Morning Brew - ☕️ Face it

Mastercard pilots biometrics pay tech.
Morning Brew May 23, 2022

Retail Brew

Ordergroove

Greetings and salutations. Let us all raise a gherkin to Robert J. Vlasic, the founder of the Vlasic brand who died recently, at 96. In the 1970s, Vlasic commercials brought us a wise-cracking stork who declared he was now delivering pickles instead of infants, bringing humor to the category and confusion to Gen Xers about where babies come from.

In today’s edition:

—Katishi Maake, Glenda Toma

PAYMENTS

Scanning in

Finding Nemo gif Finding Nemo/Pixar via Giphy

It takes at least 10 muscles to smile—and now, to check out your groceries. Mastercard is piloting a program that allows shoppers to pay using facial recognition or fingerprint scanning.

It’s underway at five grocery stores in Brazil, and Mastercard plans to debut it globally later this year.

  • Customers need to snap a selfie or scan their fingerprint to try the tech. A credit card linked to their biometric data is then created.

Facing the future: Mastercard believes consumers want an even easier way to checkout and are confident in the technology’s adoption. An overwhelming majority (86%) of shoppers are interested in using biometrics to make payments, according to a Visa survey.

  • Plus, the contactless biometric payments market is expected to reach $18.6 billion by 2026, Mastercard noted in its release.

“All the research that we’ve done has told us that consumers love biometrics,” Ajay Bhalla, Mastercard’s president of cyber and intelligence, told CNBC. “They want making a payment at a store to be as convenient as opening their phone.”

About two-thirds (67%) of consumers express interest in using fingerprint scanning to make payments, as opposed to 36% who show interest in facial recognition, per the Visa survey.

  • Mastercard says customer data is encrypted for privacy protection, and the biometric data is replaced with a “token,” or set of alphanumeric characters, for security, according to CNBC.

Zoom out: Mastercard is the latest to push into biometric payment systems. There’s also the tech that Amazon has deployed at its Go stores, which are creeping into suburbia. Increased adoption of cashierless checkout is one reason why Amazon is trying to get out ahead of the competition, Richard Kestenbaum, co-founder and partner at Triangle Capital, previously told Retail Brew.

“Once your competitor across the street has it, you have to have it. Knowing full well that convenience is so critical to consumers, there’s no reason to stand in line anymore in most retail stores,” Kestenbaum said.—KM

        

TOGETHER WITH ORDERGROOVE

Ridin’ that customer-to-subscriber pipeline ‍♀️

Ordergroove

Happy customers = happy company.

Okay, maybe there’s a little more to it than that, but a retailer that reliably creates satisfied customers is doing something righteous.

And once you’ve captured your customers’ shopping habits and desires, your brand’s next step is to turn them into happy subscribers. After all, the subscription market is projected to hit $478 billion by 2025.

Ordergroove is here to help you get there. They conducted a survey on consumer sentiment and behavior around subscription experiences, then compiled their findings into a data-packed (and free) report: Inside the Box: What Drives Consumer Subscription Adoption.

So slip on your favorite blue-light glasses and learn how to turn your brand into the next subscription success story. Download the report here.

SOCIAL MEDIA

All together now

imagery from P.F. Candle Co. and Couplet Coffee P.F. Candle Co., Couplet Coffee

Companies from Outdoor Voices to Glossier have Facebook and Instagram ads to thank for a good chunk of their growth. But today, DTC brands have to contend with privacy changes on these platforms (among other issues), writes Marketing Brew’s Katie Hicks, forcing them to rethink their approach.

The upshot? They’re diversifying their marketing and investing in more organic, community-centric strategies, Katie notes. Take P.F. Candle Co., for example, which is going more grassroots:

According to its marketing manager Meghan Alfano, connecting with customers online by sharing the brand’s backstory has been a recipe for success when the small brand couldn’t otherwise afford an aggressive paid strategy. It’s also been investing in TikTok to broaden brand awareness, with about 90% organic and only 10% paid.
Alfano said TikTok has increased traffic in a way the brand hasn’t seen from running paid ads on other platforms.
“I think we’re still kind of learning what works and what doesn’t in that channel, but it’s been really fun to see,” Alfano said. “And I think TikTok in particular is definitely a place where you’re not really selling a product necessarily; it’s really the place where you kind of come on [to] really tell who the brand is and what we’re about.”

Click here to read the full story on Marketing Brew.—GT

WHAT ELSE IS BREWING

  • Starbucks announced it will close all 130 of its locations in Russia, and pay its ~2,000 employees there for six months.
  • Parcel shipping volume in the US reached a record 21.5 billion in 2021, up from 20.3 billion in 2020, per Pitney Bowes.
  • J.M. Smucker Co. issued a recall for some of its Jif peanut-butter products.
  • GameStop introduced a digital wallet for cryptocurrencies and NFTs.
  • Abbott CEO Robert Ford apologized for his company’s role in the infant-formula shortage, while NYC Mayor Eric Adams declared an emergency to prevent formula price-gouging.

FROM THE CREW

Have a say in what you see around here. Join The Breakroom, an elite group of Brew readers who share insights and ideas to help us put out the kind of content you’ll love. Psst: You also get exclusive Brew benefits for taking part. Learn more here.

SWAPPING SKUS

Today’s top retail reads.

Sizing up the competition: Old Navy made a major move toward inclusive sizing last summer, so all of its women’s clothes are available in sizes 0–30 and XS–4X. Things haven’t gone as planned. (the Wall Street Journal)

ESG whiz: The nitty-gritty of Everlane’s impact reports. “It’s about recognizing that there’s only so much we can do alone as an island of good,” said Katina Boutis, the company’s director of sustainability. (Glossy)

Cool store, bro: Inside Mosaic’s new frozen-only grocery store. (Food Dive)

Lather, rinse, influence: In the Gen Z trend cycle, hair-care brands work to balance virality and longevity. Comb through the insights in our latest article, sponsored by Edelman.*

*This is sponsored advertising content.

HOT TOPIC

At the mall, it’s where band tees are the only tees. In Retail Brew, it’s where we invite readers to weigh in on a trending retail topic.

From the Fashion Act to the Fabric Act, the fashion industry is increasingly getting heat for unresolved sustainability and labor issues.

Both proposed bills aim to hold fashion companies accountable in several ways:

  • The Fabric Act, for instance, would extend California’s anti-wage theft principles nationwide, penalizing fashion companies that pay manufacturing workers below federal minimum wage.
  • The Fashion Act (the legislation is pending in New York) would require global apparel or footwear retailers with a presence in New York (and with $100 million+ in revenue) to disclose their environmental and social impact, setting “binding targets to reduce those impacts.”

You tell us: Should laws mandate how fashion companies deal with sustainability or labor issues? Cast your vote here.

Circling back: Last week, we asked if you’d think twice before shopping with a retailer that made you pay to return online orders—if they were dropped off somewhere other than its stores. Forty-one percent said they’d stop buying items online from a company that asked them to pay a fee, while ~35% said they would just buy fewer items online from said retailer.

  • About 20% said they’d keep shopping online with the company, but make returns in store, while less than 4% said they’d pay the fee.

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Written by Katishi Maake and Glenda Toma

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