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For Grocery Deliveries, MasterCard And Samsung Say ‘Put Down The Phone, Pick Up The Fridge’

FreshDirect and ShopRite are the launch partners for the on-demand/IoT refrigerator project, unveiled at CES.

MasterCard has rolled out an app that allows users to order groceries directly from Samsung’s wi-fi connected Family Hub refrigerator.

The payments processor and the electronics manufacturer are demonstrating the on-demand meets Internet of Things partnership in what the two are billing as the “first shopping app integrated into a refrigerator.”

The app, Groceries by MasterCard, offers to connect consumers to markets via both through smartphones as well as through the tablet-sized display on the front of the companion screen on the outside of the Samsung Family Hub fridge, which is set to hit appliance stores this May.

A Supermarket In Your Kitchen

The “Groceries” app was developed in partnership between MasterCard Labs and Samsung and will come “pre-loaded” in Samsung’s Family Hub refrigerator.

Groceries By MasterCard with Samsung's Family Hub fridge
Groceries By MasterCard with Samsung’s Family Hub fridge

“In a world where every device – from the phone to the refrigerator – is connected to the internet, the ways in which consumers interact and transact with their favorite brands are changing,” said Betty DeVita, MasterCard Labs’ chief commercial officer. “We’re developing compelling, safe and seamless commerce experiences for consumers across channels and devices as we continue to eliminate the boundaries between how we shop and how we pay.”

DeVita’s remarks amplify a number of things Karen Pascoe, head of user experience at MasterCard, told GeoMarketing this fall about the company’s intensifying cross-channel focus.

“We’re seeing a lot of momentum in the work that were doing with our credit card issuers, like with MasterPass, our digital acceptance mark,” Pascoe said. “In addition to that, we’re working with major electronics manufacturers; Apple Pay, which is on MasterCard technology, as well as Samsung Pay and Android Pay. It’s really generating consumer awareness and adoption around contact-less payment. So yes, consumers are gaining comfort with the security and convenience of paying with a mobile phone — [we’re] getting there.”

The initial merchants on the other end of Family Hub and Groceries by MasterCard are e-commerce grocer FreshDirect and ShopRite, which boasts having the largest supermarket cooperative in the country with more than 250 stores in the Northeast.

The way it works: items can be added to a cart by scanning a barcode or typing products in directly; the final shopping list is approved with a 4-digit pin,. Items are then paid for in a simple, single checkout experience that accepts any U.S.-issued credit and debit cards. Orders are delivered directly by the merchants and are not dependent on a third-party or concierge service, making shopping more efficient.

Consumers can also use the mobile app to scan barcodes on products for easy additions to the online shopping cart.

Building on M-Commerce

“Just as Family Hub changes the way we interact with our fridge, the new Groceries app will change how consumers shop,” said John Herrington, SVP/GM of Home Appliances for Samsung Electronics America.

While Samsung has been priming consumers with a variety of “smart home” objects for years, this is certainly a sign that it considers the mass market — as opposed to CES attendees and early adopters — to take IoT as a mainstream concept.

The partnership also builds on the numerous m-commerce offerings that MasterCard has been playing up in the past year and follows this week’s deal with Wal-Mart to offer the mobile pay system MasterPass.

But the promise of this arrangement also holds promise for brick-and-mortar enterprises and independent SMBS, which have fitfully eyed the emergence of the on-demand marketplace that has been built up by Postmates and Uber.

While ShopRite has thus far rejected Apple Pay, it does accept NFC and has indicated its interest in promoting the chain store industry mobile payments platform, CurrentC. In addition to attention from affluent families who tend to use on-demand supermarket apps to order their weekly produce, the partnership with Samsung and MasterCard also represents a significant technological leap for the company.

“By partnering now with Groceries by MasterCard, we can make life even more convenient for our customers with this latest innovation in on-demand grocery shopping.,” said Joe Sheridan, president and COO of ShopRite parent company Wakefern. “This new technology incorporated into the Samsung Family Hub refrigerator allows families immediate access to our ShopRite stores the moment they run out of food or need ingredients for a recipe or planned meal.”

Smart Or Dumb Technology?

Like most of the dazzling products on display this week at CES, it’s worth wondering if Samsung’s smart fridge is indeed intelligent by appearing to lock in partners such as MasterCard, ShopRite, and Fresh Direct. (Techcrunch’s Romain Dillet has some good reasons for arguing that the electronics giant is being less than wise.)

As a considered purchase, a refrigerator whose chief value is that it duplicates the same thing as a smartphone delivery app does with only a limited set of grocers and payment options does indeed sound too restrictive. But it’s probably best to view the Family Hub and the Groceries app as prototypes designed to demonstrate possibilities, not ultimate endgames.

Over time, as Apple or Google — or some other entity — takes command of the connected home, these alliances that once seemed so restrictive, will likely be embraced by people who accept the idea of all their appliances “speaking” to one another. Most consumers have enough trouble extending their wi-fi to their upstairs bedroom, let alone setting up a separate system for each device. At that later point, consumers’ call for a larger number of delivery options and payment processing settings will allow for more “brand agnostic” smart appliances.

In three years, when advances to the connected home and “Internet of Everything” become more commonplace, Samsung and MasterCard, along with ShopRite and Fresh Direct, will likely appear to be more than ready for whatever comes next as well as what the current consumer will be willing to buy and expect.

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.