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Classification: Status:
Transaction
Trends shaping the future Eric van Vuuren Online Betaal Congres | March 4, 2014
• Full-service Card & Payment processor and Acquirer • Headquartered in Utrecht (Netherlands) with offices
across five European countries and serving clients in 17 European countries
• We offer a distinctive, fully customisable and modular range of future proof payment processing and payment acceptance services
Company description
Actuals 2013 (per 31-12-2013)
Number of payments processed 10,4 B
Number of ATM / POS transactions 4,4 B
ATMs connected to the Equens network 21 K
POS terminals connected to the Equens network 873 K
Credit- and debit cards under management 61 M
Revenue € 357 M
Key figures
! Utrecht, The Netherlands (HQ) Eendrachtlaan 315 3526 LB Utrecht
! Frankfurt, Germany
! Stuttgart, Germany
! Milan, Italy ! Rome, Italy
! Helsinki, Finland
! London, United Kingdom
Locations
Online Betaal Congres | March 4, 2014 2
About
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Hoe$shopt$de$consument$in$2020$en#welke#ac)es#moeten#worden#ondernomen#op$
na2onaal,$branche$en$bedrijfsniveau$opdat#B2C$ondernemend$Nederland$succesvol#hier#op#in#
kan#spelen,$na)onaal#én#interna)onaal?#
Founding#Partners:# Wetenschappelijke#partners:#Kennis#partners:# Netwerk#partners:# Media#partners:#
19 Expert groups over 460 Experts over 150 companies Equens / PaySquare host for Expert group Transaction as part of the Customer Journey
About
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About
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Two separate research stages: 2013 & 2020
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Research$Ques2ons$Expert$Group$‘Transac2on’$
ShoppingToday$(2013)$1. What#is#the#current#situa)on#for#transac)ons#in#Dutch#retail#prac)ce?#
2. What#are#current#trends#and#examples?#
Shopping2020$1. What#are#most#important#trends,#points#for#improvement#and#opportuni)es#in#transac)ons?#
2. What#are#the#most#likely#future#scenarios?#
ORIENTATION SELECTION TRANSACTION DELIVERY CUSTOMER CARE
© Bonsing / Mann time
Expert group TRANSACTION
Cus
tom
er J
ourn
ey
How do the Dutch pay? Non electronic payments
Greece - 97% Poland - 90% Italy - 89% Spain - 80% Ireland - 75% Germany - 69% Switzerland - 66% Austria - 64% UK - 57% Belgium - 54% Netherlands - 52% France - 50% Nordics - 46%
Cash share of transactions (2011)
! Although continuous declining, using cash is still popular ! At supermarkets 6 out of 10 consumers still pay in cash ! Cross-border payments use less Credit Card; Consumers use
Cash and Debit Card instead
Dutch using cash
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Sources:#McKinsey,#Innopay#analysis,#DNB,#Betaalvereniging#Nederland#
How do the Dutch pay? Electronic payments
Source:#BLAAUW#
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Offline# 93%$$Market#share###electronic#payments#
Online#59%$Last#used#
online#payment#
Two clear favorites in electronic payments (2012)
iDEAL by far most used for internet payments
iDEAL Acceptgiro
Credit Card
74% 10%
7% One-off mandate 4%
PayPal 4% Other 2%
Preferred online payment method
iDEAL Acceptgiro
Credit Card
59% 10% 8%
PayPal 5% Online banking 4%
Acceptgiro 3% PIN
Rec. Direct Debit 2% 2%
Cash 1% One-off mandate 1%
Buyers 2013-1 (n=1678)
Top 10 payment methods last purchase
Sources:#Blaauw,#Thuiswinkel.org,#Bandenergycheck#
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Strongest brands in NL 1. Google 100,0 2. IKEA 99,9 3. iDEAL 99,8 4. Bol.com 99,7
Online purchases in 2020
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83%
17%
Current market (2013)
Online Offline
64%
36%
Shopping2020 Experts (2020)
What percentage of your purchases will you be conducting online in 2020? Please consider all your purchases together.
© GfK 2013 Hoe shopt de consument in 2020
Consumers n=11914
48%
52%
Consumers (2020)
34% of consumers expect over half of their purchases to be made online by 2020
8% of consumers expect to be making almost no purchases online by 2020
Disappearing consumers in physical retail
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To what extend do you think you will be making your purchases in the physical store? Consumers that will definitely not be using the offline channel in 2020
© GfK 2013 Hoe shopt de consument in 2020
Consumers n=11913
Media and entertainment: 24% Consumer electronics: 23% Toys: 20% Books: 20% Fashion (shoes & lifestyle) : 17% Daily groceries: 17% Home & Garden: 15% Sports goods: 14% Fashion (clothes): 12% Pr
oduc
ts
Airline tickets and accommodations: 41% Event tickets: 40% Insurances: 37% Travel packages: 36% Telecom: 31% S
ervi
ces
The Customer Journey for Shopping Towards a seamless omni-channel shopping experience
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Orientation Selection Transaction Delivery Customer Care
Nine trends impacting the role of transactions in the total retail experience (1/3)
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! Many parties trying to offer wallets: ‘war on the wallets’
! Innovative services are expected from wallets
3: Digital Wallets
! 70% of Dutch smartphone users use their phone for shopping
! Mobile shopping is held back because of there’s no good payment service
2: Mobile Shopping
! Increasing electronic interaction drives demand for identification/authentication in the virtual world
! Trust is a basic requirement for consumers and merchants: we need strong online identity solutions
1: Digital Identity
Nine trends impacting the role of transactions in the total retail experience (2/3)
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! New technologies are challenging traditional POS terminals
! Need for terminals might decrease
! New forms of hardware arise (e.g. mPOS, Biometrics, NFC BLE and QR-code)
4: Changing POS interaction
! The in-store checkout and payment flow is changing
! New technologies are challenging traditional checkout systems (e.g. Assistants with tablets, self service checkout, beacons)
5: Changing checkout
! e-Commerce is maturing
! Growing possibility for merchants to combine channels
! Consumers will go cross-channel and expect to be able to do this
6: Conversion of channels
Nine trends impacting the role of transactions in the total retail experience (3/3)
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! Consumers are forced to leave information everywhere
! Scattered info means increased risk
! As a reaction the trend is to turn the ownership of personal data around
7: Consumers in control
! Payments with less parties in the chain and less central control, will be an alternative in retail contexts
8: P2P payments
! The EC harmonizes payments’ legal framework
! The regulations aim at: ! Level playing field ! Innovation ! Lower costs f/ consumers
9: Increased regulation
Uncertainty 1: Consumer attitude towards Privacy
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HIGH privacy awareness and control:
• People are conscious and want to control about what happens with their personal data
• Dedicated services to support Digital Identity
• A move into this direction can be sparked by an incident or examples of data breaches
LOW privacy awareness and control:
• Currently, experts observe a trend of decreasing privacy awareness
• The adagio ‘I don’t have anything to hide’ is still strong in the public opinion
• People are willing to ‘trade’ their data for additional benefits
HIGH privacy awareness and control
LOW privacy awareness and control
Uncertainty 2: Number of payment methods (providers)
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MANY payment Methods (providers)
FEW payment methods (providers)
FEW payment methods: • With different channels converging, demand for an
omnipresent payment method (and brand) increases • A force that might support this, are schemes that restrict
the use of their brand to support other payment services
MANY payment methods: • More payment methods because user experiences
throughout various channels are more and more optimized
• Wallets we currently see arising may develop into payment methods in their own right
• Regulation aimed at allowing innovative parties to initiate banking transactions
Experts evaluated the scenarios
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Consumer perspective
General description of the scenario Current trends shaping the scenario Expected path for the scenario
Stage 1
Stage 2
Etc.
ENABLERS
BARRIERS
Enablers and barriers for the scenario
Implications of the scenario for various stakeholders
PSPs Regulators
Merchants
Banks
Consumers
Four payment scenarios emerge from the trends, shaping development of ‘transactions’ towards 2020
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Scenario 2 - ‘Consumer Driven’ “I choose for convenience and a smooth user experience in a given context”
Scenario 3 - ‘Back to the Trust’
“I trust a limited set of payment methods”
Scenario 4 - ‘Big Brands, Big Data’ “My payment provider knows a lot about me and can therefore provide me with useful services in all contexts”
Scenario 1 - ‘In Control’
“Out of the many payment methods I can choose the way I pay to fit my privacy needs”
Few payments methods (providers)
Many payments methods (providers)
High privacy awareness and control
Low privacy awareness and control
Four payment scenarios emerge from the trends, shaping development of ‘transactions’ towards 2020
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Few payments methods (providers)
Many payments methods (providers)
High privacy awareness and control
Low privacy awareness and control
(Consolidation)
t=0
2
1
Disruption from incident, regulation,
technology, …
3 4
Observations and conclusions
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1. In shopping and paying consumers look for reliability & security and convenience where reliability is a qualifier and convenience is a differentiator
2. Consumers find privacy important but seem to be willing to trade it for convenience
3. Payment will become seamless part of the shopping experience
4. Digital or financial identity will be a key enabler to progress the market and to realize a truly seamless shopping experience
5. Developing an (international) ecosystem for digital identity and personal data management is considered almost conditional for any scenario
6. Major fragmentation of payment solutions and infrastructures is likely to slow down development of truly seamless shopping innovations
See you in the future
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Subtitle
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Full report
www.equens.com
All research reports
www.shopping2020.nl