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2018 Commerce and Payments Year in Review · Within Retail, Pre-Holiday Pre-Holiday (Nov 1- Nov 21)...
Transcript of 2018 Commerce and Payments Year in Review · Within Retail, Pre-Holiday Pre-Holiday (Nov 1- Nov 21)...
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referenced in this material are the property of their respective owners.
Commerce and Payments Year in Review © 2018 First Data Corporation. All rights reserved. The First Data
name, logo and related trademarks and service marks are owned
by First Data Corporation and are registered or used in the U.S.
and many foreign countries. All trademarks, service marks, and
trade names referenced in this material are the property of their
respective owners.
2018
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Recap: FDC’s
predictions
for 2018
Another evolutionary year
Consumer expectations for
faster access to their
ecommerce orders, and same
day delivery, is changing
physical retail
As retail and digital
increasingly converge,
traditional retailers are turning
to M&A of startups to catch
up on retail transformation
In addition to M&A, retailers
are forming unexpected
partnerships with big
technology giants
Retailers and banks are
utilizing machine learning and
AI to strengthen services and
streamline operations
Retailers are experimenting
with smaller format physical
stores given changing
shopping dynamics
Disparate industries are
working together through
IoT collaboration to reach
more households with
connected commerce
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2018 Commerce and Payments Year in Review
Holiday
Spending
Kickoff
Amazon
Goes
Further
Offline
Cashierless
Automation
Retail
Apocalypse
Data
Privacy
Digital
Bank
Launches
FinTech
Friendships
Trends in
Blockchain
Chinese
Payments
Expansion
Payments
and the Capital
Markets
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6 7 8 9 10
FDC’s Top Trends of 2018
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Holiday season kickoff
Note: Figures include Brick & Mortar and Ecommerce channels. Source: First Data aggregated same-store data.
3.4%
5.7%
2.6%
7.8%
11.9%
7.1%
5.6%
11.3%
5.0%
0%
5%
10%
15%
2016 2017 2018
Pre-Holiday (Nov 1- Nov 21) Thanksgiving + Black Friday Thanksgiving to Cyber Monday
Total Spending YoY Growth
› 2017 saw very strong growth
to kick off the holiday season
– spurred in part by recovery
spending as a result of
hurricanes in 3Q17.
› Comparatively, Pre-Holiday
spending growth of 2.6% was
not spectacular, but solid
considering the tough comps.
› Thanksgiving + Black Friday
showed noticeable
acceleration to 7.1% vs. the
Pre-Holiday period.
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Holiday season kickoff
Note: Figures include Brick & Mortar and Ecommerce channels. Source: First Data aggregated same-store data.
YoY Growth Retail Spending
1.6%
5.9%
1.3%
9.0% 9.3%
7.5%
5.8%
8.0%
3.9%
0%
5%
10%
15%
2016 2017 2018
Pre-Holiday (Nov 1- Nov 21) Thanksgiving + Black Friday Thanksgiving to Cyber Monday› Within Retail, Pre-Holiday
spending growth of 1.3% was
the slowest of the last 3 years.
› However Thanksgiving +
Black Friday Retail growth
jumped to 7.5%, driven by
strong growth in both
Ecommerce and Brick &
Mortar.
› Similar to the prior two years,
growth from Saturday through
Monday tapered off a bit.
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Holiday season kickoff
Note: Figures include Brick & Mortar and Ecommerce channels. Source: First Data aggregated same-store data.
YoY Growth Total Spending vs
SMB Spending
2.4%
4.5% 3.6%
0.2%
2.5% 1.4%
2.6%
7.1%
5.0%
0%
3%
6%
9%
Pre-Holiday (Nov 1 - Nov 21) Thanksgiving + Black Friday Thanksgiving to Cyber Monday
Transactions Average Ticket Total Spend
0.2%
2.4% 1.2%
0.6%
5.0% 4.3%
0.8%
7.5%
5.5%
0%
3%
6%
9%
Pre-Holiday (Nov 1 - Nov 21) Thanksgiving + Black Friday Thanksgiving to Cyber Monday
Total
SMB
› SMB spending growth has
outpaced the total
marketplace.
› And while they are driving
transaction growth, SMBs
have also figured out how to
encourage customers to
spend more per visit.
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Amazon goes further offline
2018 YTD $5.8B Physical retail sales
$12.8B Physical retail sales
2017
Includes sales from 465 North America and 7 International
Whole Foods locations + ~15 physical bookstore locations
Now operates 630 physical retail locations, up 30% YoY,
and now includes bookstores, Amazon Go convenience
stores, and Whole Foods grocery stores, among others
Source: Company press releases and web sites; TJI Research.
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Solutions are emerging from
startups to established
enterprise
tech providers
Retailers from the U.S. to
the U.K. and France, to
China and beyond are
testing the concept
Go-ing beyond the cashier… across the globe
Source: Company reports; ZDNet.
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“Retail Apocalypse…” or continued evolution?
The reality
› In-store still the top destination
› Net growth of 2,000+ stores in 2018
› Positive forecasts
› Retail struggle = Mall struggle
› Consolidated closings
Omnichannel Customer
Experience +
Note: Figures include all tracked spend across all categories, including Brick & Mortar and Ecommerce channels. Source: First Data aggregated same-store data; IHL; US Census Bureau; National Retail Federation.
Debt burdens and lack of technology improvements
are common to struggling retailers
4.5%
5.7%
4.9%
0%
2%
4%
6%
8%
10%
Brick & Mortar Ecommerce Total Spending
3Q17 4Q17 1Q18 2Q18 3Q18
Total Spending – YoY Growth
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“Retail Apocalypse…” or is old the new new?
Source: JLL Retail Research.
Ecommerce “natives” are forecasted to open
850+ physical stores in the next five years
Given the importance Brick & Mortar still holds in retail,
many pure-play ecommerce firms are opening physical locations
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Current state of data privacy
Key Takeaways From First Data’s
Cybersecurity Study on PII Data
Recent Cybersecurity
Market Events
Key Highlights
› The survey was divided among four key demographics: Linksters (18–23),
Socializers (24–34), MTV Generation (35–54), and Maturists (55+)
› The older you are, the more likely you are to believe that fraud is inevitable
› 25% of consumers assume their PII is safe unless they are told otherwise
› 26% of consumers say they have had their PII compromised within the last
month; 34% say that their PII has been compromised within the last year
Consumer Trust With PII Data
Most
Trusted
Least
Trusted
46% Financial
39% Healthcare
30% Insurance
8% Telecom
8% Foodservice/QSR
4% Petroleum
Thousand of Mobile Apps Leak Data from
’s Firebase Database
June 23, 2018
said to have exposed 340M
records, more than Equifax breach
June 1, 2018
advising all 336M users to change
passwords after bug exposed them in plain text
May 3, 2018
admits public data of its 2.2B users
has been compromised
April 4, 2018
Source: TechCrunch, June 23, 2018; USA Today, June 1, 2018; FORTUNE, May 3, 2018; NBC News, April 4, 2018; First Data 2018 Consumer Cybersecurity Study.
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Traditional banks shifting to digital
Consumers Are Shifting Their Behaviors
American most often use online and mobile to
access their bank accounts
Source: Company reports; The Daily Telegraph; ABC News; Reuters; Engadget; Morning Consult, on behalf of the American Bankers Association, conducted a survey of 2,000 U.S. adults.
2%
4%
7%
18%
26%
40%
Telephone
ATM
Bank Branches
Mobile
Internet
2018 Digital Bank Launches
Leading Mobile Banking Ecosystems
33M 23M 26M
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FinTech and banks – Becoming best of friends
Bankers Expecting
FinTech Influence
Percent of expected contribution to the banking
ecosystem by FinTechs
17%
25%
54%
2016 2018 2020E
Source: Company reports; World Retail Banking Report 2018, Capgemini and Efma.
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Trends in Blockchain
A Foundation for
Blockchain Innovation
West Virginia
Mid-Term Elections
Walmart to Add Transparency in
Food Traceability via Global
Supply Chain
ICE to Launch Platform for
Trading Digital Assets
Canadian Border Services
Streamlining Freight Shipping
2018
Implementations
Blockchain-as-a-Service to
Facilitate Deployments
Source: Computerworld; Coindesk; ZDNet.
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China payments going global
150M+ Outbound
Trips
$5.5T+ Mobile
Payments
1.3B+ Total
Population
~$260B Outbound
Tourism
Spending
Source: Company reports, Mercator Advisory Group; UN World Tourism Organization; Suning Institute of Finance.
Enormous Spending Power Abroad Growing Partner Ecosystem
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Payments and the capital markets
IPO M&A
Source: Company reports.
Financing
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Other headline topics from 2018
Retail
Delivery
Retail
M&A
P2P
Monetization
U.S.
Open Banking
Alternative
Lending Landscape
Terminal
Tremors
Faster
Payments
Bank
M&A
Cashless
Society
PSD2
Goes Live
Shared Ecommerce
Payment Button
Bank Regulatory
Rollback
GDPR Becomes
Enforceable
Cashless
Stores
China
Opens Up
AI in
Everything
Expanding Voice
Ecosystem
Ongoing Merchant
Litigation
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First Data – An exciting 2018
Feb
Launched in
Germany and Austria
Reached ~$50B in
annualized volume
750K+ Clover units
shipped
Apr
Reached ~$58B in
annualized volume
Jun
Disburse-to-debit
partnership
Investor Conference
Aug
JV extended
Remittance processing
business agreement
Oct
Reached ~$70B in
annualized volume
Partnership
Sep
1M+ units
shipped
FirstSense launched
Partnership
Card processing
agreement with SBI Card
Mar
Expanded partnership
Card processing
agreement
May
European card processing
agreement
Agreement and
acquisition
First Data Education
established
Jul
Class 8 announced
Reached ~$65B in
annualized volume
Jan Nov
Launched in
Argentina
First Data Holiday
Insights launched
Clover launched in
Canada
Partnership
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Stay tuned…
Holiday Insights Dashboard
Live Now
Holiday Season Recap
Coming Soon
2019 Outlook
Coming Soon
….there’s more in store from First Data Insights
Get in touch with us anytime at FirstData.com/SpendTrend