One can only sit back and wonder at the breathless reporting around Square, and it’s obvious that the halo effect from the twitterverse has had a remarkable reach.
Let’s make sure we take a breath. Square is hardly a giant killer yet. Three million in daily transaction volume translates into less than $100,000 in gross revenue. Not bad for a one-year-old but hardly a juggernaut.
As predicted, Square has expanded its app capability with a richer POS system application to run on the iPad. Called Square Register, it’s an obvious expansion avenue for them, leveraging the app distribution channel to get updated software out there and to add more value for the merchant in the form of CRM-style capabilities.
What’s unexpected is Square’s new Card Case, a clever way to put merchant apps and loyalty on a smartphone that also leverages a card on file scheme and geo-location to confirm the customer is who she says she is.
Once you’ve downloaded your mobile Card Case, you can fill your case with ‘cards’ of all the merchants you visit and buy from who accept Square. When you click on an individual merchant’s card, you’ll be able to see a map of where the merchant is located, contact information, your own order and purchase history, and receipts with the merchant and a daily live menu of items or services from the merchant. You’ll also be able to see what other customers are buying at the store, and merchants can serve customized offers to specific customers based on their purchase history.
So here’s where things get interesting. In a merchant’s card within the case, you can press a “use tab” button which allows the frequent customer to essentially put a purchase on their virtual tab with Square at the merchant. So once you press that button within two blocks of the merchant, you’ll be able to tell the cashier your name and your card will be charged on the merchant’s backend Square register. Because you are a repeat customer, Square already has your payment information. The purchaser will then receive a push notification when the merchant processes the payment.
Another feature of the newly designed Square is the ability for the payments company to show other merchants nearby who also accept Square payments. As Rabois puts it, “it’s like a curated app store for local businesses.”
With plenty of programming talent and “clean sheet of paper” cloud-based services, Square is in a position to develop some compelling capabilities for small merchants and customers alike. There is plenty of skepticism about its model, its fraud capabilities, and its merchantability to larger merchants. Holding 90 p-percent of a sale for 30 days, which it will do in some instances, will not thrill any merchant, particularly those who run on tight margins and cash flow.
Click here to read more: http://techcrunch.com/2011/05/23/squares-disruptive-new-ipad-payments-service-will-replace-cash-registers/