mpos - disruption or "only" evolution
TRANSCRIPT
1
Karl Illing, Product Management, ConCardis
Berlin, 04.11.2015
Conference³
WiWo
mPOS
Disruption or
„Only“ Evolution?
2
About ConCardis
German payment provider for cashles s payments with international reach
Principal Member of MasterCard and Visa
Acquirer for Diners, JCB, UP, Amex
Payment Institute as per Zahlungsdiensteaufsichtsgesetz (ZAG)
Headquartered in Eschborn near Frankfurt am Main
400.000 Points of acceptance
331 million transactions
€ 35 billion transaction volume
€ 450 million revenue
2
39 % Private Banken
39 % Sparkassen
Finanzgruppe
20 % Genossenschaftliche
Finanzgruppe
2 % Öffentliche
Banken
A shared enterprise of the German
banks
Stand 31.12.2014
3
From Acquirer to Payment Service Provider –
30 years of experience
PSP
Service
1982
1997
2003
2004
2009 2012 2013
2014
ConCardis
OptiPay
2015
Commercial
Network
Operator
Acquiring
Acquiring
E-Commerce POS-Terminals
mPOS
4
What is „mPOS“?
Basic definition of mPOS (mobile Point of Sale)
Merchant-side payment device connected to a smartphone or
tablet
Can vary in
Form factor (Dongle, Bluetooth reader, 2-in-1 device, …)
Platform (iOS, Android, ...)
Software Applications (Payment App only, cash register, …)
Not to be confused with
Mobile Payment in the narrow sense (involving buyer-side
mobile device)
Unterschiedliche mPOS-Formfaktoren
5
10 Mio. $
series B
67 Mio. $
series D
150 Mio. $
series E
The market dynamics are impressive...
Millions are invested in mPOS „start-
ups“…
60 Mio. $
series D
Selected rounds of financing in the last 12 months
… and new players enter the market every
month
Source: PYMNTS.com
6
…European market penetration lags behind
expectations
“46% of overall POS in 2019”
(ABI Research, May 2014)
“mPOS (mobile point of sale) usage by
small businesses (SMEs) in Europe will
take off dramatically in 2014.”
(VISA, May 2014)
High expectations… …and sober reality
Source: First Annapolis
7
Still: mPOS is a global phenomenon
First truly global payment innovation
mPOS players are active throughout the
world
The largest volume can be found outside of
Europe
Registrations in the Mastercard mPOS Program
Top 5 mPOS countries by volume
Source: Mastercard
8
Three target segments for mPOS with very
different characteristics and use cases
Micromerchants SME Enterprise
Re
ve
nu
e p
er
me
rch
an
t
Number of merchants (cumulative)
9
Micromerchants – accepting cards for the
first time
10
ConCardis OptiPay, launched 2014, has been
the first NFC mPOS solution in Germany
11
ConCardis OptiPay emphasizes maximum
simplicity and transparency
Transparent pricing model
Simple transaction fee
No running costs
No fixed contract duration
Payment app for iOS and Android
Mastercard, VISA, Maestro, VPay and Amex
Contactless payments (including Apple Pay and
Android Pay)
Radically simplifying the proposition „card acceptance“
12
The mPOS „package“ (device and pricing)
as long-tail solution vs traditional terminals
Light and mobile
Not as rigid
Low purchase price
No fixed contract period
Potentially higher transaction
feds
More than one device
(Smartphone/Tablet, Card
Reader, Drucker)
Robust, for heavy use
Limited mobility
High purchase price or rent
Multi-year contract period
Potentially lower transactions
fees
All-in-one
mPOS-Terminal TraditionalTerminal
13
Small businesses in Germany are more
skeptical than elsewhere
Results of an mPOS poll by VISA Europe in 2014
Source: VISA Europe
Likelihood of using
an mPOS solution
Definitely
Probably
Not sure
Probably not
Definitely not
Changing preconceptions (before and
after presenting the solution)
14
Example of a photographer
Photographer
Often on the road
Few, high-value
transactions
15
Example of a market seller
Market seller
Sales in a mobile setting
Only used on certain
days
16
Conclusion – mPOS for micromerchants
mPOS simplifies card acceptance regarding
hardware and pricing
There are clear pros and cons compared to
traditional terminals
Even though German micromerchants are
still relatively sceptical…
…mPOS for the first time renders card
acceptance economically viable for them
Disruptive potential
For merchants: medium
For providers: high
17
To be relevant for larger customers, mPOS
needs to go beyond pure payment
Micromerchants SME Enterprise
Um
sa
tz p
ro H
än
dle
r
Anzahl Händler
Card
acceptance as
a differentiator
Nice to
have
Should
have
Must
have
18
SME – integrated card payment and „big
retail“ functionality
19
Orderbird Payment by ConCardis: seamless
card acceptance with the orderbird POS
Card reader connected via BT /
Wifi to iPad / iPod
Fully integrated in the POS
(payment, refunds, invoice)
Integrated payment leads to a
much higher share of orderbird
merchants accepting cards
We showed the first Apple Pay
transaction in Germany using an
integrated payment system
20
mPOS APIs allow seamless integration of
mPOS payment in any application
ConCardis OptiPay SDK
Easy integration in any app
Multi-platform: iOS, Android,
Windows
Integriertes Merchant-Boarding als
Teil des Paketes
mPOS
API / SDK
Payment
Gateway
Your
APP Integrationspartner
von ConCardis
21
„mPOS“ as a scalable hub for POS services,
backend processes, and business intelligence
In Store
Cloud
APIs
Inventory management
E-Commerce
Loyalty
…
Payment
Mobile POS Devices
SaaS-Server
Additional services
WWW
Shopper-WiFi
22
Conclusion – mPOS for SME
mPOS as stand-alone payment lacks
relevance for SMEs
True value comes from integrated
payment as part of mobile POS systems
Mobile/tablet POS systems such as
orderbird give SMEs access to „big retail“
functionalities, greatly improving
processes and giving a new level of
control over their business
Disruptive potential
High for both merchants and
providers
23
Enterprise – from replacement terminal to
omnichannel system
24
Value added of mPOS terminal stem from
various „small“ use cases
Use cases of mPOS terminals in „Big Retail“:
However, the complete use case (not only the payment part) needs to be
considered
Queue Busting Pop-up Stores
Replacement
Terminal
Assisted
Shopping
Street Sale
25
mPOS as omnichannel enabler – example
of a sports retailer in Denmark
Implementation of the Wallmob iPad POS
Omnichannel
Seamless integration of POS and e-commerce
In-store payment – even for online deliveries
Mobile card acceptance
Queue busting
Street sale
Pop-up shop
Improved shopping experience
Assisted shopping
Quelle: Wallmob
26
Conclusion – mPOS for enterprise
mPOS terminals can add value for large
retailers through various use cases
When implementing mPOS, the end-to-end
customer experience needs to be considered
Holistic implementations can change the way
of doing business, e.g. through omnichannel
commerce
Disruptive potential
Low for stand-alone payment
High for holistic solutions
27
Summary
mPOS market dynamics are high, the volume seems to be lagging
Micromerchants: mPOS makes card acceptance possible for
everyone
Small and medium businesses: It‘s about more than payment –
scalable platforms and „big retail“ functionality
Enterprise: Depeding on the implementation mPOS can add value
on a small level or change the entire business
“There will always be a need for traditional POS solutions
driven by large fixed lane checkout applications, but equally
there will be merchants looking at simpler cost-effective
solutions with added value services.”
(ABI Research, 2014)
28
www.concardis.com www.concardis.com
ConCardis GmbH
Karl Illing
Helfmann-Park 7
65760 Eschborn
Thank you for your attention!