beyond payments: the digital commerce opportunity for banks€¦ · technology is revolutionizing...

Beyond Payments: The Digital Commerce opportunity for Banks

Giorgio Andreoli

Managing Director | Accenture Digital | mCommerce

Mobey Day

Barcelona, Oct 8th, 2014

Copyright © 2014 Accenture. All rights reserved. 2

1. Digital disruption and the impact on the FS industry

2. Digital Commerce: which opportunity for the Banks?

3. Case studies and lessons learned

Agenda





Agenda


DIGITAL is disrupting the

technology we use to live, work, buy

…and

COMPETITORS …in turn changing

PEOPLE


DIGITAL disruption waves, transforming the technology we use to live, work, consume…

Wearables, Industrial Internet, …

Mobile Payments

Financial Services

In 2020, > 40 Billion devices will be connected wireless to Internet

> 80% of mobile OS today in use have been launched after 2007…

After Square now Apple, Facebook and Amazon could disrupt Payments industry…

…and it’s not just about payments, it’s about Banking!


PEOPLE are changing Digital transforming behaviors across generation boundaries

Informed shoppers

2 79%

of smartphone owners use their phone to help with shopping

Price Sensitive 64% of people will go 5-10 minutes out of their way to secure a better price

3

Socially Connected

30% of mobile time is spent on social media accounts

5

Instant answer & delivery

57% of US consumers are likely to abandon an online purchase if an answer to an online purchase is not immediately forthcoming

4

Highly connected

1 4,18h average number of hours per day spent by internet users on the Internet

Sources: US Census Bureau, InternetWorldStats, iConsumer, Mc Kinsey 2013, Poland Online Consumer_Mc Kinsey, 2011 Postnordlogistics, E-commerce-in-Europe-2014

…not only affecting Millenials and Gen X/Y, but also Silver Surfers!


COMPETITORS are changing, as Digital is transforming Banking customers expectations

Direct Competitors

Experiential

Perceptual Change expectations Banks customers have

Sell experiences that replace Banks’ ones

Sell products that compete with Banks’ ones

32% banking

revenues will

be at risk by

2020





Agenda


Digital is disrupting traditional Commerce…

Payments are being disrupted by new technology that eliminates the need for traditional infrastructure, making payments a seamless moment of truth within the shopping process

Billions of always-on, location aware devices, as well as social networks, will produce an unprecedented amount of data that will be leveraged to make shopping experience more personalized and relevant

Payments in the digital age

Context is king

Technology is revolutionizing the way brick & mortar retailers promote, sell and manage the relationship with customers, and the way consumers take a decision, shop and pay in the store

Brick and mortar reinvented

Availability of real-time personal data, new productions paradigms (e.g. 3D printing) with express delivery (e.g. drones) will enable consumers to order and receive products on an as-needed basis

Supply chain renewal


Brick and mortar reinvented Technology is revolutionizing the way consumers shop in-store

Traditional advertising

Geo-located marketing and context aware advertising

Standard customer experience

New, connected in-store customer experience

Pay anywhere in the store / seamless checkout

Check-out at the cash barrier

Yesterday

Today and Tomorrow

Leverage data to improve performances


Payments in the digital age Traditional POS payment infrastructure being disrupted

Yesterday

Today and Tomorrow

Merchant equipment Customer Verification Tablet cash register, Beacons

Fingerprint / eyes / voice

Check-out process Seamless / ubiquitous check-out

Consumer equipment Smartphone, iWatch, wearables

Merchant equipment Customer Verification Contactless POS, Mobile POS,

Signature / PIN

Check-out process Traditional

Consumer equipment Cards


…and Banks may decide to play as “Everyday Banks” at the center of the ecosystem, or to go for a utility-like role

Re-focus on payments with a new approach, i.e. exploiting payment (and pre/post payment) data so to better profile consumers and to offer value-added services to retailers and brands

Leverage Bank’s multiple touch points with consumers (online & mobile channel, branch, ATMs, POS…) and other valuable data (transaction history) so to provide valuable real-time services to consumers and merchants

Payments in the digital age

Context is king

Leverage existing relationship with SME clients and acquiring activity in order to expand product offering towards B&M retailers, adding merchant services such as promo, coupons, loyalty, and mobile payments

Brick and mortar reinvented

Understand how to best support corporation and brands in the digital re-engineering of the supply chain

Supply chain renewal

The Everyday Bank™

http://www.accenture.com/microsites/everydaybank/Pages/index.aspx

http://www.accenture.com/microsites/everydaybank/Pages/index.aspx


In order to help Merchants in their digitalization journey, an Everyday Bank should focus on pre- and post-payment Value Added Services (VAS)

XX – YY% Share of value Merchants are open to share across the value chain Source : Accenture analysis

Pre-Payment Payment Post-Payment

Targeted Ads Promotions Coupons Location Based Marketing Social Marketing

Plastic, virtual

Remote, c-less Credit, Debit or

Prepaid

Loyalty (Points accumulation, redemption)

Social recommendations Big Data analytics

MERCHANT EXPERIENCE

CUSTOMER EXPERIENCE

1 - 3% 40- 75% 2-20%

Choice Preference Knowledge Repeat choice

(loyalty)

Socialize (word of mouth)

Awareness

Digital Commerce

Mobile Payments

Pre- and post-payment are key to help SME customers digitalizing the shopping process

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By helping merchants digitizing their commerce business, an Everyday Bank may also provide a valuable experience to Bank’s retail customers

Bank’s core business

Leverage transaction data to provide users’ relevant offers and services

By leveraging Bank’s SME and acquired merchants network, and customer base

Provide a seamless shopping experience including coupons, loyalty points accrual, etc.

finance (or insure)

the purchase

Merchants / customers

match-

making

Personalize the

shopping experience

… pay in a simpler

way

Banks can enable & improve the Digital Commerce experience

During the shopping process, an Everyday Bank can…

Gather additional data…

1

2

3

4

5





Agenda


• In 2013 BNPP Fortis and Belgacom started up a m-

Commerce initiative with the objective to be first in the

market with in-app payments and value-added services,

prepare NFC launch, and anticipate Internet players’ threat

• After the announcement, 3 other Banks (KBC, ING and

Belfius) joined Sixdots JV. All Belgian MNOs are endorsing it

• In May 2014 Sixdots launched first production release, while

a large scale commercial launch is planned on next months

Case study

Sixdots (Belgium)

Sixdots mWallet concept will initially enable:

Online and in-app payments

Identity management

Ticketing (transportation, events etc..)

Coupons

Loyalty

Mobile Operators and Banks are leveraging respective

strengths:

High penetration overall in the country

Brand, trust, relationship with merchants

Relevant distribution network (branches, MNO shops)

Wide share off handsets distribution market

Large amount of transaction data to be monetized

Service Model

Case Overview

Belgacom_et_BNP_Paribas_Fortis_lancent_ensemble_l'in-App_commerce_sur_smartphones_-_1080p_-_YouTube.mp4


Case study

mBank (Poland)

Multi-channel UX and technology redesign:

full redesign of a state-of-art multi-channel Customer

Experience, with seamless integration between Digital

and physical channels (branch, ATMs)

Innovative apps leveraging Mobile Identification, and

offering LBS, selling, deals, PFM, P2P M- payments

Merchant-Funded Loyalty:

mOkazje is an application available on Facebook,

offering users personalized discounts (5-50%), based

on user’s transaction history

The user can browse deals and send them to friends or

directly purchase the products via debit, credit card or

bill payments

Video chat

PFM

P2P money transfer (SMS and Facebook)

Gamification

…

Service Model

• mBank (formerly BRE, part of CommerzBank Group) is 4th

universal Bank in Poland with > 4 Mil customers, also

present in Czech Republic and Slovakia

• First Poland’s Internet Bank in 2000, mBank started in 2012

an ambitious, 360° digitalization program with the

objective to be the first true Digital Bank of Poland

Case Overview


1. Digital pure players, such as Google, PayPal, Facebook and Amazon, are rapidly establishing in the m-payments and Financial Services space

2. Banks have the option to become “Everyday Banks” building an own economic ecosystem, leveraging their assets and network of local relationships, or to become “utility” Banks

3. Supporting SME customers in their digitization journey by enabling Digital Commerce, is a key objective for an Everyday Bank

4. While supporting merchants in the digitalizion of the shopping experience, Banks should focus on pre- and post-payment value-added services

Conclusion


Thanks!

Giorgio Andreoli Managing Director | Accenture Digital | mCommerce [email protected]

beyond payments: the digital commerce opportunity for banks€¦ · technology is revolutionizing...

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