Session 2: New Worlds of Commerce – Putting Puzzle Pieces Together

Highlights

– The macrodynamics of mobile and social commerce

– How offline and online are converging

– How consumers shop and where they buy (and how that is changing)

– Where payments fit and why it matters

An animated debate broke out amongst institute participants following the presentation by Barry McCarthy (Global Group Head, Strategic Clients and Alliances, First Data), who discussed his company’s role in the Google Wallet venture. Many in the audience questioned the concept in general of user data being stored on a chip inside the phone instead of in the cloud. McCarthy (seen right) responded that technology is currently not fast enough to support sub-second transactions.

In the case of a lost or stolen phone, McCarthy pointed out that users can get the information stored on their mobile device transferred in a few minutes, whereas a lost or stolen card might take days to replace.

As for other players in the space, McCarthy offered his personal predictions that PayPal was “beautifully positioned” to make a run in the mCommerce space, along with Apple. With regards to the AT&T/Verizon joint venture, ISIS, McCarthy thought it was great the two telecom giants were cooperating but noted that partnerships tend to be tricky.

Also presenting during the session was Greg Boardman, Ingenico’s SVP of Product & Development, who spoke about activating the point of sale for mobile and social commerce.

“Our more than 15 million device-installed base and solutions enable payment acceptance in 125 countries,” said Boardman, who went on to note that mobile POS has been a niche market up until now.

Boardman acknowledged that enabling mobile payments via Near Field Communication (NFC) technology among merchants has been a slow proposition but believes consumers will find the idea of tapping a mobile phone more appealing than using a card. He went on to outline Ingenico’s 18 to 24 month strategy for igniting NFC adoption.

“By creating an interoperable, secure, adaptable payments platform that can accept NFC, swiped and chip card-based transaction, Ingenico is easing the switching pain for merchants and the integration pain for our partners,” he said. “Easing the switching pain for merchants and partners – that’s the value Ingenico brings. We’re qualified to deal with barriers to entry because we’ve been doing it for a long time.”

Patrali Chatterjee, Associate Professor, Montclair State University, during the session looked at the implications of cross-channel payment behavior for consumers and retailers. She noted that with the explosive growth and diffusion of remote access devices through which consumers seek “perpetual” interactions with firms anytime, anywhere, organizations increasingly face market pressures to transact with consumers across multiple channels. She noted, though, that cross-channel customers are more satisfied with retailers than Web-only or store-only customers.

Additional panel presenters included Jim Greene, Cisco’s VP of Global Financial Services Practice, who called mobile commerce a race for companies to create solutions that are relevant to specific groups of consumers. He also added his prediction that interchange is going to be free.

“It’s like what is going to happen to telecos,” said Greene.

Dartmouth University Associate Professor Jonathan Zinman, meanwhile, explained how behavioral insights can help to develop new products and features that create and meet demand.