Cfir aim 10. maj 2012

© 2012 IBM Corporation

mCommerce @ IBM – Converging mbanking, mpayments, retail and value chain visibility

+ =

Let’s build a smarter planet

2 © 2009 IBM Corporation 2 © 2012 IBM Corporation

Mobility is here and making a difference

• 2011 The year mobile platforms surpassed traditional platforms IDC …Which happened 4 years earlier than predicted in 2009

Adoption of mobile banking will reach 50% in 2016

•  2 Billion eBay expectation to be transacted via mobile — up from $400 million in 2009. Forrester

– 8x Faster Adoption than internet and if tablets included, even faster Morgan Stanley

50% + Are SmartPhones today — GMUs outpacing 1st world countries

Smart Phone Users

•  48% •  39%

<30 yrs

30-49 yrs



The transaction value in Mobile Payments globally is $86B growing to $426B by 2015.

2011 Global Mobile Payment Users are 141M Growing to 349M in 2015 (CAGR 35%)

Source: Gartner “Forecast: Mobile Payments, Worldwide, 2008-2015”; Pub May 2011

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Mobile Payment Users by Region 2015

Western Europe, 21.2%

North America,

14.4%

EMEA , 23.2%

Latin America,

4.8%

Asia/Pacific, 36.6%

2011 Global Mobile Payment Transaction Volume is growing at CAGR 47%

Asia Pacific dominates, representing 36% of Global users

Mobile Payment Transaction Volume

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2008 2009 2010 2011 2012 2013 2014 2015

Mill

ions

Mobile Payment Transaction Value

$0

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2008 2009 2010 2011 2012 2013 2014 2015

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ions

of D

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2011 Global Mobile Payment Transaction Value is growing at CAGR 49%

$86B

$426B

Mobile Payment Transaction Volume by Technology 2015

SMS, 53.4%

WAP/Web, 25.9%

USSD, 5.4%

NFC, 15.2%

SMS dominates, at 53% of volume. NFC is only 15%

Mobile Payment Transaction Value by Region 2015

Western Europe, 22.9%

North America,

14.7%

Asia/Pacific, 27.9%

EMEA, 32.7%

Latin America,

1.8%GMU Markets dominate at 62% of Value.

Note: EMEA does not include Western Europe

2010: 185M

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Source: CGAP: “The State of the Branchless Banking Sector” May 2011



Mobile banking usage characteristics

Source: Aite Group, The Impact of Mobile Banking: A Case for Mobile Marketing, April 2011

1. Mobile bankers are mainstream consumers

2. Mobile bankers are balance checkers

3. Mobile bankers are electronic coupon-clippers

Unlike online banking, mobile banking won’t need 10 to 15 years to scale to mass‐market adoption.

Many of customers check their card balance using a mobile device before a transaction, after a transaction, and even during a transaction.

The shift in coupon use from paper to electronic among mobile bankers emphasizes the need for banks to be able to reach customers and prospects on their mobile devices.

IBM Point-of-View

Mobile is the ultimate multi-channel device supporting anytime and anywhere self-service, alert, speech and offline with extreme personalization.



Functionality unique to mobile banking on smartphones

Source: Bank Systems and Technology, Apr 2011

Location-Based Services Checkbook

Bill Reminder Expense Tracker Multiple Ways To Contact Bank (Call-out, call-back, social, etc)

Integration with Social



Functionality unique to mobile banking on smartphones

Chase’s RDC “QuickDeposit” Vendor: Mitek Systems

Early adopters of RDC report very high customer satisfaction, positive ROI and negligible fraud. Mobile RDC works best for banks with large % of customers living outside of its branch network. - Tower Group, Setting US Mobile Banking Priorities for 2011: Opportunities Attainable in the Short Term, Nov 2010

Chase’s P2P “QuickPay” Developed in-house



Functionality as rich as those on internet banking

Source: Bank Systems and Technology, Apr 2011

Market Info

Investing Cards & Reward Program

Corp Banking Handy Tools



Functionality unique to mobile banking on smartphones: Mobile + Social + P2P Payment

Commonwealth Bank of Australia allows users to pay Facebook friends

IBM Point-of-View

Banks need to have a business model that takes advantage of the fact that a smartphone may be the only thing many people keep within arm’s reach all day. For example, expense tracking combined with mobile payment and bill-pay is a very “sticky” feature.



Mobile wallets will change the way we conduct our daily routines

Payment Cards

Loyalty Programs

Gift Cards

ID Cards

Receipts

Cash (Replacement)

Smart Ticketing

Wallet

Pay in shops

Get electronic receipts

Register purchases on loyalty program

Use a coupon

Use a Gift card

Present receipt at store and get refund

Pay parking ticket

Use Public transportation – smart ticketing

Pay online

Person to Person transfer

Get electronic receipts

Register purchases on loyalty program

Use use coupon

Buy Gift card

Use Gift card

Pay congestion charges

Scan coupon

Use a coupon

Receive Gift card

Use Gift card

Check in at airport



IBM’s mCommerce Appliance Solution Only Industry Appliance that Provides an End-to-End mobile experience for bankers, retailers and consumers



IBM Smart Commerce for the retailer: Get the information you need when you need it to help your customer make better decisions and drive more revenue via efficient data mining – and gaining last mile supply chain visibility.

“Who” “Who + What” “You + Why” “You + Now”

Customer Identification Current

Customer Context

Identification

Customer Segmentation Guided Selling

Relevancy Engine

Collaboration

Customer Branded

Experiences*

Who are you – what do you buy, how do you buy, what have you bought before?

Who are you + where are you right now,

who are you with, what do you want to do,

what is going on around you?

Who you are + what are you in the process of doing,

and what can we do to support that?

What are you doing right now

what could and should happen next.

Others like you + what can we do together

right now.

“Right Now”

Opt-in mobile presence

1 2 3 4 5 6

*Dynamic temporal customer experiences based on the customer – the shopping experience – the business intent in a moment of time

Opt-in mobile presence

How often do your customers

shop at your store versus competitors

What is your customer’s

attitude towards their spend?

How much do your customers

spend at your competitors?

Flash sale

Guided sale

Collaboration

Where else do your customers shop

when they leave your store?

Lots of products and lots of

customers with no real

understanding of who is interested

in what

‘Intent – to – buy’ demand signals End consumer traceability



IBM Mobile Shopper: Mobile Screen Layout

• “Rolling” Advertisements paid from Vendor to Retailer. (When touched, expands to show details of what is scrolling)

• Running Totals • Running Savings (Note, does NOT include savings after totals (i.e. Zavers), only shows if non-zero

• Item Description • Customer Instructions

• Total Coupon Savings for item

• Item Offers Button (i.e. upsell, cross sell, etc. – only displays when offer is available)

• Enable Scanner for item entry

• Enable keypad for item entry

• Shows list of items entered

• “Transaction” Alert Indicator • Price Check an item

• More Button (Includes buttons for): • Removing an item • Help • Cancel Transaction • Settings • Etc.

• Retailer logo

• Item UPC (or PLU)

• Net Item Price

© 2012 IBM Corporation

IBM Mobile Shopper as an extension to self-service scales and Point-of-Sales solutions



Security concerns is one of the barriers to adoption of mPayments

Source: SAP AG, IDC, Forrester, Gartner, Symantec, Research & Markets



Mobile banking is much more than just the app

IBM Point-of-View

Mobile banking is much more than just apps. IBM has tremendous capabilities to help banks and retailers succeed.

Connectivity Simplifying the process of connecting mobile applications to diverse back-end systems and enabling two-way communications (SMS, web sockets, notifications)

Scalability Delivering the ability to scale with unpredictable demand while maintaining quality of service and experience

Security Ensuring that distributed data and access into the enterprise from applications is controlled and secure

Analytics Enabling customers with insight into who is using their applications, when they are using them, and how

Manageability Providing customers with the ability to control who has access to specific applications and updates

Strategy Business model for advanced features such as mobile wallet, NFC and P2P payments and cross industry convergence



Our client list includes every international card and payment association in the world, 8 of the top 10 issuers, 2 of the top 3 processors and 3 of the top 5 acquirers in the US

Asia

Europe Americas and Global

ü Global Card and Payment Team – unique insight & latest industry thinking §  400 people in 21 countries representing consulting,

research, security, products, sales §  Issuer & acquirer clients in over twenty countries

including, Australia, Austria, Brazil, Canada, the Caribbean, China, Denmark, Germany, Greece, Hong Kong, Italy, Japan, Korea, Mexico, the Netherlands, Singapore, Sweden, Thailand, UK, and the US

ü  Consulting Offerings - unparalleled depth in consulting, system design, build & package integration § Vast majority of US card core system rationalization,

feasibility & decommissioning strategies § Design & architecture of world’s largest & most highly-

available networks: MasterCard, Visa, American Express, Discover & China Union Pay

ü  Project management, infrastructure & hosting -- world-class competency with large, complex projects §  Largest outsourcing service provider in the world §  90% of top US issuers rely on IBM infrastructure

ü  Conversion Centre of Competency § Well-defined, rapid data migration methodology §  156 successful, references conversions world-wide

Our global payment practice is the largest in the world

Economy & Finance

Cfir aim 10. maj 2012