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Web-based “Digital Wallets”

Definition of Problem, Market Demand, and Proposed Strategy

Manu Sporny

CEO / Digital Bazaar

Member - Web Payments WG, Digital Offers CG, Verifiable Claims TF

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Problems for Stakeholders

  • Customers
    • “Am I getting good value?”, retail spam1, app fatigue2,3
  • Retailers
    • loyalty programs are limited and expensive4,5, POS integration difficult6, vendor lock-in6, app barrier2,3
  • Consumer Packaged Goods Companies
    • anemic digital offer strategy7,8, not widely redeemable9
  • Software Vendors
    • app fatigue2,3, siloed market with high integration costs6,9

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Digital Wallet Ecosystem

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Customer

Merchant

Consumer Packaged

Goods

Digital Wallet Provider

Stores/Retrieves

Payment Instruments, Digital Offers, Tickets, etc.

Issues

Digital Offers

Issues/Requests

Digital Offers

Transmits

Digital Offers

Initiates

Purchases

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Customers

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Customer

  • Incentives:
    • want good value, ease of use, and choice of wallet10, without app fatigue2,3
  • Benefits:
    • digital wallet available across all devices
    • integrated payments, digital offers, and verifiable claims
    • can easily choose and change digital wallet provider
    • accepted by large number of retailers

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Retailers

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Retailer

  • Incentives:
    • strong loyalty competition from larger retailers11
    • customer loyalty increases size and repetition of purchases12�
  • Benefits:
    • keeping an existing customer is 7 times less expensive than acquiring a new one.12
    • new payment channel - payments initiated via digital offer
    • no vendor lock-in6

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Consumer Packaged Goods

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Consumer Packaged Goods Companies

  • Incentives:
    • wants better reach, resonance, and reaction�
  • Benefits:
    • real time tracking of when and where digital offers are redeemed
    • can produce individualized digital offers
    • increases reach to consumers via the Web
    • reduces lifecycle management costs

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Software Vendors

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Software Vendors

  • Incentives:
    • a level playing field enabling them to provide competing products �
  • Benefits:
    • larger customer base for software and services
    • ability to compete with existing vendors

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Demand for Ecosystem

  • 315 billion coupons issued, $515B USD of coupon value12, 13
  • Only 2.5% of coupons are digital, 51% of consumers want all coupons to be digital, and 55% would use more if they were14
  • 3.3 billion loyalty memberships, 29 cards/household15

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Why W3C

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  • W3C is involved in developing the following initiatives:
      • Web Payments
      • Verifiable Claims
      • Digital Offers
  • These initiatives include the technology necessary to execute on this "Web-based Digital Wallet" use case
  • No plan for cross-collaboration.
  • Web Payments IG ensures proper coordination of these activities.

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Missing Capabilities from Web Platform

  • Store Digital Offer from Merchant
  • Merchant query for Digital Offer(s)
  • Message customer (Push API limitations)
  • Context-sensitive Wallet Display
  • Encoding of Digital Offer data
  • Dynamic display of Digital Offers in Digital Wallet
  • Fast Provisioning of Digital Wallet

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Thoughts? Questions? Concerns?

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Work Happening Elsewhere

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