innovation edge. mobile payments (english)
DESCRIPTION
The mobile payments trend, undoubtedly, is on its way of becoming a mainstream phenomenon. It will change how society thinks about monetary transactions. In this issue we sum up the best social business case study and we analyze future opportunities around it. `BBVA InnovationEdge' is the first corporate multiplatform magazine focused on innovation. Each edition featuresarticles, analysis and huge information about a particular theme. The mainpurpose of the magazine is to express the new trends and the upcomingtechnologies that may impact to the financial industry.TRANSCRIPT
Technology trends
Trending issues
also in this issue
mPayments (quick overview)
Elevator Pitch
Smartphonatics
Cashing in on the opportunities
4NOVEMBER 2012
Paying with a mobile device
Mobile Payments
mPayments.................................................................................................4
Elevator Pitch ........................................................................................... 11
Global Snapshots ............................................................................... 17
BBVA & Mobile Payments ......................................................22
SmartPhonatics ...................................................................................24
Cashing in on the Opportunities ...................................28
Innovation Forecast ........................................................................31
In Depth....................................................................................................... 34
Sections .......................................................................................................36
Trending Issues ............................................................................36
Technology Trends ................................................................. 43
Mobile Payments & Banking event .............................47
BBVA Innovation Center Open Day ...........................48
Credits ...........................................................................................................50
contents
04
mPaymentsThe mobile payments trend, undoubtedly, is on its way of
becoming a mainstream phenomenon. It will change how
society thinks about monetary transactions. Let’s take a
look into mPayments, meet the main actors and gain a basic
understanding of this fast moving trend.
quick overview
06 November 2012 | MOBILE PAYMENTS 07
DefinitionMobile payments are payments made using a mobile device. Generally, there are two ways to pay by mobile: online payments and proximity payments.“mPayments will transform customers’ lives”. See video
Example of wallets VISA ISIS (AT&T, Deutsche
Telecom & Verizon) Google
Online PaymentsMobile payments for digital or physical goods. Digital goods
payments refer to products/services consumed on mobile de-
vices, such as app purchases or digital content. Also, person to
person (P2P) payments may be considered as online payments.
Physical goods payments refer to products/services delivered
physically, but purchased via a mobile device.
Proximity PaymentsMobile payments for products & services purchases on-site via
a mobile device (short range radio technologies, such as NFC).
Generally used at POS terminals, transit, etc.
Main Actors
Banks & Card CompaniesIncumbents who are currently dominating the general payment
landscape; as the overall leaders, they are generally taking a wait
& see approach, looking for the right product at the right time.
Mobile walletsMobile wallets are platforms that bundle together products and
services from several providers. In general, mobile wallets offer:
■■■ A prepaid account (equiva-
lent of cash in real wallets)■■■ Credit, debit & charge cards
(payment instruments)
■■■ Loyalty programs & offers
(coupons)■■■ Transit (public transportation)■■■ Other (ID, electronic key, etc.)
08 November 2012 | MOBILE PAYMENTS 09
Retail CompaniesNew entrants who are disrupting the payments business with
mobile technologies, such as Starbucks and Amazon . Technology companiesThe financial services market is a new area for growth for these
aggressive players. Armed with the latest and greatest in technologies,
they are very active in experimenting with new value bundles and
business models.
Companies include Google , Facebook , and PayPal (an
eBay company).
Also, the mobile device is being used to process transactions. Retail
stores may now enable payments with a mobile device functioning
as a POS, such as Square or PayPal Here .
Mobile Operators (MOs)Looking for new avenues for growth, MOs
are looking to mobile payments as a way to
make their relationship with clients stickier by
offering payment services, as a part of the
overall voice & data portfolio.
10 November 2012 | MOBILE PAYMENTS 11
Mobile Payments
Let’s take visual journey through the mobile payment
space. We’ll look at the users and usage, deployment
scenarios, business models, and take a peek into the
future and the market.
elevator pitchmPayment & Value Bundles
“The smartphone is simply an enabler — not a driver — of changing behavior.”Ron Shevlin, Aite Group
Therefore, each actor is using or will use mobile payments to design and build the “best” value bundle for a given customer segment. Lots of collaborative models are emerging, such as ISIS and Boku which are collaborations between mobile operators and other entities.See video (Boku)
“Mobile payments on their own are not sufficient to drive consumer adoption but the value bundle — payments together with incentives and offers — has a higher chance of persuading consumers to change their behavior.”Advanced Payments Report 2012, Edgar, Dunn & Company
Mobile Payments
12 November 2012 | MOBILE PAYMENTS 13
What is happening with mobile payments?
In the next five years, insiders expect a majority of
brick-and-mortar retail transactions to take place on
mobile devices. That is a big change-up for a $5.5
trillion marketplace. Meanwhile, mobile devices users
who utilize mobile payments are expected to swell
from 6.8 percent in 2009 to 21.3 percent in 2012.
Who is using mobile payments?
39%Millenials
(18-26)
31%Gen-xers (27-39)
18%Young
Boomers (40-50)
9%Old
Boomers (51-61)
Seniors (62+) 3%
Users Deployment
Usage
How is the mobile payment industry shaping up?
Retailpurchase
53%
27%
10% 12%
20%
66%
Fastfood
8%
22%
70%
Masstransport
16%
37%
43%
Onlinepurchase
18%
35%
47%
Digitaldownloads
FOCUS
HIGH MODERATE
LOW
Mobilecarriers
Financialinstitutions Merchants
DEPLOYED
READY TO DEPLOY
TRIAL STAGE
PLANNING STAGE
NO INTEREST SO FAR
16% 17% 8%
16% 13% 9%
39% 38% 28%
25% 28% 36%
5% 3% 19%
Handsetmanufacturers
Paymentservice
Applicationproviders
10% 19% 22%
20% 24% 37%
37% 45% 30%
29% 11% 10%
3% 1% 1%
DEPLOYED
READY TO DEPLOY
TRIAL STAGE
PLANNING STAGE
NO INTEREST SO FAR
Mobile Payments
14 November 2012 | MOBILE PAYMENTS 15
The future
The market (1)
The market (2)
Business models
What is the most viable business model?
By 2014, an estimated 13 percent of all smartphones
will have built-in NFC capabilities.
*common platform shared by alliance of carriers
and financial institution.
43%Mobile-financial
institution partnership
20%Third-party
intermediation model
7%Mobile carrier
going solo
26%Open federation model*
Financialinstitutiongoing solo
4%
What will be the most popular mobile payment app in the near future?
As merchants, financial institutions, and mobile carriers
work together to figure out the future of the mobile
payment system. People should not be surprised if
their phone starts to replace the contents of their wallet
over the next few years.
27%NFC-enabled
payments
14%Mobile carrier
going solo
13%Java-based payment
application
19%SMS-based payments
16%Embedded credit cards
USSD-based
payments1%
10%Other
Percentage of respondents
Global E-payments: number of transactions (billion), 2009-2013FMost payments are not mobile. Alternative pay-
ments, which includes mobile, will account about
for 8% and 9% in 2013 of e-payments transactions.
Global M-payments: number of transactions (billion), 2009-2013FBanks are still in charge, but the competition is grow-
ing faster. By 2013, the new entrants will have taken
about 8% of the mPayment business, from a base of
0.5% in 2009.
Mobile Payments
Total Alternative Payments
Non-banking competition
Debit, credit, prepaid cards
CAGR‘09-’13F19.1%32.1%
18.1%
Total Non-bank providers Bank providers
CAGR‘09-’13F48.8%67.3%27.6%
Source: Capgemini I World Payments Report 2011, September 2011
Number of transactions (Million)
2009
3,120156
272
473
785
4,587
6,756
9,814
15,284
2010 2011F 2012F 2013F
1,223
2,9644,315
6,2839,029
14,062
Source: Capgemini I World Payments Report 2011, September 2011
Number of transactions (Billion)
2009 2010 2011F 2012F 2013F
14.2 16.819.8
23.427.6
15.10.9
17.91.2
21.31.5
25.42.0
2.7
30.3
Source: Deloitte.com
16 November 2012 | MOBILE PAYMENTS 17
The market
In 2010, the total volume of global credit card payments totaled
$6.2trillion dollars
The number of mobile payment users will reach
212.2million in 2012,
up from 160.5 million in 2011
We are forecasting a market with
448million users
by 2016
Source: Gartner, May 2012
Mobile Payments is a dynamic
trend; and, as such, is drawing a
lot of attention from around the
world. This section takes a look at
selected banks & card companies,
retailers, mobile operators and
technology companies and see
what they are up to.
Globalsnapshots
Mobile Payments
The market (3)
18 November 2012 | MOBILE PAYMENTS 19
TELEFONICA: O2 WALLETA deal with Facebook, Google, Microsoft, and RIM
allows a Telefonica subsidiary customers (O2) to pay
for digital goods and services directly through the
mobile phone bill.
See video
AT&T, T-MOBILE AND VERI-zON WIRELESS: ISISThe Mobile Operators led consortium is offering a
mobile wallet platform. The Isis mobile commerce
network will be available to all merchants, banks, pay-
ment networks and mobile carriers.
Fuente: Pay with Isis
TELIA, TELE2, TELENOR AND 3 (ThE SWEDISh BIG 4 MOS): WYWALLETWyWallet, the mobile wallet joint venture from Telia,
Tele2, Telenor and 3 has been launched with support
for person-to-person money transfers, SMS transit
and ticketing payments, and online shopping. Live
tests of POS payments using NFC are set to start in
July, with full-scale roll-out scheduled for 2013.
Fuente: WyWallet
Mobile OperatorsBanks & Card
Companies
RetailBARCLAYS: PINGITUsers can send and receive money by using just a
mobile phone number.
See video
COMMONWEALTh BANk: kAChING Allows customers to make payments to email, to
Facebook, to mobile, and to PayPass (MasterCard)
contactless terminals.
See video
ChASE: INVESTMENTS & PARTNERShIPS■■■ Square, GoPago (investor)■■■ ISIS (partner)
Source: GoPago
ChASE: QUICkPAYAllows customers to make P2P payments to emails
or mobile phone.
Source: Chase
MASTERCARD: PAYPASS WALLETIt’s a digital wallet service that makes online shopping
safe and easy by storing payment and shipping
information in one convenient and secure place. With
PayPass Wallet, customers simply shop, click and
checkout faster online.
Source: PayPass
STARBUCkS: ANNOUNCES DEAL WITh SQUAREThe coffee giant chooses Square to process pay-
ments in all of its stores and also takes an equity
investment. “The focus is on the experience, and
putting that above everything else,’ says Square
founder Jack Dorsey about Starbucks’s stores.”
FastCompany added, “Square treats payments a
lot like Starbucks treats coffee: by focusing on the
experience around a product that is more or less a
commodity.”
Source: Starbucks
AMAzON MPS Amazon allows its merchant partners to accept mo-
bile payment with its Amazon Mobile Payment Ser-
vice (Amazon MPS). On the other end, Amazon offers
its customers to make payments via mobile devices.
Additionally, Amazon facilitates P2P, sending money
to an email or a mobile number.
Source: Payments. Amazon
20 November 2012 | MOBILE PAYMENTS 21
Technology Companies
GOOGLE WALLET Fast and easy payments, with any card. Google Wallet
now supports all major credit and debit cards, from
Visa, MasterCard, American Express, and Discover.
Google Wallet stores cards online so they’re available
wherever customers go in the real or virtual worlds.
See video
APPLE: PASSBOOkWith the iOS 6, Apple introduced the “Passbook,” a
mobile app which manages boarding passes, tickets,
store cards, and coupons. The leading mobile tech-
nology company is expected to further pursue its
“iWallet” strategy. The company launched Passbook
with it newest OS, the iOS 6. “Apple controls the hard-
ware and the mobile OS, and now with Passbook, it
provides brand app developers the ability to link their
products to a centralized and easy management.”
Source: Forbes | What CIOs Need to Understand about Apple’s Pass-book Service, October 2012.
FACEBOOkFacebook has scrapped its Facebook Credits and
has everyone wondering what they will do in the
mobile payments arena. There is a tremendous
amount of buzz as Facebook continues to grow and
the company is uniquely positioned to completely
revolutionize commerce.
Source: Thedailybeast l June 2012
SQUAREWith Square, small business owners and merchants
can accept card payment using an Android phone,
iPhone, or iPad. Also, the company offers “pay with
Square,” allowing customers to pay with their mobile
device at the POS.
Source: Squareup
PAYPAL hERE Keeping up with its competitor, PayPal recently
launched PayPal Here, allowing customers to accept
cards and also checks. Also allows users to invoice
and track cash payments. Of course, PayPal contin-
ues to win mindshare as it facilitates payments, in-
cluding mobile devices. Recently, a survey revealed
that 8 of 10 consumers would use PayPal’s wallet, if it
were to be available.
Source: PayPal
LEVELUPA new mobile payment network, LevelUp provides a
QR code pay-by-phone application for consumers and
a terminal system for merchants. Recently it raised $21
million ($9 million coming from the venture capital
arm of Deutsche Telekom) in a 2nd round funding.
See video
IzETTLEEurope’s answer to Square, iZettle allows businesses
to take card payments using an iPhone or iPad.
See video
DWOLLAThe company’s product allows anyone with an in-
ternet connection to safely send money to friends
or businesses.
See video
Other notable companies
BANkS & CARD COMPANIES (TEChNOLOGY PROVIDERS TO BANkS)■■■ Telepin Software ■■■ Customer Engagement■■■ Corfire ■■■ MChek ■■■ First Data■■■ Braintree ■■■ JMango
MOBILE OPERATORS (IN APP PURChASES, BILL TO MOBILE COMPANIES)■■■ Bango ■■■ PayOne■■■ Mopay ■■■ Dimoco ■■■ BilltoMobile
MOBILE WALLETS■■■ Serve ■■■ Magtek■■■ MasterCard ■■■ MobilePay ■■■ Cimbal■■■ Tabbedout ■■■ NoMoreCards
TEChNOLOGY COMPANIES POS SOLuTIOnS ■■■ Charge Anywhere■■■ VeriFone ■■■ InTuiT GoPayment ■■■ Roam Data■■■ RedFin network■■■ Moneris Solutions■■■ Corduro■■■ Handpoint
LOyaLTy PROGRaMS■■■ Foursquare■■■ Mogley■■■ Swagg
nFC■■■ DeviceFidelity■■■ Giesecke & Devrient■■■ Ingenico■■■ Oberthur Tecnologies■■■ Vivotech■■■ Xius Innovate Lead
22 November 2012 | MOBILE PAYMENTS 23
The Channel Director of BBVA Bancomer, Mauricio Pallares, highlighted during the presentation that the company is turning to electronic banking to lead it’s strategy to bank the unbanked and promote financial inclusion. With ‘Mobile Money,’ the group intends to extend banking services to 1.5 million customers and reach a volume of 19.5 million transactions in the first year of operations.
BBVA Bancomer Mobile Money results from an interest in developing a modern and innovative bank that offers alternatives that facilitates access to low-cost, financial services while ensuring safety, proximity, availability, time savings, and convenience. The new service launched by BBVA Bancomer is also available in Spain under the name, “dinero móvil.”
BBVA &Mobile PaymentsBBVA Bancomer recently
launched ‘Mobile Money’, a new
service that allows customers
to send money anywhere in
the country using a mobile
phone. This service will
provide access to banking
to 1.5 million users,
contributing to their
financial inclusion.
November 2012 | MOBILE PAYMENTS 25 24
SmartphonaticsAre a group of consumers who are driving the demand for
mobile payments. They aggressively change the way they
shop and pay for products and services.
Based on a global survey of 4,200 consumers (realized in Q1 2012), Aite Group’s research reveals leading mobile payment consumers, the Smartphonatics.
Source: Aite | The Global Rise of Smartphonatics: Driving Mobile Payment and Banking Adop-tion in the Americas, EMEA, and Asia-Pacific, May 2012.
4%
31%41%Less important
Very important
Low High
Importance of mPayments
Interest in mPayments ussage
smarphonatics!
24%
“smartPhonatics”The rise of the mobile class
Customer surveys always seems to facilitate
understanding. In this section, we’ll take a look at the
recent survey results related to mobile payments and
some insights they reveal.
26 November 2012 | MOBILE PAYMENTS 27
Are twice as likely than non-Smartphonatics to adopt
mobile payments.
Are driving mobile payment adoption around the world .
Offer clues to creating and meeting demands for mobile
payments (albeit at different rates across the globe).
Represent a country’s mobile maturity level.
Do not necessary use smartphones (it’s all about the behavior).
Will continue to use a myriad of payment options,
including mobile.
Smartphonatics / Key Findings
Source: Aite | The Global Rise of Smartphonatics: Driving Mobile Payment and Banking Adoption in the Americas, EMEA, and Asia-Pacific, May 2012
Mobile payment usage
Smartphonatics
Others consumers
has used mobilephone to make
a payment in the last six months.
70%
23%
23%
Who are they?
32%
Gen X
18%
BoomerSenior
36%
Gen y
6%
■■
11% Sweden
10% Germany 31% China16% UK
8% France 27% Italy
34% U.A.E60% India
24% Singapore
16% Australia
42% South Africa
37% Brazil
20% U.S
7% Canada
Where are they?
November 2012 | MOBILE PAYMENTS 29
Whoever creates the most meaningful financial
value bundle for a given customer segment will
win marketshare. The walls between industries
are beginning to breakdown and the market
is turning into a free for all. Can the banks be
competitive?
Cashing in on theopportunities
New business models
Be part of someone else’s value bundle! Banks can collabo-
rate with platform providers for value delivery. For example,
Chase, CapitalOne and Barclays are part of ISIS mobile wallet, a
consortium of mobile operators.
November 2012 | MOBILE PAYMENTS 31 30
forecastInnovation
Mobile Payments is a trend that is gaining a lot of
momentum and, as such, banks and other financial
services companies are watching it closely. In this section,
we’ll take a quick look how banks should understand
mobile payments and how to approach it.
Meaningful Value Bundle
For banks, mobile payments are not an end to it-
self. In a world of customer experience as the new
value proposition, products by themselves do not
offer a competitive advantage. Together with other
building blocks of the business model, banks can
leverage mobile banking and put together a value
bundle that can delight customers and regain their
trust and confidence, such as offering value added
financial products/services; such as helping custom-
ers to save, to invest, and to borrow. In other words,
banks are positioned to provide a meaningful expe-
rience to customers when it comes to addressing
their financial needs/wants, including the ability to
pay for purchases via mobile devices.
Mobile BANKING
Mobile PAYMENT+
+ Mobile WALLETS
+ Value-added financial
PRODUCTS/SERVICES = MEANINGFUL
VALUEBUNDLE
32 November 2012 | MOBILE PAYMENTS 33
Sources: BCG | How Banks Can Take
the Lead in Mobile Payments, June 2012
Take the Long View
Between the seemingly imminent domination
of mobile payments as seen in the news and
knowing that they represent a small percentage of
total payments lies the true relevance this trend.
Mobile payment is a business opportunity for
banks... it’s just a matter of timing.
For now, most banks are dipping their toes to see
how the water is... and don’t seem to be in a hurry
to dive in. In this context, the Boston Consulting
Group in their recent article, how Banks Can Take the Lead in Mobile Payments, offers some in-
sights for banks:
■■■ The value will be in deals and offers, not in pay-
ments.■■■ Cards will not disappear anytime soon.■■■ mPayments are not yet superior to traditional pay-
ment methods.■■■ Banks are the masters of their own destiny.
Insights
The Long ViewThe article also offers suggestions for banks on
how to seize the moment:
■■■ Invest to gain experience.■■■ Form a “house view” on the m-wallet.■■■ Preserve the attractiveness of cards.■■■ Establish security protocols.
Suggestions
34 November 2012 | MOBILE PAYMENTS 35
A list of sources to other useful tools and resources that you may find useful as a supplement to the information offered on the ‘Mobile Payments’ report.
Books & PublicationsAite | The Global Rise of Smartphonatics: Driv-ing Mobile Payment and Banking Adoption in the Americas, EMEA, and Asia-Pacific, May 2012.
Capgemini | World Payments Report 2011, Septem-ber 2011.
Capgemini & EFMA | 2012 World Retail Banking Re-port, April 2012, May 2012.
Celent | Preserving Merchant Relationships When Mobile Comes to the Retail POS, January 2012 presentation
Deloitte | Cell me the money: Unlocking the Value in the Mobile Payment Ecosystem, 2011.
Forrester | 2012 US Mobile Banking Functionality Rankings, April 2012.
Forrester | Consumers Bankers Association Survey, June 2012.
Deloitte | Mobile Payments: a Deloitte Analysis -- Managing change in the “mobi-payscape.”
Edgar, Dunn & Company | Advanced Payments Re-port, March 2012.
In depth On the WebAmazon | Amazon Mobile Payment Service
Barclays | Pingit
Boku | Introducing Boku Accounts. Smarter phone, smarter payments (Vimeo), February 2012.
Boston Consulting Group | how Banks Can Take the Lead in Mobile Payments, June 2012.
Business2Community | Facebook Credit Card As Your New Universal Payment Solution?, July 2012
Chase | QuickPay
Commonwealth Bank | kaching
Daily Beast | Universal Wallet: Facebook’s Very Bright Future
Dwolla
FinExtra
Google | Google Wallet
Google | Introducting Google Wallet (YouTube), Au-gust 2011.
GoPago
Intuit | The Marketplace in Your hand, 2012
ISIS
ISIS (PayWithIsis) | The Isis Vision (YouTube), February 2012.
izettle
Lafferty | QR code to boost mobile payments dra-matically, September 2011 (subcription article).
LevelUp
MasterCard | PayPass
Brandon McGee | Mobile Banking Blog (covers mo-bile payments as well)
Mobile Money
Mobile Payments Today
New York TImes, Technology | PayPal here is More Than a Square Imitator, July 2012
NFC World
Payments News
Pymnts.com: What’s next in payments
PayPal here
PayPal | PayPal’s Global Mobile Solution Unveiled: Merchants Around the Globe (YouTube), May 2012.
PayPal | PayPal here: how It Works (YouTube), March 2012.
SapientNitro | The Future of Money and Mobile Pay-ments (YouTube), June 2012.
Square | Boccalone Gets Paid with Square (Vimeo), December 2011.
Square | Pay with Square
Starbucks | Mobile Apps
Starbucks | New! Starbucks iPhone Apps (YouTube), September 2009.
TechCrunch | Apple Announces New Passbook App To Store Movie Tickets, Retail Cards, And Board-ing Passes, June 2012
Telefonica (O2) | Mobile Wallet
Visa | Visa Digital Wallet (YouTube), May 2011.
WyWallet (Telia, Tele2, Telenor and 3 - the Swedish Big 4)
EFMA | EFMA Global Yearbook 2012, May 2012.
Ernst & Young | Global Banking 2020: Foresight & Insights
Gartner | Forecast: Mobile Payment, Worldwide, 2009-2016, May 2012.
IDC Financial Insights | Consumer Payments Survey, July 2012.
Juniper Research | NFC Mobile Payments — No Con-tact Required, June 2012.
kPMG | 2011 kPMG Mobile Payments Outlook, July 2011.
kMPG | kPMG Banking Outlook Survey, June 2012.
kPMG | Monetizing Mobile: how banks are preserv-ing their place in the value chain, July 2011.
MasterCard | The Mobile Payments Readiness In-dex, May 2012.
Pew Internet & American Life Project | The future of money: Smartphone swiping in the mobile age, April 2012.
36 November 2012 | MOBILE PAYMENTS 37
Have the need to better understand customers and the value bundle? Go back into the core.
“Banks need to seriously consider core renovation.
Core renovation allows modern architecture to
deliver new functionality like dynamic pricing and
product and pricing simulations which help banks
to understand, at an enterprise level, the value of
customer relationships and the potential of any
given product offer or bundle.”
Source: Finextra
Core banking platform
New formats Enterprise 2.0
Which Way to Go?
Most mobile banking apps in the market today are native
apps. That is to say, the kind of apps you purchase from an
app store for a particular mobile platform, such as Apple’s
App Store, Google’s Play, etc. These apps currently provide
the best experiences for customers as it integrates the
functionalities of the smart devices into the mobile banking
app, such as camera or GPS. However, keeping the mobile
banking up to date for each platform can quickly run up
the costs. With the coming of html5, banks can “write once,
publish in many platforms;” not only html5 can save money,
but also decrease time to market. Banks will have more
choices regarding mobile banking applications in the post
PC era. Which way to go?
Source: Finextra | Apps, a continuing debate: html5 vs. native, 12 August 2012
The future of bank channels, as seen by Cisco
Cisco Internet Business Solutions Group Global
Research reveals new ways for banks to prosper in the
omnichannel world: the future of the branch.
The Knowledge Economy is coming
“The knowledge workers’ revolution will come from a re-
newed workstation, and it will live in the cloud, whether
it is public, private or hybrid,” fueled by Desktop as a
Service, Social Desktop or whatever it may be called.
Currently, the challenges enterprises face include:
■■■ Growing number of communication channels: email,
Facebook, Twitter, Skype, RSS, etc.■■■ Dispersed knowledge (internal and external)■■■ Short-term vision of social integration
Source: Forbes | July
Mobile bankingIn this section, readers will find summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry. The summaries were prepared by the editorial board. Further information is made available for each given topic.
Trending issues
■■■ The old branch is dead; long live the
omnichannel branch■■■ Mobile: The promise of embedded
banking in consumers’ lives■■■ Social: The potential is here—when will
banks be ready? ■■■ Video: Seeing is believing
Source: Cisco
25%
7%
22%
30%
25%
20%
15%
10%
5%
0%virtual banking
would not be happy, but
would keep the same deposits
would switch banks
would not be happy and
would reduce deposits
38 November 2012 | MOBILE PAYMENTS 39
20 % of Europeans already make payments with mobile
According a recent report from Forrester, 1/5th
of european consumers. “Banks need mobile
payments to protect their retail payments
businesses from digital disruption.”
Source: Internetretailing | July
The social bubble seems to
be bursting
A quick look at the Global X Social
Media Index Fund pretty much tells
the whole story. The fairy-tale story is
ending and it’s time for social media
companies to begin delivering real
value to consumers and businesses.
Source: Seekingalpha
Mobile payments Digital Marketing
Crowd financeSocial Media
Taken from weekly stat monitoring by Econsul-
tancy, a digital marketing firm:■■■ Between 7.30pm and 9pm more people click on
tablet ads than on mobile ads■■■ A quarter (25%) of respondents said they would be
likely to click interactive ads
Source: Econsultancy
Put your money
where your mouth is
Crowd-sourcing is used to fund innova-
tive farm and food projects. ThreeRevo-
lutions.com offers food and farm enter-
prises an opportunity to raise funds from
appreciative consumers who are eager to
support and connect with their favorite
businesses and really put their money
where their mouths are ...
Source: Marketwatch | July
Trending issues
Interesting digital marketing stats: people use tablets in the evening & interactivity is best in tablets
Sep Oct Nov Dec 2012 Feb Mar Apr May Jun Jul Aug
12.212.412.612.813.013.213.413.613.814.014.214.414.614.815.015.215.415.6
15.8
SOCL (Global X Social Media Index Fund) Nasdaq GM. 2 - Aug - 2012 SOCL (Daily) 11.93
Open 12.07 high 12.10 Low 11.84 Close 11.93 Volume 125.4k Chg -0.15 (-1.24 %)
11.93
40 November 2012 | MOBILE PAYMENTS 41
App ecosystem
New banking concepts
Join & enjoy
New Gizmo era
It’s not a bank; it’s a banking store: The Virgin Money Store The first Virgin Money Store opened its doors in
July, with plans to open some 70 plus more stores
in the future. The “stores” feature free WiFi, iPads and
iMacs, and a “no hard-sell policy” adopted by staff.
“Customers can simply come in, take the weight
off their feet, enjoy a cup of tea and use our free
facilities.”
Source: Thefinancialbrand
“Only” 1.6% of Facebook users spent money on virtual goods
In percentages, it’s pretty paltry. But ... when
expressed in dollars, that becomes over 1 billion dollars. Uh, that would be nine zeros. “The newly
launched Facebook App Center will spur pay-
ments usage. In addition to in-app purchase, app
developers (not only social games developers)
now have the flexibility to charge users one-off flat
fee and/or subscription.”
Source: Forbes | August 2012
Trending issues
They’re finally here: enterprise app stores
Now big software vendors hope to stream-
line the searching and buying process by
following in Apple’s footsteps. SAP and other
enterprise software companies are opening
app stores and hoping that they can monetize
the app ecosystem, such as The SAP Store.
Sources: PC Advisor / EcoHub.
3D printers to go
Couple of MIT students developed
the first truly portable 3D printer
that fits inside a metal briefcase, a
“personal fabrication machine.” In a
short period of time, consumers will
become mobile manufacturers. What
could that enable? Time will tell.
Source: Arstechnica
42 November 2012 | MOBILE PAYMENTS 43
According to Daimler AG, it’s the best
way to get from A to B “Moovel,” brings together entirely different means of
travel and presents the options so that they can be
seen at a glance – transparently, in a user-friendly way
and on an equal footing. The recommendations are
based on the offers of the mobility service providers. A
pilot program is launched in Stuttgart and another one
is planned in Berlin. As of July, the app is available for
download in Apple’s App Store.
Source: Media Daimler
Is there a doctor in the phone?
There is an explosion of mobile medical
apps, beyond the diet and exercise kind.
The president of the American Academy
of Physicians, Glen Stream states, “People
want to be empowered to take care of their
health” and are asking for apps for help.
Current apps include:
■■■ Diabetes monitoring■■■ Heart EKG monitoring■■■ Blood pressure monitor (wrists)■■■ Electrocardiogram device■■■ E. coli sensor■■■ Ear infection checker
Source: USAtoday l August 2012
Smart cities + urban mobility
Health
Trending issues
The following section outlines the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.
3D Printing3D printing is a process of making three dimensional solid objects
from a digital file. 3D printing is achieved using additive processes,
where an object is created by laying down successive layers of
material. In other words, 3D printing turns bits into atoms.
Technology trends
“3D printing makes it as cheap to create single items as it is to produce thousands and thus undermines economies of scale. It may have a profound impact on the world as the coming of the factory did. … Just as nobody could have predicted the impact of the steam engine in 1750 —or the printing press in 1450, or the transistor in 1950— it is impossible to foresee the longterm impact of 3D printing. But the technology is coming, and it is likely to disrupt every field it touches.”
Source: The Economist
44 November 2012 | MOBILE PAYMENTS 45
Technology as marketingWHEN TECHNOLOGY BOOSTS MARKETING CAMPAIGNS
Building a product is just the beginning. Once in
the market, users will evaluate if the application
developers have been working on during the
last months is good enough or not. It is true
that this evaluation depends on a never-ending
number of variables - customer satisfaction,
needs covered, look and feel, expectations,
overall experience - which makes the success
almost impossible to predict.
Technology trends
The market for 3D printing and related products
and services are expected to grow because ad-
ditive manufacturing essentially makes the cost of
complexity free (or almost free). Massive personali-
zation doesn’t mean massive costs. In terms of man-
ufacturing, personalization becomes essentially free.
■■■ The cost of 3d printers is dropping dramatically. The cost of basic home 3D printer is dropping to about
$1,000 and a industrial 3D printer to about $10,000.
■■■ The material base is expanding. Plastics, metal
alloys, ceramics, food, etc.
■■■ 3D model creation is being democratized. What
was a complex & expensive is now simple & af-
fordable; and readily accessible.
3D printing comes in all shapes and sizes. For ex-
ample, they can go big or go small and everything
else in between.
Source: Forbes
Even the most simple solution needs a
marketing campaign accompanying
the launch —it may not be mandatory
but it really helps!— Spreading the word
can be done in many different ways, but
surprising the final users is becoming
harder and harder. Google has detected
the opportunity and their teams are creat-
ing amazing examples about how to take
their products to the limit. In other words,
Google uses the technology beyond their
product as the marketing campaign. Let’s
enjoy with a few examples.
3D printed passenger planes
Printing Houses
Fat, even at nano-scale
46 November 2012 | MOBILE PAYMENTS 47
Events
Mobile PaymentsMobile payments are on their way to become a mass phe-
nomenon. Analysts believe that on the next five years most
of the transactions done in physical commerce will be ex-
ecuted through mobile devices.
This payments will shape the way monetary transactions
are seen in the future by the society as a whole, and will
surely transform the clients’ lives.
The Mobile Payments event will be held on November 29th.From 9.30 to 2.00 pm. BBVA Innovation Center
Plaza de Santa Bárbara, 2, 28004. madrid
Check out the videos and photos
of the event in our web
www.centrodeinnovacionbbva.com
Other events
■ INICIADOR Iniciador Madrid with Enrique Burgos “Keys to developing your personal Brand”. Iniciador Madrid dismissed the 2012 season with an interview
to Enrique Burgos (Chief Marketing Officer at QDQ Media) to
discuss the main keys to creating a personal brand.
Date: December 12th, 18.00 in BBVA Innovation Center
■ KNOWSQUARE
know Square Workshop: “Creating an optimal present”. The crisis has led to a further weakness in the already difficult
world of channeling emotions. This workshop aims to fami-
liarize and empower main mindfulness, from the standpoint
of both theoretical and practical.
Date: December 18th at 18:30 BBVA Innovation Center
More info
Videos, pictures and all the info
Technology trends
Play the CubePlayMapsCube is a tilt-to-roll marble game using 3D
and the Google Maps API. The game is a tutorial for
Google Maps but it includes some features that make
it an addictive game. Is it really needed to explain how
Google Maps works? For most of the people probably
not, but it is cool and it will be useful during the maps
war for sure.
Chaos to perfectionThe Google Cultural Institute has created an amazing
3D virtual tour of the Palace of Versailles. This
example shows the true power of Google Chrome
navigator working with WebGL for rendering
interactive 3D graphics without the use of plug-ins.
World Wonders ProjectAnother example created by the Google Cultural
Institute to show how Google Street View works.
Google makes world heritage sites available
to users across the globe by using the Street
View technology including videos, photos and
in-depth information. Users can now explore
the world wonders just as if they were there.
48 November 2012 | MOBILE PAYMENTS 49
BBVA Innovation Center Madrid, is a place where ideas become reality. Would you like to know? You can see the prototypes we created to model the bank of the fu-ture, to understand how we crossed the barrier of convention to seek new sources of value for our customers and to observe new forms of work that we have de-ployed to support our innovation methodology.
The first few days available for the month of December are:
December 4th at 18:00
December 12th at 10:00
December 19th at 18:00
www.centrodeinnovacionbbva.com
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Plaz
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©BBVA2012
BBVA Innovation Edge is the result of a collaborative work done by all the people who are involved in innovation at BBVA Group.
CONTRIBUTORS TO THIS ISSUE:Maria Pilar ÁlvarezAlfonso BeyReyes BolumarJose FernándezAntonio GarcíaEduardo Gabriel GarcíaMaría HormaecheCarmen LópezJavier LópezMarcos MarrodánDavid MartínLuz MartínManolo MoureMarcos PastorJay ReinemannAlicia SánchezJavier SebastianLuis UguinaGustavo VinacuaJose Manuel VillaSang Gu “Phil” YimPedro Francisco Zago
No part of this publication can be reproduced or communicate in any form or by any platform electronic o mechanic, including photocopying, recording o any other system of storage and retrieval, without permission of the publisher, BBVA.
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BBVA Innovation Edge is the first corporate magazine focused on innovation. Innovation Edge aims to explore new trends and technologies that may impact the financial industry, especially retail banking.
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DL: M-38720-2012