European ISO offer. European Payments Gateway Conference, Brussels 9nd June 2016 Niklaus Santschi, nps fintech & payment consulting

Transcription

1 European ISO offer European Payments Gateway Conference, Brussels 9nd June 2016 Niklaus Santschi, nps fintech & payment consulting

2 Experience related to the topic 2006 at Multipay: Build of a all-in-one POS proposition/offline proposition for Swiss SME Merchants including all relevant acceptance brands (direct acquiring and routing to 3party acquirers), DCC, VAT Refund, Couponing, Loyalty, own POS hardware and own EMV software 2008 at Multipay later SIX Pay: Build of an all-in-one offline proposition and distribution for large multi national large retailers, hotel chains and UAT customers, including all relevant brands, POS software/psp services, DCC, VAT Refund, Loyalty for all European markets independent of currencies, languages, ECRs, etc at SIX Pay: Build of a integrated PSP/Acquiring offer for SME in the DACH region at SIX Pay: Build of an international SME offline proposition and distribution for Germany, Poland, Czech Rep., Hungary, Italy and Belgium 2015 as Advisor: Consulting PE s on acquisition targets in the PSP and Acquiring space. 10/06/2016 2

3 Definition: European ISO Multi-country and Multi-channel (off- & online) offering of Relevant payment acceptance brands and infrastructure for SME merchants 10/06/2016 3

4 7 reasons not do spend any effort on this topic Too complex Too strong local competition Too many innovation in the market to assess per market and to cope with it Margin pressure and the low customer lifetime value in SME will never pay out the investments and efforts needed Different jurisdictions and ongoing pressure from regulation will increase costs and absorb management attention and available funds No way to scale and to build an efficient operation model within this fragmented setting Too high risk of failure before doing the first transaction 10/06/2016 4

5 10/06/2016 5

6 Herzlichen Dank! Merci beaucoup! Mille grazie! Muchas gracias! شكرا جزيال! mycket Tack så большое спасибо!どうもありが とう 非 常 感 谢 Many thanks! 10/06/2016 6

7 7 reasons to consider it Large customer potential High potential of winning new customers hold-outs due to increasing card payment driven by changing habits and new to the business customers Often neglected by local Acquirers so high churn potential Underserviced Good margins, with an «extra» as Acquirer didn t passed on IC reduction Lower price pressure Stand alone POS and standard brand offering needed 10/06/2016 7

8 Merchants perspective Perception equals reality «My passion is my business»: Payment is only the element which fulfills the «contract: money for goods/services». «I am special»: The payment proposition needs to fit my business, my customers, my needs «I need it simple»: Ease of on-boarding, easy technohandling, ease of use for consumer «I am growing: I may open another shop or channel» «Is it secure and reliable?»: «It s too expensive!» «What can you do for me? Do you understand my local needs?»: «Are you responsible? Can I call you personally if it doesn t work?» 10/06/2016 8

9 Suggestion for positioning Leading Edge Europe Broad High High High Fast Low Differentiation Average Customer proximity Super service Loosing End Local Narrow Low Low Low Slow High quick and easy Geography Product Range Product/ Solution Stable, Secure Cust. Service Time to Market Price 10/06/

10 Provide best customer experience at any touchpoint Customer proximity CRM Sales On-boarding Focus either on a vertical or a niche, or on a typical domestic or foreigner oriented segment Offer one contract for all product & services, with incentivicing conditions Add local expertise and flavor Deliver multilingual interfaces One central marketing, sales, on-boarding and CRM platform, combined with operations and self-self services Automated data feed as source for marketing and sales Lead generation by Outbound/Telesales Free lancer field sales Partners / Integrators Resellers Anchorman on the ground easy and quick do-it-yourself fully digital without media gaps with video identification or Bank ID integration Upload of docs and scans 10/06/

11 Customer proximity, ease and speed of service First contact Self-Service Merchant Portal Communication Channels Service taff Immediately after successful on-boarding Customer chooses POS, devices, etc. as packages in the internet Shipment of POS to merchant Download of Plug-ins or APIs immediately after on-boarding confirmation with Merchant ID and portal login data and tracking number for shipment of POS device and activation process Merchant activation before POS arrives at merchant Merchant connects POS and is ready to accept cards; Every successful process step will be confirmed to merchant via SMS, chat or (according preference) Very simple language, tutorials, payments for dummies Product explanations, guidelines, GTC Settlement reports, simple data analytics tailor made for merchants/mcc Data maintenance Customers sees same data than staff Just any! Let the customer choose!! Chat, , phone, skype, letter.. 10/06/2016 First contact great experience! Immediate answer no IVR and blablabla Super nice and competent staff, ideally in mother tongue No up- and cross-selling just real help In case of trouble send sorry and gifts. Be nice and keep 12

12 Critical factors for market development (1) Market: Size, growth rates, structure, potential (2) Competitive environment: local/regional players, ISO and/or bank distribution, domestic brands (debit) and loyalty (3) Margins per segment and market (4) Localized needs: Technical specifics, languages, holidays, culture, habits (5) Local partners: As partner for the solution (debit, etc.), delivery/logistics (6) Readiness for ISO: Labour law, availability & cost of (free lance), sales staff 10/06/

13 locals Consumer types foreigners SME markets, segmentation & target groups Key markets 6 Luxury goods UK / Ireland Star Hotels DACH & BeNe 4 Tourism & Travel Spain 3 Restaurants 2 Standard high street Poland (& CEE) Italy 1 Every day spending low Market size high 10/06/

14 Product offer: «Pragmatic» approach SME domestic business POS, mpos and materials E-Com plug-in, PSP, inapp Card acceptance MC, VISA, MAE, Vpay Domestic Debit Domestic/regional relevant APM Domestic relevant closed loop or vouchers Value adds Couponing, loyalty scheme Volume incentiviced pricing SME tourist business POS, mpos and materials E-Com plug-in, PSP, inapp Special integration hospitality or travel system Card acceptance MC, VISA, MAE, Vpay, CUP, Diners, Amex, JCB Domestic Debit (only few countries) Value adds DCC, VAT refund Value incentiviced pricing 10/06/

15 Strategic partners European: Acquirer and processor needs to support multi, multi, multi. PSP with broad offer of APM POS vendor and logistics provider Local / regional: POS SW engineering NSP for local/domestic specials (i.e. Girocard, Postfinance, Edenred, Sodexo.) Job and recruiting partners/platforms Market research and networking organisations 10/06/

16 Key success criteria Proposition: Reduce to the max! Segmentation is key! Focus on the key touch points: «Communicaton» and «Tangibles» (POS, mpos, paper, reporting, contract Digital marketing & sales: Fully digital processes for marketing, distrubution and service Digital services, such as automated on-boarding, self service & merchant portal Local anchorman and knowledge within service organisation Scalable and flexible partners/suppliers 10/06/

17 Thanks! European Payments Gateway Conference, Brussels 9nd June 2016 Niklaus Santschi, nps fintech & payment consulting