Report prospectus payment_metrics_consumer_attitudes_utilisation_traditional_emerging_means_payment_uk

Payment Metrics

Payment Metrics:
Consumer Attitudes towards and Usage of Traditional
and Emerging Means of Payment in the UK

Report Prospectus

March 2012

© Finaccord, 2012 Web: www.finaccord.com. E-mail: info@finaccord.com 1

Payment Metrics

Prospectus contents

Page

What is the scope of the research? 3
Which organisations are covered by this research? 4
What methodology has been used? 5
What is the report structure? 6-8
What are the key features of the research? 9
How can the research be used? 10
Who can use the research? 11
What are some of the key findings? 12-15
What is the cost and format? 16
How can the research be purchased? 17


Payment Metrics

What is the scope of the research?
This report titled Payment Metrics: Consumer Attitudes towards and Usage of Traditional and
Emerging Means of Payment in the UK is a brand new study about the way in which consumers
currently pay for different products and services and how this is likely to change in future. It covers
both established payment means, including different types of payment card, and payment methods
that seem set for rapid growth in future, most notably mobile and contactless payments. In addition,
consumer behaviour is analysed in the fields of specialised online payments and domestic /
international remittances, and the research also addresses two areas that are central to consumers’
choice of payment means: loyalty programs; and insurance and assistance policies linked to added
value accounts and payment cards.

The report examines how consumers state that they are most likely to pay for small, medium-sized
and large irregular purchases at present and also how they report paying for common services that
require recurring payments (e.g. cable / satellite TV, electricity, gas or water bills, flat or house
rental, travel season tickets etc.). In both cases, it quantifies usage of the following payment
means: cash; cheques or postal orders; debit cards; credit or charge cards; rechargeable prepaid
cards; and any other means (e.g. mobile or online payments not involving debit, credit or charge
cards). Also, for regular payments, it takes into consideration direct debits, standing orders and
bank transfers, and distinguishes between rechargeable prepaid cards with multiple usage
functions and those usable for one particular service only.


Payment Metrics

Which organisations are covered by this research?
Companies reported on by consumers in this study

Amazon LG Sainsbury's
American Express Lloyds TSB Samsung
Apple MasterCard Skrill
ASDA Moneygram Sony Ericsson Included where relevant in the
Barclays Motorola Tesco chapters about payment cards, mobile
Blackberry NatWest T-Mobile payments, online payments and
Diners Club Nokia Virgin domestic / international remittances.
Google O2 Visa
HSBC Orange Vodafone
HTC PayPal Western Union

Loyalty programs reported on by consumers in this study

Amazon IKEA FAMILY
American Express Membership Rewards John Lewis / Waitrose Partnership
Avios (formerly Airmiles) Marriott Rewards
Barclaycard Freedom Maximiles
Best Western Rewards M&S Rewards or M&S Premium Club
Included in the chapter about loyalty bmi Diamond Club Nectar
programs. Boots Advantage Priority Club
British Airways Executive Club Tesco Clubcard
GAME Reward The Co-operative Membership
Hilton HHonors Virgin Flying Club


Payment Metrics

What methodology has been used?
The research for this study was carried out during February 2012 using an online consumer panel. In
total, completed surveys were filled in and submitted online by over 1,000 consumers breaking down
by age group, annual household income band and geographical location as illustrated in the charts
below.
Northern London /
Wales, 2.8% Ireland, 1.1% Greater
65 or over,
North-East,
19.9% 16-24, 21.5% London, 15.3%
5.2%
East Anglia,
6.9%
East Midlands,
7.1% South-East
(exc. London),
55-64, 12.2% 14.8%

£60,000 - Over £80,000, West Midlands,
25-34, 15.7%
£79,999, 4.2% 3.1% Less than 7.8%
£50,000 - £10,000, 14.9%
£59,999, 4.1%
£40,000 - Scotland, 8.0% North-West,
45-54, 13.4% £49,999, 7.9% 12.1%
35-44, 17.3%
South-West,
£10,000 - 8.9% Yorkshire /
£14,999, 16.1% Humberside, 10.3%

£30,000 -
£39,999, 13.5%

£15,000 -
£25,000 - £19,999, 12.3%
£29,999, 11.5%
£20,000 -
£24,999, 12.7%

Payment Metrics

What is the report structure? (1)

0. Executive Summary: providing a concise evaluation of the principal findings of the report.

1. Introduction: offering rationale and a detailed description of methodology.

2. Payment Types: beginning with an analysis of the main payment methods currently used by
consumers for irregular purchases, differentiating between low-value (less than £15), medium-
value (£15-£50) and high-value (more than £50) purchases, followed by a consideration of payment
means used for 14 common types of recurring purchase (e.g. Council Tax, electricity / gas, mobile
telephone). Payment methods benchmarked include cash, cheques / postal orders, credit / charge
cards, debit cards, direct debits / standing orders, and rechargeable prepaid cards.

3. Payment Cards: offering a definitive overview of consumer holdings and utilisation rates of
payment cards with separate consideration afforded to card function (i.e. debit, charge, credit,
store and rechargeable prepaid cards), card brand / network (i.e. American Express, Diners Club,
MasterCard, Visa and private label cards), card status (i.e. standard, gold, platinum and ultra high
status cards), card target (i.e. consumer and business cards), and card type (e.g. airline, charity,
football club, hotel chain, loyalty scheme, retailer, supermarket and telecoms cards).

Report structure continued overleaf...


Payment Metrics


4. Loyalty Schemes: investigating membership and engagement rates both by generic type of
loyalty program and across 20 of the largest specific loyalty programs in the UK (as listed on slide
4), this section concludes with an analysis of the program structures preferred by consumers as
determined by earning systems (i.e. cashback, discounts, points / miles, vouchers) and earning /
redemption opportunities (i.e. with single organisations or across multiple, different organisations).

5. Insurance and Assistance: providing data for penetration rates across added value accounts and
payment cards plus analyses of perceived value to consumers and claims utilisation / frequency for
16 types of insurance and assistance (e.g. breakdown recovery insurance, card protection
insurance, concierge services, home emergency insurance, identity protection assistance, mobile
gadget insurance, travel insurance etc.) that can be linked to payment products.

6. Mobile / Contactless Payments: delivering unique insight concerning consumer awareness of,
receptiveness towards and general expectations concerning mobile and contactless payments with
results broken down by both gender and age group, in order to highlight important socio-economic
differences, and by make of mobile phone used (e.g. Apple, Blackberry, HTC, LG, Nokia, Samsung)
with a view to demonstrating how this variable will also affect consumer behaviour.

Report structure continued overleaf...


Payment Metrics


7. Online Payments: a summary of frequency of usage by consumers of different online payment
means such as Amazon Payments, Google Checkout, PayPal, Skrill (formerly Moneybookers) and
direct entry of payment card details - how do these options stack up against each other?

8. Domestic / International Remittances: a final chapter benchmarking consumer behaviour in the
fields of domestic and international remittances with implied market shares calculated for the
competing remittance options, namely: Moneygram; PayPal; Skrill (formerly Moneybookers);
Western Union; other companies (excluding banks) offering a remittance service; direct debits,
standing orders and other bank transfers (e.g. BACS); cash, cheques or postal orders sent in the
post; prepaid or gift cards sent in the post; and person-to-person payments sent by mobile phone.


Payment Metrics

What are the key features of the research?
Key features of this report include:

• coverage of consumer attitudes towards and utilisation of a very broad range of payment means
including long-established options (e.g. cash, direct debits / standing orders, payment cards) as well
as more recent or emerging alternatives (e.g. domestic / international remittances, mobile payments,
specialised online payment means);

• detailed analysis of consumer holdings and utilisation of the numerous different types of payment
card available in the UK including debit, charge, credit, store and rechargeable prepaid cards;

• cutting-edge investigation into consumer awareness of and interest in using mobile and contactless
payments including a ranking of organisations that they are looking to for mobile payment solutions;

• unique consideration of consumer behaviour in the context of 20 specific loyalty programs
including Avios, American Express Membership Rewards, Boots Advantage, Maximiles, Nectar,
Priority Club and Tesco Clubcard;

• insights into the main types of insurance and assistance that can be added to payment products to
encourage consumers to acquire and use them.


Payment Metrics

How can the research be used?
You may be able to use this report in one or more of the following ways:

• gain access to a complete ‘tool kit’ for organisations with an interest in payments to understand the
current behaviour of UK consumers in this huge and diverse sector;

• know exactly which types of card are held most widely by consumers and which they report using
most often - for example, how does frequency of usage of the many different types of affinity and co-
branded card compare to that of regular cards and what differences in utilisation are visible when
cards are analysed by function, brand, status and target?

• appreciate the extent to which UK consumers are ready to embrace future opportunities to make
payments using their mobile phone (and, possibly, other devices such as wristwatches);

• understand the typical member profile of the UK’s main loyalty programs and the extent to which
each has engaged its members to actually make use of it;

• evaluate which forms of insurance and assistance are most likely to enhance the appeal of
payment products and which are most likely to be used by consumers in the form of claims or calls
for assistance.


Payment Metrics

Who can use the research?
1. Banks, other card issuers and card brands: this research offers valuable insights not only about dynamics
in the payment card market but also about alternative methods of payment that increasingly threaten to
replace cards;

2. Mobile telecoms operators: around the world, mobile telecoms firms are working to realise a future in
which mobile phones become a primary means of making payments - this study sheds light on an array of
issues related to this evolution in the UK;

3. Other payment companies: organisations active in specialised payment segments such as online
payments and domestic / international remittances will benefit from the wide-ranging data in this report;

4. Manufacturers of payments-related hardware and software: opportunities exist for a wide range of
payment technology companies to occupy influential positions in the payments value chain;

5. Insurance, warranty and assistance companies: combining insurance and assistance with traditional
payment products is an established practice but what could the opportunities be in this field in relation to
emerging payment means?

6. Companies that receive payments from consumers: organisations such as electricity / gas firms, media
companies, supermarkets and travel entities could all benefit from the unique perspectives in this study
which will help them to understand how their customers want to pay them in the future.


Payment Metrics

What are some of the key findings?
1. For one-off purchases, payment habits among consumers aged from
16 to 24 are very different from those of individuals in older age groups

Payment means used most frequently for irregular purchases - unweighted average across all transaction sizes
60%

48%

Debit card
36% Credit / charge card

24%
Cash

12%

All other means
0%
16-24 25-34 35-44 45-54 55-64 65+

Source: Finaccord Payment Metrics survey


Payment Metrics

What are some of the key findings? (cont.)
2. By card function, rechargeable prepaid cards experience a lower frequency
of use, where held, than debit cards and credit, charge and store cards

Card utilisation frequency by card function
100% Card never used
Card used rarely

80%

Card used sometimes
60%

40% Card used most frequently but not main one

20%
Main card used most frequently

0%
All debit All credit, charge All rechargeable
cards and store cards prepaid cards



Payment Metrics

3. Respondents with Apple and HTC mobile phones display the
most enthusiasm towards the concept of mobile payments

Apple

Blackberry Yes, very favourable

HTC
Yes, quite favourable
LG
Neither favourable nor unfavourable
Motorola

Nokia No, not very favourable
Samsung
No, not at all favourable
Sony Ericsson

Other Don’t know

Average

0% 20% 40% 60% 80% 100%
Receptiveness among respondents with a mobile phone towards
the concept of using mobile phones to make payments



Payment Metrics

4. Key findings from the executive summary include:

• 74.3% of respondents with a mobile phone state that they are aware of the fact that opportunities
to utilise mobile phones to make payments (e.g. via contactless merchant payments and mobile
transfers / wallets) are likely to increase in future;

• however, at a combined 39.5%, those that are either not very favourable or not at all favourable
towards this concept outweigh those that describe themselves as quite favourable or very
favourable, at 31.1% (with the balance of 29.4% not expressing an opinion either way);

• while not necessarily the most widely-held types of payment card, Finaccord’s analysis of card
utilisation indicates that, where held by consumers, charity credit cards, ultra high status credit
cards, supermarket credit cards, football club credit cards and retailer credit or charge cards (other
than those of supermarkets) are the card types that experience the highest rates of usage;

• PayPal has established itself as a dominant provider in the markets for both specialised online
payments and domestic and international remittances, where individuals are paying other
individuals without actually being able to meet them.


Payment Metrics

What is the cost and format? (1)
Payment Metrics: Consumer Attitudes towards and Usage of Traditional and Emerging Means of Payment
in the UK is available as a standard Adobe Acrobat PDF document. The prices for this title in its entirety,
individual chapters within it and other UK consumer research titles available at the time of publication are
as shown in the table below.

PAYMENT METRICS REPORT / CHAPTER PRICE * OTHER REPORTS PRICE *

Payment Metrics - total report GBP 1,995 Aggregation Metrics GBP 1,795
within which Assistance Metrics GBP 995
Payment Types - individual chapter GBP 295 Channel Metrics - overview report GBP 2,995
Payment Cards - individual chapter GBP 595 Channel Metrics - individual briefing GBP 395
Loyalty Programs – individual chapter GBP 295 Mobile Metrics GBP 595
Insurance and Assistance - individual chapter GBP 295 Partner Metrics GBP 1,995
Mobile / Contactless Payments - individual chapter GBP 595 Risk Metrics GBP 1,995
Online Payments - individual chapter GBP 145 Travel Metrics GBP 595
Domestic / International Remittances - individual chapter GBP 295 Warranty Metrics GBP 995

For UK-based clients, VAT at the prevailing rate will be added to the basic price.
Costs quoted are for a single site user licence only.
For a corporate user licence, please see the next slide for further details.
Invoices can be paid in EUR, at the prevailing exchange rate, if preferred.


Payment Metrics

How can the research be purchased?
Simple. Just go to the relevant area of the Finaccord web site available at
www.finaccord.com/order_uk_payment_metrics.htm and fill in the online order form, clearly
indicating:
• report required
• type of corporate user licence, if required *
• billing name
• address and e-mail address
• purchase order number, if applicable

Please allow up to one working day for the delivery of electronic copy by e-mail.

* For the corporate user licence please choose one of the following options:
1. One office, one country: no supplement over and above basic cost of reports ordered
2. Multiple offices, one country: additional 20% over and above basic cost of reports ordered
3. Multiple offices, two to ten countries: additional 50% over and above basic cost of reports ordered
4. Global (unlimited offices in unlimited countries): additional 100% over and above basic cost of reports ordered

VAT at the prevailing rate will be added to the price of any corporate user licence acquired by UK-based buyers.


Report prospectus payment_metrics_consumer_attitudes_utilisation_traditional_emerging_means_payment_uk

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Mehr von Intelligo Consulting

Mehr von Intelligo Consulting (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Report prospectus payment_metrics_consumer_attitudes_utilisation_traditional_emerging_means_payment_uk