How the collaborative SIM-based NFC Commercial …€¦ · o Frank Rehme, METRO Systems GmbH (Chair) o Olaf Schrage , DOUGLAS Informatik & Service GmbH o Torsten Schreier , Kaufland

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


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


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)


EHI Retail Institute

50% Retailer

Shareholder structure of GS1 Germany

Markenverband

50% Industry (Brands)

http://www.ehi.org/?1


GS1 Germany MobileCom initiative focuses on


Objectives MobileCom Initiative

Support the GS1 Community by providing:

Whitepapers

Best practises and recommendations

Market surveys

Studies

Events

Standards


Mobile in Retail


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


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


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


Mobile Wallet - The Google Wallet


Eco-System - Google Wallet


Eco-System Mobile Wallet - extended I

Payment

Coupons

Loyalty

Advertising Brand

Coupon Issuer

Coupon Agency

Clearing House

Couponing Eco-System


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


Mobile Payment


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


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

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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


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


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


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


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

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The SIM-based Mobile Payment Pilot in

Germany


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

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Mobile Payment Pilot The Secure-SIM approach

All national Mobile Network Operators are participating - it`s a Cross MNO model



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




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


The pilot will covers different fields of NFC acceptances

Retailer

1

Transportation

2

other

3

12 Retailers

NFC-City BERLIN




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



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http://www.drogeriemarkt-mueller.de/sortiment/content_drog.html

http://www.globus.net/

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http://upload.wikimedia.org/wikipedia/commons/thumb/5/59/Famila_logo_besser.jpg/1024px-Famila_logo_besser.jpg


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


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


Mobile Payment (Wallet)

integration at physical POS

The challenges


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


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


Break through concerning to the processes


Break through concerning to the processes


Which Payment method will be

“mobilized“

for the Pilot


MNO Wallet

But how to get the cards in the wallet of the MNO`s


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


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



Why we have to wait for the Break-through of Mobile Payment in

Germany


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


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


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


Greek Mythology: Mobile Payment or the Pandora Box

Mobile Payment The Myth of Pandora – the pandora box

Retailer


Shares of different payment methods - retail sector in Germany

Credit Card payments by 5,3%

Payment Methods German Market


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


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?


The GiroCard will make it happen


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: [email protected]

Thank you very much for your attention

mailto:[email protected]



Documents

How the collaborative SIM-based NFC Commercial …€¦ · o Frank Rehme, METRO Systems GmbH (Chair) o Olaf Schrage , DOUGLAS Informatik & Service GmbH o Torsten Schreier , Kaufland