In societies that are already reliant on credit cards, the jump
to making payments using NFC might not be so difficult. Japan,
however, is a cash-based society that certainly needed convincing,
and the way NFC and micropayments were rolled out was very
different than any other kind of product. Consumers needed to be
educated, and that was done through the best way possible in Japan:
making people's lives easier.
For Japan's city dwellers, the notion of "convenience" is always
welcome, which explains why convenience stores are so prevalent
(more than 40,000 nationwide), offering everything from postal
services to laundry on top of a massive variety of food, drinks and
When NFC payments launched in Japan, they rode on a wave of
convenience for busy Tokyoites. Instead of having to figure out
your fare and stand in line for train tickets, it was now possible
to use your phone or a rechargeable NFC card to simply "touch and
go" through the gates. This simple function completely changed how
people travel in the city, and made a positive difference in their
lives. More importantly, the technology slowly gained trust and
acceptance to make even more possible, starting with
There are more than 70 million NFC-enabled devices in Japan,
according to Wireless Watch, compared with around 3 million in the
It began with micropayments in vending machines and
train-station kiosks, but this gradual implementation now has
people buying everything from McDonald's
hamburgers to airline tickets. Recently Skylark family restaurants
added NFC payments to 2,600 of its stores nationwide, and nearly
every convenience store in the country can accept NFC payments, as
well as charge the cards with cash. The Aeon retail group and
7-Eleven convenience stores even have their own brands of cards
that include loyalty programs as well. In a very real sense,
retailers are becoming banks, and Sony's FeliCa platform makes it
possible for independent operators to make their own programs while
still remaining (mostly) compatible with each shop's hardware.
The ecosystem is already in place in Japan, which will make for
very interesting times as the technology is used for more than
purchases. Payments are one thing, but Japan is also a great study
in how NFC will change the way brands communicate with their
customers, starting with the ubiquitous "point card."
Your average Japanese person likely has a wallet full of paper
point cards from every kind of shop imaginable, but we're moving
toward a world where all of these loyalty programs can be stored
conveniently in a handset. Some retailers like discount chain store
Don Quixote already base their loyalty programs on bar codes that
can be saved as images in a device, but electronics retailer
Yodobashi Camera uses NFC to make it a matter of quick touch, also
enabling their customers to manage their points through their
devices. Taking existing point schemes, such as media retailer
Tsutaya's T-Point program (Japan's largest, at 35 million members),
and converting the members to digital points would be much easier
in this environment.
For marketing communications, it's a bit trickier. There has to
be a benefit to the customer to interact, but we're seeing more and
more interesting ways the technology can be used.
Now that it's easier to get mobile data in the subway system,
there are more opportunities to connect with a captive audience.
Japanese agency Shunkosha rolled out "Strappy," an advertising
medium that has chips embedded in subway hand straps. It allowed
straphangers to make a quick brand connection with travel agency
H.I.S. by bringing them to a mobile website.
At the recent NFC & Smart World trade show, we were given
"NFC Quest" game cards connected to our Twitter accounts that let
us check in at different booths we visited, earn points and then
let our avatars battle it out for prizes at the end. This mixing of
NFC with social networks is going to change retail in a lot of
ways, because now we'll be able to "like" the things we touch and
share them with the world.