Payments is an Information Business

In my teens, I remember TV commercials for Yellow Pages in the UK.  The publication would list local retailers by category, and then you could call to see if the retailer had the item in stock. Maybe if they were a ‘nice retailer’ they would but the item aside for you (a boy wanting a new bike for Christmas is the commercial that sticks in my mind).

Fast forward to 2013 and the world has changed a bit. Yellow Pages is online, and phones are cellular – and ‘smart’ - but bicycles still have two wheels and are more popular than ever. In the past, payments was a transactional business, but now with the development in social media and mobile devices, it has become an information business. Consumers make decisions about what, where, and how to buy in different ways these days. Now days if my ‘digital native’ children wanted to buy a bicycle the process would be quite different (at least, after first asking if I would buy it for them).

First they would use a search engine like Bing to review different models and compare retailers (online and brick and mortar). They might not be sure which to bicycle to pick, but rather than ask Dad for his thoughts, they would probably ask their friends their opinions. However, they wouldn’t phone – it would be on Facebook. Next they might see what kind of deal they could get by searching for offers and incentives. The next step in the purchase process is to buy the item – maybe using a mobile payment, maybe not. Finally they might tell the world about their experience by Facebook, or Twitter. It is also possible this could all be transacted on a phone - how the world has changed in 30 years! But if you are a bank - and you only process the transaction, you have missed out on an incredible opportunity to influence your customer and add value to their financial experience.

In my last post I discussed the value of digital wallets, where payments data, offers, loyalty and analytics all converge to add value to banks, merchants and consumers alike. Digital wallets and the integration with devices, social media and offers platforms are the hub of value to the future of payments. Microsoft’s Digital Wallet Foundry (#DWF) kicks off on March 18th in London, and one of the key participants is our partner, FreedomPay with their SEEK solution. Closely aligned to the Payments Platform as a Service viewpoint, SEEK combines the cloud, devices and analytics to bring a unique digital wallet and mobile payments experience on the Microsoft platform. I invite you to come and see their offering at #DWF, but if you can’t make it, please check them out at SEEK.