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1
Karl Illing, Product Management, ConCardis
Berlin, 04.11.2015
Conference³
WiWo
mPOS
Disruption or
„Only“ Evolution?
2
About ConCardis
 German payment provider for cashles s payments
with international reach
 Principal Member of MasterCard and Visa
 Acquirer for Diners, JCB, UP, Amex
 Payment Institute as per
Zahlungsdiensteaufsichtsgesetz (ZAG)
 Headquartered in Eschborn near Frankfurt am Main
400.000
Points of acceptance
331 million
transactions
€ 35 billion
transaction volume
€ 450 million
revenue
2
39 %
Private Banken
39 %
Sparkassen
Finanzgruppe
20 %
Genossenschaftliche
Finanzgruppe
2 %
Öffentliche
Banken
A shared enterprise of the German
banks
Stand 31.12.2014
3
From Acquirer to Payment Service Provider –
30 years of experience
PSP
Service
1982
1997
2003
2004
2009 2012
2013
2014
ConCardis
OptiPay
2015
Commercial
Network
Operator
Acquiring
Acquiring
E-Commerce
POS-Terminals
mPOS
4
What is „mPOS“?
Basic definition of mPOS (mobile Point of Sale)
 Merchant-side payment device connected to a smartphone or
tablet
Can vary in
 Form factor (Dongle, Bluetooth reader, 2-in-1 device, …)
 Platform (iOS, Android, ...)
 Software Applications (Payment App only, cash register, …)
Not to be confused with
 Mobile Payment in the narrow sense (involving buyer-side
mobile device)
Unterschiedliche mPOS-Formfaktoren
5
10 Mio. $
series B
67 Mio. $
series D
150 Mio. $
series E
The market dynamics are impressive...
 Millions are invested in mPOS „start-
ups“…
60 Mio. $
series D
Selected rounds of financing in the last 12 months
 … and new players enter the market every
month
Source: PYMNTS.com
6
…European market penetration lags behind
expectations
“46% of overall POS in 2019”
(ABI Research, May 2014)
“mPOS (mobile point of sale) usage by
small businesses (SMEs) in Europe will
take off dramatically in 2014.”
(VISA, May 2014)
 High expectations…  …and sober reality
Source: First Annapolis
7
Still: mPOS is a global phenomenon
 First truly global payment innovation
 mPOS players are active throughout the
world
 The largest volume can be found outside of
Europe
Registrations in the Mastercard mPOS Program
Top 5 mPOS countries by volume
Source: Mastercard
8
Three target segments for mPOS with very
different characteristics and use cases
Micromerchants SME Enterprise
Revenuepermerchant
Number of merchants (cumulative)
9
Micromerchants – accepting cards for the
first time
10
ConCardis OptiPay, launched 2014, has been
the first NFC mPOS solution in Germany
11
ConCardis OptiPay emphasizes maximum
simplicity and transparency
 Transparent pricing model
 Simple transaction fee
 No running costs
 No fixed contract duration
 Payment app for iOS and Android
 Mastercard, VISA, Maestro, VPay and Amex
 Contactless payments (including Apple Pay and
Android Pay)
 Radically simplifying the proposition „card acceptance“
12
The mPOS „package“ (device and pricing)
as long-tail solution vs traditional terminals
 Light and mobile
 Not as rigid
 Low purchase price
 No fixed contract period
 Potentially higher transaction
feds
 More than one device
(Smartphone/Tablet, Card
Reader, Drucker)
 Robust, for heavy use
 Limited mobility
 High purchase price or rent
 Multi-year contract period
 Potentially lower transactions
fees
 All-in-one
mPOS-TerminalTraditionalTerminal
13
Small businesses in Germany are more
skeptical than elsewhere
 Results of an mPOS poll by VISA Europe in 2014
Source: VISA Europe
Likelihood of using
an mPOS solution
Definitely
Probably
Not sure
Probably not
Definitely not
Changing preconceptions (before and
after presenting the solution)
14
Example of a photographer
 Photographer
 Often on the road
 Few, high-value
transactions
15
Example of a market seller
 Market seller
 Sales in a mobile setting
 Only used on certain
days
16
Conclusion – mPOS for micromerchants
 mPOS simplifies card acceptance regarding
hardware and pricing
 There are clear pros and cons compared to
traditional terminals
 Even though German micromerchants are
still relatively sceptical…
 …mPOS for the first time renders card
acceptance economically viable for them
 Disruptive potential
 For merchants: medium
 For providers: high
17
To be relevant for larger customers, mPOS
needs to go beyond pure payment
Micromerchants SME Enterprise
UmsatzproHändler
Anzahl Händler
Card
acceptance as
a differentiator
Nice to
have
Should
have
Must
have
18
SME – integrated card payment and „big
retail“ functionality
19
Orderbird Payment by ConCardis: seamless
card acceptance with the orderbird POS
 Card reader connected via BT /
Wifi to iPad / iPod
 Fully integrated in the POS
(payment, refunds, invoice)
 Integrated payment leads to a
much higher share of orderbird
merchants accepting cards
 We showed the first Apple Pay
transaction in Germany using an
integrated payment system
20
mPOS APIs allow seamless integration of
mPOS payment in any application
ConCardis OptiPay SDK
 Easy integration in any app
 Multi-platform: iOS, Android,
Windows
 Integriertes Merchant-Boarding als
Teil des Paketes
mPOS
API / SDK
Payment
Gateway
Your
APP
Integrationspartner
von ConCardis
21
„mPOS“ as a scalable hub for POS services,
backend processes, and business intelligence
In Store
Cloud
APIs
Inventory management
E-Commerce
Loyalty
…
Payment
Mobile POS Devices
SaaS-Server
Additional services
WWW
Shopper-WiFi
22
Conclusion – mPOS for SME
 mPOS as stand-alone payment lacks
relevance for SMEs
 True value comes from integrated
payment as part of mobile POS systems
 Mobile/tablet POS systems such as
orderbird give SMEs access to „big retail“
functionalities, greatly improving
processes and giving a new level of
control over their business
 Disruptive potential
 High for both merchants and
providers
23
Enterprise – from replacement terminal to
omnichannel system
24
Value added of mPOS terminal stem from
various „small“ use cases
 Use cases of mPOS terminals in „Big Retail“:
 However, the complete use case (not only the payment part) needs to be
considered
Queue Busting Pop-up Stores
Replacement
Terminal
Assisted
Shopping
Street Sale
25
mPOS as omnichannel enabler – example
of a sports retailer in Denmark
 Implementation of the Wallmob
iPad POS
 Omnichannel
 Seamless integration of POS
and e-commerce
 In-store payment – even for
online deliveries
 Mobile card acceptance
 Queue busting
 Street sale
 Pop-up shop
 Improved shopping experience
 Assisted shopping
Quelle: Wallmob
26
Conclusion – mPOS for enterprise
 mPOS terminals can add value for large
retailers through various use cases
 When implementing mPOS, the end-to-end
customer experience needs to be considered
 Holistic implementations can change the way
of doing business, e.g. through omnichannel
commerce
 Disruptive potential
 Low for stand-alone payment
 High for holistic solutions
27
Summary
 mPOS market dynamics are high, the volume seems to be lagging
 Micromerchants: mPOS makes card acceptance possible for
everyone
 Small and medium businesses: It‘s about more than payment –
scalable platforms and „big retail“ functionality
 Enterprise: Depeding on the implementation mPOS can add value
on a small level or change the entire business
“There will always be a need for traditional POS solutions
driven by large fixed lane checkout applications, but equally
there will be merchants looking at simpler cost-effective
solutions with added value services.”
(ABI Research, 2014)
28
www.concardis.comwww.concardis.com
ConCardis GmbH
Karl Illing
Helfmann-Park 7
65760 Eschborn
karl.illing@concardis.com
Thank you for your attention!

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mPOS - Disruption or "Only" Evolution

  • 1. 1 Karl Illing, Product Management, ConCardis Berlin, 04.11.2015 Conference³ WiWo mPOS Disruption or „Only“ Evolution?
  • 2. 2 About ConCardis  German payment provider for cashles s payments with international reach  Principal Member of MasterCard and Visa  Acquirer for Diners, JCB, UP, Amex  Payment Institute as per Zahlungsdiensteaufsichtsgesetz (ZAG)  Headquartered in Eschborn near Frankfurt am Main 400.000 Points of acceptance 331 million transactions € 35 billion transaction volume € 450 million revenue 2 39 % Private Banken 39 % Sparkassen Finanzgruppe 20 % Genossenschaftliche Finanzgruppe 2 % Öffentliche Banken A shared enterprise of the German banks Stand 31.12.2014
  • 3. 3 From Acquirer to Payment Service Provider – 30 years of experience PSP Service 1982 1997 2003 2004 2009 2012 2013 2014 ConCardis OptiPay 2015 Commercial Network Operator Acquiring Acquiring E-Commerce POS-Terminals mPOS
  • 4. 4 What is „mPOS“? Basic definition of mPOS (mobile Point of Sale)  Merchant-side payment device connected to a smartphone or tablet Can vary in  Form factor (Dongle, Bluetooth reader, 2-in-1 device, …)  Platform (iOS, Android, ...)  Software Applications (Payment App only, cash register, …) Not to be confused with  Mobile Payment in the narrow sense (involving buyer-side mobile device) Unterschiedliche mPOS-Formfaktoren
  • 5. 5 10 Mio. $ series B 67 Mio. $ series D 150 Mio. $ series E The market dynamics are impressive...  Millions are invested in mPOS „start- ups“… 60 Mio. $ series D Selected rounds of financing in the last 12 months  … and new players enter the market every month Source: PYMNTS.com
  • 6. 6 …European market penetration lags behind expectations “46% of overall POS in 2019” (ABI Research, May 2014) “mPOS (mobile point of sale) usage by small businesses (SMEs) in Europe will take off dramatically in 2014.” (VISA, May 2014)  High expectations…  …and sober reality Source: First Annapolis
  • 7. 7 Still: mPOS is a global phenomenon  First truly global payment innovation  mPOS players are active throughout the world  The largest volume can be found outside of Europe Registrations in the Mastercard mPOS Program Top 5 mPOS countries by volume Source: Mastercard
  • 8. 8 Three target segments for mPOS with very different characteristics and use cases Micromerchants SME Enterprise Revenuepermerchant Number of merchants (cumulative)
  • 9. 9 Micromerchants – accepting cards for the first time
  • 10. 10 ConCardis OptiPay, launched 2014, has been the first NFC mPOS solution in Germany
  • 11. 11 ConCardis OptiPay emphasizes maximum simplicity and transparency  Transparent pricing model  Simple transaction fee  No running costs  No fixed contract duration  Payment app for iOS and Android  Mastercard, VISA, Maestro, VPay and Amex  Contactless payments (including Apple Pay and Android Pay)  Radically simplifying the proposition „card acceptance“
  • 12. 12 The mPOS „package“ (device and pricing) as long-tail solution vs traditional terminals  Light and mobile  Not as rigid  Low purchase price  No fixed contract period  Potentially higher transaction feds  More than one device (Smartphone/Tablet, Card Reader, Drucker)  Robust, for heavy use  Limited mobility  High purchase price or rent  Multi-year contract period  Potentially lower transactions fees  All-in-one mPOS-TerminalTraditionalTerminal
  • 13. 13 Small businesses in Germany are more skeptical than elsewhere  Results of an mPOS poll by VISA Europe in 2014 Source: VISA Europe Likelihood of using an mPOS solution Definitely Probably Not sure Probably not Definitely not Changing preconceptions (before and after presenting the solution)
  • 14. 14 Example of a photographer  Photographer  Often on the road  Few, high-value transactions
  • 15. 15 Example of a market seller  Market seller  Sales in a mobile setting  Only used on certain days
  • 16. 16 Conclusion – mPOS for micromerchants  mPOS simplifies card acceptance regarding hardware and pricing  There are clear pros and cons compared to traditional terminals  Even though German micromerchants are still relatively sceptical…  …mPOS for the first time renders card acceptance economically viable for them  Disruptive potential  For merchants: medium  For providers: high
  • 17. 17 To be relevant for larger customers, mPOS needs to go beyond pure payment Micromerchants SME Enterprise UmsatzproHändler Anzahl Händler Card acceptance as a differentiator Nice to have Should have Must have
  • 18. 18 SME – integrated card payment and „big retail“ functionality
  • 19. 19 Orderbird Payment by ConCardis: seamless card acceptance with the orderbird POS  Card reader connected via BT / Wifi to iPad / iPod  Fully integrated in the POS (payment, refunds, invoice)  Integrated payment leads to a much higher share of orderbird merchants accepting cards  We showed the first Apple Pay transaction in Germany using an integrated payment system
  • 20. 20 mPOS APIs allow seamless integration of mPOS payment in any application ConCardis OptiPay SDK  Easy integration in any app  Multi-platform: iOS, Android, Windows  Integriertes Merchant-Boarding als Teil des Paketes mPOS API / SDK Payment Gateway Your APP Integrationspartner von ConCardis
  • 21. 21 „mPOS“ as a scalable hub for POS services, backend processes, and business intelligence In Store Cloud APIs Inventory management E-Commerce Loyalty … Payment Mobile POS Devices SaaS-Server Additional services WWW Shopper-WiFi
  • 22. 22 Conclusion – mPOS for SME  mPOS as stand-alone payment lacks relevance for SMEs  True value comes from integrated payment as part of mobile POS systems  Mobile/tablet POS systems such as orderbird give SMEs access to „big retail“ functionalities, greatly improving processes and giving a new level of control over their business  Disruptive potential  High for both merchants and providers
  • 23. 23 Enterprise – from replacement terminal to omnichannel system
  • 24. 24 Value added of mPOS terminal stem from various „small“ use cases  Use cases of mPOS terminals in „Big Retail“:  However, the complete use case (not only the payment part) needs to be considered Queue Busting Pop-up Stores Replacement Terminal Assisted Shopping Street Sale
  • 25. 25 mPOS as omnichannel enabler – example of a sports retailer in Denmark  Implementation of the Wallmob iPad POS  Omnichannel  Seamless integration of POS and e-commerce  In-store payment – even for online deliveries  Mobile card acceptance  Queue busting  Street sale  Pop-up shop  Improved shopping experience  Assisted shopping Quelle: Wallmob
  • 26. 26 Conclusion – mPOS for enterprise  mPOS terminals can add value for large retailers through various use cases  When implementing mPOS, the end-to-end customer experience needs to be considered  Holistic implementations can change the way of doing business, e.g. through omnichannel commerce  Disruptive potential  Low for stand-alone payment  High for holistic solutions
  • 27. 27 Summary  mPOS market dynamics are high, the volume seems to be lagging  Micromerchants: mPOS makes card acceptance possible for everyone  Small and medium businesses: It‘s about more than payment – scalable platforms and „big retail“ functionality  Enterprise: Depeding on the implementation mPOS can add value on a small level or change the entire business “There will always be a need for traditional POS solutions driven by large fixed lane checkout applications, but equally there will be merchants looking at simpler cost-effective solutions with added value services.” (ABI Research, 2014)
  • 28. 28 www.concardis.comwww.concardis.com ConCardis GmbH Karl Illing Helfmann-Park 7 65760 Eschborn karl.illing@concardis.com Thank you for your attention!