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E-commerce:
Visa Everywhere
MSS Team
March 2018
Preparation Materials • Visa’s Everywhere Initiative
Visa Public
Forward-looking statements and disclaimer
2
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere e-com
This presentation contains forward-looking statements within the
meaning of the U.S. Private Securities Litigation Reform Act of
1995. These statements are generally identified by words such as
“outlook,” “forecast,” “projected,” “could,” “expects,” “will” and other
similar expressions. Examples of such forward-looking statements
include, but are not limited to, statements we make about Visa’s
business, economic outlooks, population expansion and analyses.
All statements other than statements of historical fact could be
forward-looking statements, which speak only as of the date they
are made, are not guarantees of future performance and are
subject to certain risks, uncertainties and other factors, many of
which are beyond our control and are difficult to predict.
Studies, survey results, research, recommendations, opportunity
assessments, claims, etc. (the ‘Statements’) should be considered
directional only. The Statements should not be relied upon for
marketing, legal, regulatory or other advice. The Statements
should be independently evaluated in light of your specific
business needs and any applicable laws and regulations. Visa is not
responsible for your use of the Statements, including errors of any
kind, or any assumptions or conclusions you might draw from their
use.
Visa Public
What are we solving for?
3
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • Problem statement
Opportunities to address
(Ideas for R&D):
Digital commerce growth rates outpace the traditional retailformats, but its value chain is more complex and includessuch elements as platforms, gateways, payment aggregatorsthat add friction. Consumers are expecting from online storesfaster service with higher quality comparing to traditionalretail formats. Major digital players are working hard onconsumer stickiness and frequent usage to challengeincumbent retail brands. Traditional retailers expand theironline sales channel and are looking to create similarconsumer & payment experience across all retail formats
We’re looking for concepts and products that can reducefriction and add value for major ecosystem players –consumers & merchants while acting in online environment.Partnerships across the value chain are consideredfundamental.
The ultimate goal is to erase barriers and differences forseamless consumer experience across channels, devises andVisa card form factors.
Reduce friction & increaseconversion:
What value add would increase trust and encourageconsumers to prepay online for goods and convert fromcash on delivery?
Light authentication & checkout, one click purchases
E-com as an integral part of 360 omni channel: erasechannel difference in consumer UX for orders, payments,loyalty, delivery, returns
Seamless consumer experience:
Transactionless commerce. Ease of daily routinetasks. Lifetime subscriptions concepts.
Better targeting through search, social & paymentdata convergence
Augmented reality to boost e-com purchases
New sales channels – chat bots
We’re looking for ideas and services that create an integral and seamless experience for consumer while shopping in
digital taking in consideration his personal preferences and transaction context.
Visa Public
New digital commerce experiences
continue to evolve
4
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • The E-commerce Landscape
Basic digital commerce emerges to buy things remotely…
…enhanced withfast checkout…
…and upsell opportunities with real time recommendation engines…
…that can be used anywhere …with conversational simplicity
…connecting real time customer context with commerce…
Note: All brand names and logos are the property of their respective owners, which are used for identification purposes only, and do not imply product endorsement or affiliation with Visa.
1994 1999 2006 2011 2014 2015 2017
Multiple retailers
One checkout
Visa Public
E-com and m-com value chain:
Multiple players enter the ecosystem
5
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • The E-commerce Landscape
The rapid growth in digital commerce, especially in mobile, is driving
structural changes across the payments ecosystem
Cardholder Merchant Payment Gateway Merchantacquirer processor
Acquirer Network Issue processor Issuer
Wallet provider
ClosedEcosystems
4-Party OpenEcosystem
Note: All brand names and logos are the property of their respective owners, which are used for identification purposes only, and do not imply product endorsement or affiliation with Visa.
Visa Public
Segment behavior: how online payments starts and
mature towards purchases
6
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • E-com in Russia
Tablet online access
Smartwatch online accessMobile online access
Laptop online access
2.7 6.2 12.7
Number of categories purchased online
– Bills
– Cosmetics
– Personal electronics
– Bills
– Food delivery
– Cosmetics
– Personal electronics
– Movie tickets
– Household electronics
– Bills
– Food delivery
– Movie tickets
– Event/concert tickets
– Airline
– Cosmetics
– Personal electronics
– Digital content
– Household electronics
– Fashion
– Groceries
– Hotel
25% 29% 43%Emerging Evolving Mature
Visa Public
Trends in consumer behavior & growth opportunities
7
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • E-com in Russia
Consumer segmentation
and online payment
behavior
Trends in consumer
expectations and UX
in e-com
Key growth opportunities
for online sales &
payments
– To e-com in not dependent on age
– Online shopping starts with online
payments
– Cost is the key trigger for e-com and
price is a most searchable item
– One out of five online purchases is
made from a smartphone
– From consumption to lifestyle. Consumers
expect as many customized services and
goods as possible. Retailers must be
aware of and understand their
preferences
– Key challenges for online shopping: trust
in product quality
– Key challenges for online payments:
secutiry
– Industries: Grocery,
Transportation, Fashion
– C2C is a key opportunity for
growth in Russia
– Omnichannel approach
– Platforms, AI, big data
Visa Public
Triggers to E-commerce
8
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • E-com in Russia
Base: All online buyers (n=780)
B0: Generally, which if any of the reasons below encourage you to buy or pay online compared to in store or face-to-face?
73
54
52
40
33
32
26
18
10
Cost is the biggest trigger of eCommerce followed by variety of products
and the ability to browse and compare more easily before purchase
Cheaper to buy online
Emerging Evolving Mature
64 76 77
43 55 60
38 53 59
28 40 46
20 31 42
21 30 40
21 24 30
14 13 23
5 9 12
Larger variety
Easier to browse and compare before purchase
More convenient than in store
Gives more information than in store
More access to brands
Unable to find product or services in store
Multiple payment methods acceptance
Quality is better than in store
Visa Public
71
26
23
70
47
33
53
19
19
51
27
14
38
25
7
BUYING/ PAYMENT PROCESSS
Not willing to wait for product delivery
Prefer to buy face-to-face
TRUST IN PRODUCTS/SERVICES
Can't inspect the product
Differences in online and what is received
PAYMENT SECURITY
Unsure of the credibility/reliability
Sharing personal or payment card information
COST
Shipping costs for online purchases are too high
Concerned about additional taxes / duties
OTHER
Habit to shop in-store
Lack of local language or providing local currency
Barriers to E-commerce
9
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • E-com in Russia
Only top 2 barriers for each nett is shown
Base: All respondents who bought offline categories (n=789)
B1: Which, if any, of the reasons below prevent you from buying or paying online generally compared to in store or face-to-face?
Hesitance to purchase online is largely due to concerns in the Buying /
payment process as well as concerns around Trust in products and services
especially not being able to inspect the product
Emerging Evolving Mature
68 72 70
67 69 74
47 52 56
48 41 53
42 38 34
Visa Public
Bill payments
Education
Cosmetics
Digital content
Event/ Concert tickets
Fashion Financial services
Travel / tour packages
Groceries
Airline / travel tickets
Hotel / accommodation
Car/ vehicle rentals for travel
Health and wellness
Physical books, CDs and DVDs
Sports, adventure equipmentGround transportation
Magazines and newspapers
Movie tickets
Household electronics
Personal electronics
Food delivery
0%
10%
20%
30%
40%
50%
60%
70%
80%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Overall growth opportunities for local e-commerce
10
Preparation Materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • Opportunities to Address
Base: All respondents (n=804)
Groceries, Ground transportation and Fashion are ideal candidates for growth with high future intent and frequency but low incidence.
Low online incidence
Low future intent
High online incidence
Low future intent
High online incidence,
High future intent
Low online incidence
High future intent
Visa Public
C2C e-commerce is a key growth area
11
Preparation Materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • Opportunities to Address
Source: Wikipedia
Which of the following are you likely to start doing
online within the next 12 months?
Explore the availability of a specific product and choose a point of sale
Purchase goods through classified ads
Order goods from Russian online stores
Sell something
Use online paymentsto pay for goods / services
Visa Public
Customer journey:
Key insights & recommendations
12
Preparation materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com • E-com in Russia
1Trigger
2Search
3Rvaluate
4Transact
5Repeat
1. Trigger
Top 3 triggers to E-commerce:
– Lower cost of buying online
– Larger variety and ease of browsing
– Comparing before purchase
Encourage merchants to focus on online pricing, variety, ease of browsing on their websites and ensuring Visa is a payment option
2. Search
Price is the most searched for information and official brand website being the most used source of information. Strong behaviour of browsing online and purchasing in-store.
Tie up with key merchants to run promotions exclusive to online purchase
3. Evaluate
Buying or payment process like slow wait for shipping of purchase and confidence in quality of products like not being able to inspect the product are the main barriers. Confidence in quality is particularly the main barrier for Mature.
mPOS upon delivery for Visa transactions or offer free expedited shipping with tracking
4. TransactionHigh share of non-card payment methods due to security and other reasons like habit, insufficient limit or funds .
Merchants displaying security symbols (especially Global Payment Operator like Visa) can help to increase trust towards websites.
We’re looking for concepts and products that can create
seamless consumer experience and reduce friction in omni
channel world. Solutions should encompass key digital
commerce stakeholders: consumers, merchants &
payment providers
The ultimate goal is to erase barriers and differences across
channels, devises and Visa card form factors to create an
integral and seamless experience for consumer taking in
consideration his personal preferences and transaction
context.
Preparation Materials • Visa’s Everywhere Initiative • E-commerce: Visa Everywhere E-com