Interview with Jens Hegeler, Managing Director, Dr. Thede Consulting GmbH
Dr. Thede Consulting is a management consulting firm specializing in payment.
1. Where do you see mobile payment in 10 years?
Payment market trends clearly show that e-commerce is rapidly growing. With smartphone penetration continuously thriving, the phone is more and more becoming the natural link to the POS and merges both markets. At the POS, the smartphone can significantly simplify the payment process and, equipped with additional features such as price comparisons, vouchers or additional product information, it supports the shopping process notably. With more and more people using their smartphones for shopping whilst on the train or out in shops, it is the natural device to make mobile payment a dominant player in adequate markets.
2. With your experience of financial services and mobile payments, how do you think a brand can implement mobile payments successfully? What are the key success factors?
A successful payment method has to focus first and foremost on the customer and his needs and desires, as well as the merchant’s requirements. The payment model has to work seamlessly and adapt to all relevant touchpoints (POS, e-commerce, mobile etc.). Every provider who is able to enhance payment with added value and loyalty features will distinguish himself from competition and attract more customers. In general, payment providers have a stock of extensive payment data which can be utilised to understand the customers‘ interests, his shopping preferences and as a result provide him with valuable benefits. The winner is, in our mind, whoever knows that payment is just a feature in the shopping process, not an additional product.
3. With the customer relationship and loyalty strategies in mind, what are the typical success criteria which can provide the customer with a satisfying payment experience?
The rule is: Think from the customer’s perspective and listen to their demands. The customer doesn’t care about technology or multichannel approaches. He just wants a simple, convenient and secure payment process. In an ideal world, the customer doesn‘t even notice that he is paying. The successful payment models radically fade out payment and process it in the background. A perfect example for such a seamless payment process is Uber, where, once registered, you just exit the taxi getting charged without additional verification.
4. Where do you see operator billing fit into this future of mobile payments? What are the benefits of operator billing vs other mobile payment methods?
Operator billing perfectly caters to the convenience factor. Requiring a direct connection to the network provider, it is, however, restricted to online shops whilst surfing via mobile networks, not wireless or on computers due to the lack of a SIM-card. Ultimately, the most important factor in the payment process is trust. Customers are often sceptical about merchants who they don’t know and hesitate to provide their payment details. Paying via your known mobile phone provider helps to overcome these obstacles, whilst at the same time some online shops play on this factor which may lead to hidden purchases.
The fact that, with carrier billing, the customer can pay without registration or an additional need of identification significantly simplifies the shopping process. Currently, carrier billing is a niche payment product, however within this niche it is continuously growing thanks to digital products such as gaming and entertainment, and features notably higher conversion rates than other payment methods.
5. Where does Germany fit into this map of mobile growth and mobile payment?
Traditionally, Germany is a difficult market when it comes to anything but cash payments. Credit cards still struggle, compared to other countries. Therefore mobile payment naturally is not as developed as in some other markets. Many variations have been tested in the past years: QR-code, wallet-solutions, in-app-payment etc. Products, developed by small start-ups and global corporations alike, are emerging and disappearing, and mobile payment is still waiting for its expected breakthrough in Germany. Saying this, we believe that mobile payment will become a game changer as soon as it provides the customer with an additional advantage. He will only change his payment habits once he receives benefits, added value or time-saving. Our message to payment providers is: Provide extra services, cut out any complicated steps in the payment process, provide standardised digital systems which seamlessly work across all channels and with all mobile devices and, most important, provide value to the customer. Following these rules, the customers will embrace mobile payment.
About Jens Hegeler
Jens Hegeler joined the Dr. Thede Group in 2010, bringing in comprehensive experience in the conception and implementation of payment products.
He started his consulting career as Strategic Consultant in the Financial & Risk Enterprise Group of Mercer Management Consulting in Munich, before taking the helm of Bayern Card-Services GmbH, the market-leading product management and service provider for payment cards, for a total of 8 years.
Since 2014, he serves as Managing Director of Dr. Thede Consulting GmbH. One key focus of his projects is the development of data based business models for the financial services industry. Additional to this, he has built up our business areas ‘Mobility Services’ and ‘Loyalty’, where leading providers of payment methods can provide added value.