Kristian Thure Sørensen, Nets: "Loyalty in its core is about recognition"

Kristian serves as Senior Manager for Mobile Payments and E-commerce for Nets (www.nets.eu), where he leads the Mobile Wallet initiatives across the Nordic countries. Kristian is board member of the Mobey Forum (www.mobeyforum.org) and active contributor to Mobey Forum’s highly successful series of whitepapers on Mobile Wallets. His work has made him a frequent speaker and panellist on the topic of mobile financial services.

What’s the position of Nets in the global mobile payments space?

Kristian Thure Sørensen: Nets is primarily focusing on the Nordic region where we already have a significant role. We are well connected with around 280 banks and more than 500.000 merchants, and we posesses the competences that enable us to act as a trusted service manager – TSM – and connect all these contacts in the mobile payments space as well.

Furthermore, by using international standards for mobile payments, we can service our customers globally. In this respect, we are part of the global mobile payments space, although our key market is in the Nordics.

You recently announced a mobile solutions suite which has at its centre the mobile wallet platform. Could you please share with our readers what functionalities it will provide and how is it different from other mobile wallet solutions?

Kristian Thure Sørensen: The core functionality of the suite includes solutions which enable us to help our customers – mainly the banks and other issuers – to provide a mobile wallet containing international standardized payments instruments. Additionally, given our merchant reach and POS market, we will be able to enhance the user experience by integrating some of the value added services like memberships, loyalty, coupons, offers, etc. with a quicker time to market.

In March 2014, Nets entered an agreement with the Norwegian bank Eika Kredittbank to launch a pilot project for contactless payments via smartphones. Could you share some details about this latest development?

Kristian Thure Sørensen: The project is progressing accordingly to the plan together with the customer and we’re looking forward to help the customer launch the solution in the not-so-distant future. The agreement with Nets allows Eika Kredittbank to deliver a solution that stands out. In addition, the bank will strengthen its already strong position by enhancing their brand rather than trying to create new consumer brands in the payments area.

Given your recent focus on contactless payments and the fact that many mobile payments solutions are based on the card infrastructure, how do you see the shopping experience changing with the new mobile technologies?

Kristian Thure Sørensen: The ‘shopping experience’ – and not just the ‘payment experience’ – will definitely be enhanced by these new services, and that is what Nets is aiming at. We are striving to help banks and merchants to bring valid, relevant offers and information to their customers, which will enable the latter to benefit from the loyalty offers they are entitled to.

Furthermore, instead of creating all these different membership cards and punch or stamp cards and carry them around in the existing physical wallet, we will have these new services fully integrated into a mobile wallet.

In the last years, we have seen a booming number of mobile payments providers arguing that their solution is the most convenient for the customer. What do you think will be the key feature which will enable providers to retain customers after the maximum of convenience is achieved?

Kristian Thure Sørensen: Convenience is a major driver and if you foresee that convenience will become a commodity, you could argue that the different solutions available now are more or less equally convenient.

Personally, I believe that things can always be done better and there will always be someone to challenge the concept and come up with something that directors of markets haven’t thought of. Convenience is a key factor, for certain, but the companies that provide the right services to the right audience will be the winner in the long run.

Also, other key factors are knowing your customers and using the available data in a clever way with a respect to the user’s privacy. This approach will make possible for the customers to receive the most relevant information wherever they are.

There is a lot of discussion around “paying for convenience”, in the sense that customers are willing to pay for a specific service if it saves them time, for example. What alternatives/solutions do you see in the mobile for a convenient way of paying without paying more and without sacrificing quality?

Kristian Thure Sørensen: I strongly believe that quality will win in the long run. I am fully aware that some solutions choose a lower quality in order to increase convenience and time to market. In some way, you can say that e-money solutions are of lower quality because they come with less consumer protection, for example, but on the other hand, they come with high convenience and ease of delivery.

Nets has a great functioning payment infrastructure which, backed by the existing knowledge of the market, enables all the Nets products to be of high quality.

In your opinion, how is the concept of loyalty going to change in the next 5 years with the ubiquity of mobile phone?

Kristian Thure Sørensen: In the future, just having a loyalty system will not be enough. The difference lies in the way the merchants choose to package the loyalty and the way they will enable customers to actively engage with the brand.

Also, it will not only be about discounts or about being recognized. It will be about implementing loyalty solutions via mobile in a much broader sense than we have seen so far with basic earn point system, for example. It will be about a more active use of the knowledge that a certain merchant gets when they provide service to their customers and use that knowledge intelligently.

Finally, due to the fact that loyalty in its core functionality is about recognition, the winners of the loyalty game are the ones that actively recognize the customer’s need directly.

In the online ecosystem, we have seen some developments in this respect, such as the one by Amazon which is one of the leaders in the loyalty game, which has very accurate suggestions of what I should buy next. I think we will see a similar development in the physical retail as well.

Via mobile, all the parties – banks, merchants and payment service providers - can meet on a single platform, which will provide the data that eventually can be used in a clever way to support the consumers.

Company description

Nets specialise in managing digital values through the delivery of strategic consulting and IT solutions. We enable a more efficient society and optimise our customers’ business through the way we handle money, information and identities digitally. We have one of the most extensive product portfolios in Europe and our ambition is to become an even stronger partner to our customers by supporting their business, nationally as well as internationally. Nets has 2,600 employees in Denmark, Norway, Finland, Sweden and Estonia and a yearly turnover of EUR 850 million. Find out more at www.nets.eu.