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TNS' most recent webinar gave an insight into the top payment market trends facing merchants in 2014. The topics covered were: * Focus on security and risk management * The acceleration of change in the payments ecosystem * Sea change taking place at the POS * Impact of BIG Data on payments * Insourcing vs. outsourcing
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Unique insights into top payments market trends facing merchants in 2014
February 20, 2014
Travis Lee, Director, Product Marketing
#tnspaymenttrends
2014 Payments Ecosystem Trends
Yesterday’s environment was about card data. Tomorrow’s
environment ties device driven personal data to cloud-based services
Payments acceleration and risk
concerns cause merchants to
question their focus and their scope of
management
A shift from the Point of Sale transaction to the Point of Interaction with
the customer
Pace of change is accelerating -
customer focus and risk management are the
driving actions
More in Play than Ever
Before
Sea Change at the POS
It’s About the Data
Great Infrastructure
Required
2TNS Confidential Information
More in Play Than Ever Before
What we can say is that in 2014 …
What commerce will look like in 5 years is difficult to say, but it will be drastically different than what it was in 2013?
Channels are blurring – no longer multi or
omni channel – it is the integration of
channels into “One-Channel” and it is about
commerce and the customer.
3TNS Confidential Information
NRF Report – the word on everyone’s lips: omni channel. ECommerce and mCommerce took their places next to traditional brick-and-mortar in New York as panelist after panelist acknowledged the importance of bringing products to customers in exactly the ways they want. Cardnotpresent.com
More in Play Than Ever Before
Security is paramount – your payment
systems (networks, databases, POS)
need to be locked down and cleansed
of card data. Previously it was about
compliance management, now it is
about risk management.
What we can say is that in 2014 …
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FBI Jan 17th Report – discovered 20 more hacking cases involving the same RAM scraping malware technology used against Target. “We believe POS malware crime will continue to grow over the near term.”
What commerce will look like in 5 years is difficult to say, but it will be drastically different than what it was in 2013?
More in Play Than Ever Before
What we can say is that in 2014 …
Mobile is happening – it needs to be a
critical part of how you create and
maintain loyal customers as well as
enable intelligent merchant associates.
5TNS Confidential Information
What commerce will look like in 5 years is difficult to say, but it will be drastically different than what it was in 2013?
Adyen 3rd Mobile Payments Index – mobile payments accounted for 19.5% of online transactions, up 55% over 2012. Smartphone payments proved the highest volume, but tablets showed the highest average transaction value.
More in Play Than Ever Before
What we can say is that in 2014 …
Tender types are increasing – forever it
was cash, check or a handful of credit cards;
then Paypal and a couple alternatives came
along, now we are seeing a flood of options
and some that are changing the paradigm
for merchants, customers and banks.
6TNS Confidential Information
What commerce will look like in 5 years is difficult to say, but it will be drastically different than what it was in 2013?
WorldPay January 2014 report “Global Guide to Alternative Payments” – within three years alternative payments will eclipse card payments as the dominant way to pay online. Paypal is the current alternative payment leader with 57% market share. Alipay is second with 20%.
Sea Change at the POS
We are moving to a Point of Interaction with the convergence of channels that are not solely focused on transactions
Trad
ition
al P
OS • Tied to PC-based
systems
• POS terminals attached to tablets will be transitional implementation
• Reduce number of aisles to free up floor space
Tabl
ets • In aisle customer
service, including payments
• Line busting
• Inventory lookup
• Payments
• Loyalty
• Know Your Best Customer (KYBC)
Smar
tpho
nes • Line busting
payments acceptance
• Restaurant order entry and payments
• Curbside
• Delivery
Source – Glenbrook Partners 7TNS Confidential Information
Sea Change at the POS – Mobile Revolution
A recent survey revealed that more than one third of in-
store shoppers accessed their mobile device to check
product reviews, browse alternatives, price match and
check stock availability while on the shop floor.
* Carlisle and Gallagher Consulting Group 8TNS Confidential Information
9TNS Confidential Information
Sea Change at the POS – Merchant Readiness
*Graphs: RIS News, 2013
Sea Change at the POS – Merchant Readiness
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Sea Change at the POS – Merchant Mobile Priorities
*Graphs: RIS News, 2013 11TNS Confidential Information
Sea Change at the POS – Mobile Strategy
*Graphs: RIS News, 2013 12TNS Confidential Information
It’s About the Data
• Many channels of data from “Always Connected” devices - mobile, social media, sensors, and location technologies will need to be connected to analyze, communicate, and act
Age of Big Data
• In the past, only card data was examined. Now, these additional channels of data, requires the merchant to manage multiple data providers
Beyond Card Data
• Advertising, incentives, customer analytics, and other behavior shaping approaches
Data to Drive Behavior
• Increased data requires greater security Risk Management Mandate
• Will grow from $31B in 2013 toward $114B in 2019*Global Big Data Spend
Tomorrow’s environment ties device driven personal data to cloud-based services.
*Glenbrook Partners 13TNS Confidential Information
Great Infrastructure Required
Are we Payments experts or Retail experts?
Should I do this in house or securely managed outside of my scope?
How can I access services in the cloud that will allow me to add new
functionality, increase security and decrease operations and capital costs?
Payments acceleration and risk concerns cause merchants to question …
Ensure focus Avoid complexity, cost and liability
Enhance payments roadmap flexibility
14TNS Confidential Information
2014 Payments Ecosystem Changes
• The traditional payments landscape is under pressure
• Advancements in payments technology will continue at a
faster pace
• Security and risk management must be a roadmap driver
• Flexible platforms will be required to deliver a “Customer”
focused experience
• Cloud-based payments provide flexibility, security and control
15TNS Confidential Information
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Q&A
If you have any further questions or would like to discuss any of the items mentioned in more detail please contact Travis Lee
at 703-453-8352 or email [email protected]
www.tnsi.com
Questions and Follow Up