Facial Recognition to Transform the Shopping and Payment Experience

This week Intel, Foxconn Technology Group, and Asia Pacific Telecom offered their first public demonstration of facial recognition technology for retail usage. Some of the applications demonstrated included residential and business access control, a virtual shopping service app, and retail payment apps.  Intel’s solution utilizes multi-access edge computing (MEC) 5G and artificial intelligence (AI) to enable the services.

Facebook has also been in the process of developing a facial recognition tool connected to cameras in high-end shops. The technology will allow the store’s staff to improve its customer service by capturing insights from the customer’s user profile. Facebook is also working on facial recognition to allow payment at shop registers.

In China, Alibaba introduced Tao Cafe, which is a cashier-free retail store that utilizes facial and voice recognition systems while customers are shopping. Shoppers pay for their products as they leave the store through their mobile phones.

Some of the benefits of facial recognition technology in these applications include quick identification authentication, reduction of personal information leakage and credit card fraud, and reduced need to carry cash and credit cards. In the business environment, offices can track their employee attendance and working hours. For retail, historical shopping behavior data can offer customers with an image of how a certain item of clothing would look like on them. For retailers, virtual clothing offerings can help reduce inventory space and costs and allow shoppers to “try on” apparel and order on the spot.

In airline scenarios, Delta is testing facial recognition for self-service bag check-in at Minneapolis airport. Passengers walk up to a kiosk and are identified rapidly and are able to drop their bag(s) off and proceed. This frees up customer time and frees up Delta agents to seek travelers and offer addition customer support. Hotel check-ins could become a task of the past as well. Imagine walking into a hotel lobby and having facial recognition cameras detect your identity, enabling you to walk past the front desk directly to your room, which you can unlock through facial recognition as well.

With the latest iPhone X device, FaceID is becoming a platform that allows retail payments as well. Similar to Apple Pay, financial transactions can now be made by using facial recognition rather than a user’s fingerprints. This means you will be able to look at your phone to make a payment at a supported POS terminal. This also would not require retailers to upgrade their terminals if they support Apple Pay (NFC payments). 

Facial recognition is becoming a more regular part of everyday life with biometric security services from Android, Apple, and Windows that allow unlocking of their devices and now, making financial transactions. Privacy remains an issue though. Technology like facial recognition is sometimes seen as an invasion of privacy and some companies have gone as far as developing glasses and other accessories that aim to disrupt the technology. 

According to the Industrial Economics and Knowledge Center of Industrial Technology Research Institute, the worldwide production of 3D facial recognition is estimated to reach US$1 billion by the end of 2017 and expected to grow to US$7.3 billion by 2021. This 6x growth rate in four years showcases that facial recognition will become a major application in the 5G timeframe and can be thought of as a benchmark for the new era of smart retail and lifestyle.

Facial recognition will be a technology that becomes widely implemented, not only by large retail organizations but by those who want to better compete with  such as Amazon, which dominates many retail categories. One example of this includes cosmetic retailer, Sephora which uses an in-store program called ColorIQ which scans a customer’s skin to find the correct shade of makeup, and the Virtual Artist feature within the Sephora app uses facial recognition to virtually try on products.

Walmart has also filed a patent to use facial recognition to help detect customer satisfaction. It would scan shopper facial gestures in-store to see who may be dissatisfied so that staff can be notified to assist the shopper with their shopping experience. This may be an example of privacy invasion and may not be welcomed openly by customers. Technology like facial recognition is a great way to automate, validate, and authenticate retail operations and help streamline the transaction process for shoppers, but retailers and technology suppliers need to always ensure that the technology does not have a negative effect that deters customers rather than attains them.