PCM MPE 2017 Special

MPE Issue | February 2017 

SPECIAL MPE ISSUE 

PCM 

YOUR GATEWAY TO THE WORLD OF PAYMENTS 

The Merchant Journey 

a world built for convenience

10TH 

ANNIVERSARY 

February 14-16, 2017 Berlin 

1000+ 

attendees at TOP European conference & exhibition 

CARD ACQUIRING, CX, POS, REGULATION, 

SECURITY, ONLINE & MOBILE PAYMENTS 

300+ 

MPE C-Level Club executives 

150+ 

amazing speakers 

Ingenico ePayments, Payvision, Verifone, Worldline, 

Equens, PPRO Group, Wirecard, Worldpay, Sagepay, 

Concardis, Holland FinTech, Spire Payments, SumUp, 

iZettle, Wargaming.net, Samsung Pay, UBER, 

Carrefour, AliPay 

... and many more 

Yandex.Money 

iDEAL 

SEPA Express 

MyBank 

Mastercard 

70+ 

SPONSORS & EXHIBITORS 

MPE Awards 

& Gala Dinner 

MPE Awards acknowledge 

13 leading vendors, influential 

leaders & rising stars 

payment gateway services 

www.merchantpaymentsecosystem.com 

+421 233 329 999 mpe@empiriagroup.eu

Contents 

Amir Abdin 

Editor-in-Chief 

amir@paymentsandcardsnetwork.com 

https://nl.linkedin.com/in/amir-abdin-21365683 

STORIES 

4 

The Payments Powerhouse between 

Europe and Asia 

8 

Wallet Wars - The Awakening 

Duc Dang 

Production Editor 

duc@paymentsandcardsnetwork.com 

https://nl.linkedin.com/in/ducdanghh 

11 

15 

20 

Open API driven innovations as 

differentiators 

Customer Loyalty: The Comeback Story 

Start-up Spotlight: Yoyo Wallet 

THANKS TO OUR PARTNERS 

Layla Durani 

Editor 

layla@paymentsandcardsnetwork.com 

https://nl.linkedin.com/in/layladurrani 

PCM is designed by Duc Dang, Payments & Cards Network. Art 

and photos © Payments & Cards Network, picjumbo.com and 

Shutterstock.com, excluding advertisments and company logos. 

PCM is property of Payments & Cards Network, Herengracht 576, 

2nd Fl., 1017 CJ, Amsterdam, The Netherlands. All material contained 

within PCM is the property of Payments & Cards Network. All other 

product and service names may be trademarks of their respective 

companies. ©2017 Payments & Cards Network. All rights reserved. 

Reproduction of any kind is strictly prohibited without express prior 

written consent of Payments & Cards Network. 

ADVERTISING INFORMATION 

For details, please contact amir@paymentsandcardsnetwork.com 

3

Thought Leaders Corner 

TURKEY 

The Payments Powerhouse 

between Europe and Asia 

by Y. Emre Güzer 

Between 2012 and 2016, more than 40 million dollars 

were invested only in FinTech initiatives in Turkey. This 

enabled the country to grow by 20 per cent annually in 

the field of financial technology. In particular, recent 

developments of new solutions in payments systems boosted 

the significant growth of investment in the payments domain. 

The PCM team invited Y. Emre Güzer, Country director of PayU 

Turkey, to share his experience operating in the Turkish market 

as well as critical challenges businesses need to consider when 

entering the market. 

As head of Turkey can you can give us a summary of what 

the payment landscape looks like in Turkey? 

The Turkish market is more developed compared to 

European markets in terms of payment systems and payment 

infrastructure.In addition, the country has a solid banking 

system and the technology to back it up. We can easily say 

that Turkey is a credit card driven country with more than 58 

million credit cards in the country. Although there are more 

than 115 million debit cards in Turkey, debit card usage rates 

in online & offline shopping are very low. 

The main reason for high credit card usage is installment 

options and many people prefer installment options even for 

purchases of more than TRY50 (online & offline). Electronics, 

fashion and jewelry are top sectors in terms of installment 

usage rates. The most preferred installment period is 3 or 

4 months. Several banks provide loyalty programs with 

installment options. 

As a merchant you have to work with a few banks to offer 

shopping through card points (loyalty) or installments in 

order to cover a large consumer base. Therefore we at PayU in 

Turkey work with 6 banks to give our merchants the highest 

conversions and an ability to appeal to more consumers. 

The Turkish payment ecosystem is built on several layers 

of payment companies, associations, banks and regulators. 

Working together is crucial. 

If you’re a payment company, one of your main targets is 

offering several payment methods to your merchants to 

allow them get many consumers and increase their sales. 

Therefore we have several business partners in Turkey. One 

of them is BKM (Interbank Card Center). The Interbank Card 

4


Center (BKM) was established in 1990 with the partnership 

of 13 public and private Turkish banks with the purpose of 

providing solutions to common problems and developing the 

rules and standards of credit and debit cards in Turkey, within 

the card payment system. They developed BKM Express, 

a national digital wallet, which is one of the milestones in 

Turkish e-commerce history. It has been used by 2 million 

unique cardholders from 17 banks. 

We also recently integrated our system with ComPay, which 

works similarly to PayByLink and allows direct money transfer 

from banks for more than 5,5 million consumers. Direct Debit 

plays a critical role in the market for consumers with security 

& trust issues who do not want to use their credit card. 

For our merchants we are trying to expand the e-commerce 

ecosystem and leverage the market. That’s why we are seeking 

solutions to enable online payment options for unbanked & 

underbanked consumers. Even as credit card usage is high 

it shouldn’t be forgotten that almost 50% of the Turkish 

population does not have access to banking services. 

Recently we made a deal with UPT (universal payment transfer 

company) and integrated our payment infrastructure with post 

offices’ from all around Turkey to reach 25 million unbanked 

adults. We are aware of our responsibilities and are working 

to attract new users to the ecosystem and grow the payment 

system industry. 

Given everything that has happened in Turkey, what in the 

way of innovation and business opportunity can global 

merchants expect from your market? 

Turkey is the 18th largest economy in the world and 6th largest 

economy compared with the EU. Main assets include a young, 

dynamic population, a large domestic market, and a strategic 

location, combined with strong infrastructure and much 

improved public services. 

Social & technological factors show us that the country has 

big potential when it comes to adaption of new technologies & 

online / social media usage which will lead to an e-commerce 

boom in the near future. 

• 48.6 million broadband internet subscribers in 2015, up 

from 0.1 million in 2002 (ICTA, TurkStat) 

• 73.6 million mobile phone subscribers in 2015, up from 

23 million in 2002 (TurkStat) 

• 58 million credit card users in 2015, up from 16 million in 

2002 (The Interbank Card Center of Turkey) 

• 181 million airline passengers in 2015, up from 33 million 

in 2002 (TurkStat) 

• 35.6 million international tourist arrivals in 2015, up from 

13 million in 2002 (TurkStat) 

And recently the Turkish government introduced a new law 

that offers citizenship for foreigners who invest, acquire real 

estate, or place deposit in banks. 

And news is coming in from important companies worldwide 

like Bank of China – The world’s 7th largest & China’s 3rd 

Y. Emre Güzer 

Country Director - PayU Turkey 

Y. Emre Güzer started his professional career at 

Pamukbank in 2001. He was Electronic Commerce 

Products Director at Garanti Payment Systems, 

where he played active roles in the establishment 

of many payment and verification systems that are 

used throughout Turkey. He has published research 

articles in various academic resources that focus on 

the online world and the ecommerce sector. As of 

2011, Y. Emre Güzer was appointed as the Country 

Director of PayU Turkey. 

largest.They set up deposit banking in Turkey, bringing in 

required capital. The country’s Banking Regulation and 

Supervision Agency (BDDK) said BOC had brought the “required 

capital” and would begin operating shortly. And recently U.S.- 

based multinational alternative investment company National 

Standard Finance (NSF) made an announcement that they will 

connect Turkey with a $2 trillion funding network that would 

bring direct foreign investment and help boost the economy. 

What do you see as the most important factors for global 

merchants to be aware of when entering your market? 

Credit card and installment are the keys to enter the Turkish 

market. I can say that international merchants are lucky 

because credit card transaction is a universal payment method 

and makes payment processes easier for businesses. But there 

is an additional hussle if they’re processing from abroad 

because they won’t able to offer an installment option. 

Without having a Turkish entity, international merchants can 

5


easily benefit from PayU Turkey’s services & local payment 

methods like point redemption during shopping, installment 

etc. 

The importance of value added services like fraud, 1click, 

and recurring payments should be taken into consideration 

too because they play an important role in increasing sales, 

conversion rates and revenue. 

PayU offers several payment services, customized to Turkish 

consumer needs that will help every kind of merchant to 

increase their sales. In addition to payment & value added 

services we offer our merchants the opportunity to run endconsumer 

campaigns with BKM Express for 2m wallet users 

and Compay for 5.5m consumers. Needless to say that having 

local PSPs also increases conversion Rates from 45% for token 

payments to 82% as credit cards and terminals are from Turkey 

and we have direct integration with the acquirers. We saw that 

CRs for our international merchants was 45% for users who 

received payments from Turkey with tokens. We increased the 

CRs of GIMs to 80%, by enabling them to integrate directly with 

the acquirers in Turkey. 

And in future the share of alternative payment methods will 

increase (PaybyLink – BKM Express etc) therefore international 

merchants should offer local payment methods to be sure that 

they’re covering their largest consumer base. 

Apart from credit card payments (with a share of 85% in 

market) Turkish consumers need new ways for online payments 

because credit cards are not enough to cover all. We foresee 

that the share of credit cards will decrease to 60% in 5 years in 

light of the new technical developments and changing payment 

culture enabling more and more consumers to shop online. 

Any last bits of advise for a company contemplating 

expanding into this exciting market? 

Turkey is a country between East and West which means that 

you may be a global company, but you have to act locally to be 

successful here. Companies that don’t understand the power 

of localisation are forced to leave the country eventually 

because they couldn’t understand consumer needs. Therefore 

international companies should work with powerful local 

partners in order to understand market needs & dynamics. 

When it comes to payment systems, processing locally allows 

global companies to have better control over the conditions of 

the Turkish market & consumer. 

• 60% of all ecommerce transactions are made using 

installments from credit cards issuers. 

• 6 different connections to Banks are required in order to 

offer installments with all major Banks and give access 

to the loyalty programs 

• Plus 1-click payment, recurring payment, BKM Express 

(national digital wallet) and PyByLink and CashPay 

options are offered to the merchants with several 

campaign opportunites 

PayU 

PayU is a leading online payment service in 16 high growth markets across Africa and the Middle 

East, Central and Eastern Europe, India and Latin America. Our 250+ payment options enable safe 

transactions for more than 160,000 merchants, allowing them to focus on reaching the 2.3 billion 

consumers in our markets. 

For more information please visit www.payu.com 

6


“Wallet Wars” - The Awakening 

Consumer awareness of mobile payment has risen dramatically but 

adoption rates aren’t as high as many research institutions predicted. 

At this stage of mobile-first it is now time to move forward with valueadded 

services on an aggregated level to make mobile payment SEXY 

and CONVENIENT. 

by Martin Christl 

The current view on the mobile payment ecosystem 

Experts identified main challenges for the mobile 

payments landscape: 

1. Mobile payment is not a seamless and consistent 

experience. 

2. The Pan-European Consortia which aimed to unify the 

market, failed in its attempts due to a lack of collaboration 

and strategic alignment cross borders. 

3. Payment schemes are looking for alternative revenue 

streams to compensate for their regulated transaction 

rates and to compete with fintechs entering the market. 

4. PSD2 (European payment industry regulation) puts 

pressure on the whole payment market as providers have 

to open up their environments to standardised conditions. 

5. Most of the mobile payment services don’t offer sufficient 

special incentives. 

8


How to survive the “Wallet Wars”? 

Consumer centric user experience is the basic groundwork of 

the only useful but daunting KPI: Retention Rate. Merchants 

and brands seek deeper and stronger relationships with 

consumers to enable cross-selling and to up-sell their 

portfolio. Meanwhile a 2017 consumer expects consistent 

experience across all sales channels and touchpoints from the 

brands they love. 

Mobile wallets will play a key role in connecting brands and 

consumers and enabling a seamless shopping experience. 

People today have clearly expressed their desire for a single 

wallet that keeps track of all of their loyalty memberships and 

coupons, and automatically applies earned rewards. 

A well designed wallet is meant to: 

1. enable a compelling mobile shopping customer 

experience 

2. help merchants attract new customer and serve loyal preexisting 

customers 

3. generate the necessary scale across the whole value chain. 

Considering the increasing adoption of mobile wallets such 

as ApplePay, AndroidPay, SamsungPay, and AliPay - how will 

other players compete with the growing number of global 

over-the-top services? 

The roadblock of mobile wallets 

The lure of something new has universal appeal. Therefore, 

it’s no surprise that mobile wallet providers spend a lot of 

resources to attract new consumers. But even for big brands, 

acceptance is growing slowly, mainly due to the diversity of 

offerings. Low merchant acceptance rates result in consumer 

mistrust. Mobile wallets don´t come with a lot of consumer 

friendly features in general, beyond the initial cool factor or 

the ability to save time at the till. If it’s urgent that consumers 

adapt their behaviour, you must come up with a game changing 

relevant experience. 

Sweet spot for merchant services 

Loyalty programmes and couponing are at the heart of many 

merchants’ customer engagement strategies. 

Advanced mobile technologies and services are opening up 

opportunities to make loyalty and couponing more relevant 

and compelling for consumers. 

In-store, merchants use mobile contactless technologies, 

such as GPS and Beacons for location aware interactions to 

influence consumers in a shopping situation (when presenting 

the loyalty card or pushing relevant, personalized content, for 

example). Moreover, merchants and brands can use mobile 

technologies and services to increase the effectiveness of their 

marketing campaigns in real-time. 

It’s obvious that each and every brand and merchant tries to 

have its very own app out in the market. As consumers interact 

with many different merchants and brands, it is unrealistic 

for business owners to expect that all individual B2C apps 

will be consumed equally. Today, consumers expect to find 

all shopping benefits in one relevant place. This is where the 

acceptance of mobile wallets comes in. 

In 2017, things appear to be shifting again in the “Wallet Wars”: 

Besides device manufacturers Apple, Google and Samsung, it 

seems that only wallets that provide value-added services will 

survive. 

May the force be with you! 

Mobile payment alone is no game changer anymore. The 

strong demand for a value-adding ecosystem addressing 

consumer and merchant needs has become the No 1. market 

topic. 

The mobile-pocket loyalty HUB is built to enrich the loyalty 

services baseline in a wallet. The services start from a very 

basic but relevant functionality of storing loyalty cards, 

towards more advanced capabilities of targeting and engaging 

with consumers on an individual level. 

While enabling merchant and brand communications 

functionality, the HUB ensures adoption and active users, 

increases relevance, pushes transaction frequency, offers 

higher reach over the HUB ecosystem and maintains consumer 

happiness. 

Merchants and brands are given a single entry point to 

conveniently manage content across the globe in multiple 

wallets. This results in astonishing consumer satisfaction, 

which makes the hard work of wallet operators to entertain 

consumers worth it. Improvement of app ratings (in avg. 

by 0,7 Stars), proven boost of usage and exciting additional 

interaction points for consumers mark a tipping point in 

wallet experience to meet the standards of the 2020´s. 

The industry-disrupting open ecosystem approach from 

mobile-pocket is bringing true value to all partnering 

stakeholders with a fair share. Banks, MNOs, brands, 

merchants, franchisees, shop owners and end users benefit 

equally. 

Best practice case of a mobile wallet 

A remarkable case can be found in the Vodafone Group. The 

international team has achieved their best practice, and were 

9


honoured with several global awards in the past months. 

Scoring “Emerging Payments Award for the Best Loyalty 

Incentive Programme” and two trophies for the “Payments 

Award with the Engagement & Loyalty Scheme of the Year 

2016” clearly sets a global benchmark. 

Vodafone, with the mobile-pocket HUB as enabling service, 

managed to increase traction and improved core KPIs such as 

consumer adoption, user activity, app and service ratings on a 

remarkable base. 

Partner up to create force 

mobile-pocket HUB is recognized by industry leaders as an 

enabling solution for rapid mobile wallet growth. It is now 

up to you to join this award-winning ecosystem approach and 

sustainably survive the “Wallet Wars”. 

mobile-pocket 

mobile-pocket is an ecosystem for mobile loyalty and reward 

solutions. It unifies users, retailers, wallet- and contentproviders 

on one platform and its features enrich wallet and 

payment services. mobile-pocket is a product of bluesource 

mobile solutions gmbh, situated in Hagenberg that is also 

known as Silicon Valley of Austria. The company is focusing 

its innovation and expertise on the development of mobile 

solutions and apps for big brands, merchants, operators and 

financial institutions. Special attention is focused on mobile 

marketing, mobile payment and mobile commerce sector. 

Martin Christl 

Business Development Executive at 

bluesource 

Martin Christl is Business Development Executive 

at bluesource, with extensive Marketing & CRM, 

Product Management and Innovation knowledge. 

He’s been working for 10+ years in the mobile 

industry space within large entities like Deutsche 

Telekom or Ericsson addressing large scale 

programmes and projects. 

10


by Natalia Ivanis 

Open API driven digital 

innovations as differentiators 

Everyone knows that merchant payments and card 

acquiring offers are highly commoditised today. When 

merchants select a payment provider usually considers 

two factors: price and customer experience. 

Multi-channel merchants have more ways to interact with 

customer than ever, but they need to translate these interactions 

into a POSITIVE CUSTOMER EXPERIENCE. They need to 

CAPTURE CUSTOMER FEEDBACK and constantly MEASURE 

the gap between the expected customer experience and what 

is actually delivered during digital shopping journeys. 

It is not surprising that with a growing complexity of channels: 

• only 22 % of consumers say the average retailer 

understands them as an individual, and 

• only 21 % say the communications they receive from the 

average retailer are “usually relevant 

• 88 % of merchants say their growth depends on 

personalizing the customer experience – but lack the 

resources and expertise to design an improved customer 

journey. 

• Only 37 % believe they have the tools they need to deliver 

exceptional customer experiences. 

But the danger may come in focusing solely on one part 

of the experience. Only 22% of the companies surveyed by 

E-consultancy and Seren (Foviance) had an integrated strategy 

to improve the customer experience. 

To keep up with the changing landscape of ecommerce, social 

commerce, and mobile payments, all businesses start to pay 

attention to all data gathered, including demographics, inapp 

behaviors, data trends, and more. Merchants can engage 

even with card customers and let them see available discounts 

when they are in or near their locations and also to confirm 

risky transactions. 

For payments and non-payments companies, new merchant 

services are attractive areas for growth. There are several 

ways how payment providers can help merchants improve 

customer experience with new functionalities like payment 

data analytics, advertising and loyalty programs. 

Card acquiring and merchant services increasingly tend to 

attract new FinTech entrants. Their solutions help merchants 

drive personalized interactions and improve buying decisions. 

How? - they are floating customized app solutions on cloud 

services so that they can access and leverage API data to 

provide more insights into consumers’ buying habits. 

11


Digital transformation, increasingly dematerializing 

plastic cards offer several innovative ways for a powerful 

communication between customer and merchant. For 

example, Feedback, a service launched by Square in May 2014 

provides fresh way of looking at an old problem of letting 

customers offer comment on their shopping experience. It let 

businesses get and act upon feedback from customers through 

their digital receipts. If a business decides to use Feedback, a 

customer is prompted to answer the question “How was your 

experience?” with either a smiley or frowny face when they 

receive their receipt by text or email. Businesses are able to 

respond to customers on an individual basis. The feature is 

available to merchants for $15 a month. According to the Wall 

Street Journal, Square processed 10 million digital receipts per 

month in 2014, so the opportunity to facilitate the building of 

those relationships is substantial. 

The new breed of global merchants such as Uber, Netflix, and 

Airbnb, have built the success of their products and services 

on openness, so you can also expect an open technical setup 

from their payment providers. This puts pressure on payment 

providers to keep up with the Open API economy. The Open 

API driven digital innovations focused on building positive 

customer experience represent attractive revenue opportunity 

for the entire merchant payments ecosystem. 

Major card schemes MasterCard and VISA, which are fully 

aware of Open APIs driven opportunities are unbundling full 

suite of their products and services and giving developers 

open access to the underlying payment capabilities. 

MasterCard Worldwide announced in 2016 the release of its 

Open Application Programming Interfaces (Open APIs) for 

third-party and independent software developers around 

the world. Josh Peirez, Chief Innovation Officer, MasterCard 

Worldwide said: “We are excited about tapping into the 

ingenuity of software developers around the globe to help 

create the next generation of game-changing payment 

applications. We feel this will unleash innovation within our 

industry especially in the burgeoning areas of e-commerce 

and mobile payments.” 

Visa announced in February 2016 the launch of its global 

developer engagement program that includes the creation of 

a marketplace enabling financial institutions, merchants and 

technology companies to collaborate, share and search for 

innovative digital commerce applications and services. VISA 

Natalia Ivanis 

Head of Production, Empiria Group 

Natalia Ivanis is Head of Production team at Empiria 

Group, specialising in merchant payments & POS 

technology. She is a part of managing team behind 

Merchant Payments Ecosystem (MPE) - the biggest 

European conference on merchant payments. Natalia 

is also involved in strategic planning, large-scale, 

industry-specific research and content creation 

projects supporting key conference topics. 

opened more than 150 proprietary APIs to outsiders. These 

include such services as Visa Checkout, Visa Alerts, and the 

Visa Direct person-to-person payments app. 

Visa Inc, Rajat Taneja, executive vice president of technology, 

said: “We believe this will lead to the creation of entirely new 

commerce experiences with Visa technology integrated to 

enable greater security, scale and convenience when it comes 

time to pay. When you add the ability to distribute those new 

experiences across Visa’s global network, you can see why 

Visa Developer will become the preferred playground for 

developers everywhere.” 

And what are the challenges for payment processors 

and payment solution providers connected with Open 

Architecture? 

According to Wolfgang Berner, ACI Worldwide: “Software 

developers – regardless of whether they are on the merchant 

side or developing payment solutions for payment providers 

– have high expectations when evaluating a potential service. 

They expect the initial positive feedback in the first five 

minutes, the first success within 20 minutes, and a complete 

sketch for a solution within 45 minutes. If it does not deliver, 

the option will simply be discarded. Not being able to deliver 

the essential technical setup that is now expected can present 

a major obstacle to growth, and stop the pitch process for a 

12


payment technology provider before it has even begun. The 

ACI Worldwide UP eCommerce Payments API reflects the shifts 

in market expectations that have occurred in recent years. A 

single, unified API ensures simple integration and streamlined 

processes, as well as automated merchant onboarding. We 

acknowledged, in the course of developing the API, that the 

technical platform alone is not enough. 

When an API evaluation is expected to yield results within 

minutes, it must be accompanied by intuitive and interactive 

tutorials. Developers now expect interactive documentation 

that gives instant access to the payment system, and is 

capable of providing real-time feedback and showcasing the 

capabilities of the API. 

A 100-page PDF just does not cut it. Just as websites wish to 

maximize the conversion rate of online shoppers, interactive 

documentation needs to guide developers through the 

evaluation process and convince them that the API will deliver 

the tools they need. This is what we call “developer conversion,” 

and this is a concept that we had in mind in developing our 

own developer documentation.” 

From that a number of questions arises, such as how are 

traditional card acquirers, banks, PSPs, ISOs & payment 

networks capitalizing on this opportunity? Are they doing 

enough to help merchants create a more customer centric 

experience, shorten the buying cycle, increase loyalty and 

retention, and boost customer life-time value? How do they 

face the challenge of disruptive services being launched by 

innovative FinTech companies? 

Forward-looking payment providers aren’t writing off startups 

as threats. Instead, they’re finding new ways to collaborate 

with them. Starting with recognizing a need for building 

a collaborative culture, they can look to address customer 

expectations and working with other businesses to make their 

services ready for Multi- & Omni-channel commerce. 

Merchant payments, Open Platforms & API driven digital 

innovations with FinTech companies are among the key 

topics to be discussed at the MPE 2017, the Top European 

merchant payments, POS and card acquiring event featuring 

300+ CXOs and MDs, 150+ speakers, 1000+ of participants from 

40+countries, 70+ sponsors & exhibitors. MPE 2017 is 1 BIG 

expo with 3 parallel conferences, MPE top class networking 

& evening dinners; Internationally recognized MPE Awards, 

MPE C-Level Club, Festival of European online merchant 

payments and Innovation Corner. 

MPE 2017 topics span from ACH payments, Apple, Samsung, 

Android Pay to integrated shopping experience, NFC, from 

FinTech to RegTech, SmartPOS, mobile & online checkout 

conversion, CNP Fraud & security, IoT, biometrics, local and 

cross border acquiring. 

Request the conference program and registration form/sponsorship 

brochure at mpe@empiriagroup.eu or visit us at 

www.merchantpaymentsecosystem.com 

To access to the MPE VIP ZONE please enter the following promo code: 

MPE_IHS into the field: special requirements on the registration form. 

Empiria Group 

Empiria Group is focused on providing their clients with 

expertly researched B2B events, workshops and meetings. 

They work directly with leaders from the entire merchant 

payment ecosystem to ensure that the content and format 

of their industry events always fit the specific needs of their 

customers. 

13

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expert interview 

Loyalty: The 

Comeback Story 

Pierre Boces, Head of Product Marketing and 

Consulting, brought an extensive knowledge of the 

payment business to Welcome Real Time, having held 

various positions at key solution providers. Pierre 

oversees Corporate marketing, Product marketing, 

Product management and Consulting. Pierre’s team 

design and promote innovative solutions that bring 

value to our clients. 

Pierre Boces 

Head of Product Markteting 

& Consulting, Welcome Real 

Time 

The reasons for launching a 

loyalty program in the market 

are manifold. It can contribute 

to increase customer loytaly 

and satisfaction, decrease customer 

churn rate, strengthen brand equity, 

help boosting both up-sells and crosssells 

targets and many more advantages. 

However, with launching such a program 

merchants are also facing different 

challenges from the operational 

perspective and have to think about 

risks even before launching a loyalty in 

the market. Together with Pierre Boces, 

Head of Product Markteting & Consulting 

at Welcome Real Time, a global loyalty 

solution provider company, we explore 

the world of the loyalty ecosystem. 

PCM: What are the main benefits of 

running a loyalty program from a 

Merchant PoV 

Pierre: Merchants usually run two main 

types of marketing activities: promotions 

(discounts, rebates, offers) and loyalty 

(points and cash back programs). 

When executing correctly those 

marketing activities, merchants gain 

three main benefits: 

• Drive traffic to their physical, web 

or on the go stores (from customers 

who have a high probability to make 

a purchase). 

• Increase repeated visits, average 

ticket size and basket size 

• Get to know better their customers 

for improved interactions and 

relationships 

PCM: What is the psychology behind 

using various reward systems, such as 

cash vs. coupons / discount? 

Pierre: Promotions in the form of 

discounts, rebates or offers are usually 

short term. 

• They send to consumers messages 

such as “thanks for coming”, 

“thanks for spending with us now”. 

• Consumers may not feel any tie 

or link to the merchant and could 

disappear once the promotion ends. 

• Promotions work well in countries or 

cultures or with customer segments 

where price is still an important 

criterion for shopping. Promotions 

may attract cherry pickers that are 

not so loyal to the merchant. 

Loyalty programs in the form of points, 

miles, stars and cash back are longer 

term. 

• They require consumers to 

cumulate those rewards over time 

in a dedicated bucket of points or 

cash back. 

• They send to consumers messages 

such as “come over time”, “thanks 

for continuously spending with us”. 

• Sometimes, consumers need to 

reach a minimum amount of points 

before enjoying any conversion of 

points. 

• Loyalty works with customer 

segments for which recognition is a 

more important criterion. 

Growing trends around loyalty 

programs show that customers want 

more than just rewards. They want a 

more meaningful relationship with the 

businesses with which they interact. 

Loyalty schemes are therefore changing 

15


from transaction-based exchanges to an 

ongoing relationship with the customer 

at the centre. 

PCM: What are the best practices for 

running a loyalty program? 

Pierre: Promotions run on a short-term 

basis; however running a loyalty program 

requires a long-term commitment so 

defining clear objectives (financial, 

branding...etc...) is a pre-requisite for 

the merchant 

Best practices also translate into 

spending a fair amount of time on the 

design of the program itself. This means 

coming up with all the answers regarding 

target audience (and segmenting or 

not customers), customer life cycle 

(registration, earning, redemption, 

communication, exit ...etc...), customer 

journey and customer touch points 

(front-ends, call centre, cashiers ...etc...), 

the type, value and cost of the loyalty 

currency. 

Technology is ever evolving. Today, 

customers are all about mobile so 

the program should provide benefits 

to customers through mobile 

interactions. Mobile technology and 

apps allow pushing product updates 

and distributing benefits and coupons 

directly to customers. Tomorrow, loyalty 

technology might be about unattended 

retail combined with proximity 

marketing and Internet of things. 

Selecting the right technology solution to 

support the program and its evolutions 

over time becomes vital. Merchants 

should look for solutions that emphasize 

flexibility, agility and scalability. 

Best practices finally vary depending 

on the size and nature of the merchant 

(small retailer with one store, a network 

of franchises, association of merchants, 

malls ...etc...). 

PCM: What are the challenges do 

merchants have to face when running 

a loyalty program? 

Pierre: A loyalty program should be 

consistent and adapted to the customers 

spending behavior to be fully efficient 

as customers want personalized and 

relevant rewards. This means merchants 

must spend time defining the right 

campaigns for the right customers 

segment at the right time. In order to do 

so, retailers will need the help of big data 

analysis with data coming from multiple 

sources to make sure their campaigns 

are efficient, profitable, and make sense 

for the customers. 

Customers also want to earn rewards 

through various channels so loyalty 

programs must cover multi channel 

rewarding to ensure convenience and 

engagement. Retailers can leverage 

on this multichannel experience and 

capture customer information by taking 

advantage of the appetite of customers 

to share personal data through social 

media for example. 

PCM: What impact does a loyalty 

program have on merchants’ services/ 

products/overall profitability? 

Pierre: A loyalty program can influence 

in many different ways the products 

and services of the merchants and their 

overall profitability, here are a few 

examples: 

• Merchants can analyse their 

customers spending behaviour and 

thus better adapt their products and 

services to the different customer 

segments. 

16


• Merchants can increase their 

revenue and profitability: a loyalty 

program engages customers and 

as a result increases their average 

basket, ticket size, and repeated 

visits depending on the various 

campaigns run and their objectives. 

• Merchants can manage their 

stock differently, running special 

campaigns and promotions on 

products they have not sold. 

PCM: What advice would you give 

to merchants who would like to 

implement a loyalty program? 

Pierre: For short-term impacts, 

merchants are better off to provide 

promotions. However, running a loyalty 

program requires some long-term 

commitment if the program is meant to 

run for several years. 

Some merchants will carefully consider 

a solution provider who can bring an 

agile, flexible and scalable technology 

needed to support a long-term loyalty 

program. Others, who have the right 

resources, will prefer to build their own 

solution. 

Retail banks also run loyalty programs 

and need the support from merchants 

to fund the rewards for their customers. 

Those banks face today a decrease 

of revenues that used to fund those 

programs in the past. Those interchange 

revenues are now limited as the 

interchanges fees are capped by the 

regulators. 

Therefore, some merchants could 

consider joining a loyalty program setup 

by a retail bank involving a network of 

merchants (coalition). It might be more 

interesting than to set up their own 

loyalty program. In that case, merchants 

will benefit from shared communication, 

shared data and shared infrastructure, 

but will also face their own competitors 

participating in the same coalition. 

Welcome Real Time 

Photo by Joe Loong 

Welcome Real Time is part of the 

Collinson Group, a global leader in 

shaping and influencing customer 

behaviour to drive revenue and add 

value for our clients. Through our range 

of proven and innovative payment 

based solutions, Welcome Real Time 

helps organisations run real-time 

loyalty and marketing programmes 

leading to improved customer 

satisfaction, retention and profitability. 

17

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Spotlight 

You think you have what it takes to start a 

business in a super-hot market? 

PCM takes a close look at some of the most 

innovative and promising startup companies in the 

payment industry.

startup spotlight 

“IF THERE ARE OTHER 

MARKETS WE DISRUPT 

IT WILL BE BECAUSE OUR 

COMPETITORS DIDN’T 

LISTEN TO THE NEEDS OF 

THE RETAILERS ” 

Michael Rolph, Co-Founder and CRO at Yoyo Wallet 

Loyalty programs have grown exponentially beyond the 

borders of the airline industry. While the basic idea 

of any loyalty program has been to reward your best 

customers, managers continue to face challenges on 

how best to optimize these often expensive programs. We 

spoke with Yoyo Wallet, a company that combines payment 

and rewards in one seamless and personalised experience. 

PCM: How did Yoyo Wallet come to be and what is the main 

idea behind it? 

Michael: Myself and the co-founders are all from the Payments 

world, so we’ve seen a lot of big companies try and fail to make 

mobile payment relevant for mobile. We were inspired by what 

Starbucks was doing back in 2012 and it became clear what 

sort of role mobile can truly play. They were at a point where 

10% of their customers used their mobile app to pay and get 

rewarded. We also looked at what Tesco has achieved with 

their club card, which is probably one of the most successful 

Loyalty programs in the world. It was successful because they 

identified who the customer was and it matched them to their 

basket data. 

We wanted to take these inspirations and improve on them. We 

decided to provide a better experience and democratize it for 

all retailers and by doing that, in turn we provide consumers 

with the mobile experience that they want. Payments through 

mobile isn’t solving anybody’s problems. It’s a cool thing to do 

and ultimately, yes, that is where technology is taking us, but 

it doesn’t actually add any value to retailers or consumers). 

So, our focus was about adding that value by making mobile 

relevant to retail and democratizing the Club Card / Starbucks 

experience for all retailers. 

PCM: What is your business model at Yoyo Wallet? 

Michael: First of all, we recognize that for mobile to be truly 

adopted, the retailer has to be the one that sees a benefit 

because it’s the retailer that is going to be paying for the service 

that is provided by mobile. Essentially, what we really do is 

identify a customer, and when they transact through mobile, 

we match that customer to the basket data. We then charge a 

fee for that transaction that we enable. 

Fundamentally, Yoyo is the Loyalty Scheme Program Manager. 

Loyalty is specific to each retailer, so it is not a coalition. Yoyo 

is creating different program functionality for retailers. The 

retailers choose the loyalty program they want and we then 

effectively help them. Usually, they are the issuer of the loyalty 

program and we are the program manager and we provide a 

scheme mark for the benefit of the consumer. So, we charge a 

monthly subscription fee per outlet for the benefit of running 

a loyalty program on behalf of the retailer. 

Finally, because we are connecting the seller to the buyer 

via mobile experience in a way that hasn’t happened before, 

enabling new transactions to happen. For example, a retailer 

can run a marketing campaign to enable their customer to 

buy 20 coffees in advance. That itself (purchase in advance 

of consumption) is the ultimate form of loyalty. From a 

consumer’s perspective, I’ve given you (the retailer) my money 

before I’ve consumed a product you are going to provide me, so 

20

startup Spotlight 

we charge an enhanced transaction fee for that. Another 

good example of an enhanced transaction fee would be 

pre-ordering; the ability for me to order my coffee ahead. 

PCM: Essentially, you also have a payment system 

integrated in the app to enable transactions. Do you 

then also view yourself as a payment company? 

Michael: We’ve built our own rails, so Yoyo integrates to 

the Point of Sale as a button on the till, so Cash, Card, 

or Yoyo. Within those rails, the user has linked their 

transaction method to their Yoyo user account. Yoyo is 

then able to act as part of the transaction of automating 

somebody’s collection of loyalty and capturing basket 

data to issue a fully itemized digital receipt and we’re 

also able to automate the payment. 

Yoyo does not have to be the payment method. For 

example, the user can also use ApplePay, AndroidPay or 

SamsungPay and Yoyo is essentially the customer identification 

platform. We provide the token for customer identification 

as part of that transaction. In that case, payment is just an 

enabler, we treat it no different to how Uber does. It is an 

enabler for better experience. There are other people who want 

to be payment companies like Apple, Samsung and Google, but 

we do not want to be a payment company, we rather want to 

be an enabler of a better payment experience. 

PCM: Can you please walk us through a single customer 

experience / journey? 

Actually, there are two types of experience; there is the Yoyo 

app and the retailer app that is powered by Yoyo. The way to 

think about Yoyo just before going to the consumer experience 

is that we are a technology provider around the most rewarding 

transaction experience. 

From a retailer perspective, they can use features of our 

platform and have them power their own app. For instance, 

in the UK, we are working with Café Nero and Café Nero will 

launch a Café Nero app powered by Yoyo. Alternatively a 

retailer can just accept the Yoyo app. 

The user journey is very simple; I can create an account; I attach 

a funding method if I want to (Visa, MasterCard, Amex, etc.), I 

may choose not to in which case I would be only experiencing 

the loyalty through the app or even just a card. Once I’ve done 

that, Yoyo is then tokenizing my identity. When I transact, 

whether it’s for loyalty only or loyalty and payment, I’m not 

passing any personal or financial information as part of that 

transaction, I’m simply passing over a unique customer token, 

which is only relevant for that 30 second window. It’s dynamic 

as it changes every 30 seconds, making it the most secure form 

of transaction out there. It’s a little bit like if you were to look 

at the 16 digits printed on your usual debit or credit card but 

every time you used the card the numbers changed. That is 

what we are doing with our customer identity—everything 

happens in the cloud. When you transact it is a little bit like 

Starbucks experience as you can scan a QR code. 

Equally if the Yoyo customer identity token has been linked to 

AndroidPay or ApplePay, Yoyo is passing that customer identity 

token through NFC via Android or Apple to the Point of Sale 

and this is where the magic happens. Whether it is because 

Yoyo enables it through the scan of a QR code or passed via 

the NFC of Apple or Android, once that token hits the Point 

of Sale, we can automate the payment experience as well as 

the loyalty experience. This allows us to recognize it’s person 

X at the Point of Sale, he’s making a transaction of 10 Euros, 

within these 10 Euros, the basket consist of two coffees and 

two croissants and those two coffees are part of a stamp cup 

program, so we need to immediately issue two stamps. 

We also recognize the retailers from the points program, so 

we need to issue 1.000 points. We also know that the person 

would want a receipt, so we would issue immediately a fully 

itemized receipt with no difference to what you would get if 

it was to be printed off. All of that would happen seamlessly 

and spontaneously. Following that, there would be a complete 

feedback transaction loop that would say “how was your 

experience today?” and as a consumer you can let the retailer 

know. 

Basically, there are many aspects of a transaction that are 

fragmented today and cause wrinkles in a customer’s daily 

experience at the Points of Sale. We are able to iron them out 

through a better mobile-first experience. Another example 

could be, because I get the same coffee everyday from the 

same store, using Yoyo I can pre-order it and use the feature we 

have “jump in line”. As part of that, Yoyo employs gamification 

traits, automatically collecting my loyalty points or stamps and 

automatically issuing a receipt. All I’m doing is picking up my 

product from the store and walking off, so it’s order and collect. 

PCM: How did it work out for retailers who signed up so far? 

Michael: For a retailer, it really is simple: they can take 

payments and it works just fine. They can run loyalty programs, 

whether its stamp, card or points. However, what does not 

exist is the ability to identify your customers, through their 

preferences, profile and behavior and that is what Yoyo does 

for a retailer. We help the retailer know who their customer 

is and we also enable the retailer to segment their customers, 

based on their profile preferences and behavior. We do that by 

21

startup spotlight 

providing insight through a product that we built specifically 

for a retailer called “Yoyo Engage”. Essentially, it is an insight 

dashboard but also a campaign manager and launcher similar 

to “Facebook Advertiser”. 

This enables retailers to create campaigns based on an outcome 

that they would like. For example, one of those outcomes could 

be: “I would like to get more sales of product X. To do that, I 

need to identify the customer segment which is most likely to 

take up that offer.” That’s where the engage platform comes in, 

because we can identify that customer segment which is most 

likely to buy product X. It could be because; they buy product X 

if you give them a discount; they buy product X at a discounted 

rate because they bought product Y; (and if they buy product 

Y, they’re more likely to buy product X, so you need let them 

know that product X is available) 

PCM: Where do you see Yoyo Wallet 5 years from now? 

Michael: We think globally about what we do but equally, 

we are an early stage company going into the 3rd year of our 

journey. We need to show that we own a market, so the UK 

has been our focus and it continues to be so because it is our 

domestic market. With that being said, the best form of an 

international expansion is to go where your customers take you 

and this is why the US is incredibly exciting for us because we 

have customers who want to take us there. The same goes for 

Singapore and it is the reason why we are live in Ireland and 

Luxembourg. There is nothing that would stop us expanding 

into other European markets. However, what we won’t do is 

overstretch ourselves as we are very much focused on building 

a sustainable business that is going to be here for many years to 

come. In order for that to happen, we have to be smart with the 

resources we have since we have a really focused international 

expansion strategy. 

When thinking about the markets we are disrupting, it is 

the loyalty market which is completely wide open. Nobody 

has cracked it apart from some of the big retailers who have 

millions of Dollars, Pounds or Euros to spend on this. No 

one has yet democratized this for retail and we think we’ve 

got an open opportunity here to democratize true customer 

engagement through loyalty for the retailer on a global level. 

That’s the market we’re focused on and that’s the field where 

we can we add great value. We are here for the sole benefit 

of retailers. By putting the retailer first, you are putting the 

consumer at the heart of the experience because any retailer 

in their right mind would not do anything that doesn’t benefit 

their customers. We think that it is a global experience that 

5 years from now will make Yoyo a truly ubiquitous loyalty 

program manager and scheme that enables the retailers to 

become the issuer of unique programs for their customers. 

PCM: Any exciting news/announcements you would like 

to share? 

Michael: We’d like to announce our UK-wide partnership 

with Caffè Nero. This partnership does represent a significant 

move onto the UK high street for Yoyo Wallet and will further 

solidify our position as the UK’s most used mobile wallet. Yoyo 

Wallet is already live in 50 per cent of UK universities and 

over 100 corporate locations. For more information about this 

partnership please visit Yoyo Wallet’s company blog. 

22

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PCM MPE 2017 Special

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