WHITEPAPER. EUROPE S TOP RETAIL PAYMENT TRENDS Strategy Shapers and Sales Enablement.

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1 EUROPE S TOP RETAIL PAYMENT TRENDS Strategy Shapers and Sales Enablement This is a decade of change. Diverse channels, payment types, legislation and services are redefining the point of sale. Understanding critical trends and responding quickly with appropriate payment tools is vital if retailers, banks and acquirers want to survive and thrive during the challenges that lie ahead.

2 Shaping European WHITEPAPER Executive Summary European retailers are making it clear they want to focus less on just talking about trends and much more on action. Pragmatism, enablement and problem solving are some of the key themes that are already emerging from a market which has been knocked back by deflated economies, the rising cost of sales and lower consumer spending. While retailers take stock to reassess their operational strategies, they are looking to learn from European success stories such as mobile, contactless and the Internet by capitalising on NFC, e-commerce and online spending. There is no denying that the payment industry is shape-shifting. Previous disruptive technologies are now vital to retail success. Europe s Rapidly Evolving Payments Landscape Europe is no stranger to change. With 857 million people in 50 countries speaking 230 languages, it s a daily occurrence. However, while each country within has its own unique requirements and challenges there are also some common areas that are impacting the shape of payment and delivery across the continent. Common Drivers These can be summarised as: Harnessing sophisticated payment related technologies like NFC, e-loyalty, multi-media devices and value adds are also key to linking the virtual and physical retail worlds together. Consequently, retailers, banks and acquirers are now ready to embrace new tools, channels and investment models. They are also eager to exploit new service opportunities and create closer interaction for consumers. And this is extending throughout their organisations. In the future, marketeers will become even more proactive in shaping payments as a strategic tool to manage customer relationships, drive footfall and boost loyalty. This paper outlines some of the most important trends influencing the shape of European payments as well as the technological and service enablers that will be crucial for success. Operational drivers, where payment investment is governed by merchants own strategic priorities and bottom line business goals such as greater efficiency, performance and profitability. Industry requirements in terms of local and international payments regulation that secures and protects the interest of the consumer. Consumer forces, where retail payments innovation is responding to profound changes in the way consumers buy goods and services, get and redeem offers, and interact with merchants and retail banks. Consumer Operations Industry Shaping European Payments Payments Consumer Operations Industry EUROPE S TOP RETAIL PAYMENT TRENDS 2

3 More Choice, Greater Complexity European shoppers want to pay for what they want, when they want, where they want and however they want to. This is opening the doors for new payments channels and solutions. As competition intensifies, particularly in the UK, France, Germany and Nordic countries, many retailers will respond by using outsourced technology to retain flexibility, economies of scale and competitive edge as markets and margins get tighter and to offer the depth and breadth of payment services that European consumers will increasingly expect them to deliver. Evolution from basic payments value chain to... Customer Merchant Merchant Acquirer Processor Consequently, the ecosystem is becoming wider and more complex (See Figure 1), the platforms more diverged with many new payment formats, channels and value added services. We are moving from a linear payments path to one which is harder for retailers and banks to deploy, manage and monitor not just at an international level but also on a local level. Figure1 Changing Payments Ecosystem Schemes Issuers...to complex multi-channel models...more influences...more players, touch points...more ways to pay Europe s Emerging Payments Trends Touching all aspects of the payment chain, and present in all European countries, VeriFone works closely with retailers of all sizes and with banks, acquirers and legislative bodies across the region. Its unique market perspective has helped it to identify the following areas as being the key consumer, operational and industry developments that will impact the payments business in the next few years. Strategy Shapers and Sales Enablement December

4 VeriFone s Top Trends for Payments Investment 1 2 Integrated Mobilisation Channels & Services Channels & Services Mobilisation E-commerce E-commerce 1. Mobilisation of Channels & Services 1 2 Integrated Within Europe there are now 741 million live phone subscriptions and 366 active mobile broadband subscriptions. This means that almost everyone in Europe has a phone AND nearly half can access the internet on them. In countries such as France, Germany, Italy, Spain and the UK 55% of these mobile devices are smartphones with the ability to access product information, store locations, location-based offers, voucher codes, comparison sites, barcode scanners, product reviews and purchase tracking. All of this is making the traditional, linear in-store approach to physical purchasing something of the past. Customers no longer choose between either a physical or virtual channel. With their mobile they can immerse themselves in both at the same time using the Internet to guide decisions while actually in store. Finding new ways to exploit mobile apps and services will be central to retailers mobile strategies. NFC Enablement NFC (Near Field Communication), enables users mobiles to talk to other NFC-enabled devices, to read NFC tags embedded in their surroundings, and allow instant transactions with NFC acceptance devices. This type of use will escalate further when millions of NFC-enabled phones hit Europe this year. According to a recent study by Juniper Research, one in four mobile phone users in Western Europe will be making NFC payments in five years time. NFC will open the doors to new types of services from wave-and-pay payments, loyalty and couponing applications to personalised promotions, targeting and up selling. 3 Improved Customer Experience Experience 3 Improved Customer Mobile Marketing 4 PCI Development & Security & Security 4 PCI Development Consequently, annual global spending by retailers on mobile marketing is expected to hit $55 billion by 2015, almost double the $28 billion forecast to be spent this year. For this to be achieved there needs to be a rapid change in how retailers use mobile to reach customers. However, there is already some evidence of this in a further Juniper Research report which shows that mobiles are driving retail footfall through coupons, with couponing apps becoming an increasingly popular tool of distribution and coupon storage. Another trend is towards the development of additional distribution channels, including augmented reality and near field communications as mobile becomes increasingly integrated into in-store retail strategies. Smart Devices and Mobile Retailing Mobile POS and in-store tablet retailing will become more pervasive within the high street thanks to solutions such as VeriFone s PAYware Mobile which transforms smart devices into PCI/EMV compliant payment acceptance devices. mpos adds a wow factor at the checkout and also opens up opportunities for retailers to develop complimentary value-added apps, such as loyalty and couponing programmes. These tools can also be used to innovate, recover abandoned sales, capitalise on pop-up store opportunities and simply provide a better customer experience. Using specialised apps and integration software, such as VeriFone GlobalBay, they can also be used to provide instant visibility to in-store inventory, saving hours of store time currently spent on inefficient inventory EUROPE S TOP RETAIL PAYMENT TRENDS 4

5 management processes. ipad retailing with clienteling will also become a core part of many high street retailers future strategies. This uses NFC tagging to identify individual customers and access their preferences and buying habits, in real-time, whenever they enter the outlet. Mobile Retailing for Small Merchants In addition, smaller merchants will also seek to move from cash to card acceptance via paymentsenabled mobile phones. Consumer payment dongles and devices will compete with banking apps such as Pingit in the UK and Swish in Sweden for person-to-person payments, In this vertical, security and trust will be the key to success. 2. Greater Integration of E-commerce Internet adoption in Europe is the highest in the world. A United Nations survey found that 40% of the world s population is online and that Europe leads this trend with 75% of the population now having access to the Internet. Europeans are also advantaged by having the cheapest relative costs for Internet access in the world. The wide scale availability of cheap internet and connected equipment means that today s consumers can now access sales from PCs, mobiles, tablets, games consoles and even social media sites. Consequently digital sales are rising sharply. Several recent studies indicate that online B2C sales are climbing steadily in Europe, despite economic headwinds and spend tightening on the part of consumers. According to European Online Retail Forecast 2012 to 2017 from Forrester Research, online sales in key markets Sweden, the Netherlands, Italy, Spain, France, Germany and the UK will rise an average of 11% annually between 2012 and 2017, to reach 170 billion ($217 billion) at the end of the forecast period. emarketer, which published new forecasts for digital sales in January 2013, reports similar trends, anticipating that annual B2C e-commerce sales in Western Europe will reach $ billion by Mobile Wallet The digital or mobile wallet will offer more than just another payment option. In 2013 payments will finally merge with loyalty and rewards. These three separate businesses will converge to make it easy for consumers and merchants to automatically leverage the appropriate coupons and offers. Mobile Banking Mobile banking is also a clear IT investment priority in 2013, as retail banks attempt to capitalise on the features unique to mobile, such as location-based services. Ovum forecasts show that what it categorises as Other Channels, which includes mobile banking, will grow 4.0% in Europe in 2013, and rise at a compound annual growth rate of 6% between 2013 and Overall, spending on online channels including mobile-browser-based banking services is set to grow 4.2% in Unified Channels and Managed Services The increasing focus on online and mobile sales has created an urgent need for better ways to manage and consolidate payments and services into unified platforms that offer a single view of a retailer s payments, provide better cost/performance benefits and create a consistent user experience. This trend requires for managed solutions that offer the depth and breadth of tools and capability to cut through the complexity to deliver simpler ways to deploy and manage payments across channels and countries AND at a price retailers and banks can afford. Reverse Channel Trends The shift to a seamless and integrated omni-channel retail experience on the high street means onlineonly retailers are now missing a key element a high street presence will see a growing contingent of online-only retailers opening pop up shops with savvy technology, such as digital windows and tools such as augmented reality, QR codes and mobile apps to bring in customers. ebay has already put this into practice by testing out pop up shops earlier this year. Strategy Shapers and Sales Enablement December

6 Alternative Payment Services Retailers will have to embrace new digital payment methods to remain competitive online. Alternative payment services such as PayPal and Google Checkout are now commonplace. PayPal is used by half of online shoppers in the UK and Germany, 3. Improved Customer Experience Across the world, EMV and the customer-facing PIN pad has put payment devices into the hands of the consumer. Until now that touch point has never been fully exploited. However, things are set to change. The POS becomes a Point of Interaction The inclusion of more memory, enhanced processing power, larger, colourful touch screens, multiple applications, flexible multi-connectivity and, of course, contactless and NFC are all contributing to the evolution of a new generation of payment devices that can do more than just accept cards. In future, the POS will not simply close the sale it will be part of the whole customer journey, helping to interact, create impact, and impress. It will boost loyalty, add value and drive profitability. and by 40% of European online shoppers overall, according to industry researcher Forrester. Forrester also estimates that fully one in five e-commerce transactions are completed using alternative payments. That percentage will grow to nearly one in four 23% in the next four years. Incorporation of Multimedia Into the POS As retailers seek to boost their IT return on investment and make the POS work harder, many are looking to incorporate digital signage and multimedia. This turns the POS into an interactive tool for managing customer relationships, informing them of offers and promotions, building brand and instilling loyalty. The inclusion of advertising loops, promotional features and loyalty incentives as well as Internet browsing and ordering helps influence shoppers when they are most receptive. Multimedia at the POS also creates a more unified channel experience for shoppers and provides a seamless way for retailers to glue together their visual and virtual worlds. A high proportion of Europe s retailers are currently replacing their estates in line with PCI compliance. Rather than replacing them, like for like, many forward thinking retailers are taking the opportunity to upgrade to next-generation devices such as VeriFone s VX Evolution range, which is now certified for use in Europe. Contactless Convenience Contactless will become more prevalent across Europe as retailers capitalise on the growing base of contactless-enabled consumers. Visa s recent annual report indicates that in 2012 contactless usage quadrupled and that growth was particularly strong in emerging markets like Poland. In addition, over 20% of Visa card usage is now online and that trend will increase throughout The Smart Payment Association has revealed that contactless cards represented 23% of all smart payment cards shipped in Shipments of dual interface cards, incorporating both chip and PIN and contactless technologies, are now are growing at 77% year-on-year. The increase in contactless shipments points to an eventual move to mobile and NFC. The Epson Vision Survey interviewed 500 retail brand and marketing managers across the five largest European economies the UK, Germany, France, Italy and Spain to evaluate use of POS signage. Today over half of all in-store POS activity is print-based, but this is predicted to fall to just over a third (39%) by 2020 when electronic POS will comprise the largest proportion of POS activity (61%). EUROPE S TOP RETAIL PAYMENT TRENDS 6

7 4. PCI Development and Enhanced Security Protecting the customer against fraud will continue to be paramount for the entire payment industry. While the Payment Card Industry Data Security Standard (PCI DSS) is central to this, across Europe many merchants are failing to meet compliance putting users card data at risk and leaving themselves open to fines. The issue isn t necessarily complacency, but rather obsolescence with too many stores simply in need of equipment upgrades. In the next few years, retailers will continue to address this by upping their investment in PCI compliant systems, processes and devices. Europe s New Connected Delivery Models With the emergence of innovative channel and service solutions, the industry will need to respond with new ways to help retailers, banks and acquirers manage and integrate their payments in order to create the smooth, seamless, secure and reliable services that European customers have come to expect. However, keeping standards maintained is not only expensive, but requires significant internal resource and a long-term commitment. Consequently, taking part of the environment out of scope is fast becoming a key trend. One of the more problematic areas is card-not-present fraud, and while there are robust solutions in place to handle this. Many are looking at encryption and tokenisation as potential solutions to minimise their PCI requirements across their channels. For others who want to reduce the PCI burden, having a third party manage their payments platform may offer a cost-effective and less-disruptive option. VeriFone believes that new consolidated approaches that connect, optimise and facilitate multiple payment platforms, types and channels will gradually replace the fragmented approach that exists today. In this way, the industry will benefit from faster deployment, greater economies of scale and holistic integration of customer facing elements of their business. Europe s Future Payment Delivery Models 1. Creating Seamless Channel Integration Many retailers now have a number of channels via which customers can access them, from in-store to online and mobile platforms. A recent survey by HP showed that more than half of the top 50 European retailers use more than three channels to sell direct to consumers. However many retailers still don t offer a seamless experience across their channels. Research from YouGov shows that 78% of shoppers found price offers online that were not subsequently available when they went in-store. Strategy Shapers and Sales Enablement December

8 Connecting these dots between channels can greatly improve the customer experience and consequently benefit sales. 34% Have a MAIL-ORDER CATALOGUE What is Omni-channel? 98% Have a PHYSICAL STORE With omni-channel, the customer gets a seamless brand experience and approach with whatever channel they use. They can access any service or sales function irrespective of whether it is via mobile, catalogue, online or a physical store; the retailer can track and manage their interaction to ensure it is completely consistent, whatever the format. Why is it important? Today s connected consumer wants to use all channels simultaneously for example surfing for deals from their mobiles while in store, choosing click and collect online, or returning cataloguebought goods via a store. They want interfaces that guide them straight to the goods and services they are most likely to buy, which flag up promotions that are specific to them and that support their purchasing decisions with real-time stock and price checks. They also want loyalty, couponing and discounts that are designed around them and not purely channel-related. CRM, data mining and cross channel marketing are, therefore, all crucial elements of building an omni-channel brand. It seems that current multi-channel strategies are simply no longer enough to keep pace with these increasing consumer demands. To stay ahead of the game, retailers and banks need to be moving towards the more unified, retail experience often described as omni-channel. 86% Have a E-COMMERCE WEBSITE What does it offer? 30% Have a M-COMMERCE WEBSITE 28% Have a M-COMMERCE APP Source: HP Given the complexity of knitting together an omnichannel retailing platform, it makes sense to unify and integrate as much as possible from a small supply base. A core part of this is providing a payments platform that can work across a retailer s entire operations. A true, omni-channel managed payment service, will deliver all the tools needed to manage the entire payments lifecycle across any channel irrespective of size, customer present or not. This includes software, services and solutions that can be tailored to a retailer s business, so they can quickly and effectively create secure, reliable and resilient payment platforms and manage associated services, loyalty programmes and apps. At the same time, it addresses consumer concerns for security, legislative and regulatory requirements without placing an inordinate drain on retailers resources. Payments must enhance the immersive experience using invisible technology to support a new generation of compelling omni-channel solutions and managed services that will connect consumers with brands more consistently than ever before. EUROPE S TOP RETAIL PAYMENT TRENDS 8

9 2. Moving Towards Payment as a Service As new technologies continually emerge, mitigating risk and security becomes more difficult. Dealing with changing PCI regulations and industry standards such as EMV can be overwhelming and a cost burden. To help address this, many retailers, banks and acquirers are now seeking to outsource Retailers want to reduce complexity... They also need... Cost-predictability Manage entire commerce services platform affordably - no obsolescence or surprises To accommodate future needs Respond to regulatory changes, trends & technology quickly and easily Choice and flexibility Tools & services to enable payment, loyalty & promotional media solutions Customer-centric experience Create new ways to personally engage consumers & energise sales their entire payments function using payments as a service which help to reduce the complexity of payments and provide a much simpler more operationally efficient route to taking a secure sale. This also helps to facilitate the delivery of omnichannel models. Payments as a service delivers complete payments simply Points of Interaction POS mpos ecommerce EMV/ NFC PCI Loyalty Payments as a Service ***** Tokenisation/ encryption Estate Management Gateway Processor Mobile Wallets Processor Neutral Social Payments Loyalty Merchant Control Portal Configuration Analytics Provisioning Only VeriFone has all the capabilities and experience necessary to bring together a complete payment solution in a single, all-in-one service Updates What is Payments as a Service? Payments as a service is when a third party vendor provisions and manages a merchant s entire payments platform, bundling together devices, software, gateway and professional services, security, estate management, reporting and valueadded services. It is supplied on a fixed or scaled cost fee basis, with no capital costs or associated payment equipment system investment required by the customer. Why do European retailers need it? Merchants are looking for a commerce solution to help them stay competitive while allowing them to focus on their core business eliminating complexities while still providing the choice, flexibility, security, support and cost control they need. Payments as a service platforms, such as VeriFone s Point and PAYware Ocius solutions, take the guesswork and complexity out of managing multiple payment, payment-related, and promotional technologies and meeting regulatory standards. What does payments as a service offer? Payments as a service gives merchants a competitive edge with a simple, cost-effective, subscription-based platform that lets them better engage with customers, tap into the latest technologies, extend the point of interaction, scale resources and enjoy the flexibility needed to tailor services as desired. Everything from mobile wallets, loyalty, gateway, estate management, processor neutral EMV/ NFC, PCI, tokenisation/ encryption can all be provisioned and controlled with simplicity and convenience. Strategy Shapers and Sales Enablement December

10 What are the benefits? Payments as a service: allows merchants to stay focused on what they do best taking care of their customers ensures cost-predictability and reduced CAPEX by offering a fixed regular OPEX-based fee structure provides quick and easy integration using compatible proven solutions 3. Value Added Services and Mobile Marketing Platforms For many merchants, future growth is tied to marketing strategies and the delivery of value added services, loyalty and promotions. Leveraging digital formats will become increasingly central to this. This includes development and use of mobile wallets which will allow consumers to carry all the loyalty cards they choose, never lose a coupon or promotion and receive targeted messages and promotions on their phones to be redeemed at the POS, without having to print or clip anything. Success, however, will depend on their ability to deliver an end-to-end mobile marketing infrastructure that incorporates wide reach, frictionless redemption for consumers, and the kind of targeting, tracking and analytics to provide maximum value to merchants and third party advertisers as well. VeriFone believes that this requires a new set of tools, which can be combined to create mobile marketing platforms (MMP). What does an MMP do? MMPs allow merchants, brands, mobile marketing agencies, VAS providers, malls and MNO s to manage comprehensive campaigns, including all possible payments methods (credit card, prepaid card, gift card), values added services (offline coupons, online coupons, vouchers, loyalty, etc.), and media (reach media, hyperlinks, etc.) via web portal and system integration using a universal value added service gateway. They will include web portals that enable all stakeholders to create, manage, control and analyse their campaigns. The VAS gateway will enable all functionality through systems integration via open API. reduces risk and compliance costs by ensuring the latest security, certifications and processes accommodates future needs and keeps merchants ahead of the latest trends offers choice and flexibility with dynamic crossselling and upselling tools through added value applications and services enables customer-centric experiences to be built without being held back by infrastructure constraints Why do we need dedicated MMPs? Marketers have yet to capitalise on the full potential of mobile, lacking a campaign management platform that aligns the issuance of promotions and offers with the merchant s point-of-sale acceptance system. In many cases, coupons and offers, either from merchants or brands, still rely on an analogue system. Enabling mobile marketing and promotions, however, is about more than just converting from paper to digital or plugging it in to existing digital systems. It requires integration into a merchant s point of sale and back-end store infrastructure, so that campaigns can be properly redeemed, tracked and fulfilled. Remote management capabilities are required to manage a network of POS systems that need to be updated often with new parameters, offers, apps and campaigns. An MMP does this and allows them to manage the cloud-based gateway services necessary to facilitate the offers and campaigns and their deployment when a consumer taps the phone. What does an MMP solution comprise? The MMP itself should include three key components: campaign management system for creating and managing mobile marketing campaigns and for integrating with the merchant s CRM systems distribution system that delivers campaigns both to Issuance (consumers) and Acceptance (merchants) parts of the mobile marketing equation reporting and billing system to provide the analytics and intelligence that feed usage data back into the campaign management system for better campaign tracking and improved campaign performance EUROPE S TOP RETAIL PAYMENT TRENDS 10

11 SEPA EMV interoperable 1 SEPA single set of Security Requirements Interoperable & Open Standards and Protocols Single EMV payment application working with all bank issued cards Single POI Security Certification + Single POI functional Certification (at least for Basic Card payment services) Fewer terminal to acquirer protocols based WHITEPAPER To provide a complete integrated system, MMPs also include, or work in tandem with, an agnostic platform that works with all payment wallets, TSMs and merchant back-end systems; with all merchant POS systems; and with all NFC and non-nfc standards What do MMPs mean for services? Merchants and brands will finally be able to create a two-way communication with consumers leveraging their physical presence and the cloud to interact with mobile phones. They will be able to leverage mobile devices to drive traffic to stores, delivering location-based and personalized promotions ready 4. Delivery and Exploitation of SEPA Over a decade since SEPA s inception, Europe is finally getting closer to realising its dream of a single, unified pan-european payment platform as the 2014 implementation deadline approaches. to be redeemed at the point of sale. They will also be able to influence consumer behaviour in-store, helping cross-sell and upsell products and increase repeat purchases by sending coupons directly to the phone from the checkout system upon completion of a purchase. This becomes even more important with the rise of showrooming and other changes to shopping behaviour that threaten traditional brick and mortar business models. Merchants and brands increasingly need to provide consumers with compelling value and ease of use to stay ahead of their competitors, both online and off. As an active member of SEPA s various committees, VeriFone has been extensively involved throughout the consultation process, on working groups and pilot programmes helping to champion more effective payment solutions for Europe. One that facilitates easier and more cost-effective cross border card acceptance from multiple channels. The EU legislator mandates migration to SEPA in the Euro area by 1 February 2014 Fewer terminal to acquirer protocols based on open ISO standards Cardholder Standalone POI Merchant Acquirer Issuer SEPA EMV interoperable payment application 1 SEPA single set of Security Requirements an Single Certification Single POI Security Certification + Single POI functional Certification (at least for Basic Card payment services) Interoperable & Open Standards and Protocols Single EMV payment application working with all bank issued cards independently of the brands independently of the brands payment application an Single Certification Why is SEPA important for retailers? Cardholder SEPA will introduce more competition among card schemes, by ensuring that domestic markets have access to a choice of cards. Through additional SEPA initiatives such as SEPA-FAST and OSCar, leading industry players, including VeriFone, are also working to ensure that SEPA, once implemented, will also address retailers increasing needs for: Uniform integration and a standard protocol spec ISFS, EPAS and API consolidated reporting and multiple acquirer connectivity across all operations irrespective on open standards ISO of country Standalone POI Acquirer Issuer Merchant new ways to ensure comprehensive security/ PCI DSS compliance/minimising scope faster time to market and greater economies of scale on hardware through pre-certified hardware better support for local card schemes and easier ways to integrate future payment technology NFC, contactless, mobile wallet, couponing Strategy Shapers and Sales Enablement December

12 Will it affect payment devices? Major players in the European card payments industry, including VeriFone have joined together to deliver the first common standard for payment terminals, the Financial Application Specification for SCF Compliant EMV Terminals (SEPA-FAST). Based on EMV, SEPA-FAST describes the financial application on a terminal which is compliant to the SCF and SEPA Cards Standardisation Volume Book of Requirements. SEPA-FAST will: support a uniform look and feel of transactions from the cardholder s perspective reduce the risks of interoperability obstacles between applications enable an open market for EMV-based components serve as the basis for a one-stop shopping for terminal testing and mutual recognition of type approval Conclusion Proposed Certification path for a SEPA Payment solution Before SEPA can be achieved there are still many barriers to be overcome including the plethora of country-specific card payment applications and certifications in Europe. Some of these are defined by local card schemes; others are selected by the individual acquirers themselves. The dependency on domestic payment applications results from the continued use of domestic debit cards, as well as other private label or value-add schemes used on a market-specific basis. On top of this, acquirer host systems and payment terminal software needs to be upgraded to support any common standards. This will require a significant investment to enable common, pan-european payment applications to be supported along-side the many existing local payment applications. In addition, the differences in security requirements between the European markets do not allow offering a single cost-efficient accepting solution across the markets, which creates a further barrier to crossborder or central acquiring. While we believe that the content of this paper represents the principle areas for European investment in new technologies and solutions, for a great many merchants payments change over the next few years will still be about getting the basics better continuing to make the POS faster, more convenient and efficient and e-commerce platforms more accessible, reliable and secure. Therefore, any payment innovation will have to be backed by pragmatic delivery and justified by its ability to deliver real value for shoppers and bottom line return for retailers and banks. However as competition for custom intensifies and capturing and retaining sales becomes increasingly aligned with retailers and banks ability to engage and remain relevant to consumers there is no question that mobile, internet, security and experience will play an increasing role in shaping payments and how they are delivered. To keep pace with these trends, VeriFone offers the following top tips for those looking to invest: Make sure payment acceptance platforms support all sales channels including retail, e-commerce and mobile Different channels need different solutions whether that s a secure payment page for your e-commerce operation or secure acceptance device for your point-of-sale. You ll also need to make sure that you can accept all of your added value transactions throughout these channels. More channels means more potential access points for villains take a 360 degree approach to security Point-to-point encryption keeps customer data safe and helps maintain PCI compliance while tokenisation eliminates the need to store sensitive cardholder details but still allows data for CRM and loyalty applications. EUROPE S TOP RETAIL PAYMENT TRENDS 12

13 Invest in solutions that reflect business needs Make sure your payment gateway is flexible enough to process all transactions across all of your channels with software, solutions and services that can be added as required so you get what you need without paying for unnecessary extras. Consider whether you really need something bespoke or might benefit from a feature-rich off-theshelf solution instead. Don t stop at payments, maximise impact with value-added services and CRM tools delivered through the POS Enhance the full potential of your EPOS system using value added services such as NFC, Contactless, Mobile Vouchers, Gift Cards and Loyalty Programmes. For mwallets this may mean investing in a MMP system to help manage service deliver to the customer. Ensure it provides real time reporting tools to help multi-channel businesses work smarter Merchant web/console portals should include instant real-time reporting of payment status across all channels. A single holistic view across your entire operations will let you make more intelligent management decisions. Consider using a single integrated solution If in doubt, invest in feature-rich and future-proof solutions from a leading supplier like VeriFone. Look for a solution that can deliver both services and devices; that can facilitate customer present and not present channels; that can help you reduce compliance and risk; and which can prove successful delivery of any hosted payment processing services for at least a decade. Strategy Shapers and Sales Enablement December

14 ABOUT POINT Point is a VeriFone company and the leading provider of electronic payment solutions to merchants in Northern Europe. Point has a local presence in Denmark, Estonia, Finland, France, Iceland, Latvia, Lithuania, Norway and Sweden. Global Mobile Statistics 2012 published by mobithinking ComScore figures October 31, 2012 Juniper Research report Retail mcommerce: Mobile & Tablet Marketing, Advertising & Coupon Strategies VeriFone. All rights reserved. No portion of this document may be reproduced or distributed in any form or by any means without the prior written permission of said company. All trademarks are the property of their respective owners.