From Pioneer to Leader

an opinion piece on mobile payments in 2020

estimated reading time: 7 min

what’s the big deal about paying mobile?

I can only think of superlative bullshit bingo when I hear that our world is becoming increasingly “smarter”; “digitally-connected”; “client-centric”; “mobility-aware”; “service-oriented” and “value-driven” … but bottom-line remains that payment for goods and services is evolving as rapidly as the terms we use to describe what we are, live and want – in some sectors quicker than others.

When I look at everyday expenses for food, telco, entertainment or … mobility, there is nothing particularly exciting in driving a car and … eventually pay for gas… unless it becomes a moment of true customer engagement; a moment that genuinely addresses all digital capabilities and adds actual value to the process of payment itself. An interaction that bears value for both, the merchant and the client.

Mobility has been trending for the last decade in a myriad of applications - and apps have been flooding the consumer market more or less successfully with more services than a human can possibly try out in a lifetime - let alone use them on a consistently recurring and loyal basis. In 2020, we are living in a connected world where “convenience” and “frictionless” are ruling with “recognition” and “value” and the iconic simplicity of “Time is Money” is long gone.

Payment itself has become an everyday normality, a commodity, a necessary burden. “Deferred (mobile) payment” might add a little complexity from a technical or risk-taking viewpoint, but it remains “payment” at the end of the day. Methods of payment have been multiplying ever since the existence of commerce, from gold to cash to credit cards - and more recently cyber-money and increasingly facilitated cross-border payments with such great facilitators like SEPA or inter-bank schemes.

payment + mobile + x =?

Now try to imagine the power of combining those ineluctable trends. Go figure the countless use cases and business possibilities that mobile payment can enable. I sure have not been the first - and will definitely not be the last one wondering about what shape and place mobile payments are likely to take in a near future - be it in a retail B2(B2)C or more structured B2B context like digitized fuel cards… offering more services than simply paying for gas – think of genuine, value-adding, time-saving and efficient mobility services.

Mobile payment is designed to offer us an unprecedented potential in the way we pay for goods and services. It is meant to make our lives easier, to remove burdens of cash (and risk) and to allow us to effectively value ourselves as the customers we all are. A recent study revealed an average of 51% of the Western European population aged between 30 and 40 years are using mobile payments already with an astonishing almost 70% declaring that it makes buying “less complicated” while saving on checkout queues and hassles. It also showed that the Benelux countries are slightly ahead of our European neighbors with respect to the adoption (and acceptance…) of mobile payments. Moreover, the “Amazons” of this world have long boosted online payments to becoming a true commodity, often linked to traditional payment means with relatively mature authentication and data-protection coming the same way.

is there a use case for mobile payment?

Why change what is working? Why consider additional expenditures to go digital when it is “just payment” after all? I could think of so many viable and exciting use cases, but the single ones that really got us started at CarPay-Diem - and helped our loyal customers reaping early benefits of going mobile with us - are all spinning around the re-invention of the payment process itself. Not only a re-definition of the payment process, an entire re-positioning in a collaborative ecosystem that reaches beyond simple “client / merchant” transactions.

• A retailer or fuel merchant that is seeking to better understand its client behavior and buying patterns as a matter to sell more goods or services to more clients; or
• A car maker or OEM manufacturer that is seeking to offer integrated and brand-agnostic services from within a connected car; or
• A (smart) mobility service/app provider wishing to monetize its client base and offer a more diversified portfolio of services including fueling… because even if there is a general trend towards alternative or greener mobility solutions…our cars are not yet ready to disappear from our everyday lives; or
• A retail bank that is battling to identify viable (and scalable) “innovation use cases” or that is seeking ways to simply retain their clients with innovative – increasingly non-financial - service offerings … or be it simply to fight against the looming threat of losing the payment processing business to GAFA or other digital market entrants.

the cost of survival

20th century-management-guru W. Edwards Deming once said that “It is not necessary to change. Survival is not mandatory”. How true! Especially in times when it is not about selling and paying anymore – in times when it has become about “the whole stuff around it”; call it “customer value”; “positive experience” or “digital engagement”. Payment can become that vector, that moment of engagement when fuel retailers also realize that “Data is the New Oil”.

Mobile payment sure comes at a cost. It is an emerging technology that is seeking adoption; it is rivalling with well-established, traditional methods of payment. Mobile payment cannot compete on cost of transaction, it will need to differentiate on another dimension; it will need to compete on augmented customer experience and … ideally add a premium that is worth the move - for both, the consumer and the merchant. Digital hyper-trends, UX, speed, convenience are all certainly contributing to attractiveness - but in our 2020 world, value-oriented- and connected consumers will always hunt down the “what’s in for me?”-factor.

In order to be (and remain) attractive, there is need to offer more than “just” payment. In our case, we have chosen to replace that necessary “moment of payment” into an effective and personalized “moment of customer engagement”. With location-based real-time offers, and analytics-driven campaigns (remember the bulllshit bingo?) we increasingly leverage the power of social networks and segmentation / profiling possibilities to offer dedicated and automated campaigns that ultimately drive effective customer acquisition-, servicing- and retention. All this on top of the payment itself – and this is where the true value lies. This is what makes the fine difference worth the investment in mobile payment.

the thin line between “wanting” and “canning”

Despite the endless supply of superlatives, there will always remain a special spot for the one actually “doing the job”. With so many initiatives and actors promoting ideas, concepts and hundreds of PowerPoints slides… all praising the benefits that “integrated mobile payment platforms” could possibly offer…the actual number of actors really delivering at scale (rather than telling about it) is very scarce.

Paying for gas has long been considered a necessary burden, a checkout process prior to leaving the forecourt. The arrival of “digital” in general and “mobile” in particular allowed to somehow gamify the process and also drive loyalty or brand exposure - but inclusion of actual mobile payment has long been lagging behind. Not as a matter of lacking technological capabilities, but as a matter of a viable business case for the merchant. With our transformed vision of payment, we were amongst the very first ones pioneering the space of mobile payment, jumping into the cold water and strongly believing in the fusion of mobile payment and customer engagement.

from pioneer to leader

500,000 – that’s the number that made my week. CarPay-Diem has passed the production mark of half a million mobile payment transactions - successfully processed.

Done and delivered - no lab, no sandbox, no pilot – actual and existing production. That is an impressive millstone and makes us de facto leader in the mobile (fuel) payment space - amongst “wanters” and “dreamers”.

From pioneering into the sub-explored space of true, frictionless mobile payments and eventually taking the jump; we now have established ourselves as leaders in the mobile payment arena (read: true, frictionless mobile payment, no strings attached, no hardware required - unlike other payment means like NFC-based transactions).

We have done it. Within our first year of production we have processed over 500K mobile payment transactions. What an achievement, what a milestone, what an outlook ahead!

I am proud to belong to this incredible team.

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You are a fuel retailer, a large mobility user community, a retail bank or simply want to find out more about combing digital solutions, mobile payment and customer engagement and how we could fuel your business case going mobile?

Reach out and find out!