Visa eCommerce in the Developing World 2013

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Visa eCommerce in the Developing World 2013

  1. 1. Global Payments Summit Singapore -- June 6, 2013 eCommerce and the Developing World Niki Manby Head of Emerging Product & Innovation, APCEMEA Visa Inc. @NikiManby
  2. 2. 2 Notice of Disclaimer Case studies, statistics, research and recommendations are provided "AS IS" and intended for informational purposes only and should not be relied upon for operational, marketing, legal, technical, tax, financial or other advice. When implementing any new strategy or practice, you should consult with your legal counsel to determine what laws and regulations may apply to your specific circumstances. The actual costs, savings and benefits of any recommendations or programs may vary based upon your specific business needs and program requirements. By their nature, recommendations are not guarantees of future performance or results and are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Assumptions were made by us in light of our experience and our perceptions of historical trends, current conditions and expected future developments and other factors that we believe are appropriate under the circumstance. Recommendations are subject to risks and uncertainties, which may cause actual and future results and trends to differ materially from the assumptions or recommendations. Visa is not responsible for your use of the information contained herein (including errors, omissions, inaccuracy or non-timeliness of any kind) or any assumptions or conclusions you might draw from its use. Visa makes no warranty, express or implied, and explicitly disclaims the warranties of merchantability and fitness for a particular purpose, any warranty of non-infringement of any third party's intellectual property rights, any warranty that the information will meet the requirements of a client, or any warranty that the information is updated and will be error free. To the extent permitted by applicable law, Visa shall not be liable to a client or any third party for any damages under any theory of law, including, without limitation, any special, consequential, incidental or punitive damages, nor any damages for loss of business profits, business interruption, loss of business information, or other monetary loss, even if advised of the possibility of such damages.
  3. 3. 3 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by the terms “objective,” “goal,” “strategy,” “opportunities,” “continue," “can,” "will" and other similar references to the future. Examples of such forward-looking statements may include, but are not limited to, statements we make about our corporate strategy and product goals, plans and objectives. By their nature, forward-looking statements: (i) speak only as of the date they are made, (ii) are neither statements of historical fact nor guarantees of future performance and (iii) are subject to risks, uncertainties, assumptions and changes in circumstances that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from those forward-looking statements because of a variety of factors, including the following: the impact of new laws, regulations and marketplace barriers; developments in current or future litigation or government enforcement, including interchange, antitrust and tax disputes; economic factors; industry developments, such as competitive pressure, rapid technological developments and disintermediation from the payments value stream; system developments; costs arising if Visa Europe were to exercise its right to require us to acquire all of its outstanding stock; loss of organizational effectiveness or key employees; failure to integrate recent acquisitions successfully or to effectively launch new products and businesses; changes in accounting principles or treatments; and the other factors discussed in our most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission. You should not place undue reliance on such statements.
  4. 4. 4  eCommerce is fast outpacing traditional Face-to-Face – especially in developing markets Source: Euromonitor Retail Data Growth in eCommerce Volume -5% 0% 5% 10% 15% 20% 25% 30% 2008 2009 2010 2011 2012 Face-to-Face Payment Volume eCommerce Payment Volume Payment Volume -- Year-over-Year Growth 2.0x 2.3x 3.6x 2.9x 12.4x
  5. 5. 5 eCommerce Volume by Region Source: eMarketer, July 2012 - 100 200 300 400 500 600 700 800 900 2011 2012 2013 2014 2015 2016 North America Asia Pacific Western Europe Latin America Eastern Europe Middle East & Africa $Billions  Asia Pacific expected to take lead in B2C eCommerce growth this year
  6. 6. 6  Despite rapid Y-O-Y growth, eCommerce share of total payments remains small Source: Euromonitor Retail Data eCommerce Share of Total Payments eCommerce Payment Volume 3% 3% 4% 4% 5% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2008 2009 2010 2011 2012 $275B $520B Face-to-Face Payment Volume
  7. 7. 7 Drivers of eCommerce Evolution Proliferation of Devices Convergence of Payment Methods Consumer Purchasing Behavior Influence of Millennials
  8. 8. 8 Proliferation of Devices Source: Internet connections according to NewMediaTrendwatch 2012; Social Networking accounts according to the Radicati Group Inc. Social Networking Market, 2011 to 2015; Mobile subscriptions according to The International Telecommunication Union – 2012; Internet access data from Euromonitor, Mobile internet access, mobile broadband subscriptions, smartphone penetration, and handsets shipped according to mobiThinking  Number of mobile subscriptions is nearing world population 2.4billion Internet connections 2.4 billion social networking accounts 6.8billion mobile subscriptions 2million mobile broadband subscriptions 21% smartphone penetration 1.9 billion handsets shipped in 2012
  9. 9. 9 Convergence of Payment Methods Use of third party trademarks, logos and images does not imply product endorsement Payment Channels Multiple Devices Payment Methods eCommerce Mobile Face-to-Face Debit/Credit/ Prepaid/Commercial Rewards Currency Alternative Payments Visa Inc. Confidential  The lines between traditional payment experiences are blurring
  10. 10. 10 Consumer Purchasing Behavior Consider Buy Evaluate Advocate 1 3 4 2  Consumers are becoming ‘integrated shoppers’, and payments are a part of a more integrated consumer experience
  11. 11. 11 Influence of Millennials  1.1 billion strong -- 615 million in Asia Pacific, UAE, South Africa and Russia  Highly urbanized  Technologically adept, particularly with smart phones -- "entitled to conveniences”  Comfortable with cashless environment  Expect ability to establish relationships remotely  Millennials are key influencers in the evolution of omni-commerce Source: Data on Millennials from Millward Brown study conducted for Visa, “Connecting with the Millennials”, Nov 2011
  12. 12. 12 eCommerce across Market Types Emerging Developed Sophisticated State of the Market 1 Population 240 million 1.3 billion 23 million Mobile Penetration 104% (250 million) 77% (1 billion) 109% (25 million) Internet Users 48 million 570 million 18 million Projected eComm Growth Average Spending 3 $600-700 $490-1,000 $3,500-4,000 Total Sales Volume 3 $6-15 B $100-450 B $36-51B eCommerce Penetration 2 0.2-0.3% 5.3-10.8% 2.4-3.8% Online Buyer Penetration 4 23-27% 43-67% 74-79%  eCommerce growth in the future will depend on adaptations for the ‘small screen’ 1 Euromonitor 2012; 2 Euromonitor 2012-2016; 3 eMarketer 2012-2016; 4 eMarketer 2012-2016, internet users making at least one purchase within a year
  13. 13. 13 eCommerce Fundamentals  Setting the foundation for future eCommerce growth requires investment in fundamentals Digital Wallets Card Enablement Optimized eCommerce Fraud Mitigation Shipping & Delivery
  14. 14. 14 The Future of Omni-Commerce AUGMENTED COMMERCE CUSTOMIZABLE SHOPPING PREFERENCES SOCIAL NETWORKING INTEGRATIONFRICTIONLESS CHECKOUT LOCATION-BASED SERVICES MULTI-CHANNEL SHOPPING  An integrated and customized payment experience across channels and devices
  15. 15. Niki Manby Head of Emerging Product & Innovation APCEMEA Visa Inc. @NikiManby Comments

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