e-commerce: visa everywhere · overall growth opportunities for local e-commerce 10 preparation...

E-commerce:

Visa Everywhere

MSS Team

March 2018

Preparation Materials • Visa’s Everywhere Initiative

Visa Public

Forward-looking statements and disclaimer

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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?

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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

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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

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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

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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


– Movie tickets

– Household electronics

– Bills

– Food delivery

– Movie tickets

– Event/concert tickets

– Airline

– Cosmetics


– Digital content

– Household electronics

– Fashion

– Groceries

– Hotel

25% 29% 43%Emerging Evolving Mature

Visa Public

Trends in consumer behavior & growth opportunities

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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

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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

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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

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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

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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

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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

e-commerce: visa everywhere · overall growth opportunities for local e-commerce 10 preparation...

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