Google Focussing on Customer Loyalty
- Ingenico confirmed Google’s NFC-enabled terminals order. These POS terminals will be able to receive and process discount coupons downloaded by customers on their Android mobile phones. Google wishes to test this solution with the help of New York and San Francisco-based pilot merchants.
- Contrary to previous announcements, Google will not be in charge of payments: they will be financially settled as usual by card schemes.
- Several commentators logically consider Google is putting off the inevitable. Google’s customer referral to physical stores resembles Groupon’s model. A fee rewards the business deal, a process with which Google, as a contextual advertising specialist, is familiar. In comparison, offering payment services requires a wide range of skills, liabilities and compliance with standards. Moreover, margins are being impacted by unsettled regulatory changes, such as the Durbin amendment on debit card interchange, and by competitive issues.
- Google’s “temporary” backward step may in fact last for long. This strategic move can also be compared to ISIS’s. The JV of US telecom operators (AT&T, Verizon and T-Mobile) confirmed on 16 May its decision to give up the NFC option in favour of an e-wallet as a result of the Durbin amendment.