Brett King

Posts Tagged ‘Android’

Mobile NFC payments – there’s an App for that…

In Customer Experience, Mobile Banking, Retail Banking on February 27, 2011 at 23:01

There’s a great deal of debate in the Financial Services community at the moment about the potential impact of NFC or Near-Field Communication technology within mobile phones and how it will effect the payments landscape. The financial services players are generally scratching their heads and although they admit that NFC phones like the iPhone 5, the Nexus S and others are interesting – they don’t see the need for rapid response. After all, the lack of POS (point-of-sale) infrastructure that supports NFC is in itself a reason why a sense of urgency is not necessary. There’s plenty of time to worry about that later. Right?

Wrong!

There’s an App for that…

In July of 2007 Apple launched the iPhone (what we call the iPhone 2G generally today). Since that time I’ve owned each successive generation of iPhone and I now also have an iPad. So what’s the big deal?

The most impressive thing about the iPhone is not necessarily multi-touch, retina display, ease of use, or core functionality, but is unquestionably the iTunes platform that brought us “Apps”. Prior to the launch of the iPhone, we’d never even heard of Apps, and yet today, just 4 years later, here are the stats on Apps:

  • 350,000 Apps for Apple and close to 200,000 for Android
  • 10Billion downloads for Apple, 2.5Billion for Android Marketplace
  • 15.1Bn in Apps Revenue expected for 2011
  • Daily downloads 22million per day – Apple
  • New app submissions/day – 587 (100 games/488 non-games)
  • No of Active publishers/developers – 72,000 on the US store
  • 160m iTunes account holders (that’s 160m credit cards on file)

So from it’s humble start iTunes was always more than just a place to come and download music or TV episodes, it became the core delivery platform for a whole new category of software and user experiences. At 10:26 AM GMT on Saturday, January 22, 2011, the 10 billionth app was downloaded from Apple App Store.

10 Billion Apps in 5 years is pretty impressive

Now, before iTunes, the iPhone and “Apps” there had still been software – both for PC screens and for phones. Prior to the so-called ‘JesusPhone’, there were Java “Apps”, games and so-forth you could buy and download for your phone, but these certainly didn’t become ubiquitous, primarily because the usability wasn’t good enough and there wasn’t a marketplace that distributed these Apps.

So here we are, just a few years later and there’s probably not a single person in the US, UK, Australia, Germany or France who doesn’t know what an “App” is. Worldwide mobile application store revenue is projected to triple to more than $15.1 billion this year and reach $58 billion in three years, according to Gartner Inc. That revenue was $0 in 2007.

And yet, there are bankers out there that still persist in the belief that mobile payments via your iPhone will take years to ‘take off’. In a debate on this via Twitter over the weekend one of the typical quotes was “I can see it, just not for some time…”

Why the App is a great paradigm for NFC

The dominant position from the card issuers and traditional too-big-to-fail banks is that there is already an existing point-of-sale infrastructure in place in the USA, for example, that will take years to replace with NFC or contactless capable terminals. This naturally limits the adoption of contactless payments technology because even though someone has a contactless credit card or a phone enabled with contactless technology, it still doesn’t mean that they can pay – if a merchant can’t accept their payment then it is essentially dead before it starts.

In our Twitter debate over the weekend Rich Clow (@richclow) from Citi came up with a strong analogy likening the existing POS infrastructure to the ‘rail network’ that opened up the frontier of the US in the 1800’s. Without the ‘rails’, without contactless point-of-sale terminals, how exactly will customers make payments using their NFC phones? What’s the good of having a locomotive unless you have rails you can put it on? It’s an excellent point.

Is the lack of 'rails'/POS infrastructure going to limit NFC payments adoption?

Except … prior to 2007 there were no rails for Apps. The App didn’t effectively exist, but that didn’t stop Apple from creating the rails and the locomotive as part of the iPhone ecosystem at the time of their launch. Right now today Apple and Google are working on alternative payment schemes that will circumvent the traditional visa/mastercard POS systems and networks to enable both P2P payments and commercial transactions with merchants and retailers via phones. There may be some hook into the traditional payment networks behind the scenes, but all you’ll need to pay is an NFC phone and wireless network access.

How quickly will payments from one phone to another become ubiquitous? Answer: How long did it take Apps to become ubiquitous?

Put it this way – those out there that think this will take another 3 to 5 years to honestly compete with plastic mag stripe or chip and pin POS terminals, need to change their terms of reference. Apple and Google won’t wait for the rails. They’re going to jump straight to supersonic transport and the banks will still be waiting around for the train to stop at their station. Meanwhile, we’ll be choosing new payment networks as the paradigm for the next generation of commerce interactions.

Goodbye checks, goodbye plastic! If you’re a banker or card issuer, the sonic boom is coming your way…

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Starbucks Mobile – the Shape of Things to Come

In Customer Experience, Mobile Banking, Retail Banking, Technology Innovation on January 27, 2011 at 17:07

On Wednesday 26th of January 2011, Michael Degnan (of SapientNitro and Engagement Banking fame) and myself headed down to the Starbucks at One Penn Plaza in New York City with the objective of recording our experience of processing a mobile payment using the Starbucks App for the iPhone. The App links your phone to your pre-paid Starbucks card to process payments using a QR code on the screen, which can be scanned by a small reader connected to the cash register. The experience was, in a word, engaging…

Check out the video:

So here are my observations. Firstly, this is very simple. It is at least as fast as getting cash out of my wallet to pay, receiving change and then putting my wallet back in my pocket, in fact, probably faster. The whole transaction you see here took just moments.

The second observation is that the Starbucks Barista was well versed in the new payment technology and was not phased at all by either the request for us to film the payment, or the payment itself. You can see the Barista adjusting the phone so the scanner quickly picked up the QR code off the screen. No fuss, efficient and simple.

The final observation is that this is far superior to a current interaction using cash or a card for a number of reasons. This gives us a glimpse of what the cashless society will be like, it isn’t risky, it isn’t subject to fraud or theft, it is safe, secure and fast. The App is super easy to use, which encourages you to use it again. Personally, I doubt that I will ever pay for a Starbucks using cash again. The only issue could be data connectivity problems. However, with Gilder’s Law in effect, this is an ever reducing issue.

Gilder’s Law: Bandwidth grows at least three times faster than computer power.
Source: Article, “Programming” – Wikipedia.org

But one of the key benefits of this transaction was the transaction visibility. I know what my balance is. I can see my payment history at the touch of a button. I see the balance updated in real-time, and I don’t have to carry around paper receipts. This is far superior than my check book, debit card or credit card from an interaction perspective. I know exactly where I am in respect to my balance available, and the transactions I’ve made. Jack Dorsey, one of the founders of Twitter, figured out this differentiation already and has built a great receipt capability into the Square platform that he launched last year.

“I made the purchase at 8:47 this morning and the receipt was immediately emailed to me in the form of a link to a Square page. On this page is a receipt featuring the logo of the vendor, their email address, and their Twitter handle. Below that, it shows the amount and the exact time of purchase. And below that is a Google Map of where the transaction was made and your signature.”
What A Square Receipt Actually Looks Like, MG Siegler, via Washington Post, Dec 1, 2009

So what does Starbucks Mobile Payments mean for the future?

For those of you who still doubt the power of NFC and mobile payments to change behavior around cash and cheques (checks) watch this video again. The benefits of mobile payments are plenty:

1. Safe (more secure than plastic or cash)
2. Speed
3. Easier than cash (less fuss)
4. Great feedback on transactions
5. Better deals – Starbucks give a 50 cent discount using the card

The modality shift will happen far quicker than banks, card issuers and others can comprehend. This is extremely dangerous ground for retail banks still enamored with transactional banking based on cheques/checks, cash and card transactions.

Banks beware – if by July this year you are still issuing plastic cards, or still opening checking accounts – you are about to be in a world of hurt!

Don’t worry – you don’t need to develop an iPhone banking app…

In Business Banking, Customer Experience, Engagement Banking, Mobile Banking, Retail Banking, Strategy on November 19, 2010 at 10:26

As of May this year, only 4% of US FDIC insured institutions in the United States had any sort of mobile play, a small subset of this group had iPhone apps, and an even smaller percentage had Android apps. We already know that mobile Internet based banking is the fastest growing interaction channel for banks today, so this level of commitment by the industry is quite concerning. So why so slow?

Why so slow?

The challenge is that iPhone came into being in 2007 and it wasn’t even on the radar of banks generally. Organizations like Bank of America (who launched their App in July 2007) were an exception. Wells Fargo, for example, was the last of the big 4 banks in the USA, and they didn’t launch their native iPhone App until May 2009. By 2008, when many banks were considering launching an iApp, the Global Financial Crisis was upon us and budgets were being slashed, so rather than cut Bonuses, we saw bankers cut discretionary spending in the areas of IT. Mobile was often the first to go, because the attitude was “we don’t have to worry about that yet…maybe in 10 years time”. 2009 the budget woes continued, and 2010 was about rebuilding trust so the focus was on keeping costs low so that improvement in net earnings could be demonstrated to shareholders. Thus, we approach the start of 2011 when many banks will be thinking about mobile for the first time realistically.

This is all woefully lagging the customer behavior curve, but good to finally see the majority of banks are starting to think of ways to enable customer behavior through the mobile device and now committing to not only iPhone, but Android platforms too.

The Future Mix

By 2015 the day-to-day interactions of the average retail customer will be very different. Driven by changing customer behaviors, increasing pressure on our time, increasing customer expectations around improved interactions and journeys, etc will drive a complete shift in channel priorities. By 2015 the #1 interacted channel (or by frequency if you prefer) will be mobile, #2 internet on the desktop and TV, #3 ATM, #4 Contact Centre, and #5 in the branch. Even #1 and #2 might tend to look a little the same; in that, as devices like the iPad become more capable the lines between ‘mobile’ and desktop blur, so the issue of the ‘journey’ or the interaction itself becomes very critical.

It’s not just one App that we will need either. There will be a bunch of interactions we’ll be managing in this space. Increasingly those journeys will become contextually integrated and delivered via HTML 5 no longer restricted to an “App” or browser-based, instead being based on a contextual trigger, event or service opportunity.

So obviously banks need to make a big P&L commitment to mobile as a channel and to journeys as a philosophy for serving the customer moving forward. So how is it that I advocate that you don’t need to worry about developing your App?

Lessons from VTB24 in Russia

Last week I visited with the multi-channel team at VTB24 in Russia. They are the second largest retail bank in Russia and have close to seven million customers. Given the growth in smartphone adoption and mobile usage in general in Russia, just like everywhere else in the world, there is an obvious urgency to investing in mobile platform development. This was the challenge presented to the VTB24 team.

VTB24 was strongly committed to a mobile App for the iPhone platform, but budget constraints being what they were, they didn’t expect to be able to invest in the development of the App until 2011. Some preliminary conceptual work had already been done, but the platform wouldn’t be mobilized till next year. They already had previously deployed WAP-based banking but this was looking tired compared with customers expectations for App-based mobile banking.

So in this environment, Daniel Gusev, who was tasked with developing the plan for development and launching the iPhone App, was very surprised to wake up one Saturday morning and find the following tweet:

“Great to see VTB24 finally has their iPhone app!” – Tweet (translated from Russian feed)

WHAT?!? This was Daniel’s immediate reaction. This can’t be right?! After all, he was the one tasked with developing the App, if someone else in VTB had been working on something, he would have known. So he logged on to the iTunes store in Russia and sure enough, there was the App for download.

The App as it appeared on the iTunes store

The immediate reaction was to suspect foul play. That someone had created an App to phish identity details from customers or use man-in-the-middle technology to conduct electronic theft. However, after requesting source code from Apple, VTB24 found that the App had no suspicious content, and in fact, had adapted the iPhone APIs around WAP commands to convert the mhtml-based commands of VTB’s to a workable iApp. An elegant, and workable solution.

Daniel then tracked down the developer and had a simple question? Why on earth would you do this?

The customer answered, “Well, I wanted iPhone banking and you guys didn’t have it, so I thought I would try to see if I could build it myself. When it worked, I figured other customers might use it too!”

Wow!

So VTB24 have engaged with the developer. They now have a live iPhone App that was built by a developer for a fraction of the cost, in a fraction of the time that they would have taken to develop it. Yet, it works and works well, even at some point claiming a number 3 spot in Finance section of the Russian App Store (without any marketing support from the Bank)

Conclusion

There is a lesson here. Sometimes due to embedded politics and internal gaming, we want to control such ‘projects’ as the “iPhone App” internally. We might argue around compliance, risk, security, etc, but this approach shows that by thinking outside of the box, we could actually have much quicker innovation in the customer space than we currently do.

The moment we turn the “iPhone App” into an internal project, we are essentially guaranteeing a 3-9 month turn around time to implement and launch. By engaging a developer community, we could reduce this time, cut costs, and probably end up with some really creative solutions that we would not have thought of ourselves.

Take this on the road. Try to breakdown the barriers and IT silos in respect to production of new channel solutions. The end result may be better than anything we could do internally.

Evolutionary marketing – Tribal, viral and mobile (Huff Post)

In Media, Mobile Banking, Retail Banking, Social Networking, Technology Innovation on March 26, 2010 at 15:08

See the original Huffpost entry here…

There is a lot of discussion about how social media will play out from a mobile perspective, and how marketers in particular can monetize and leverage social media for real revenues and brand influence in the future. There are those, such as Umair Haque from Harvard Business Review Blog, that believe social media in its current form is a bubble with very little in the way of real income – in effect creating relationships that are not as robust as others would have you believe.

As we start to see massive adoption of smart or App phone handsets, the promise of potential migration of social media onto these platforms are hailed as the real future of 2.0 with endless possibilities. When we throw Augmented Reality and Geo-Tagging into the mix, those who are pro social media envisage an interconnected semi-virtual community where purchase decisions, social grouping, real-time collaboration, even political lobbying are all enabled by mobile 2.0. Neither Haque’s lukewarm perception of ‘thin-connections’ or more upbeat assessments of the impact of AR-enabled social media are completely accurate because a key ingredient is missing in the assessment of the viability of mobile social networking.

The real question businesses ask is how do you make money out of social media? We have seen social media give a voice to customers, empowering them to either individually or collectively influence policy, pricing or strategy.

The flawed logic by Haque and others is that you need to define your social ‘network’ through a social media platform like Facebook or Twitter and that the voluntary nature of participation in these networks does not always guarantee quality relationship that can be leveraged commercially. The fact is that there are social tribes that exist that are a great deal more powerful than defined networks established on social networking sites (SNS).

Everyday when we use our mobile phone we are participating in social behavior that is a great deal more natural and powerful than those established via SNS. Every time I call a friend or business contact, SMS or MMS my friends, check my email, or use mobile internet based communication tools, I’m forming social connections that look just like those you’d see on Facebook or Twitter, but are made up of extremely strong connections with my most intimate and trusted contacts and colleagues. These are extremely powerful natural, social networks that transcend programming and platforms – they are the networks formed by our day-to-day interactions in real terms.

CDRs or Call Detail Records are the day-to-day transaction data recorded by mobile network operators to enable accurate billing on your mobile bill. These CDRs contain all of the information required to map social interactions within tribes with substantially more accuracy than an online social network.

By data mining CDRs and seeing the natural connections between mobile users, strong network activity can be observed. Within these networks exist natural influencers of the tribe, key influencers or as Gladwell calls them connectors. By targeting these key influencers with targeted messages that are group sensitive, marketers could reach the entire group via the viral network effect.

None of this is really happening effectively today because we are either still broadcast advertising, relying on sketchy CRM databases not informed by analytics or are using demographic, tag or keyword association in weaker social networks online.

Viral social networks

Key influencers are high value targets for initiating viral campaigns

As an illustration a small start-up in Australia, QMani Analytics, has recently demonstrated a platform they call tribefinder which can identifying the tribes contained within a mobile network operators CDR pool. But the key to success on the revenue side is matching other profile information from an enterprise CRM system, or from customer behavioral analytics (like credit card usage data) and filtering CDRs to create better tribal models. Then we need intelligent marketers who can create compelling viral offers that we can roll out via MMS to a key influencer so he or she can send it on to their valuable network. The best key influencers, of course, should also be great advocates. So once we identify these guys we should service the pants off them so they feel inclined to support our viral efforts (although they won’t recognize them as viral campaigns hopefully.)

For network operators converting pre-paid to post-paid and preventing churn will be a handy by-product of tribe marketing. For retailers, banks, and other service organizations, however, we are talking highly targeted mini-segment offers that will have a massive acceptance rate. Cheaper than pretty much every current media platform, and magnitudes more effective at conversion, tribal marketing via natural mobile social networks is nothing short of a revolution in customer connectivity.

The real challenge is not the technology. Tribefinder’s analytics engine is not rocket science. The real challenge is for companies to understand the shift in marketing dynamics. For almost a decade now traditional broadcast media has been in decline. Marketing to tribes requires a completely different skill set than is on offer in most organizations today, but it is a key part of our future in reaching and retaining customers.

Tribal, viral, mobile – they are your future if you are trying to reach customers.