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Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 1
How the collaborative SIM-based NFC Commercial Pilot is shaping up GSMA Workshop 19th November 2012 London
Ercan Kilic, GS1 Germany GmbH
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 2
Agenda
GS1 Organisation
Mobile Payment Initiative GS1 Germany
Mobile Payment Workgroups in Germany
Mobile Payment Pilot: NFC City Berlin
Partner Model
Mobile Payment Scenario and Processes at physical POS
Retailer`s requirements
Challenges
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 3
Global Organisation with local Presence
108 Organisations. 150 countries served.
2,000 people helping us.
Countries with a GS1 Member Organisation
Countries served on a direct basis from GS1 Global Office (Brussels)
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 4
EHI Retail Institute
50% Retailer
Shareholder structure of GS1 Germany
Markenverband
50% Industry (Brands)
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 5
GS1 Germany MobileCom initiative focuses on
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 6
Objectives MobileCom Initiative
Support the GS1 Community by providing:
Whitepapers
Best practises and recommendations
Market surveys
Studies
Events
Standards
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 8
Mobile Strategy - Retailers
Inte
nsi
ty o
f u
sage
value-add - Mobile-Business/Commerce NFC / Mobile Payment
M-CRM Enabling transaction via the mobile, Loyalty programm
M-Payment at POS via NFC
Content & value added services
Mobile Transactions
Mobile Content and value added services - Product Information etc.
Being present with the customers on the most personal channel – Mobile App or Mobile Web
Mobile Presence
1
Media strategy – building awareness
Awareness Access
2
3
Building customer profiles for 1:1 Dialog - efficient customer communication
Campaigns 4
Extension customer communication – increasing intensity of usage
Opt-in Platform
5
7
Mobile Couponing
6
M-Couponing avtivities drive in store traffic – Sales Promotion , special offers & deals
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 9
Why GS1 Germany is active in Mobile Commerce - especially in Mobile Payment
9
Credit cards and debit cards will begin to be replaced by mobile phones – and even cash. We’re already heading down the path of a cashless society.
The way consumers make their purchases, pay for goods, redeem coupons at physical POS and assume loyalty points via NFC will change dramatically.
Convergence of Payment, Couponing,
Loyalty & Co. “The Mobile Wallet“
This has an enormous Impact of the businesses of our shareholders and community
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 10
Starbucks - The largest Mobile Payment Network in the US
The Mobile Payment benchmark
Successful because - “Closed Loop“ approach?
STARBUCKS Jan. 2012
Cliff Burrows, president of Starbucks Coffee U.S., told analysts customers during
December loaded $500 million
into their Starbucks prepaid card accounts, which encompasses mobile-app users, up 23% compared with the same month a year earlier
Payment | Couponing | Offers | Deals | Loyalty (STARS) | Advertising
more than 2 million mobile payment
transactions per week
overall, $3 billion has been loaded on
to Starbucks cards this year
Starbucks card transactions
accounting for more than 25 percent
of sales in U.S. stores.
the my Starbucks rewards loyalty
program has more than 10 million
members, half of whom have opted in
to receiving communications from
Starbucks
05. November 2012 Howard Schultz, Chairman & CEO Starbucks
… will also support NFC
What Colour has Mobile Payment?
But it`s still a “closed loop“
approach
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 13
Eco-System Mobile Wallet - extended I
Payment
Coupons
Loyalty
Advertising Brand
Coupon Issuer
Coupon Agency
Clearing House
Couponing Eco-System
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 14
Eco-System Mobile Wallet - extended II
Payment
Coupons
Loyalty
Advertising
Brand Coupon Issuer
Coupon Agency
Clearing House
Couponing Eco-System
Brand Mobile Agency
Mobile Ad
Network
Mobile Advertising Eco-System
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 16
Retailer:
o Oliver Behrens , ORLEN / Star Deutschland GmbH
o Ludger Bieberstein, OBI Smart Technologies GMBH
o Martin Herfs , REWE Informations-Systeme GmbH
o Jörg Hilbert , dm-drogerie markt GmbH + Co. KG
o Michael Klausmeyer , LUNAR GmbH
o Paul Mengelkamp , Kaiser´s Tengelmann AG
o Stefan Neumaier, Charles Vögele Trading AG
o Uwe Metz , Deichmann SE
o Frank Rehme, METRO Systems GmbH (Chair)
o Olaf Schrage , DOUGLAS Informatik & Service GmbH
o Torsten Schreier , Kaufland GmbH & Co. KG
Mobile Network Operator:
o Jochen Bornemann, Vodafone GmbH (Co-Chair)
o Marc-André Fengler , Vodafone D2 GmbH
o Daniel Klein , Telekom Deutschland GmbH
o Denis Kliefken, E-Plus GmbH
o Marcus Lilienthal, Telefonica GmbH Co. OHG
o Stefan Rascher , T-Mobile Deutschland GmbH
Handset manufacturer & automotive:
o Jens Dissmann, Nokia Deutschland GmbH
o Frank W. Peters, Daimler AG
o Thorsten Müller, Research In Motion GmbH
o Frau Simone Thomann , Alcatel-Lucent
o Andre Simons , Alcatel-Lucent
o Torsten Wichura , Nokia GmbH
Finance (Banks) and CreditCard Companies:
o Jörg Abrolat , MasterCard Europe
o Wolfgang Adamiok , Deutscher Sparkassen- und Giroverband
o Frau Gabriele Benning , AMERICAN EXPRESS INTINC.
o André Dehm , Visa Europe
o John Delaney , Deutsche Bank AG
o Daniel Diebold , Sparda-Bank Hamburg eG
o Frau Julia Einhaus , WGZ Bank
o Björn Fehrs , AMERICAN EXPRESS INT., INC.
o Dirk Hagemann , Deutsche Post DHL
o Dr. Till Hakenberg , Deutsche Bank AG
o Bernd Kierdorf , Deutsche Post Zahlungsdienste GmbH
o Hans-Dieter Lahmann , Deutscher Sparkassen- und Giroverband
o Dr. Thomas Meyer , Deutsche Bank AG
o Arne Pache, MasterCard Europe
o Frau Karin Pientka , Deutsche Post DHL
o Nils Richardt , Landesbank Berlin
o Christoph Salzmann , AMERICAN EXPRESS INT., INC.
o Ralf Schlatter , Deutsche Post DHL
o Paul Schlopsna , WGZ Bank
o Jürgen Schübel , MasterCard Europe
o Dr. Tilo Schürer , Landesbank Berlin
o Alessandro Ulivieri , Visa Europe
Payment Networks, Processors, Terminal
o Nicolas Adolph , InterCard AG
o Lars Bischoff , First Data
o Volkmar Bloch , Ingenico GmbH
o Marc Bröking , TeleCash GmbH & Co. KG
o Michael Hartwig , InterCard AG
o Jens Hoffmann-Wülfing , easycash GmbH
o Jürgen Manske , Wincor Nixdorf Technology
o Klaus Naderer , SolidGround GmbH
o Peter Reich , POSPartner
o Peter Baumgärtner , Atos Worldline
o Pawel Chrobok , Giesecke & Devrient GmbH
o Thomas Delonge , Giesecke & Devrient GmbH
o Alexander Hahn , TeleCash GmbH & Co. KG
o B /S Card Service, ConCardis
Assoziation:
o Ulrich Binnebößel, Handelsverband e. V.
o Horst Rüter, EHI Retail Institute
o Ercan Kilic (Organisation)
GS1 Germany Mobile Payment workgroup members – extract
Couponing & loyalty:
o Christoph Thye, acardo AG
o Olaf Becker, Valassis GmbH
o Heike Zeuner, DeutschlandCard GmbH
o Felix Schul, Coupies GmbH
… more than - 30 Retailers - all national MNO`s - Credit Card organisations are active in the GS1 workgroup
The GS1 Germany Community
- covers more than 90 Companies
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 17
GS1 Germany supports helping the industry to develop a Mobile Payment eco system by bringing Key Players together and discuss and evaluate the different strategies /
1. Mobile Network Operators: Mobile Wallet approach
mPass
2. IAP`s and Handset manufacturers: Google, PayPal Amazon, Facebook etc. Apple evtl. Nokia
3. Finance and Banks:
DSGV Deutscher Sparkassen-und Giroverband
LBB Landesbank Berlin
4. CreditCard Companies
5. Retailer: Own Mobile Payment
Solution 6. Couponing 7. Loyalty (own & e.g. Payback) 8. Advertising
Mobile Payment Solution
Value added services (VAS)
consideration in subgroup-I. - currently
consideration subgroup-I. activities in phase 2
consideration in subgroup-III. in phase 2
Consideration –only retailer activities in phase 2
consideration in couponing workgroup activities in phase 2
All existing partner models of key players in the eco system will be analysed in different work groups of GS1 Germany
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 18
Mobile Payment initiative GS1 Germany – work group structure
Subgroup I. Subgroup II. Subgroup III.
Mobile Payment Main Group
Mobile Network Operators Retailer POS Specialist - - - - - - - - - - - - - - CreditCard Company
Paypal Google Retailer
CreditCard Companies Finance (Banks) Payment Networks Retailer
established
established
planned planned
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 19
GS1 Germany – Mobile Payment initiative Mission
Informational
Networking
Shaping the Eco System - Creating
the Future
Industry insights - discussing and analysing the eco-system
First hand experience sharing about current and upcoming solutions
Knowledge repositories
GS1 Germany workshops bring together the leaders across industries to share experiences and to build new relationships
Furthering of GS1 objectives via industry network like supporting our Events ECR Tag and M-Days to position GS1 as the leading platform for Mobile Commerce
Interaction and ongoing connection with standardisation organisations, analysts and Industry influencers
Our four fold strategy
GS1 Germany driving force to facilitate and accelerate Mobile Payment in Germany
Implementation
Prototyping of Mobile Payment Solutions
Piloting and support of cross-retailer solutions
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 20
GS1 Germany Workgroup activities
• GS1 Germany supports helping the industry to develop a Mobile Payment eco system by bringing Key Players together and discuss and evaluate the different strategies / models
• The GS1 Mobile Payment Group comprises more than 90 Companies with all relevant Stakeholders in Mobile Payment (Couponing, Loyalty) in the German market
GS1 Germany Mobile Payment Initiative - key objectives
“Best Practice“ Develop best practises Mobile Payment
Define an ideal Mobile Payment scenario and processes at POS
in physical stores
1
NFC-based Mobile Payment Pilot
Realising a NFC based Mobile Payment Pilot in a cross retail
environement 2
Communication Awareness gaining activities by publishing key results of Mobile
Payment work groups – white papers etc. 3
Identifying Devloping, Defining Standards
Identifiying needs for standards
Devloping and defining potential standards like data profiles,
formats, protocols, processes and API`s etc.
4
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 21
GS1 Germany Mobile Payment work group and workplan
Workplan – Phase model
community
building
being close
to the
market
market
trance-
parency
communication: internally and externally
requirements and
processes
Mobile Payment
building know-how
prototyping,
specification &
evaluation
piloting
implemen-
tation of a
cross
retailer
mobile
payment
solutions
developing
Best
Practices
sharing
results of
pilots with
community
1 2 4 5 6
3
7
standardisation
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 22
2 way strategy to accelerate Mobile Payment in Germany
Retailer`s own Payment method
Mobile Payment Pilot
NFC-City BERLIN
More than 28 Retailers met at GS1 to discuss an own payment method
More than 12 Retailers are willing to participate
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 23
The SIM-based Mobile Payment Pilot in
Germany
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 24
The owner of the Secure Element controls the eco-system
Smart Card components in secure chip SE
The Mobile Payment application will be stored in the ”Secure Element”
Cloud-based
Quelle: Giesecke & Devrient
Firstly to decide - The Secure Element
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 25
Mobile Payment Pilot The Secure-SIM approach
All national Mobile Network Operators are participating - it`s a Cross MNO model
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 26
Mobile Payment Pilot is based on NFC and Mobile Wallet
Mobile Payment Pilot based on NFC und Mobile Wallet
Cross MNO and Cross Retailer model
NFC-City BERLIN
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 27
Key Obejectives of the Pilot
Support creating a partner model between the key stakholders
Building a sustainable eco-system together
Figuring out the ideal Mobile Payment Solution
Testing the soultion(s) - User Experience / Design
Optimizing the processes between the Stakeholders and especially
Consumer/Smartphone and Terminal/Cashier system of the Retailer
Generating insights concerning the customer acceptance
Measuring transactions
Generating Reportings
Genarate insights for all stakeholder - also for value added service providers
Couponing
Loyalty
Advertising and others
Build focus groups to undestand customers needs – surveys in stores etc.
Preparing roll-outs
Developing and providing best practises and recommendations for the community
Defining standards
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 28
The pilot will covers different fields of NFC acceptances
Retailer
1
Transportation
2
other
3
12 Retailers
NFC-City BERLIN
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 29
Participants of the pilot – extending & expanding the projekt
Retailer environement Point of Acceptance
ÖPNV - Transportation Parking Fast-Food (McDonald`s , BurgerKing) Kaffeehausketten (Starbucks etc.) Hospitality Museum …
Politik Finance Retailer Service Provider Partners & Sponsors
Kern
others
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 30
The Timeline of the NFC Pilot
Commitment for participating – end of December2012 /January 2013
Implemantation of the soultions at the physical POS in Q2 2013
Exceution of the pilot – start for Consumers using their NFC Smartphones and Mobile Wallet in Q3 2013
Q I.
2012
Q II. Q III. Q IV.
Jeweils ein Markt und Partner Mobile Payment NFC basiert Produktionsbuchend “Payment Ready“ Prototype 1-5 / Akzeptanzstellen
Phase 1
Mehrfach Partnerinstallation erweiterter Testbetrieb in modernen
Märkten / Filialen Feldtest /Roll-out Bewerbung durch MNO Personalisierte Botschaften an Kunden
Phase 2
Q I. Q II. Q III. Q IV.
Vorstellung Grobkonzept Abstimmung Payment Methode Feedback aus UAG Sitzung und
Nachgang Verabschiedung
Concept
Entscheidung zur Teilnahme Vorstellung des Pilotkonzepts
mit teilnehmenden Unternehmen in der Hauptgruppensitzung
Aufnahme weiterer Teilnehmer
Committment
01.12.
15.12.
Juli 2013
2013
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 31
Mobile Payment Pilot – road map
Decision paper for the potential participants will be developed and prepared in January 2013
Definition of the Processes at physical POS - end 2012
Start detailed Project plan after receiving the commitments from the companies
Contract, financial funding, commucniation strategy and activies and roll out
31.09.2013 30.06.2014
Entscheidungsvorlage & Commitment zur Teilnahme
1
1. Year 2. Year
Q I. Q II. Q III. Q IV. Q I. Q II. Q III. Q IV. Q I.
31.12.2012
Kick-off
Verantwortlichkeiten (Rahmen) & Finanzierung/Budget/Lead
2
Umsetzungsplan/Vorbereitung Festlegung der (tech) Umsetzung
3
Durchführung/Betreuung & Begleitung/ Partnermanagement
4
Ergebnisse – Erfolgskriterien / Ergebnisse Controlling
5
Marketing & Kommunikation (Reports, whitepapers etc.)
6
Mobile Payment Pilot Commitment erhalten
Rahmen steht Verträge unterzeichnet
Vorbereitung & Tests erfolgreich abgeschlossen
Offizieller Launch – Live geschaltet
Start Erfolgsmessung Report Report Report
Commercial Life – Pilot offiziell abgeschlossen
Vorläufiger Abschlußreport erstellt
ECR-Tag M-Days MWC EHI ECR-Tag M-Days EHI
31.03.2015
Start 3. Year
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 32
Mobile Payment (Wallet)
integration at physical POS
The challenges
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 33
User
Couponing Coupon Clearing
Loyalty Loyalty Partner
Mobile Wallet
PIN Terminal
Terminal, PIN-pad & payment network processor
NFC NFC
Contactless payment feature transmission protocol
Cash
POS cashier system/ Payment channels
Kassen
syste
m
Payment Payment Processor
Different Processing networks / Systems
Mobile Payment Scenario at the physical POS
The Mobile Payment scenario includes payment transactions as well as handling coupons, loyalty points und advertising
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 34
X-Tap Apporach – to be defined
chronological order
Cashier System
Payment
Coupons
Loyalty
1
2
3
NFC Reader
single tap vs. multiple tap approach
Terminal
Process to discuss
Chronological order of transactions:
Payment, Coupons, Loyalty
Single tap vs. multiple tap approach - to discuss (also in European Payment Council
Wallet Handling Processes)
PIN-Authentication - Entering the PIN: on smartphone or on terminal
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 35
Break through concerning to the processes
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 36
Break through concerning to the processes
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 37
Which Payment method will be
“mobilized“
for the Pilot
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 38
MNO Wallet
But how to get the cards in the wallet of the MNO`s
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 39
Double burden for banks issuing physical and digital cards – parallel costs
phys. Card Digital Card
The physical card will be the back-up solution for payments in the NFC World - so banks have to support it also the next 5 – 10 years in parallel – that means additional costs
Mobile Wallet
Bank
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 40
Payment Methods in the Mobile Wallet - initially
MNO`s starting their Mobile Payment solutions by issuing their own Cards and digitalize them in to their Mobile Wallets because banks hesitate to cooperate with them
The GS1 initiative brings them together to develop a partner model for the Pilot project
MNO
Bank
Card
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 41
Why we have to wait for the Break-through of Mobile Payment in
Germany
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 42
Payment Methods in the Germany market
Cash is still King by about 58% of all payments in physical stores
Enormous potential for reducing cash payments – efficiency
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 43
Retailers requirements for intorcuing new payment methods at the physical stores
The Retailer decides which Payment solution will be deployed in their physical stores and offered to their customers
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 44
Retailers requirements for a NFC based Mobile Payment Solution – to discuss
Low costs for Mobile Payment transactions
Critical Mass - more than 5% adoption of NFC needed (Reader and Smartphones)
POS infrastructure investments - (investment cycle 4 – 7 years)
Checkout process – easy and fast
Secure
Easy-to-use, convenient
without additional costs for handling, processing transactions
“Global“ standardised
Features that increases revenue and strengthen customer loyalty
“Cross Retailer“ - unified
Branded solution - own payment service integration in the Mobile Wallet
Partner-Model and costs?
Marketing and Communication – common / joint campaigns
Customer & Data Ownership – It`s the Retailer`s Customer
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 45
Greek Mythology: Mobile Payment or the Pandora Box
Mobile Payment The Myth of Pandora – the pandora box
Retailer
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 46
Shares of different payment methods - retail sector in Germany
Credit Card payments by 5,3%
Payment Methods German Market
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 19.11.2012 | 47
A huge difference / gap between CreditCard Payments and GiroCard (Debit) Payments
brand
NFC
availabilty fees authorization
Debit
Credit
600.000
600.000
ca. 0,4%
ca. 1,0%
ab 25€ with PIN
Debit
Credit
ELV
keine 2,6% online
POS – offen offen
Debit
Credit
Q3 2012
Q3 2012
ca. 0,4%
Ca. 1,0%
ab 25€ with PIN
Prepaid
Debit
7 Mio.
ab 2014
ca. 0,02%
ca. 0,3%
max. 20€
offen
Transaction costs are a hurdle for NFC Payments - today
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 10.05.2012 | 48
Challenges – the retailer worry about …
The Business Model
Payment method (which card will be integrated in to the wallet) has impact on the transaction fees
Retailers will not support payment methods, which are more expensive than the already existent ones
They will not educate their customers using CreditCard instead of (cheaper) DebitCard transactions (GiroCard in Germany)
Customer ownership – Data ownership
Which data will be generated via the wallet – who owns it?
Ercan Kilic | GS1 Germany GmbH | MobileCom | GSMA 10.05.2012 | 50
GS1 Germany GmbH Ercan Kilic Leiter Strategieprojekt MobileCom GS1 Germany GmbH Maarweg 133 50825 Köln Tel: 0221-94714-218 Mobile: 0171-561 44 84 Fax: 0221-94714-7218 E-Mail: kilic@gs1-germany.de
Thank you very much for your attention
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