Tag Archives: iOS

Mobile payments leader must provide value to consumers and banks

Screen Shot 2015-04-01 at 8.23.55 PMI remember being swept up in the early Foursquare craze. I raced around my little town checking in at my local Starbucks and favorite lunch spots to become The Mayor. I worked hard to keep it by doing drive by check ins as I was stuck at traffic lights. I know, I’m hyper competitive on certain things. Friends and I would compete on who could win the most badges too! I quickly earned the “jet setter” badge with frequent flights from SJC to SNA. Other friends won the “crunked” badge with late night shenanigans. Ahh to be a DINK again. All for what? For pure competition and Facebook feed bragging rights!

At a deeper level, I hoped that eventually I’d receive relevant geographically based alerts and rewards on my phone as I walked by a restaurant or store. Unfortunately, many of these rewards required an AMEX card subscription (creating a HUGE hurdle) or were nothing more than a free drink at check in. Big whoop. Sigh…it was very clear that geo based local marketing had not made the jump from great concepts to effective execution. However, this is all changing quickly with the launch of mobile payment solutions like Apple Pay and well designed retail loyalty mobile apps. Real customer value can be delivered at the right time. Banks can also make HUGE strides in building more meaningful customer relationships beyond checking accounts. FINALLY!!!!!

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My family and I are loyal Safeway customers for the majority of our food. The loyalty was solidified by Safeway launching a program that contained several weekly coupons and special offers based on shopping activity. A key component of the loyalty program is the Safeway mobile app which serves as the main touch point for how offers are communicated to consumers. Just recently, Safeway has pushed daily offers that appear on the front scream of my mobile device. Last week I made a special trip into Safeway’s deli to take advantage of a sandwich offer that was delivered to my phone that morning. Cool. There are several other retail apps, Starbucks for example, that deliver this customer value in a similar way. All of these apps have a way to go on using geo fencing technology to send me offers as I’m nearby or actually in store. Clearly this will be coming!

I mentioned in a previous post that I recently completed my first Apple Pay transaction at Sports Authority. It took me 6 months to actually do this after I loaded all of my cards. Honestly, I forgot to use Apple Pay and struggled with finding locations that use it. I opine in my last post that Apple Pay must do a lot more to remind users that “Apple Pay is Accepted Here” to drive adoption. Steps are being taken to do so for I saw an Apple Pay logo appear on a Walmart payment terminal as I purchased Easter cards.

So where do banks fit in creating greater customer value? Apple Pay requires that customers enter in debit cards and credit cards to make payment. Banks provide these cards. Banks frequently offer rewards programs and provide an incentive to shop a designated retail location. By not actively engaging in this payments ecosystem, banks are LOSING OUT BIG TIME on engaging with customers in a meaningful way with relevant, geo targeted offers.

Screen Shot 2015-03-27 at 3.15.25 PMFor example, let’s say a consumer is using a Wells Fargo bank card for Apple Pay. The consumer pays for items at Walmart that is a member of Well’s Earn More Mall program. The consumer is then informed that they receive double points and are reminded of other Earn More Mall retailers that may be geographically close by. How powerful is that for Wells to influence consumer purchase decision and drive usage of its cards?!

Unfortunately, this type of consumer influence will not be available to banks through Apple Pay. Apple has decided to not share consumer purchase data with card providers/banks. Clearly Apple is looking to own the consumer relationship AND control the valuable behavioral data. However, given the amount of marketing activity driven by banks, especially Wells Fargo, this seems a little one-sided of Apple…giving room for a competitive payment platform that helps consumers AND banks. Banks need to use their power to guide the creation of a payments ecosystem that builds deeper customer relationships.

As we all know, Android OS based Samsung announced the acquisition of LoopPay as their digital payments platform and competitive solution. It would not be surprising if the Android OS based Samsung phones enable banks to access purchasing data to banks and provide the channel to communicate special offers. For a fee, of course. Apple and Samsung need to be reminded of the power banks have in the transaction process. Banks provide the cards! Strangely, BANKS need to be reminded of the power THEY have in influencing the payment ecosystem. The larger banks like Bank of America and Wells Fargo, have enormous power. At the current moment, banks are willing to draft on the success of Apple Pay.  Wells Fargo even promotes their Apple Pay features in TV commercials.  Cleary banks see value in positioning themselves as “cutting edge.”  However, this affiliation is purely brand driven and not consumer value drive.   If a bank can be promised greater access to consumer data AND direct access to consumers through the device, banks will drive great consumer value while promoting new technology.  Because of the consumer value focus, banks will promote one payments solution over another…and mean it.

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EMM solutions required to address consumer demand for BYOD

Screen Shot 2014-11-13 at 8.39.41 PMA recent survey by MobileIron found that 80% of respondents are now using personal smartphones or tablets in the work place. Intuitively this makes a lot of sense. I work in the heart of the Silicon Valley and see a ton of badged employees checking their work email on their personal devices as they wait for the salads at Specialties. It’s really easy to tell who works in marketing or BD (iPhone user) and who works in IT or engineering (Android)….or who moved here from the EU (Microsoft) and is still waiting to upgrade their device.

I still marvel at why people want to bring their own device to work…and why companies allow it with very little consideration given to data security and device management. I remember how excited I was in the early 2000s to get my company issued mobile phone. “Wow, I can make business calls AND personal calls…and I don’t need to buy my own phone! Or pay for my plan! Killer.” Now that attitude has evolved to me wanting to access my work email on my own device…and wanting my company to pay for the service plan. After all, I am using my personal service plan to make work calls and check work email. Given this use case, why shouldn’t I want my company to buy the phone as well? Seems logical to me.

We use our laptops for business and personal use and we expect the company to buy those as part of the workplace. It’s RARE that someone wants to use their own laptop at work…and is even greeted with a degree of suspicion for what kind of secrets he or she wants to steal. For example, I had an employee who wanted to write code on his personal laptop. I was adamant that he writes code only on a company laptop out of fear that we’d lose control of the code…let alone having the code physically leave when/if he left the company or lost the laptop. Clearly this was during a time when consumer facing cloud storage solutions were not prevalent.

Screen Shot 2014-11-13 at 8.35.02 PMSo why are there varying employee expectations for mobile devices and laptops? I think the big difference lies within HOW the employee uses the mobile device and what technology is available on the handset. The handset is a camera, online radio, game console, and an access point to social media. All these use cases are driven by personal preference and interest. I can think of only three common use cases on the work front: check work email, make work calls on the road and dial into WebEx meetings while commuting. Conceptually, the mobile device represents an employee’s personal life…and the employee wants to connect their personal life to the company and all it’s proprietary information.

Let’s take a 15 second commercial break and ponder the significance of this and the implications it has for businesses.

OK…we’re back.

Controlling how much access these “personal life” devices have to company data is MISSION CRITICAL for protecting proprietary information and conforming to regulatory environments. Controlling access is also critical to protecting customer data and preventing breaches from unscrupulous employees. Unfortunately, I can speak to several occasions where I’ve witnessed colleagues opening up sensitive data on their phone…to then upload a file to a personal cloud service. Or instructed company visitors to log on to Wi-Fi…to unknowingly providing them access to the same network files that NDA’d employees have access to. Wow, this is scary when you think about it, isn’t it?

So what to do? No matter how small the company, business must embrace the fact that employees want to bring their own device to work…or better put, want to meld their personal life with their professional life. Internet technology managers must also make implementing an enterprise mobility management (EMM) solution a top priority to control who has access to what company data and through which access points.

There are several EMM solutions out there and it’s up to IT leadership to assess their solution needs and approach the right vendor. However, the lagging IT manager will rue the day that he/she pushes off implementing a solution “until next year.” The Internet and cloud connected nature of mobile devices is a ticking time bomb for important data to leave the company. It’s just a matter of time until the data escapes.


Now hear me out,the Apple/IBM partnership is BIG for mobile payments

Apple IBM PartnershipI have worn many hats working in the financial technology vertical including business development, product, marketing and partnership development. In fact, I managed the IBM partnership for a PFM technology provider I joined in 2010. IBM played an important role for the PFM technology provider for it opened access to many of the financial institutions that run on the IBM technology to support core, online and mobile banking systems. Specifically, the PFM solution ran on IBM’s Websphere mobile software and on the IBM DB2 data base software. The software compatibility proved to be a strong selling point during business development discussions with banks that ran core legacy banking systems on Big Blue.

I learned fairly quickly that one of the biggest objections from mid-tier and larger banking executives was, “love your technology….but it MUST run on our legacy core and online banking systems.” Fortunately for us, we overcame this objection by playing the “we run on IBM” card to continue conversations. Unfortunately for IBM, these legacy limitations prevent many financial institutions from launching new tools and features that help consumers access their money through a mobile device. As we fintechers all know, these mid-tier and large banks are losing customers to the more sophisticated, innovative and mobile centric financial institutions…like Moven, Simple or GoBank.  An April 2013 Forrester study found that nearly 50% of respondents said they would be willing to switch to a bank with a better mobile experience.

The recently announced partnership between Apple and IBM could fix this and will position both companies very well for continued growth in the mobile banking and payments verticals..even with Millennials. I know, this is shocking …but in the words of Kevin Nealon, “now hear me out.”

As part of this partnership, IBM will be launching roughly 100 native mobile apps developed specifically for iOS. These apps are part of the MobileFirst platform IBM launched earlier this year and will adhere to the security, backup and data movement capabilities IBM is known for across the high technology industry. These capabilities are what keep banking IT executives coming back to Big Blue and a few of these iOS apps will strategically address the specific needs of the banking vertical.

The collaboration between IBM and Apple to build these apps will allow legacy systems written in Assembler or COBOL to run on the iPhones and iPads. Penny Crosmen at American Banker states, “Making existing mainframe applications usable on iPads could help banks bring mobility to old technology.”  This is HUGE for it helps banks easily engage with customers within the branch, through merchants or at home through a mobile device without having to make heavy investments in new technology or go through the lengthy process of selecting a clunky third party provider. For example, a bank will no longer need to license mobile platform technology from a Kony or mFoundry for their IBM partnership will open up mobile functionality through iOS sitting on top of legacy software. This is cool for the banks…but SCARY for mobile platform providers.

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The biggest use cases for the IBM/Apple mobile technology marriage can be seen at the branch and merchant levels. I can easily envision a wealth management representative having an in-branch investment conversation with a client using an iPad. The representative easily accesses a client’s core banking information from the mobile device and displays current balances, checking account activity and recommended investment opportunities right on the tablet. Taking this one step closer to the consumer, I envision the consumer later that evening going back to the banking application and sharing the investment recommendations with his/her spouse. Together the couple reviews the recommended investments, discusses financial goals and asks for further detail from their adviser directly from the iOS application.  Tadaaaaaah! The mobile/table user experience is helping the bank build deeper customer relationships through helping consumers manage their money…leveraging a channel the consumer prefers.

The second benefit of this marriage comes at the business banking level. This relationship should make payment providers pause…and maybe even shit.  Imagine a small retail merchant opens a business banking account that includes the “rental” of a payments tool like a card reader. The Apple/IBM relationship enables the bank to provide payments tools, card processors, etc. through already widely adopted iOS products. The bank may even function as a third party retailer for the iOS hardware and will save money by phasing out those clunky counter top card processors.  Banks will take away a key competitive advantages from payment providers who boast about the ease of use and mobility of collecting payments. Additional benefits for the bank are the ability for business bankers to track small business activity and recommend lower cost banking products, loan savings opportunities based on the specific business activity and transactions. Banks can also FINALLY find the right channel to provide those ever so sought after (and never well executed) locally targeted special offers and discounts to consumers.

For those of you keeping score at home, the consumer will also benefit from the IBM/Apple partnership. The iOS loving consumer will now be part of the same payment ecosystem merchants have with their banks. The iOS system now includes Passbook and it is no far leap to envision this evolving into a wallet that holds bank provided payment cards. This is “duh” obvious. Given that merchants, banks and consumers are all part of the same iOs payment system, consumers can easily continue using their long held VISA and Mastercards on their mobile device.  Continued adoption of the same payment ecosystem may provide opportunities for lower processing fees for all involved. Unfortunately, at this point the mobile payment providers are now banking on lower fees as their main value proposition. However, if banks are able to provide an easily adopted mobile wallet with many iOS supported merchants accepting these payments, even lower fees may be a moot point. Consumers will be able to FINALLY use their mobile wallets at the merchants and service providers they have always used.

Wow, way to go Apple.  You created a true mobile wallet.


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