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Square Buys Restaurant Delivery Startup Caviar

Square, the mobile payments company led by Twitter co-founder Jack Dorsey, is hoping to grow in new directions by acquiring Caviar, a Bay Area startup that delivers meals from restaurants that don’t have their own couriers.

“It’s logical for them to be looking for where they can extend into adjacent businesses,” said Todd Ablowitz, president of Double Diamond Group, a consulting firm that focuses on the mobile payments industry.

Mercury News, August 4, 2014

Square Merges Its Mobile Payments With Food Delivery By Acquiring Caviar

For Todd Ablowitz, senior analyst and consultant at Double Diamond Group, the confidence in Square’s business model has always been there.

Ablowitz identified quality products, high number of accounts, and respectably-priced transaction fees as three key successes at Square, each of which he sees proving themselves with this newest acquisition.

Forbes, August 4, 2014

Blog: Convergence is the Real Non-Payment Payment Story

As an analyst, I earn my living answering the question: “What’s happening in payments?” At risk of destroying my primary source of income, I’m going to tell all of the people asking that question a little secret: “You’re asking the wrong question!” There is, in fact, a much better and more important question you should be asking and that will have a much bigger impact on payments than anything actually happening in payments. That question is: “What is happening outside of payments that will affect the payments industry?”

The answer to this question is convergence. The convergence of communications of all types into online and mobile technologies is the single biggest thing happening in every industry. This trend already has revolutionized many industries and will continue to revolutionize many more, and each revolution will take a little piece of the payments industry along. –

Pay Before, July 24, 2014

Another Zero Option: Cloud-based POS Provider Pose Drops Its Software Fee

Such a move as Pose’s, when there are scores of tablet- and cloud-based POS options, may help it stand out, suggests Rick Oglesby senior analyst at Double Diamond Group, a Centennial, Colo.-based payments consulting firm.

It could be an evolutionary step, he says. “A basic POS system that is good for small-to-medium-size merchants is rapidly becoming a commodity and is generally available as part of a merchant-processing agreement at no additional cost,” Oglesby says.

“Companies that offer these solutions need to either monetize their offering through payments, or they need to push the envelope on features in order to offer a product that stands out from the commoditized solutions to the point that companies will pay for them,” Oglesby says. “There’s a lot of potential value in more advanced POS systems, but those that provide basic electronic cash register and payments capabilities are not attracting much in terms of standalone value.”

Digital Transactions, July 21, 2014

Twitter, Facebook Make Payments Moves, But Do They Threaten Payments Firms?

“I don’t think these are indicative of payments aspirations as much as they are indicative of these companies’ desires to consummate sales,” Rick Oglesby, senior analyst at Centennial, Colo.-based Double Diamond Payments Research, says by email. “One of the major implications of online commerce is that advertising and selling can merge into a single activity. To do this, online advertisers need some payments capability, although the goal isn’t necessarily to monetize payments themselves. Rather the goal is to monetize selling, of which payments is a part.

Payments firms, however, do face some risks as the social networks work to make e-commerce on their sites easier, Oglesby adds. “What they [payments companies] currently sell as a stand-alone solution is being swallowed up by greater solutions that incorporate payments,” he says. “So payments companies need to be rethinking their long-term strategies.”

Digital Transactions, July 18, 2014

How to Choose a Mobile Card Reader for Your Business

Rick Oglesby, senior analyst with Double Diamond Payments Research, says the product features aren’t the largest differentiators, but rather the companies themselves — where they come from and their pre-existing customers.

“For example, PayPal’s legacy stems from eBay and online selling, so PayPal Here users are most likely to be companies with a significant online presence but also some local sales needs,” he says. “An eBay seller who also sells at some local craft fairs would be a good example. It’s easy and convenient for these merchants to just extend their relationship with PayPal to include the card reader.”

He says Square focusses more on small mobile retailers and food service providers such as cafes, food trucks, caterers, pop-up retailers, etc.

“Their offering includes not only payment acceptance, but also a lightweight point of sale system that replaces a cash register with a tablet app.”

GoPayment, Intuit’s product, has its foundation in Quickbooks, an accounting solution with applicability across many industries.

“Their payment product is loosely tied to Quickbooks and is targeted at a broader set of industries with more varying needs,” Oglesby says.

The market for mobile point-of-sale (mPOS) systems is mostly small businesses, though Oglesby notes, “The trend seems to be that mPOS providers are developing more features and moving up-market.”

Credit Cards Canada, July 17, 2014

Visa Revamps Its Online Wallet, And Gives It a New Name: Visa Checkout

Visa Checkout is a change in philosophy for the giant card brand, says Rick Oglesby, senior analyst at Centennial, Colo.-based Double Diamond Group. “Visa Checkout represents a change in philosophy from in that it endeavors to include the faster checkout and facilitation of merchant relationships directly into the core card offering rather than offering it as a standalone, separate product,” Oglesby says. “It’s more like merging into the Visa card.”

The idea is to streamline the product to the point where the online payment function becomes just a feature of the card that issuers simply would add to new and existing cards, he says.

“When we launched three years ago, we knew it would be an iterative process,” Visa says in a statement. “Commerce, both online and via mobile devices, is always growing and changing, requiring us to constantly innovate our offerings.” Visa says it incorporated lessons from into Visa Checkout.

A name change alone will not convince merchants or consumers to widely adopt the online payment service. “Despite the fact that the wallet is a mainstream product online and the fact that Visa is the most mainstream electronic payment product, there will be big challenges,” Oglesby says.

Digital Transactions, July 17, 2014

Jihadist Group’s Rise Prompts Mobile Payments Service Isis to Re-Brand

Given the flood of negative press generated by the militant group, the Isis mobile payments service had little choice but to re-brand, according to Todd Ablowitz, president of Double Diamond Group, a Centennial, Colo.-based payments consulting and research firm.

“To have a branding problem of that magnitude, it’s very smart of them to self-aware and take rapid action,” he told “This situation is unfortunate and completely out of their control — the branding of that terrorist group happened so quickly in the Western media.”

Fox News, July 8, 2014

GoDaddy’s Get Paid Integrates Invoicing and Other Business Tools With Payments

The combination of payments with business-management tools can be powerful, says Todd Ablowitz, president of Double Diamond Group, a payments consulting firm, and one payment companies should strive to emulate.

“Clearly, they feel their customers building Web sites need a way to manage their small businesses,” Ablowitz says, relying on software-as-a-service models to deliver them. “It’s a really good horizontal application because so many businesses can take care of invoicing.” It’s a relatively straightforward service to offer, he adds.

Offering services in conjunction with payment processing is a well-known tactic to enticing and retaining merchants, and demonstrates that “it’s not just about payments anymore,” Ablowitz says. “The value is in the capabilities, and payment is the secondary concern. If you’re an acquirer, processor, or independent sales organization, you should be thinking about what you’re doing with services.”

Digital Transactions, July 1, 2014

Opening Its Developer Platform, SimplyTapp Seeks to Ease Cloud-Based NFC for Issuers

SimplyTapp’s new platform is “an important step in terms of making [HCE] solutions more accessible,” says Rick Oglesby, who follows mobile payments as a senior analyst at Centennial, Colo.-based Double Diamond Group. “It’s a great way to let the ecosystem gain some momentum.”

Also, while the platform’s API credit may appeal to developers and lower costs compared to programs based on the secure element, it won’t make HCE anything close to cost-free. “In-house technology upgrades [financial institutions] will have to make will cost money,” Oglesby says. “There’s significant coding they’ll have to do.”

Digital Transactions, June 23, 2014
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Amazon’s First Smart Phone Harbors a Big Mobile Commerce Promise For the Retailer

Amazon Smartphone

“I’m not aware of any other phone so connected to a commerce provider,” says Rick Oglesby, senior analyst at Double Diamond Payments Research. “It’s a very end-to-end Amazon experience that hasn’t been done anywhere else.” The Fire phone should prove to be a good commerce engine for Amazon, he says.

Digital Transactions, June 19, 2014

Sam’s Club And Walmart To Offer MasterCard-branded EMV Cards

While it’s important that Walmart is offering chip cards, the greater significance will be its promotion of their use, says Rick Oglesby, senior analyst at Double Diamond Payments Research. “They will obviously promote the cards and the use of its cards in-store so it represents a big opportunity for public exposure to EMV,” Oglesby says. That will make a difference when other issuers are trying to decide when they should start issuing EMV cards to the general population, he says.

“Walmart has long been pushing for EMV adoption in the United States, so it’s no great surprise that the cards they will be issuing will be EMV-ready,” Oglesby adds. “The company also has stated that they can be EMV-ready quickly in their stores due to their existing PIN-terminal infrastructure and experience with EMV internationally. So they are addressing EMV from both the issuing and merchant sides of the spectrum.”

He says the Sam’s Club cards, in particular, are geared more to the rewards features, which includes cash back on certain purchases up to $5,000 annually, than to getting consumers to switch to EMV. “Benefits are important parts of card offerings in general,” Oglesby says, “but I don’t think we’re on the verge of seeing a lot of EMV-specific incentive programs.”

Digital Transactions, June 5, 2014

Mobile Payments Startup Square Discusses Possible Sale

With losses widening and cash shrinking, representatives of mobile-payments startup Square Inc. have discussed a possible sale to several deeper-pocketed rivals, according to people familiar with the matter.

Google Inc. discussed a possible acquisition of Square earlier this year, according to three people familiar with the matter. Those talks followed a meeting in 2012 between top Google and Square executives to discuss a possible…

Square looks a lot like a company in transition. It had very strong success in penetrating the micro-merchant market, but that market isn’t a terribly profitable one, so Square needs to go up market to find the real money.

Wall Street Journal, June 5, 2014

The Real Significance of Vantiv’s $1.65 Billion Deal for Mercury

Vantiv Inc.’s deal to acquire Mercury Payment Systems LLC was noteworthy for its size—the deal carried a $1.65 billion price tag—but it was also exemplary of a key industry transformation from distribution-centric to product-centric acquiring.

For decades, the merchant-acquiring industry has revolved around selling the services of barely differentiated payment processors packaged in barely differentiated payment terminals. Independent sales organizations (ISOs) became the prevalent model for selling payment services, and distribution reach became the primary differentiator.

So if you haven’t yet gotten the message, it’s now ISVs—not ISOs—that have the superior payments-distribution model. If you want to make money in payments, the lesson is clear: You must either sell through the ISV, or you must be an ISV. Both require a new product strategy. Neither requires an ISO.

Digital Transactions, May 14, 2014

Eye on Mobile: Apple Pairs iPhone with VeriFone Case in Its Stores; Square Drops its Wallet

“The key important factor here is that Apple is upgrading to EMV readiness in the United States,” says Rick Oglesby, senior analyst at Double Diamond Group, a Denver-based payments consulting firm. “They are obviously a pretty large merchant so we can add them to the list of large merchants that are going EMV-ready in advance of the deadline.”

The move also is important to VeriFone, Oglesby notes. “Any movement towards EMV migration is important for VeriFone, which is in a position to make a lot of money during the transition,” he says. “Having Apple on its books as a customer will be an additional boost for VeriFone since Apple is perceived to be a trendsetter in the market and other companies are likely to follow Apple’s lead.”

Apple is keenly watched for any movement within payments, with Tim Cook, its chief executive, earlier this year calling mobile payments “a big opportunity on the platform.”

Though the adoption of EMV-capable mPOS hardware is notable, what it does not portend is anything specific about Apple’s potential long-term digital-wallet strategy or the inclusion of NFC on future iPhone models, Oglesby says.

“NFC is already included in the VeriFone off-the-shelf sleds, and the [card] networks incentivize merchants to adopt NFC/contactless technology within the EMV migration roadmap,” he says. “It therefore wouldn’t make sense to purchase non-NFC sleds which would need to be custom-made, would cost more, and would delay the implementation schedule. Therefore, we can’t draw any conclusions regarding the future of Apple and NFC based on this change.”

The cessation of Square Wallet is not surprising, says Rick Oglesby, senior analyst at Double Diamond Consulting, a Denver-based payments consulting form.

“Square is in the process of transitioning from being a payments company to being a digital marketplace; that’s where the opportunity really lies,” Oglesby says. “Square Wallet as a stand-alone payment solution wasn’t wowing customers because customers aren’t really looking for new ways to pay. Rather, they are looking for new ways to shop. PayPal and eBay Inc. made each other successful because eBay provided the new way to shop and PayPal provided the new way to pay, they needed to happen together. The same can be said for Amazon and Amazon Payments, iTunes and the iTunes wallet, etc. It’s exceedingly difficult to create new ways to pay unless you are simultaneously creating a new way to shop.”

Square Order is an attempt to merge shopping and payments, he says. “If they can drive consumer adoption of ordering ahead then they’ll get consumer enrollment in the app that they can in the future just use for enhanced in-store non pre-ordered shopping experiences,” Oglesby says. “This will bring a staircase approach to changing payment behavior rather than trying to jump to the next stage.”

Digital Transactions, May 12, 2014



Double Diamond Group joins industry leaders in predicting that technology will have a major impact on the way we sell payments, requiring successful companies to either sell through ISVs or become ISVs themselves.

Read about what it means to become a successful payments company today:

The Real Significance of the $1.65 Billion Deal For Mercury
Digital Transactions, May 14, 2014

Integrated Payments Trend Is in Early Innings, But Going Strong
Payments Source, May 27, 2014

With Abandonment Soaring, Equifax And Jumio Aim To Ease Mobile Commerce Pain

Efforts to ease the friction in mobile commerce transactions require significant energy to motivate consumers, says Todd Ablowitz, president of Double Diamond Group LLC, a Centennial, Colo.-based consulting firm.

“To get consumers enrolled, they either have to solve it on the first transaction or have something so valuable the person will spend the time on first use,” Ablowitz says. “The question is, will people take a picture of their cards on a regular basis? Will lots of lots of people go down the Jumio path?”

Digital Transactions, April 4, 2014

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