This event delivered expert opinion from a diverse perspective. In writing this article I could have spun up a short and simple summary with just the key takeaways. However, this event had so many relevant conversations I thought it best to just deliver the conversations as they happened, while screening out the non-essentials. Sort of like using your DVR to watch a football game or favorite TV show.
The host and moderator for many panels was Karen Webster, the CEO of Market Platform Dynamics and President of PYMNTS.com. I've always been a fan of Karen's articles and case studies!
The event kicked off with an All-Star panel:
Moderator: Karen Webster, CEO of Market Platform Dynamics and President of PYMNTS.com
Ed Braswell, President and CEO of EDO Interactive
Dan Rosen, Founding Partner of Commerce Ventures
Chris Gardner, Co-Founder of Paydiant
Chris Mahl, Chief Revenue & Strategy Officer LevellUp
Jim Debello, President & CEO, Mitek Systems
Amir Wain, CEO of I2C, Inc.
Moderator: How significant is mobile to you?
Ed: "There is a four times greater chance consumer will redeem offer if delivered through mobile device."
Moderator: What makes your Mobile Wallet different?
Chris Gardner: "Ours is a white-label, cloud-based solution. Card credentials don't belong in the wallet."
Chris Mahl: "We have performance-based partnerships with merchants. We are not a payment processor.
Moderator: What is the litmus test for investments?
Dan: "Are you enabling or disrupting? It always comes back to the team. The core component is fitting into the market to be able to capture market share. The 'Go-To-Market' strategy is also key."
Moderator: What is your role of innovation?
Amir: "Our systems are geared to support new 'Point of Interaction.'"
Moderator: NFC or NFW?
Chris M: "NFC is a protocol for interaction - it's an option."
Chris G: "Consumers will decide how they will conduct transactions. Our focus is not on the last mile; it is on security."
Moderator: Tell us how your rewards business model works?
Ed: "Gain real-time data that can be used to create offers. In our model we get paid upon redemption. Card-linked ad model could become a very large and relevant model."
Moderator: No interchange. How do you derive value from your fees?
Chris M: "The performance vs. other channels produces higher ticket. We ask (merchants) to ask themselves: What kind of return am I getting vs. other marketing channels. We are also integrating to POS systems such as Micros."
Ed: "We had a customer that wanted to target customers that bought Sherman Williams paint because they found that these customers bought a major appliance within the next 30-days. We plugged into our analytics engine."
Chris G: "This is about marketing. It's not one size fits all. QR code might work for some and not others."
Chris M: "It's not about the cost of moving money. It's about driving customers to stores."
Amir: "Consumer is asked what data they want to provide and they may want to get paid for providing data. The next level is the consumer wants to be at the center. We must get away from the idea of wanting to control the customer. Today the way you control the customer is to provide value. We just need to confirm ID at POS. Does your new product integrate with all systems and will it scale?"
Moderator: What are merchants waiting for?
Amir: They are not waiting for ISIS.
Moderator: Are checks near extinction?
Jim: "The report of the death of checks is greatly exaggerated. We capture images and extract data. The wallet is both for payments and identity. You won't type in data or use Siri. You'll use image capture.
Moderator: VC money into the space is estimated at 500M in 2011. What about future?
Dan: "The number will easily double to 1 billion and continue to grow. Ad people are wanting payment data to prove success of campaigns."
Amir: "Much like Roulette table. Hedging bets is a smart move. Mobile is just another form factor vs. card."
Moderator: What about MCX?
Chris G: "The existence of MCX is a validation: 20+ major merchants building own wallet says a lot."
Chris M: "It is hard to make a consortium work, but it makes sense."
Ed: "Our goal would never be to share merchant data. We are just using MCC codes and tying data to it."
Karen Webster and Beth Horowitz, SVP Marketing and Merchant Discover
Karen: Tell us about the PayPal Deal?
Beth: "We've had a relationship with PayPal for 10 years. We are swapping rails to expand presence."
Karen: What advice would you give MCX?
Beth: "Work with us. It is not as easy as it looks. Facebook should be the one telling us what the consumer value prop is. The hardest thing for MCX is that they all (retailers) have different goals."
Karen: Training cashiers can be a challenge to train on multiple wallets?
Beth: "Once it hits the register it should not matter what the form factor is."
Path to Purchase Panel
Moderator: Steve Casco of CardNotPresent.com
Tomas Campos, GM Online & Mobile for Blackhawk Network
Chad Brizendine, Brand Manager for P & G Walmart Global Customer Team
Dan Rosen, Founding Partner for Commerce Ventures
Kurt Karlenzig, SVP Global Digital Strategy for The Marketing Store
Moderator: So much buzz about apps, but browser is still king?
Kurt: "We are used to surfing and ecommerce and can't ignore behavior patterns. Apps must be good enough to earn a download."
Chad: "Content is king. It will vary with the time of day, location and for each customer. If honest, every retailer will tell you they hate their current app. This is why they don't market it."
Tomas: "Email interaction cannot be ignored. You can say you have a mobile-friendly site, but is it thumb-friendly?"
Dan: "User-centric design is key. Try to maximize customer experience by designing in a way that consumers are already engaging with."
Tomas: "It's a 'Multi-Screen World.' The content has to be relevant and tailored for each platform."
Moderator: Using apps in the store?
Chad: "How can I use my store as my marketing channel to drive ecommerce?"
Kurt: "When employees don't know what's going on with in-store app and the choices customers have, it can cause conflict."
Dan: "I want to be involved with the in-store purchase to influence purchase."
Chad: "The way this whole thing will end up in stores will be about showrooming. Consumers are looking at reviews."
Dan: "To me what is fascinating about showrooming is the offensive opportunity. Using QR codes to scan offers, order products and enable commerce outside of the store."
Moderator: Asked about privacy (I believe?)."
Tomas: "The focus is on the consumer and what they want and not so much price."
Chad: "We've not yet figured out how to best do digital coupons and we'll be a secondary mover into the space. However, we are spending just 5% of our budget on Mobile, but often this is 100% of available ad space. We use Monopoly to build trust and relationship with customers. Must be careful to keep it simple, ask for permission and not ask for too much."
Dan: Most startups are not sharing private data. It's about transparency and trust."
Tomas: "We are not going to risk breaking the consumers trust."
Integrating Value Added Services into Mobile Wallets
Moderator: Rick Oglesby, Sr. Analyst Aite Group
Kevin Vine, Interactive Manager for Dunkin Donuts
Donnie Diaz, Director of Information Systems for Jamba Juice
John Theiss, VP Merchant Sales for ISIS
Kevin: "Our wallet is work in progress and focused on domestic market."
John: "Carriers have 200 million customers. We are about building a platform for commerce."
Moderator: How do you see consumers benefiting from Mobile Wallet?
John: "As a consumer, I'm in because if I forgot my postcard coupon I can still redeem it via Mobile Wallet. The Mobile Wallet provides merchants the ability to engage one-on-one with their customers,"
Kevin: "Value for consumer is speed and convenience."
Moderator: What wallets are you trying?
Donnie: "We are a small company. We are working with Google, PayPal and ISIS."
Kevin: "Almost all stores are franchises. We are not in the mind-set of rolling things out on a trial basis. When we do roll out, we put our full weight behind it."
John: "Retailers are choosing to ride multiple wallets."
Kevin: "We are in the process of redefining our loyalty program. We closed in 2011 and told customers we will launch new program. We will likely have points based program."
Moderator: What are key challenges to adoption?
Donnie: "Hardware and integration is a challenge."
John: "The customer experience must be flawless and seamless or we might lose customer."
Moderator: NFC, part of the problem or part of the solution?
John: "Our sense is that, over time, NFC will be as ubiquitous as camera phones are today."
Kevin: "It is frustrating that Apple is as big as they are."
Donnie: "It's about options and embracing them because consumers want to use different wallets. We want to leverage the Mobile Wallet to maximize our brand exposure."
Richard gave a high-energy and presentation full of nuggets. He began by stating "The one who enrolls, is the one that controls. If you don't enroll you won't have access to 'Big Data' . . . The ones who stand to lose the most are banks and retailers . . . app is required: the one who loads is the one who wins . . . Ken Crone, Richard's father helped launch Bank AmeriCard . . . Target Red Card makes money! . . . Starbucks is their own program manager and so they have lower costs . . . Tender steering allows stores to save: private-label debit /credit moved to top of wallet . . . The Holy Grail of funding is from CPG's, not merchant funded rewards . . . Catalina marketing charges the highest rates because they as can as they know where you are and what you are buying (the inference is that with mobile wallets all transactions will be like this) . . . Getting mobile right is not just about business opportunity, it is about survival . . . 2/3 of America has device present while watching TV . . . What happens if check-in, payment, offers or checkout happens by way of 3rd party? Merchants are being commoditized . . . You can envision a world where bar codes enable all commerce . . . Aggregate or be aggregated . . . 39% of all check-ins are at Walmart. If they had a check-in they would have all the data and even link it to purchase."
Fostering EMV Acceptance
Moderator: David Robertson, Publisher of The Neilson Report
Oliver Manahan, VP Emerging Payments US/Canada Chip Lead for MasterCard Worldwide
Barry Hanen, Manager Payments & Card Services for Walgreen Co.
Rod Hometh, VP Market Development for Ingenico
Moderator: What is EMV liability shift?
Oliver: "It is not a mandate. It is virtually impossible to counterfeit and EMV is more secure than signature. The goal is to reduce fraud and chargebacks. Logic and reasoning behind liability shift: If a merchant has not made the investment to better secure their transactions, then they will bear the burden of the fraud that occurs."
Barry: "Everyone knows it EMV is coming. We don't know what we are getting into just yet."
Rod: "Start now or there will be a long line when closer to shift.
Moderator: Any thought what we might see in the US?
Rod: "There will be a surprise factor when the first time a customer walks into the store and the checkout process is different, but consumers adapt very quickly. Taking the surprise factor out will help. Don't underestimate consumer's concern for security."
Oliver: Using international business cases for US is not always useful. Don't take liability shift and try and reverse engineer timeline."
Moderator: Pitfalls to avoid? What will happen at POS? What will training be like?
Rod: "Larger merchants should have one person dedicated to EMV shift to manage transition smoothly. Merchants need to educate and hand-hold customers through the transition."
Barry: "We are going to have a dedicated team. It's going to be a bit of a cultural shock for consumer and cashier.
NFC Adoption - Gaining momentum or a long way off?
Moderator: Lloyd Wirshba, President of Verve Associates
Michael Stephenson, Group Manager Payment Innovation for TD Canada Trust
Peter Ho, VP Product Manager for Wells Fargo Bank
Paul Moreton, Sr, Business Director Mobile Payments for Capital One
Moderator - What are implications for Issuers? How are you going to maintain data ownership?
Michael: "Mobile Wallets will be weeded out by gaining trust of consumers."
Moderator: Enrollment moment of truth - where are opportunities for Issuers in private label world - what are Issuers doing in form of enrollment?
Peter Ho: "Issuers will be fighting for Top of Wallet."
Moderator: What are wow factors that will ignite mobile payments?
Paul: "The additional opportunity for consumers to gain additional value and immediate gratification."
Michael: "As Peter says it is early - put your big toe in because it could be really cold."
Peter Ho: "People ask why are you not doing what Starbucks is doing. Without customer trust we are no where (There have been some security issues in past with the Starbucks Card Mobile app)."
Paul: "Starbucks card is static code and one person used same Starbucks QR code. People can use to pay on my account."
Audience ?: What threat us their for going over the top and around banks?
Peter Ho: "We are open to talking about new solutions with gains on both sides."
Mobile Contactless Payments: What retailers view as best solution for gaining consumer acceptance
Moderator: Todd Ablowitz, Founder & President of Double Diamond Group
Dave Baldwin, President, Value Pay Services, Independent Purchasing Cooperative - Subway Restaurants
Greg Cohen of Verifone
James Ward, VP of Credit, Belk Dept Stores Inc.
Aidoo Osei, Sr. Manager Product Strategy for Firethorn Mobile
Moderator - Is mobile payments better than swiping a card?
James: "Yes, geo-based offers & card loads."
Aidoo: "Thru the power of the mobile platform there is an expanding opportunity to connect offline to online. We have just begun to scratch the surface."
Greg: "I think mobile payments is an extension of swiping. How does it compliment existing infrastructure and add value?"
Dave: "Cashier at Levelup asked if it was safer than swiping card."
Moderator: See signs of mass adoption?
David: "No. We are asking a lot of the same questions as last year."
Greg: "We are seeing tremendous growth via Mobile POS. We are seeing the walk, jog and run into mobile payments."
James: "We've been approved to engage a Omni-channel environment."
Aidoo: "The Burger King trial has gone very well. It places brand in front of mind and their Crown Card."
Moderator: Dave - What do you think about announcement of Square and Starbucks?
Dave: "The deal gave Square credibility. There are so many legacy systems out there and many retailers have not even hit ROI on equipment invested in 10 years ago."
Moderator: Isn't Square going route of POS integration? Is this all just hype?
Dave: "Yes right now hype - not sure revenue model is scalable to disrupt interchange."
Greg: "Rising tide floats all boats - how do I find things that work with my existing systems - how do we put systems in place to engage what we are doing today?"
Aidoo: "Notion that Starbucks could be a marketing hub is one that will be repeated - how do we pull dollars from P&G's?"
Moderator: Coffee shop from hardware store are radically different?
James: "Mobile - safe first, then protecting data, adding value to shopping experience, interchange savings."
Moderator: MCX - hub and value prop - what can retailers have to offer Issuers and can consortium succeed? Can a consortium compete with a startup?
James: "Pin pads changed market - cloud service there could be cost savings and deal."
Dave: "Concerned with the flexibility about MCX - it can't be an after school commitment."
Greg: "The more complex it is the better it is for us."
Moderator: Going back to tech models - PayPal and Google Wallet - how do each of you see between bar codes, NFC, geo-fencing?
James: "Google wallet - we don't want wallets between us and customers."
Aidoo: "For retailers that want to build a private label mobile wallet QR codes are good option - geo-fencing opens opportunity to engage with customers - opens gate to ID and authenticate customers."
Dave: "We love the simplicity of Firethorn - spend a few dollars vs hundreds."
Moderator: The perception of privacy and security vs. reality?
Dave: Levelup - something new can be scary - the first question that always comes up by consumers - is that safe?"
Aidoo: "There is general awareness of mobile payments - but this is not education - the more times they see Starbucks-like experience work, the more trust is built."
Moderator: Do you think it is the retailers job to educate the consumer?
James: "Yes, stores must have clerks educated."
Day One was Fun - Welcome to Day Two
Leveraging Mobile Channel to Innovate New Areas W/in Payments Paradigm
Mario Shiliashki, Group Head eCommerce Product Development for MasterCard
- 470B on coupons offered by CPG companies in 2011
- 90% of coupons still delivered in newspapers
- 43% of smartphone owners use their device in-store
Smartphone mass adoption makes digitizing coupons a reality
- Consumer appetite is increasing
- Nearly half of the US Adult population has redeemed an electronic coupon in 2011
Is Loyalty Rewarding?
- 2.1 B loyalty memberships in the US in 2011
- 48 B in reward points @ miles in US in 2011
- 18 programs is average in US
- 85% of loyalty program members have not heard a word from provider since they signed up
- Only 36% of consumers received a reward or promotion that made them come back to store
Keeping Pace with Technology
- US retailers spent 220am on mobile in 2011 - only 0.15 of their total advertising budget
- 69% of retail executives said mobile is an important strategic initiative
- Retailers are dabbling, but what has been built so far is not there yet
- Tech is evolving fast . . . Are business models?
Unprecedented Mobile Growth
- 43B in mobile coupon redemption globally by 2016 - Jupiter Research
- Staples, Target, Safeway - all taking advantage of mobile and digital coupons
- Digital Coupons + Mobile payments = ?
Future = Digital = Mobile
Who is best positioned to drive new customers thru new shopping tech?
- Banks are well positioned to do this
- Broken loop of coupon redemption can be closed (Linkable Networks - SKU - card)
? Karen Webster - Loyalty to deal over loyalty to the brand or store?
Mario: "Creating a platform for merchants is necessary."
? Can FI's be used to drive loyalty on behalf of merchant?
"We are in a great position to enable a network of wallets - PayPass Wallet Services - allows connection to our network acceptance."
Digital Wallets: Moving from Theory to Reality
Moderator: Mary Monahan, EVP & Research Director for Javelin Research
Joanna Lambert, SVP of Strategy for American Express
Moderator - What can be done to bridge the POS Gap?
Joanna: "We'll adopt whatever technology comes along. We are looking at the digital wallet as a whole vs the POS gap. A digital wallet allows us to engage with merchants, banks and consumers. A digital wallet allows us to offer digital rewards and deliver engagement in space.
Moderator: The Google Wallet - reaction by Amex?
Joanna: "Making sure data is secure is very important. We don't have a deal with Google but are in discussions."
Joanna: Tipping point is the adoption by major retailers. It will take a group of companies to succeed. We believe in a partnership model. In next couple of weeks we are launching offers & deals. We can reward through Zynga. But we don't always want to focus on savings and offers. We want to focus on how to add value through convenience. We invested in Payfone and Symetrics and have big partnership with Verizon. We'll be in 20K stores with our reloadable prepaid product. We are launching big partnerships thru millennial space. In last year Amex added 1 million new customers.
? Given Mobile Wallets presence - what is Amex doing to earn the card of choice and be top of wallet?
Joanna: "We have done marketing programs via iTunes promotions - 5 songs free if you load an Amex card. We'll have rewards tied to loading card into wallet."
? Enrollment and Top of Wallet - what worries you most no visibility of card or no enrollment?
Joanna: "It is critical is to maintain relationship with customers. We do a lot of value-add to build and maintain relationship with our customers."
Mobile POS: Phones and Tablets
Ken Paul, CEO of Roam Data
Ken: "There are 3 pieces to our biz: dongle, client mobile side and server side."
- Ingenico is 75% investor in Roam
- Right now PCI has not monitored the Dongles - a lot of security and tech to keep up with
Moderator - beyond small merchants where do you see greatest demand?
Ken: "All the activity has been happening at bottom if the pyramid - Square started it. Activity has been in home delivery - a lot of fraud there, but drives adoption. There is no doubt there is cannibalization: Verifone has been most impacted due to high market share. If you are going to be cannibalized it is best to do it to thyself. Using Mobile POS for line busting makes sense."
Moderator: Square - what's your view?
Ken: "My personal view - Square has helped to create the market. We feel we are well positioned to meet of beat them at all points in market. Square has not been focused on profitability. I think their biz model has to change and is not sustainable. They must add value to compete."
Moderator - Is Apple looking to stack the deck?
Ken: "We are working with them - they are well positioned to be a wallet player."
Monetizing Big Data to Create Consumer Value and Drive Revenue
Moderator - Loraine Debonis - Editor in chief - PayBefore
Tom Pawelkiewicz, Director Payments Strategy & Business Development for Royal Bank of Canada
Usher Lieberman - Director of Corporate Communications for The Find Inc.
Rajeeve Kaul, SVP for OfficeMax
David Alemeida, Partner for Sedgewick LLP
Usher: "We are a shopping search engine. We have indexed 500k ecommerce sites and have been building off of Facebook's social to see what is most relevant to customer."
David: "We draft contracts to not end up in court later."
Rajeeve: The legacy architecture has not evolved far enough yet. Enough people don't know the math to act upon data if captured. Any kind of payment system generates limited information - but each system must capture minimum data set - at volume this becomes a challenge."
Tom: "Two new data elements that we don't know how we are going to capture is location data and social data. We all receive the daily deal for spa 50 miles away - not useful."
Usher: "Data must have structure around it or it is useless."
Usher: "Facebook knows who you are and what you like but that is it. This where we come in - merchandising the like button. When you click on like button you can now market to customers directly because they have opted in - consent is through Facebook Connect."
David: "Email is great because of Can Spam Act - provide opt out - FTC does not go after with right opt out."
Rajeeve: "Big data is exciting - like kid in candy store! The challenge is coming up with model that puts structure around data that drives better marketing."
Tom: We are looking for partners. We are not a tech shop or good at building interfaces. The redemption of the offer is the ultimate opportunity. If it is expensive for merchant it will not take off."
Usher: We are getting 25% open rates on email and 10% click thru."
David: "Another wet blanket - danger is in 3rd party sharing of data. You will need to be very careful of who you are sharing data with."
Rajeeve: Must also be very careful of who you are getting data from and how they obtained data."
? How do you monetize data - CPC or CPA (acquisition) - what information do you capture?
David: "We opted in but you sent us too many text messages - $1500 per text fine."
Developing a Cross-Channel Retail Strategy
Using devices to combat showrooming and encouraging in-store transactions and capturing transactions anywhere & anytime.
Moderator: Jason Oxman, CEO of ETA
Dan Butler, VP Retail Operations, NRF
Venkat Sreenivasan, Worldwide Mobile Commerce Lead for Motorola Solutions
Healey Cypher, Cheif of Staff, Global Product Management for ebay Inc.
Jason: "35% of Consumers have admitted to showrooming - using mobile to use showrooming to turn it around - showroomers are more likely to participate in likely than non-showrooming customers."
Moderator - How do we turn showrooming on it's head?
Healey: "PayPal owns Red Laser - downloaded 21m times. If we know who is scanning and what they are scanning, then why not use this data?"
Moderator: Where are we with devices to make sure we are closing sales?
Venkat: "Retailer does not know who is in the store and therefore cannot take advantage. When consumer uses your free WIFI in store merchant will know they are being showroomed."
Dan: "Urban Outfitters has switched to Mobile POS as has Nordstrums . . . Overstock knows they have lowest price on 70% of items . . . If you have to hang a customer service sign in your store you don't have any. Customer service is part of retailing. When customers make returns how are they treated?"
Moderator: How does showrooming change equation at POS?
Vankat: "When getting showroomed you need to send trained and informed associate and must have authority and ability to close sale. I bought a bicycle in-store because though Amazon was $5 cheaper, the bike via Amazon did not come pre-assembled as it was in the store. The associate did not inform me that bike is assembled vs online."
Healey: "Offline retailers have the advantage over ecommerce stores. Offline stores have so much more to offer. 40% of searches are not from stores with best prices - it is about trust in brand and loyalty to it. Kids rate going to ToysRUs like going to Disneyland."
Dan: "We are talking about integrated retailing to produce a seamless experience (between channels)."
Moderator: Is loyalty and GPS going to be in the POS or in phone?
Vankat: "Mobile POS is the future - don't want to have checkout line - self-checkout - most not doing because problem of fraud - you are going to need optical scanner to read digital coupons."
Healey: "Does it make sense to start investing in tech now or wait?"
Vankat: "Retailers are thinking the cloud because things are changing so fast - outsource to cloud so I can focus on retailing."
Moderator: Is MCX a sign retailers are willing to band together to build unified solutions?
Dan: Retailers don't like to share merchandising data but they do like to share data on security, IT and marketing."
Moderator: What is the response of eCommerce retailers reaction to the brick 'N' mortar retailers response - is this a threat?
Healey: "Inventory matching - if there is a local merchant that can deliver product we will partner to do a rev share - lockers used to deliver products."
Vankat: "How many people read the enrollment agreement? How do you leverage data is key question? if customer has great experience in store then they will not care so much about how they are tracked."