Over the last ten years, mobile phones have gone through several incremental technology leaps that have added capabilities that impact the retail industry.  I've listed the six major ones below, along with their long-lasting impact.

1. Location

In the US, the FCC required mobile phones to implement E911 (emergency calls) by 2006, requiring the caller to be located to within 300 meters.  Back in 2000, GPS was opened up for civilian use, and by 2004 Qualcomm had figured out how to use GPS in mobile phones.  So mobile operators moved from cell tower triangulation to GPS, principally for E911.  But then lots of other uses became apparent, especially navigation.  The earliest mobile apps from retailers made it easy to find nearby stores, and companies are looking at ways to use WiFi triangulation inside stores.

2. Computer Vision

In 1997 Philippe Kahn shared a photo of his newborn using a mobile phone thus launching the popularity of instant visual communications.  Over the years the quality of the cameras got better, reaching the point where barcodes could be read around 2008.  That's when Occipital came on the scene with their Red Laser application, which was eventually acquired by eBay.  This opened up the ability for consumers to easily price compare inside stores.  Other interesting apps included Tesco's Wine Finder and Amazon's Price Checker, both allowing products to be identified by picture.

3. Augmented Reality

Once the mobile phone had GPS, a video camera, and compass functionality it was suddenly possible to overlay digital information on the screen in real-time.  Yelp, which was using GPS to find nearby merchants, created a backdoor called Monocle on the iPhone that showed nearby merchants overlayed on the video camera view.  Today AR apps are mostly used by retailers for marketing, like Moosejaw's app that undresses models in their catalog.

4. Geo-Fencing

So if we're able to track the location of a mobile phone, why not use that context to offer timely information?  My first experience with geo-fencing came courtesy of North Face, the outdoor enthusiast store. When a mobile phone enters a predetermined area, like near a store, a text message is sent to phone with an offer or useful information.  Of course retailers can geo-fence their competitors as well and find out which customers are aren't so loyal.

5. Digital Wallet

Mobile payments leverage different technologies such as NFC, QRCodes, bluetooth, and SMS to facilitate communication between the consumers's phone and the retailer's point-of-sale. The key here is the potential to consolidate loyalty cards, coupons, and bank cards into the mobile phone and enable faster checkout.  Nobody does this better than Starbucks today, but McDonald's and Duncan Donuts aren't far behind.  Google, Isis, Paypal, Square, and MCX are all vying for leadership in this area.  If NFC does finally take off, it will be leveraged by retailers in more places than just the POS.

6. Voice Response

Mobile Phones have had the ability to interpret simple voice commands for a while, but Google and Amazon were the first to use voice to allow searches for products.  Allowing searches by text, barcode, and voice makes it easy to comparison shop in the aisles.  Walmart even uses voice to build shopping lists, and if the Siri API is even opened we could see lots more innovation in this area.