eBay takes two steps forward and one step back with PayPal

eBay's decision to back down on PayPal changes comes as no suprise, but make no mistake, it's still a big step forward for the auction great in the Australian market.

Since sharing my thoughts on the PayPal mandate back in April, it became more and more obvious as time went on that the eBay proposal would have to be pruned back. For many, this decision renews confidence in the ACCC as more than a toothless tiger - even though it enlisted the support of many interested parties to support its position.

What would have been a huge win for eBay in pushing PayPal has not all been lost - in fact far from it. Somewhat buried in the backlash against eBay is that the fact that the use of PayPal as a payment method (along with other accepted methods that seller elects to accept) is still mandatory - meaning every listing on eBay.com.au will include PayPal as a payment method.

There are great benefits for eBay and consumers with this move, to list a few:

• Significant growth of registered PayPal users in Australia
  
• Revenue upside through icnreased use of PayPal as a payment method
• Improved customer experience for buyers through buyer protection and ease of payment
  
• Faster access to money for sellers through 'instant' payment capability
  

There continues to be absolutely no doubt about the convenience PayPal delivers to consumers, I remain a big advocate for the service, but I am very happy that both buyers and sellers have a choice (albeit that the blue "P" is forced as one).

The only issue that remains is the fact that PayPal is simply more expensive for sellers to accept vs. bank transfer. Arguably this will increase the base price of eBay listings (in turn lifting eBays final value fee revenue) as sellers look to recoup costs associated with accepting PayPal payments. eBay strictly forbids sellers from charging a surcharge for accepting PayPal... Does this ring any RBA & ACCC Interchange bells for anyone?

All-in-all a good outcome if you ask me... Now, I am off to check out that funky new eBay Big Game Bargain Hunters TVC...

Top 100 Aussie 2.0 sites

Have a look through the list as compiled at Future Exploration Network. A couple of interesting financial sites (interesting, but not necessarily great) - Saasu, an online accounting site; InvoicePlace, send invoices and quotes; eWise, an account aggregation tool (apparently used by Westpac); FactsOnline, for calculators, budgets etc.

This beautifully simple site also allows you to click for charity - we've seen it before, but Ripple gives you a choice of fund or type of donation for your precious click.

NABs Head of Direct Channels talks to FST

From FST Media:

Interview with Tim Cullen, Head of Direct Channels, National Australia Bank - Tim talks through recent innovations at NAB like the NAB Life website, live chat, sms banking, 2.0 and other topics.

Read the interview here.

Zopa and Gartner interviewed by The Scoop

'Social banking' start-ups have taken traditional banks out of the equation by connecting private lenders and borrowers on the internet. Fuelled by millions in VC funding, peer-to-peer lenders like Zopa, Prosper and Lending Club are pushing what's been called the "democratisation of finance." Zopa CEO Douglas Dolton and Gartner's UK-based research VP Alistair Newton debate the merits of social banking with The Scoop host Mark Jones.

Student lending latest segment for peer-to-peer

I've talked before about peer-to-peer lending starting quite wide (Zopa, Prosper) and moving towards segments, specific communities - e.g. those with common interests or even passions (harley motorcycle fanatics lending to other fanatics to purchase their harley, or yankee fanatics lending to other fanatics for their yankee season pass). Student loans is the first segment to come along, logical given the small amounts available and the attractive rates for students.

Fynanz.com is a lending site where like the others you can choose to lend or borrow. The new site allows borrowers to create an online listing with their educational profile, along with a loan and rate request. Students can request unsecured loans from $2500 to $20,000, to be repaid over 10-20 years. Lenders then place bids on the listed loans based on the student's academic record and background, as well as credit ratings. This is a terrific addition to the peer-to-peer model, adding to the honesty system pioneered by eBay - the quality of the participants determines the quality of the site. It may however deny those students with apparent potential but without the marks to prove it, but it rewards those with good grades - like much else in life I guess...

I'm waiting for eBay/PayPal to add Money or Lending as a new category on their site, where you can bid by interest rate, deposit or length of loan...

Monocle asks the worlds media on how to survive the digital age

Watch this video from The Digital News Affairs conference in Brussels. The conference featured more than 50 speakers from the media world's leading editorial, marketing and business teams. The subject of this year's event was 'How to survive the digital news age' - a discussion of how news organisations need to change the way they work in order to maintain market share and influence in a rapidly changing media landscape.

Social Media spaces are the best vehicle for people to vent

If you thought blogging and social media was not for your bank to get involved in, think again, because your customers are using them more than you are, and they're saying all sorts of good, and mostly bad things about the service your organisation provides:

"59% of internet users use social media to “vent” about a customer-care experience. 74% of internet users choose companies/brands based on others’ customer-care experiences shared online, according to Society for New Communications Research. 72% research companies’ customer care online prior to purchasing products and services at least sometimes. 84% consider the quality of customer care at least sometimes in their decision to do business with a company. 81% say blogs, online rating systems and discussion forums can give consumers a greater voice regarding customer care, but less than 33% say they believe that businesses take customers’ opinions seriously." Read the full article here.

Social media has become a crucial source of knowledge and confirmation for many customers, and now service and customer care quality is discussed, rated, even judged in these new environments. Word of mouth via social networks and community spaces is more powerful than ever - you don't have to be involved, just be aware and across what's happening. Make sure your organisations service quality leaders listen to this feedback, and respond where appropriate. Ignore it and you'll be left behind.

Online Banking Customers Report Receptivity to New Media Tools Such as Widgets and Chats

From EarthTimes:

RESTON, Va., April 14 /PRNewswire-FirstCall/ -- comScore, Inc. , a leader in measuring the digital world, today released results of a study of the online banking industry. The findings, published in the April 2008 comScore Online Banking Report, are based on passively observed online behavioral data from the comScore Online Bank Benchmarker and a survey of more than 2,500 U.S. banking customers. The report provides comprehensive insights into service usage, consumer satisfaction, paperless banking and mobile banking. The study found that the growth in the number of online banking customers at the 10 most-visited online banks softened in 2007 compared to the previous year. Additional study findings showed high customer satisfaction with banking relationships and receptivity to the use of new media tools -- such as chats and widgets -- to enhance the online banking experience.

The findings from this study, which included data collected from March 5-10, 2008, were compared to results from two previously-published comScore studies conducted from April 3-7, 2007 and March 22-27, 2006. These studies surveyed 1,405 and 2,124 participants, respectively.

"After several years of strong growth in the number of users of online banking services, it appears the market is entering its next phase," said Brian Jurutka, vice president at comScore. "As a result, many of the top banks are realizing that customer servicing is of increasing importance in this competitive market and are therefore investing resources into online service enhancements, as well as mobile banking."

Additional Study Findings:

• Customers who reported being "highly satisfied" with their bank had longer online tenure at the financial institution and were mostly in the younger age group of 24 to 44 years.
• Twenty five percent of survey respondents reported that they were interested in mobile banking, up slightly from last year's 23 percent.
• Consumers interested in mobile banking said they are most interested in obtaining account balance information (61 percent through text message and 57 percent through mobile browser).
• Fifty three percent of respondents said they had at least one of their financial statements delivered in a paperless format
• For customers who have not enrolled in paperless statements, the top two reasons for not doing so were the desire to have a hard copy of the statement for record-keeping (46 percent) and the desire to have a paper bill as a reminder to make a payment (38 percent).

Read more.... or get the report from ComScore

The threat of user-generated content

eMarketer reports on the balance of power in content and information - will it come from companies like ours, who have the tradition of advice and expertise, of holding the knowledge in product, finance, process that customers need, or will it come from other consumers, who have already accessed this knowledge from the bank?? And the banks are scared of the results - or are partnering with consumers to build superior experiences to their competitors - there the opportunity lies...

eBay restricts users to just paypal and cash

Today eBay Australia have announced plans to aggressively expand PayPal into the Australian market by banning all other methods of payment* used by buyers/sellers for goods bought/sold on eBay. eBay are marketing this as a 'security' position to their loyal sellers, some may say this is a facade, and that this decision is revenue orientated given the auction giant will now collect revenue of between 1.1-2.5% from the sale price (+postage) of all items paid for using PayPal.

• From 21 May eBay sellers must offer PayPal on all listings as well as currently permitted payment methods.
• From 17 June eBay sellers will only be able to offer PayPal on listings and pay on pick up (i.e.paid for when picking up the item).

*Pay on pick up can only be offered in conjunction with PayPal. No other payment methods will be permitted.

Read more courtesy of The Age
Read some reactions at the bottom of this page on The Australian
Read the actual briefing on the eBay website

A contributor to thebankchannel.com shared his opinion on what this change means:

• It means that payment methods such as Internet Banking (hugely popular amongst Australian consumers) are no longer permitted by eBay as acceptable ways of buyers/sellers making/receiving payments
• The banks have become even more of a 'manufacturer' and PayPal continues to use banking infrastructure to process its payments, closing banks out of the loop
• It means that challenger payment systems such as PayMate and other p2p payments platforms are excluded from a key volume of transaction they [may] target
• It allows PayPal to grow it's 'short term cash holdings' and therefore its short-term money market revenue - already under scrutiny in the USA
• It forces sellers to Pay a fee of somewhere between 1.1 and 2.5% to receive payment for items sold on eBay - as opposed to 0%/$0 for bank transfers
• It enables PayPal to rapidly expand its customer base in Australia and therefore forces anyone eBay user to become a PayPal customer
• It could seriously damage eBays listing volumes in Australia (i.e. a seller boycott - as recently seen in the US when eBay changes it fee structure)
• There will be questions around the legality (Trade Practice Act) of this given it may be considered as '1st line' forcing. Remembering that eBay (perhaps this is why they are still allowing face-to-face payments as a technicality to overcome 1st line forcing issue).

What's next for PayPal... Would not be illogical to suggest that with banks seriously undervalued, a banking license could be acquired at a reasonable price in Australia... Anyone for an acquisition? If PayPal do this, they'll directly fall into competition with Australian banks, they could start paying interest on deposits (like they do in the USA), provide a debit card (US/UK already), consumer finance/lending (US already) and of course a credit card (US already)...

Bulk update on the world of Customer Experience & Innovation

From Bruce Temkin, Guru of CX at Forrester: I just wanted to alert you about a new piece of research that I’m very excited about called “The Business Impact Of Customer Experience.” It establishes a link, objectively, between customer experience and consumer loyalty. You can read more about it in my blog: "Customer Experience Matters".

BANK OF AMERICA PARTNERS MIT FOR BANKING RESEARCH LAB: Bank of America is investing up to $25 million over five years in a collaboration with the Massachusetts Institute of Technology (MIT) to create a banking research and development laboratory.

SCOTIABANK PILOTS SOCIAL NETWORK FOR STAFF: Canada's Scotiabank is using technology from Microsoft to introduce an internal Web 2.0 social networking platform aimed at encouraging information sharing and collaboration among its staff.

CITI INTRODUCES MOBILE SERVICES TO CARDHOLDERS WITH FIRETHORN: Citi is teaming with m-banking outfit Firethorn to provide its credit card customers with access to real-time account information via their handsets.

Indonesia aspires to be a cashless society: "Services provided by the banking industry have now taken a leap to the next level, creating a society where cash distribution between various parties is minimal. The benefit of this cashless society system will result in major efficiencies in costs and minimize the risk of handling and distributing cash. We are pleased to announce that this year's APCONEX will address all these initiatives," adds Pak Pramono.

Consistency – The Key to a Great Customer Experience…Every Time: Many companies fail to provide a consistent experience because they focus on one customer touchpoint while completely overlooking others. How often have we heard about an otherwise four star hotel stay ruined by the one star service? The truth is nothing hurts your brand more than failing to provide a consistent experience across all customer touchpoints.

Customer Experience Calculators: So what kind of impact is the Customer Experience having on your business? Find out by first figuring out some of the facts you should know about your customers (but probably don't).

Hate Phone Menus? You'll love Fonolo

From SpeechTechMag:

Fonolo, a Toronto-based company, today began closed beta testing of a service that it says will make it faster and less frustrating to call large companies. The service is expected to be available for public beta testing in the summer; full commercial rollout is expected in the fall.

The service, called Deep Dialing, automatically "spiders" a company’s interactive voice response (IVR) systems, creating a visual transcript of the IVR script for the user to read. Users start by finding the company they need on the Fonolo Web site, then visually scanning through the phone menu on their computers’ or mobile devices’ Web browser and clicking on the appropriate point. Fonolo then dials the company, navigates the phone system, and calls the user’s phone. When the user answers, he is connected to the desired point in the menu."

Article continues...

Everywhere and nowhere

From The Economist:

Social networking will become a ubiquitous feature of online life. That does not mean it is a business

“We will look back to 2008 and think it archaic and quaint that we had to go to a destination like Facebook or LinkedIn to be social,” says Charlene Li at Forrester Research, a consultancy. Future social networks, she thinks, “will be like air. They will be anywhere and everywhere we need and want them to be.” No more logging on to Facebook just to see the “news feed” of updates from your friends; instead it will come straight to your e-mail inbox, RSS reader or instant messenger. No need to upload photos to Facebook to show them to friends, since those with privacy permissions in your electronic address book can automatically get them."

Article continues...

RBC employs students to blog

From Finextra:

"Royal Bank of Canada (RBC) is looking to tap the 'Facebook generation' with the launch of a financial advice blog for students that can be accessed via its fan page on the social networking site.

The bank has selected six full time post-secondary students at Canadian universities to write daily blogs on money management.

The blogs, along with videos, are available through the bank's Web site as well as the "RBC Bankbook" page on Facebook."

Article continues...

Crisis in the Call Centre

BAI/Talisma reports on current call centre issues:

When it comes to online chat, or even answering customer e-mail queries, banks still don’t get it, according to a recent survey. Of the top 50 U.S. banks, 96% do not offer live chat as a communication channel and one-third of all customer e-mails go unanswered, despite the fact that all banks in the survey provided e-mail support. And even when e-mail is answered, only half the banks gave accurate and complete information.

The survey by Talisma Corp., a software provider based in Bellevue, Wash., further found that 94% of banks lacked searchable knowledge bases for answering customer questions, with most banks offering a basic list of frequently-asked questions (FAQs) instead.

Ever wondered what Tumblr is?

Ask Rhett at Heavy Backpack: So what is a tumblelog? Well as tumblr.com puts it “Post anything + Customize everything. Tumblelogs are the easiest way to share yourself”, and when they say easy they mean it. Others have described it as micro blogging and it’s competitors would be twitter, pownce, soup. But it’s probably closer to digital scrap-booking or a mind dumping sequence of links, photos, videos, quotes and text. In essence, when all is said and done it is really just a very simple structured blog, and that’s where the addiction lies, in its simplicity. Even the newest of newbie to tumblr will feel like a pro in no time.

See Rhetts top 10 Tumblrblogs here.

And from the guys who made Tumblr comes Instapaper.

I'm thinking of dumping Blogger ...

All the Webware 100 finalists in one place

Check out the leading webware providers here in this comprehensive list. (Webware are packages and tools for developing web-based applications).

When did Fosik arrive?

Despite the impressive interface, and site, and seeing my own employer being severely undercut on rate (so it says), Fosik, a new peer-to-peer site have not come up on my radar of late. Liek most peer-to-peer, Fosik touts the benefits of using the site’s tools as a way to formalize lending arrangements among family members and friends. Plus, the site notes that investors—whether they know the people they’re lending to or not—can benefit from returns that reach 10 percent or higher.

Peer-to-peer is hitting everywhere now - and wait for it to go SEGMENTED - student to student is live (not sure how they afford it) - but imagine someone requires a tricky operation, and others sympathetic create a health vertical, or car enthusiasts help others buy their dream vintage car, or technology people get together to import crazy japanese gadgets. Old folks lend money to help others join them on the road in a 4x4 around the country (and clog our caravan parks!). Or even eBay syndicates pop up and borrow from others to buy from others ... if you know what I mean.

Its getting big.

Wikis may be working for Westpac

From TheSheet.com via Financial Standard:

"The arrival of Gail Kelly at the helm of Westpac may accelerate the bank's adoption of "Web 2.0" tools such as blogs, wikis and social networks, allowing staff to share information freely and collaborate online.

The bank already has around 1000 user generated wikis (that is, online collaboration tools), has used the virtual environment Second Life as a training venue and allows staff to access Facebook from their work computers. Westpac chief information officer Simon Macnamara meanwhile is a veteran bank blogger. Unfortunately, the blog is for internal readers only.

Westpac is acknowledged as the Web 2.0 leader among the big four banks, and chief technology officer David Backley believes it will prove a competitive advantage in terms of attracting and retaining key talent as well as opening new avenues for customer interactions."

Article continues...

Its time for all banks to make a decision on 2.0 - is it a must have or a nice to have? Do we need to make this a priority? Does it need visibility across our businesses?

Banks facing increasing competition from social networks - Gartner

From Finextra:

"Social banking platforms - such as peer-to-peer (P2P) lending networks like Zopa and Prosper - will grow to control 10% of the worldwide market for retail lending and financial planning by 2010, according to research by consultancy Gartner.

The consultancy defines 'social banking' as a combination of trends - such as green practices, social entrepreneurship, P2P lending and financial planning via social networks - with banking products and services.

Gartner says non-bank social platforms are "pushing aggressively into banking and investment services" and the threat is particularly pronounced in two businesses - lending and payment."

Article continues...

Some other interesting articles from Gartner (Reg. req'd).
Google's Mobile Payment Ambitions: A Step Forward, but Still a Way to Go
Understanding the Online Banking Customer
The Future of Money