by using their smartphone as a “mobile wallet”.
  • customers using in-store devices such as a tablet to browse and select items, and then making their payment.
  • customers using store-owned hardware such as a handheld scanner or a touchscreen tablet fixed to a shopping trolley. When they’ve finished shopping and have scanned all the items, the customers take the scanner and items to a kiosk or checkout station, where the purchase information is downloaded and payment is made.

“The traditional staffed checkout isn’t going to disappear, but there are a range of other point-of-sale methods that are becoming increasingly popular. The use of emerging technologies in retail is set to dramatically change the way we shop,” Taylor says.