Surge in Brick-and-Mortar Commerce Will Spur POS Innovation

Call it a renaissance for brick-and-mortar commerce.

The rebound of in-store browsing and buying may scarcely seemed imaginable just a few years ago, in the midst of the pandemic, where it seemed that clicking on the buy button was here to stay as, really, the only option to get what we needed and wanted.

But now, as 2025 settles in and post-holiday shopping data rolls in, it’s become clear that there’s value in the tactile shopping experience, though it’s being fine-tuned with digital features. That means that merchants will need to examine their point-of-sale (POS) experiences and technologies so that commerce can happen at any point in the (literal) aisles, where customers can use their preferred payment options and embedded financing can appear at the right time.

In other words, queuing up at the front of the store at the cashier may still be a hallmark of commerce, but it will not be the only option.

Foot Traffic Returns With a Few Digital Twists

As PYMNTS Intelligence noted several months ago, in the United States, more than 43% of shoppers stopped by stores to purchase goods, while 19% used a combination of digital features while they were in the stores, such as product details, pricing and stored order histories.

A whopping 80% of customers want to use their preferred payment options. More recently, as Visa’s own statistics have noted, 77% of holiday spending happened in store. The pace of that spending accelerated, as Visa estimated that total retail spending in stores climbed 4.1% during the latest holiday shopping season, compared to a year-on-year boost of 1.6% boost in 2023 vs 2022.

PYMNTS has also chronicled the fact that especially among younger consumers, “as physical retail rebounds, younger generations are pushing brands to offer connected online-to-offline experiences.”

Bellamy Grindl, founder of retail consulting company Retailytics, told PYMNTS that “physical retail is making a comeback as younger generations crave experiences that go beyond the product itself. To succeed, brands must embrace an omnichannel approach, ensuring a seamless connection between online and in-store interactions. Technology such as interactive displays, mobile checkout and loyalty app enhancements can elevate the shopping experience, turning routine visits into memorable moments.”

The POS Difference

It’s the last few moments of interaction — the payments themselves — that can linger in a customer’s mind.

Transactions are becoming increasingly portable, in the sense that POS systems’ form factors are moving away from the cash register and toward tablets and mobile devices. PYMNTS Intelligence has revealed, in collaboration with Discover® Global Network, that that SoftPOS technology — which helps enable the acceptance of contactless payments through tablets and phones — has been gaining ground, and that nearly a quarter of merchants see those mobile means of commerce replacing traditional POS systems in a matter of years.

Earnings results from the likes of Visa and Mastercard illustrate the rise of contactless payments in face-to-face commerce. In Visa’s Q4 earnings call, management noted that tap-to-pay transactions in the U.S. were 54% of in-person transactions, up 13 percentage points year over year. Mastercard has said that contactless payments are more than 70% of global in-person payments volumes.

Elsewhere, Fiserv also helps serve as a barometer of POS innovations and demand. In October, the company introduced a new suite of tools for small businesses tied to its Clover POS and business management service. The upgrade includes new hardware, such as Clover Compact and Flex Pocket (which exists as a portable POS offering), that further build on the Clover hardware suite. In the company’s latest earnings report, Clover notched sales growth of 28%, and annualized gross payment volume was up 15%, to $311 billion.

In another announcement, GoDaddy introduced a smaller POS tool for small businesses, Smart Terminal Flex, which fits inside an employee’s apron pocket as they interact with customers.

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