Décryptage par EY
Next Big Thing? Today Bitcoin is down 23%. « Shows it’s not a currency »
-« Consumers aren’t in love with the vision we have as experts »
-« Consumer have habits; habits require incentives as to change a behavior » –> doing that takes 66 days of repetition.
That’s why digital wallets such as Apple’s or Starbucks have worked –> we’re more than 66 days
Where mobile payments are really paying off: Starbucks because of their loyalty & payments. As well as other companies which reduce number of interactions for several services.
Mobile payments & wallets: what it takes to change habits, what it takes to deliver value, how to make these new habits and how long will it take?
There are 2 keys issues in order to make it a success:
-Change habits through incentives
-Make a trustworthy experience which is not necessarily provided by a bank
Venmo: it’s a virtual in-store experience on mobile. Real life experience through new way.
« We’re not replacing anything », « We’re thinking on how to bring best aspects of experience in a new channel »
Strategy is « Device+ ». It’s not « Mobile First » anymore.
Context: the main problem is that there’s no existing habit. We’re thinking about how to create incentives?
Changing habits is not only about consumers. It’s for merchants as well. We have incentive programs for our merchants.
By using Samsung Pay, you get points. These Points let you buy Samsung products or services. You can change points into cash (through partnership with citibank).
Transaction volumes: doubled since launch of incentive program
« Power Users »
–> Focus on the best users as to identify trends and anticipate what the others will be doing in 6 months time.
–>Test of new features on « power users »
Samsung Electronics America CEO : « It’s been 6 years since we’ve been saying it’s the year of digital payments. […] We’re never going to replace cash transactions. […] However this year now it’s going to be a new habit of having both, and ubiquity will be key. You will see us do a lot around ubiquity & multi-device experience. »
« However it’s not going to be THE year. […] We’re going to change habits this year, and the next one might be the year of adoption. »
« Where did that come from? ». Is there a blackswan for payments ?
There are accelerators (social, P2P, lending, rewards programs, ubiquity), maybe it’s inwards / security
60% of our target are not using that much Samsung Pay for security reasons. Not necessarly towards Samsung, but as regards to Merchants.
Trust is everything. Opportunities is through partnerships.
Mobile has 7 biometric authentification modules + whole load of features + encryption –> what more is required to make it trustworthy?
Physical device becomes liability paradoxically
Real / virtual world : now it’s all about « unattended retail »
It’s about putting products at the client’s fingertips.
Clients want most importantly convenience and security.
Four disruptive technologies:
– Embedded technologies
– Health tech will make us live longer
– Smart infrastrucutre, smart economies: combining all these technologies (smart energy is based on smart infrastructure: banking is the same)
How fintech is redefining banking
« It’s about redefining banking and starting again. In space we have reduced cost per pound by 60% in the last 40yrs. »
Banking is unefficient how it is done today. Eg: does paperwork really drive trust??
Margins have fallen in the last 20yrs, and acquisiton costs increased by 10%
Uber: one of the largest acquirers of small business bank accounts (60% of drivers didn’t have bank accounts).But they don’t want to be a bank ; however they reinvent banking embedded in everydays world.
Yue bao: without paper, without branch. It’s about going back to first principles.
No neo bank created in last 6 yrs have a branch
The top 70 fintechs are more valuable than ICBC.
« Were not’creating new products ; were creating new experiences »
AI will be 1000x faster: humans will not compete against AI
The digitization of commerce and frictionless payments
- Experience starts on digital. We spend on average 3 hours a day on smartphone.
- Ability to « shop on the phone », including in stores is changing everything
- Key success factor: bring consumer into experience and give experience. Instant gratification.
- There is a direct link between transaction and identity experience and number of transactions.
- We need new technologies to improve security and « digital identity experience ». Key issue : how do you secure and ensure identity without asking the client?
It’s about experience. It is hard to implement as technologies and back ends are rigid.
« Nothing exists, someone will have to create a platform »
Put together multiple services and then suddenly it’s a transformative experience.
Put product in lifestyle experience. Digital is enhancing experience.