The U.S. has entered a new phase of the mPOS evolution process, and merchants are becoming increasingly reliant on mobile commerce platform providers to suit them up for emerging technologies like Apple Pay, as well as security technologies like NFC and EMV. MPD CEO Karen Webster recently caught up with Scott Holt, VP of Marketing & Solutions for ROAM, part Ingenico Mobile Solutions to get his perspective on recent mPOS news around Apple, how ROAM is enhancing its platform for its customers as the holidays approach, and where things currently stand in the world of mPOS.
KW: Let’s get caught up on mPOS news and trends. It’s always interesting to talk about Square since their business has really evolved over the years they’ve been in the mPOS space. They made an announcement on Wednesday about a new feature that will connect their merchants to consumers through online ordering. I’d like to get your reaction first to the trend, and second to why you think Square is doing this.
SH: I think Square is clearly in a mode to be diversifying its offer. They’re trying to build as much value as they can for their merchants, and they have their foot in a lot of different areas. They’re still trying to figure out which one is exactly working best for them.
Are we seeing this as a trend? It’s not something that we’re seeing on our side, but from our perspective, we’re not necessarily playing in the same areas as Square.
KW: So where are you playing?
SH: Our solutions have traditionally targeted the mid-tier markets. While we’ve always had a strong base by servicing and white-labeling solutions for the ISO and acquiring partners we have, we’re seeing an increase as we move up market with the solutions. We’re dealing more with mid-tier retailers and a lot of the companies that are purely online, or have no storefronts themselves. Those have always been big sectors for us, and continue to grow.
KW: So let’s talk about the kinds of things your merchants are asking of the platform. The online ordering seems to be something that’s of interest to a particular segment of local merchants, but not relevant to the segment merchants you deal with. So what do they want? What kinds of features are they asking for, and what are you enabling your platform to deliver, especially as we approach the holidays?
SH: For us, where we’re seeing the most growth is in the same thing over and over: business applications, business applications, and business applications. What I mean by that is there are a lot of different use cases out there, and with those comes the need to make mPOS solutions more vertical. What are customers are asking for now is for us to provide our solutions in the form of APIs so they can be embedded in a broader business application that’s bringing full value to our customers’ customers. A great example of that is direct selling. We have a number of clients who use the APIs that we provide, but the applications that they have for payments and processing payments onsite is one small piece. For them, there’s a whole experience they’re trying to generate, and that’s an experience that they want to control, and something they fully understand. But the piece they’re not great at is the payment component, and we’re seeing that across the board. That’s become a key central part to our strategy, and has been for some time.
In addition to that, a lot of what we’re seeing are additions to being able to provide metrics or reporting around the system. By adding in additional hooks to different business applications, we’re providing greater value to the merchants that we service and to their customers.
For the most part, what we’re seeing is that those can be quite diverse. By implementing an API strategy, we’re able to service those by not becoming directly involved with building them for the customer. For the most part, customers already have existing systems or tools that they want to use. Some of them are highly customized and in many cases built in house, so by providing them with an API we can allow them to use what they have without having to change any of their experience or user flow.
KW: So you mentioned metrics. There’s lots of stuff that merchants want to measure. What are they actually interested in getting from your platform, and what are some of the metric outputs you can share with us?
SH: So in each case, it’s slightly different. The metrics that we have available to us that are through our reporting tools, which can report on all sorts of different angles of transactions, including by time, time period, type of transaction, and we are able to integrate those metrics that we provide into the broader applications that I discussed. At the other end, merchants are able to process multiple sets of metrics that are valuable to their business. What we’ve tried to do is provide as much data as we can from our system for them to be able to pull it into their systems and slice and dice it in a way they see fit. A lot of customers that we work with use a different front-end reporting tool so they can create a dashboard that’s common across all of their payment tools, and we enable that by providing that through the APIs that we offer.
KW: Let’s talk a little about security. I’m curious to get your take on it with respect to mPOS. How is ROAM addressing the whole concept of security?
SH: I think there are two parts to that question. One relates to the physical components of security around the hardware, and from our perspective at ROAM, we’ve always had that at the forefront. As an Ingenico company, that’s within our DNA. For a lot of solutions we see outside of the US, those are held to the same standards that we have across all of the payment lines – EMV, PCI, etc. Here in the U.S., we’ve always implemented an end-to-end encryption protocol on our readers, and we were the first to be Visa ready, and to meet all of the standards provided by the card brands.
Then you have the application security. In this case, we’ve always been at the forefront of that as well. There’s perceived security issues with mobile – what happens when someone gets a hold of someone else’s phone, and what can they do to manage that? We have the ability to remotely deactivate the application, and at the same time, once someone’s in, it’s hard to access that system.
On the flip side, on the backend systems, our solution is used by a number of leading financial institutions here and around the world. From a data storage and access scenario, we are fully compliant – doing businesses with banks is a really tough call in a lot of respects. So we’ve built systems that are at that level and hold all global and localized certifications.
KW: The thing that’s so unsettling about point of sale breaches that we’ve been reading about is this notion that the bad guys are getting malware into the POS operating system. Is that possible in the mPOS world?
SH: I think threats are threats, but I can’t speak to where it’s different for mPOS. To date, I know that we’ve yet to see a malware attack on mPOS solutions and that may be for two reasons. One, because mPOS solutions are still in a growth phase and they’re not yet in the eyes of the hackers that are doing this. At the same time, it may also have to do with the solution itself.
KW: What is your position on Apple Pay from a ROAM and mPOS perspective? Are you connected to it in anyway?
SH: ROAM, as part of Ingenico, is definitely committed to Apple Pay. On the mPOS side, we have a number of our devices today that are in-market and offer the NFC capability to support Apple Pay. Those are typically the more advanced devices used in chip and pin countries, but with the EMV migration happening here in the U.S., we’re seeing more demand for that at the mPOS. We’re certainly on board with it, and for us, we’ve always been payment agnostic. We aim to support as many payment types as our and their customers are demanding.
KW: I know you move around the world a lot and have the perspective of a global organization when it comes to mPOS and the ways in which it is evolving around the world. Give us a sense of where things are today and how that may have been different earlier in the year.
SH: I think we’ve seen growth in areas where were weren’t expecting growth, particularly in the emerging markets like in India where mPOS is being used to leapfrog more established technologies that exist in other countries. Here in the U.S., we’re seeing the next phase of evolution, where the off-the-shop, one-size-fits-all mPOS solution is long gone, and people are looking for broader applications with that. We’re starting to see that evolution coming in Europe. The U.S. is a little further ahead, but we’re being asked the same questions in Europe – our APIs are being increasingly requested by a lot of the European merchants and acquirers we do business with. Those have been key examples, but obviously with in the U.S. now, the EMV migration is kicking in and we’re working with our customers to support them as they make the move with physical and mobile POS.
As we start to see mPOS evolve, we’re going to see more around these customized applications that can be created from a baseline platform like the one we run here at ROAM.
KW: So it seems like there’s this ecosystem that you guys are building and supporting with your API strategy, and you’re really trying to push innovation into the ecosystem and embed that into the solutions that innovators want to take to market.
SH: Absolutely. We want to be the ones to take the heavy lifting out of payments to allow our customers and their customers to build their value-added applications without worrying about all of the nuances with payments today. As we see new requirements for EMV, that’s also becoming more important for our customers – they rely on us to rapidly and dynamically create tools and applications around payment APIs that we provide.
VP of Marketing and Solutions, ROAM
Scott has over 20 years of marketing, communications, product management and business development experience in the payments, mobile and technology industries. In his current role, Scott manages the global marketing, communications and product management functions for both ROAM and the Ingenico Mobility Business Line. Scott joins ROAM having most recently served Chief Marketing Officer with alternative payments start-up, ZipZap, where he directed the successful market launch of the company’s cash transaction solutions. Prior to this Scott was a Senior Vice President and member of the executive management team for ExaDigm, a leading provider of point-of-sale, network conversion, and wireless connectivity solutions. Originally recruited as ExaDigm’s first Vice President of Marketing, Scott was instrumental in driving the market launch of a range of industry-changing payments products and increasing the company’s brand awareness nationally. Scott joined ExaDigm having built a successful career in the ATM and self-service delivery systems industry having served as the Director of Marketing for Tranax Technologies (U.S. subsidiary of Nautilus Hyosung). Scott is an active member of the Electronic Transaction Association (ETA) and other industry groups. A native of Sydney Australia, Scott holds a Bachelor’s Degree in Management Psychology from the University of Western Sydney, Australia.
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