The TV and web retailer will bring its e-commerce and video programming to France in 2015. QVC already sells in Germany, Italy and the ...
Changing their stripes
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MasterCard says the Open API program will include a portal where developers can access documentation and sample source code for integrating MasterCard into online games, e-retail sites and mobile and other applications. MasterCard aims to have the Open API initiative and developer portal live this year.
Meanwhile, MasterCard Labs is building a team of engineers and programmers to be based in the U.S., Europe and Asia. Garry Lyons, who leads the unit, says he's looking for "people who know how to turn an idea into something that works." Lyons had been the CEO of Orbiscom, an online security company MasterCard acquired in 2008.
Visa and CyberSource
For its part, Visa appears intent on offering enhanced services to online retailers with the acquisition of CyberSource, which has a client base of 295,000 merchants.
Visa executives say they will be able to do a better job of preventing fraud by combining CyberSource's merchant-specific data with the network-wide data Visa gathers.
Allen Weinberg of consulting firm Glenbrook Partners foresees opportunities for CyberSource, which generates a majority of its revenue in the U.S., to grow internationally through its ties to Visa. He says many U.S. merchants want to sell overseas through the web and that a combined Visa/CyberSource would be able to connect those retailers with payment-processing networks around the world.
"This is clearly a big deal for Visa and the payments industry," Weinberg says.
Merchants stand to gain in another way, adds Todd Ablowitz, president of payments consulting firm Double Diamond Group: Visa now must view retailers as potential CyberSource customers and thus be nice to them. "When you have a direct financial relationship with another party," he says, "you need to make them happy."
MasterCard acquires similar assets with its plan to buy DataCash, which provides payment processing to 1,400 retail, travel and entertainment companies, most of them in Western Europe. Like CyberSource, DataCash provides fraud prevention services and access to online payment alternatives to credit and debit cards.
"E-commerce represents an important part of MasterCard's growth strategy, and this acquisition will allow us to provide new services to our acquiring customers, as well as drive increased e-commerce penetration in both existing and new markets," MasterCard president and CEO Ajay Banga said in announcing the deal.
Observers noted the similarity to Visa's deal to buy CyberSource. "It's definitely a me-too play versus Visa," says payments consultant Steve Mott of BetterBuyDesign.
"They basically found a business with a similar DNA to CyberSource, but with a stronger position in Europe and Asia—and at a quarter of the price," says Jason Pavona, executive vice president of sales and marketing at Litle & Co., a processor of card-not-present transactions for online and catalog retailers.
Reaching out to consumers
Even as they were making deals to expand their e-commerce processing and fraud prevention capabilities for merchants, Visa and MasterCard were breaking ground this year with new programs that aim to create direct relationships with online consumers, rather than working through their client banks.
The MasterCard Marketplace offers consumers discounts on products and services, such as car rentals, flowers and vacations. The site, at Marketplace.MasterCard.com, enables a consumer to customize offers by dragging the logos of retailers and other companies she likes into a blue shopping basket and those that don't interest her into a red basket.
MasterCard is working with Next Jump, which serves big corporations by providing discounts to their employees, collecting consumer behavioral data along the way. Marketplace is an expansion of a previous collaboration between MasterCard and Next Jump called MasterCard Savings, launched in 2008, that offered discounts to consumers who paid with MasterCard-branded debit and prepaid cards.
MasterCard Marketplace tries to tap into the popularity of limited-time offers with a feature called Overwhelming Offers, which goes live at noon Eastern time Monday through Friday. Consumers who have registered a MasterCard-branded card can click for a chance to buy at the deepest discount offered, typically 50%. Only about 5% win, and others are offered discounts in the 30-40% range, says Andrea Gilman, senior business leader for commerce solutions at MasterCard.
In one deal last month, Saks Fifth Avenue offered $75 off sunglasses with a list price of $149; the 100 pairs available at that price sold out in 12 seconds, suggesting MasterCard has attracted a core of consumers who closely follow each daily deal.
Overwhelming Offers is one of six enhancements introduced since MasterCard Marketplace launched in March, Gilman says. Others include a section geared to affluent consumers, a Spanish-language site and a widget MasterCard client banks can add to their web sites.
The fast pace of new feature introduction "gives a sense of how we're behaving," Gilman says. "We're working really closely with Next Jump to make sure we're continually launching and innovating and bringing new things to market."
Shoebuy.com is participating in MasterCard Marketplace as a way to reach more shoppers, including some that may not buy often online, says Keller, the e-retailer's chief marketing officer. "MasterCard is a great brand and they bring loyal followers, including folks that aren't the most savvy Internet shoppers who look to MasterCard to see what brands they recommend," he says.
Keller would not disclose data on Shoebuy's traffic or sales from MasterCard Marketplace, but it appears consumers are taking note. Unique visitors to Marketplace.MasterCard.com hit 411,149 in July, triple the number from April, says web measurement firm Compete Inc. However, that's a far cry from the traffic to an established comparison shopping site like NexTag.com that drew 15.2 million visitors in July.
Rightcliq from Visa
Rightcliq.Visa.com did not attract enough traffic in July for Compete to measure because Visa only started promoting it Aug. 2. Like MasterCard Marketplace, the Visa initiative includes discount offers from merchants—one-third of the top 100 online retailers are participating, Visa's Wilson says. But its key selling points are convenience and social shopping.
Consumers who sign up for Rightcliq download a plug-in to their browsers where they can store billing and shipping information and payment card data, including for cards that compete with Visa. That plug-in automatically fills in a consumer's personal information, including card numbers, on a web checkout page. Retailers do not have to do anything for Rightcliq to work.