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JCPenney Explains Why It Dropped Apple Pay

posted by Fnord666 on Wednesday April 24 2019, @12:42AM   Printer-friendly
from the another-nail-in-the-coffin dept.

upstart writes:

Submitted via IRC for Bytram

JCPenney explains why it dropped Apple Pay – TechCrunch

JCPenney quietly ditched Apple Pay this month. The decision was announced in response to a customer complaint on Twitter, but without any context or further explanation at the time. JCPenney had first rolled out Apple Pay into testing in 2015, then expanded to all its U.S. stores the following year, and later to its mobile app.

The retailer now claims the move was necessitated by the April 13, 2019 deadline in the U.S. for supporting EMV contactless chip functionality.

As of this date, all terminals at U.S. merchants locations that accept contactless payments must actively support EMV contactless chip functionality, and the legacy MSD (magnetic stripe data) contactless technology must be retired.

JCPenney was not ready to comply, it seems, so it switched off all contactless payment options as a result. However, it hasn’t ruled out re-enabling them later on, it seems.

JCPenney made the decision to remove Apple Pay for our stores, we apologize for any inconvenience this may have caused. We will definitely forward your feedback regarding this for review.

— Ask JCPenney (@askjcp) April 20, 2019

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  • (Score: 2, Informative) by Anonymous Coward on Wednesday April 24 2019, @12:52AM (4 children)

    by Anonymous Coward on Wednesday April 24 2019, @12:52AM (#834137)

    This means "We weren't willing to incur the expense of replacing all of our credit card readers because we don't really have the money to spare."

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  • (Score: 4, Interesting) by c0lo on Wednesday April 24 2019, @01:19AM (3 children)

    by c0lo (156) Subscriber Badge on Wednesday April 24 2019, @01:19AM (#834148) Journal

    Add to the above: "Why the fuck we should bleed money to Apple if we don't even have the ownership of the customer purchase data?"

    TFA

    That means the retailer’s decision to re-enable Apple Pay at a later date may still be in question — especially as this change allows JCPenney to fully take back ownership of customer purchase data.

    Customer data is an important part of JCPenney’s plan to get the business back on its feet. Under new CEO Jill Soltau, who took the job last October, the retailer has been closing underperforming stores, hiring new execs to focus on merchandise selection and eliminating its low-margin items, noted Bloomberg following the company’s most recent earnings. It’s also reducing inventory and adjusting its buying process to ensure it doesn’t end up with excess inventory going forward.

    And, as Soltau explained to investors in February, the retailer is rethinking its pricing and promotions strategies, too.
    ...
    Customer purchase data allows a retailer to better target its customers with relevant promotions, as stores are able to collect the customer’s name and card number at point of sale, which they can then combine with other demographic data like the customer’s address, phone and email.

    Apple Pay, meanwhile, prevents this level of access — something that customers like, but retailers traditionally have not...
    ...
    Today, many major retailers incentivize customers to use their own payments solution instead of Apple Pay — as with Walmart Pay, Sam’s Club’s Scan-and-Go, or like Target does with its store card, which can be combined with Cartwheel discounts in a single barcode scanned at point-of-sale.

    --
    https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford

    • (Score: 0) by Anonymous Coward on Wednesday April 24 2019, @03:35AM

      by Anonymous Coward on Wednesday April 24 2019, @03:35AM (#834205)

      Merchants don't pay anything to Apple. The CC processors pay a 0.15% transaction fee to Apple, which is a nominal charge considering the near zero chance of the card used* being stolen.






      * the card associated with the Apple wallet; no actual card data is transferred to the NFC terminal.

    • (Score: 2) by MostCynical on Wednesday April 24 2019, @04:02AM (1 child)

      by MostCynical (2589) on Wednesday April 24 2019, @04:02AM (#834216) Journal

      Doesn't purchase data come through the register?
      Isn't the payment method just the "sale completion event" (cash, credit card, bank app through NFC, etc..)?

      --
      "I guess once you start doubting, there's no end to it." -Batou, Ghost in the Shell: Stand Alone Complex

      • (Score: 1, Informative) by Anonymous Coward on Wednesday April 24 2019, @04:18AM

        by Anonymous Coward on Wednesday April 24 2019, @04:18AM (#834225)

        Yes, but they can't tie the purchase to an individual. Collecting and selling this type of consumer data is big business, and the stores and MasterCard/Visa/AmEx lose out on this very profitable extra from every "standard" CC sale.