Gnome Tablet POS System Relies on BLE to Ease Groupon Redemption In Stores

Yet another tablet-based point-of-sale system has joined the fray, this one from daily-deal provider Groupon Inc.

Dubbed Gnome, the iPad-based system not only accepts credit and debit cards, but is the centerpiece of a Bluetooth low energy-enabled setup to enable Groupon offers redemption without requiring the consumer to present a printed confirmation or hand over her smart phone.

The Chicago-based company says it developed Gnome—pronounced “gee-nome,” according to Groupon—to make it easier for consumers to use what it sells, a spokesman says. The device is available now.

Consumers can interact with Gnome in a couple of ways. One is as a payment device, using a payment card to pay for a purchase. The Gnome stand holds the included iPad and has a built-in card reader.

The other way, the one Groupon hopes will be prevalent, is Groupon offer redemption. Gnome relies on Bluetooth low energy—a wireless protocol that enables compatible devices to communicate without excessively drawing down battery power—to make the connection between smart phones and itself.

Here’s how it works: A consumer with the Groupon app on her iPhone walks into a merchant to redeem a Groupon offer. Merchants using Gnome must have Bluetooth low energy beacons installed in their stores. When the consumer walks in to redeem a Groupon offer, the phone, assuming its Bluetooth is enabled, communicates with the beacon. The software matches the offer with the merchant and the consumer’s account, eliminating the need for the printed offer or to hand over the phone, the spokesman says.

Currently, only iPhone 4S or newer smart phones from Apple are compatible with Gnome, Groupon says. Gnome works with peripheral devices like cash drawers and printers, but only if they can be paired with an iPad via Bluetooth.

Groupon anticipates that Gnome will be fundamental to the emergence of local and mobile, two factors influencing changing shopping behaviors. “Gnome is at the heart of what’s going to make that happen,” the spokesman says.

Merchants also can use Gnome to view transaction history and create customized marketing campaigns using customer purchase history and preferences. Eventually, Gnome will offer integration with QuickBooks and Xero accounting software, too.

Gnome costs $10 per month for the redemption and marketing services. Merchants can use it just for that, but Groupon also offers payment card processing services at 1.8% plus 15 cents for cards bearing brands from Visa Inc., MasterCard Inc., and Discover Financial Services. Rates for American Express Co. transactions vary by merchant type, Groupon says. The hardware is at no cost to merchants.

Gnome is not Groupon’s first tablet-based POS system. It also offers Breadcrumb, which has two versions, one for restaurants called Pro and another for retail. Neither has the Bluetooth low energy component. Payment processing costs are the same as for Gnome.

A merchant could have both Breadcrumb and Gnome operating in their locations. A restaurant, for example, that needs table and staff management uses Breadcrumb Pro for these tools and payments, and uses Gnome for Bluetooth Groupon redemption, the spokesman says.

Gnome likely won’t be the last of the tablet-based POS systems the payments industry will see, says Rick Oglesby, senior analyst at Double Diamond Payments Research. “We’re going to see a lot more of this: POS systems differentiated not by their POS capabilities but rather by their marketing platforms and ability to attract new consumers,” Oglesby says.

“To do this, you really need to enroll both the consumer and the merchant onto a shared platform,” he says. “Groupon’s in as a good of a position as anyone to do this, and this is probably the most complete solution to come to market so far in terms of having needed POS capabilities plus a pre-enrolled consumer base that actively shops through the platform.”