Payments Views from Glenbrook Partners » Jay DeWitt

Payments News You Can Use! (Of the Beer and Transportation Sort)

Jay DeWitt — Thu, 29 Apr 2010 03:29:26 +0000

If you’ve been following the blog posts and tweets from the Glenbrook crew this week, you know that a few of us have been attending NACHA’s Payments 2010 event. I’m a Seattle native, now living in Spokane, and I had the opportunity to ride the new Sound Transit Central Link Light Rail into the city from Sea-Tac this trip, and wanted to alert loyal readers of this new transportation option.

The Central Link runs every 10 minutes between Sea-Tac airport and downtown Seattle — even more often during “peak hours.” There are eleven stops from beginning to end, which will cost you 35 minutes and $2.50 each way (compared to about $30 and 20 minutes — if you’re lucky — in a cab). The train travels through some of the more economically challenged parts of Seattle, but you can already see the new commercial development arising next to the line.

My first trip on the Central Line was from downtown to Sea-Tac, and I took the strategic option of de-training at the Columbia City stop for lunch and a couple of Diamond Knot IPA’s — a local beer favorite at The Columbia City Ale House. The Ale House is about three blocks from the Columbia Street Station (follow the signs to “historic Columbia City” for a great stop versus lunch at the airport… good quality pub food… and did I mention the Diamond Knot IPA’s? It was 30 minutes door-to-door for me from Westlake Station to the Ale House and about the same once I reluctantly decided to head to the airport.

The Sound Transit Central Link into Seattle — $2.50! — Payments News You Can Use!

When Worlds Collide [NACHA Payments 2010]

Jay DeWitt — Mon, 26 Apr 2010 22:01:03 +0000

I’m here in Seattle today at NACHA’s Payments 2010 conference along with Russ and Erin. I’m mulling over a couple things I heard in sessions today, trying to draw the line between them.

Early this morning, I sat in on a briefing by eCom Advisors about a study they did in partnership with FIS and PayPal, focused on consumer interest in P2P payments. In the study, participants who had been prescreened asonline banking users were asked whether they were interested in using a bank-driven P2P model. The answer? 48%. Really, only 48% of active online banking consumers could even fathom using their bank to send money to someone else? I’m shocked that this number is so low — is it that consumers can’t conceive of doing a non-cash P2P payment, or that they just wouldn’t rely on their bank for this function… after all, according to the same survey, the PayPal brand had 93% brand awareness.

Cut to the keynote event — Jack Dorsey and Jim McKelvey of Square talking about payments. Square is dedicated to creating a simple payment service with the first version enabled on iPads equipped with a small card reader that plugs into the 3.5mm headphone jack on the phone. Simple customer and merchant sign up and simple pricing… 2.75% plus 15 cents.

At least, that’s how everyone currently thinks about Square. But about halfway through today’s session, Dorsey said “we’re really focused on the receipts” and that’s when it became crystal clear to me: Square is about making the “payments experience” better for consumers and merchants and the actual payment stuff is just a way to get paid for doing that.

For merchants, the “payments experience” they are talking about is creating simple to operate POS, inventory and presumably marketing tools for merchants that are uncomplicated and enhance acceptance of a payment. For consumers, the “payments experience” they are talking about is getting away from being handed a really useless paper receipt and, instead, creating an electronic record of your purchase that you can use to actually do stuff — like analyze your payments, keep track of your balances and, I’d guess, share information as you’d like. With a little imagination, the possibilities are endless. Think Blippy, among other things.

Back to that study I talked about earlier. In the study, banks were advised that (along with other things) record keeping and reporting tools would encourage adoption of P2P payments — 73% of those surveyed this as important — so clearly there’s a signal there that “receipts matter” to consumers when it comes to the next generation of payments. So al of this makes we wonder: who would you bet is going to be the “winners” in offering P2P payments: the banks with their usual “safety and security” approach to the market or Square (and others to come), that have the focus on user experience and utility buried in their DNA? Think about your average Facebook/Twitter Gen Y’er … do they care about “security and privacy” or “fun, convenient and easy to use”?

Is Global eCommerce Really Such a Dark and Scary Place?

Jay DeWitt — Mon, 05 Apr 2010 14:59:05 +0000

Here at Glenbrook, we work closely with eCommerce merchants on issues and opportunities that they confront every day. Increasingly, the questions we hear surround the topic of “going global” — “What countries should I sell into? What local payment methods are important? Who can provide my company’s payment services over seas? It seems that U.S. merchants have an incredibly difficult time answering these questions… and good resources (other than Glenbrook!) are few and far between.

Why is the topic of global payment processing such a dark and scary place for merchants? Is it because of language difficulties? The perceived (and sometimes real) vagaries of foreign laws? Are domestic payment schemes on far flung parts of the world that different? Or is it because “dark and scary” is what you want if you’re selling flashlights?

Flashlight sellers? By that I mean global payment service providers such as Global Collect, Netgiro and Bibit (now part of RBS WorldPay). If you are a US merchant searching for a global processing solution, these are the providers that are going to be first up on your list — and they can certainly help you. But I’m often disappointed with their efforts to help merchants understand their options when selling online over seas. It seems that instead of educating merchants, which from my perspective should be their primary sales tool, instead they hold their global payment knowledge close to the vest, as though it were proprietary information.

Maybe Adyen, a new (to the US) global processing provider launching this week, can become not another flashlight, but a beacon for merchants trying to understand their cross-border options. Adyen says they are able to offer merchants access to a large number of countries, currencies and payment methods… all with transparent payment processing, a single contract and integration, utilizing a “try it, you’ll like it approach” with no exclusivity or long contract term requirements. Sounds good to me!

…But I want more, I want merchants to have easy access to knowledge about cross-border processing. I want them to know which payment methods are important in which countries, and to have clear choices among payment service providers. And most importantly, I want service providers to finally realize that it is much more effective to sell their services by educating merchants and selling on the strength of their offerings, rather than keeping things dark and scary and selling on merchant’s trepidations.

Maybe Adyen is this new kind of service provider… if so, I predict success. There are signs, too, that the other players are starting to “get-it” — Netgiro had a great webinar this week on Brazilian and Chinese payment options. To all providers in this space, I say “step-up”!

Payments as Business Strategy – MRC March 10-12, 2009

Jay DeWitt — Wed, 04 Mar 2009 04:15:20 +0000

The Merchant Risk Council is holding its 7th Annual e-Commerce Payments and Risk Conference on March 10-12, 2009 in Las Vegas Nevada.

I will be leading a panel discussion at the conference on “Payments as Business Strategy”. In this discussion, we will highlight how payments management is an important part of any eCommerce Merchant’s overall strategy, both in keeping expenses in line but also, and, even more importantly, contributing to top line revenues. Hope to see you there!