Prepaid Summit 2010 Di Marco (Final)

A Euronet Worldwide Company

New trends in the Gift Cards markets & global cash collection in Europe

Giuseppe Di Marco

epay Italy Managing Director

Prepaid Cards Summit

Milan, 13th of October 2010


Contents of PresentationToday there are two main drivers that are pushing the prepaid digital market:

(becoming Digital Goods)

(mobile phones, music players, game consoles, E-books readers, TVs, tablets, etc.)

This market involves many players:Large Retailers (willing to sell their goods using new ways)

Contents Providers (needing new ways to distribute and sell their products)

Devices suppliers (aiming to fill their new marvels)

TelCo Companies (bored to provide roads making other to get the money)

Financial Institutions (interested in new ways of managing payments)

Trusted Third Parties (needed to integrate all these players)

We will go through this new way of selling goods

2


Evolution of virtual goodsThe evolution of virtual goods, maybe, is not giving us the right perspective:

Once there were just Mobile Top Ups and other telephone related products. This has been and is even now a huge market. But the margins are decreasing

Other products joined the Mobile Top Ups:Pay TV Top Ups

Financial Products (Open Loop Cards, eVouchers, etc.)

Music Top Ups (i.e.iTunes Cards)

Moreover many Retailers and Contents Providers created their own Cards

All of them have been seen as Cards, Gift Cards, in general PRODUCTS

But, given the wide range of virtual goods might be, we need to change the focus we look at this market

3


Today Cards and Gift Cards have become a CATEGORY - these are no more just a product!

A Euronet Worldwide Company5

Gift Card How much

Did you know that: *Today the Gift/Prepaid Category

The #2 category in sales at grocery storesThe #1 fastest growing categoryThe #1 in margin per square meterThe #1 in revenue per square meter

The average overspend amount is 72%

* Source: FirstData


Gift Card - Why

Why a Customer decide to choose a card as a gift? *

Receiver can buy what they want71%

Convenient to purchase50%

Flexibility in redeeming a gift card35%

He doesn't know what else to buy the gift receiver33%

* Source: FirstData


How to approach to the European gift card world

Distribution

Content

New Products

We need to make the flyweels start....

on the Consumer side and ...

... on the Retailer side

7


Distribution

Content

New Products

RETURN ON INVESTMENT

8

How to approach to the European gift card world

DESIRE FOR A VARIETY

CONVENIENCE & TARGETING

PROMOTION & INNOVATION

SERVICES

TURNKEY SOLUTIONS


Marketing and destination merchandising

Source: Mercator, 12/09

consumer brands

Destination merchandising

both in store and in third party

malls

Increased sales, profits and brand

exposure

9


How to approach the ConsumersDESIRE FOR VARIETY

Today the European prepaid market is dominated by Mobile Top Ups

We need to enrich this offer, even if already important, with a wide range of products, that is extending in different sectors, both Global and Local contents:

Digital Contents: Gaming, Music, eBooks, Software, Social Networks Credits, etc.

Physical Contents: Fashion, Electronics, Toys, Dining Out, Pet, Travel, Recreation, Luxury, Home, etc.

Transportation and Ticketing (Transit)Financial Products: Open Loop Cards, eVouchers, etc.


How to approach the ConsumersCONVENIENCE & TARGETING

Different Targets for the different Retailers:Once in 2 months

Large Retailers:Women 25/65

(The Decision Maker)

Independent Retailers:Cross 15/65

(The Self-Shopper)

TARG

ET

Electronic Large Retailer:

Adults 25/40 (The Specialist)

People buy here specific products: accessories for pc,

People buy here products and servicesTop ups, pay TV recharge,

People go here for grocery shopping They can find also other services:

Once a week

Once a day

Through the Gift Card Mall, choice has extended, and cards,issued by a company, may be sold through a wider network (Hypermarkets,Supermarkets, Convenience Stores, Bars, Newsagents, etc.)


How to approach the Consumers

INNOVATION

We have to find the best ways and releasesoon new solutions to integrate the giftcards with the contactless technology togive new services to the customers

We must deliver new applications to bring the Gift Cards, Couponing and other related contents on smart phones and on the other types of new devices very shortly


How to approach the RetailersTURN-KEY SOLUTIONS

Technology, Merchandising and logistics: sales systems (cash registers and POS Terminals) integration, card printing, fixture installation, display maintenance, inventory management

Marketing and promotion: full loyalty program to allow SMS, email, and or mail campaign management

B2B Sales: availability of sales portal to allow marketing to B2B customers including ordering, shipping and fulfillment

RETURN ON INVESTMENT

When redeeming their gift card, over a quarter of receivers purchase an item they had not planned to spend money on and an additional one in ten buy a more expensive version of an item they were already planning to buy

Gift cards are a great way for businesses to spread the brand, while simultaneously improving cash flow (the gift card sales are for a retailer a no-interest cash advances)


How to approach the RetailersVALUE ADDED SERVICES

The Merchants platform must allow consumers to self-register, so Merchants can truly acquire their customers

Self registration allows card issuers to capture names, addresses, phone numbers, email addresses, and demographic information

The Merchants platform must allow card issuers tools to send SMS messages, create cash back or points-based promotions, couponing, create email campaigns, or send direct mail offers to consumers


Case History: Euronics

Euronics is one of the major Electronic Large Retailer in Europe and in Italy there are 270 Points of Sale, active to epay system

Closed-loop gift card, issued in 3 denominations:

50 euro

100 euro

200 euro

Can be used also for the Internet purchases

Target: not only B2C, but also B2B


THANK YOU

For further information:Giuseppe Di Marco

[email protected]: +39 335 7716461

mailto:[email protected]



Prepaid Summit 2010 Di Marco (Final)

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Transcript of Prepaid Summit 2010 Di Marco (Final)