The payments industry’s top players must continuously grow and innovate to remain in the game. Three of those have gotten a head start on new strategies for the coming year.
eBay
In 2012, eBay hopes to reinvent itself as the leading technology partner for retailers, that’s at least according to CEO Jim Donahue. The acquisition of numerous mobile commerce startups over the course of the past year, not to mention its ownership of PayPal, will surely help fuel the push towards an entirely different platform.
Donahue explains that eBay plans to abandon its prior business model, shifting the focus from small and medium-sized business to that of larger retailers, adding that the company has been receiving requests from them for a multi-channel platform, a way to handle generation demand and drive traffic, and of course, a way to go global.
“We want to become the partner of choice for retailers of all sizes to compete in this new commerce world,” he said, at the Goldman Sachs Technology and Internet Conference on Wednesday.
Donahue also maintains that the total value of e-commerce has increased tenfold since last year, thereby representing the current desire for a “web-enabled” market.
“What’s happened over the last 12 to 18 months is that the line between e-commerce and retail is coming down.” Donahue said, “It’s not just blurring. It’s falling down like the Berlin Wall.”
The idea is that with the rapid evolution and growth of the e-commerce market, eBay will be able to diversify its prospects and extend its services to larger merchants in this multi-channel world.
Visa
Also at Wednesday’s GS conference, Visa announced the launch of its new mobile service channel—developed in partnership with mobile banking provider, Monitise—that will allow those banks issuing Visa cards to offer customers the ability to monitor their recent account history, transfer funds and receive transaction alerts, all via mobile phone. The goal is to simplify the current mobile banking platform and reduce the cost associated with it.
Also on the list of mobile strategies for 2012 is mobile check deposits, mobile payments and the official launch of “V.Me,” Visa’s digital wallet, which is currently being tested by its employees, as well as a number of its partners.
The company is also pushing for merchants to accept Visa processing via mobile payments, as well as continued growth on the global front.
According to Visa CEO Joseph Saunders, Visa’s Fundamo unit has confirmed deals in several countries this quarter—one of which includes the launch of a service in Africa that allows users to access a prepaid account via their mobile device, in partnership with one of Africa’s largest telecommunication providers.
These announcements come in the wake of Visa’s reported 16 percent growth for the fiscal first quarter.
MasterCard
Top player MasterCard is also revving up its global e-payment engines, with new focus on electronic payments via electronic devices, especially in emerging markets.
CEO Ajay Banga maintains that even with MasterCard’s gains in the fields of technology and innovation, the ultimate goal is transformation of its payment platform—which Banga hopes to achieve through new developments and new employees. The aim is to get down to basics and facilitate its current processes, by promoting the execution of innovative, forward-looking practices and generating growth in a continuously changing (payments) world.
The challenge, however, according to Banga, has been convincing long-time employees of this need for change and innovation.
“Our greatest challenge has been convincing our people that a change in mindset is even necessary. After all, MasterCard has a rich 45-year history built on strong customer relationships and consumer affinity, reinforced by solid financial performance,” Banga explained, in an interview with Investor’s Daily News, “But our world is changing rapidly — both the payments world and the world at large.”
To help facilitate this change, MasterCard created its global research and development team, MasterCard Labs, which has succeeded in bringing a new degree of urgency and innovative spirit to the company environment, since its launch in 2010. The company also introduced an idea management system called Aspire, allowing employees to share their own, individual ideas to improve company products. MasterCard has even gone so far as to host “Innovation Express” to keep the spirit of innovation alive—a two-day competition, during which employees must work in teams to create new product prototypes.
It is this changing culture, though, that will help MasterCard promote itself as a multinational company. “We do business in 210 countries and territories, and more than 60% of our net revenue is generated outside of the U.S.,” said Banga.
However, since 85% of global transactions are still conducted with cash or check, Banga maintains that MasterCard’s opportunities to grow its electronic payments industry are endless.
The company’s next steps include forming partnerships with a range of companies, adjusting their recruitment approach, and empowering consumers to help make the world a “cashless society.”
This trio of leaders is far from an exhaustive list of key players in the payments space. Later: updates from CEO Hikmet Ersek from Western Union, CEO Jeff Bezos from Amazon, and Senior Vice President (Chrome and Apps) Sundar Pichai from Google.
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