MasterCard, Samsung Turn the Fridge Door Into a Virtual Supermarket

MasterCard is unveiling an app that takes the Internet of Things to its logical extreme, stopping only one step short of becoming Star Trek's instant food replicator.

Groceries by MasterCard lives in a display on Samsung's upcoming Internet-connected refrigerator, allowing users to shop for ingredients without ever leaving their kitchen. The app also begins the separation of mobile shopping from the mobile device, making it possible for consumers to restock the cupboard the moment they realize they are out of Earl Grey tea.

"Consumers are going to be in their kitchen, and that fits a grocery app that can be delivered through a connected refrigerator," said Betty DeVita, chief commercial officer of MasterCard Labs, which developed Groceries by MasterCard in partnership with Samsung.  "You can order while you're seeing if you have enough milk for the next few days."

Consumers can use Groceries by MasterCard to order items directly from Samsung's new Family Hub refrigerator. MasterCard's grocery app connects consumers to grocers including FreshDirect and ShopRite. Consumers add items to a cart and the final shopping list is approved with a 4-digit PIN, which is designed to provide control over who can make purchases. The app works with U.S.-issued credit and debit cards.

Groceries by MasterCard will also 'learn' a family's shopping habits and make personalized suggestions on items and brands. Over the course of 2016, MasterCard will add partners through the card network's partnership with MyWebGrocer, which provides e-commerce and marketing for more than 130 grocers and 500 consumer packaged good brands.

"The grocers and our partnerships with them are front and center of how we're thinking about engaging with consumers, whether it's seasonal offers like Thanksgiving or around the intelligence the app will gather about brands the consumers use," DeVita said.

MasterCard and Samsung have separately been developing services for Web-connected devices, particularly clothing, for the past couple of years. The connected refrigerator partnership takes this collaboration to a much larger device and screen. While people obviously aren't going to wear a refrigerator like watch or pocket it like a smartphone, there's lots of opportunities to use the connected refrigerator for purposes beyond grocery shopping.

The Family Hub refrigerator, which will be available this spring and cost about $3,200, according to The Verge, has a large touchscreen and a microphone on one door to accept touch-based and voice commands. The screen can display content such as news, weather and marketing when it is not being used to create shopping lists or purchase groceries.

"We believe the size of the screen, 21.5 inches, is such an extraordinary opportunity to engage with consumers in a way that you can't with a six or seven inch screen," DeVita said. "It's a high resolution screen with very engaging video. There are so many different avenues that we're putting on our roadmap."

It's the 'hub' part of the partnership that's interesting, according to Thad Peterson, a senior analyst at Aite Group.

"It would appear to be a novelty if it were only to link to the refrigerator to enable payments for delivered groceries," Peterson said. "[Samsung intends] is to be a central hub for a lot of different home activities going forward, with the fridge being the first example. If MasterCard is the payments enabler for the hub, they could then be the central payment vehicle for any aspect of the home that interacted with the hub."

Groceries by MasterCard is similar in concept to Amazon's Dash buttons, which are adhesive WiFi-connected devices that can be placed around the house near certain items, such as detergent and toilet paper, to allow the user to place an order to replenish the home's supply.

MasterCard and Samsung could expand the refrigerator's presence throughout the home in a similar manner by networking it with other connected devices, DeVita said.

"It's always good to have formidable competitors because that pushes everyone to play to their game, and we look at all of the technology that is out there," DeVita said.