The Stratification of the ATM Industry:
Highlights from the 2006 ATM Deployer Study
Welcoming Steve White
ATM Debit & Prepaid Forum
The Search for Contactless Life
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The ATM industry reached an inflection point in 1996, when the widespread adoption of surcharging redefined the ATM business model that had existed for almost thirty years. Ten years later, in 2006, we have reached another inflection point, as many deployers, re-evaluate the role of the ATM (is it purely a cash dispenser, or is it a strategic customer delivery channel?) and make strategic decisions accordingly.
In this issue of On Payments, we share some of the key findings from our 2006 ATM Deployer Study. Based on data from 161 ATM deployers representing 134,110 ATMs (34% of all the ATMs in the U.S), this study is the fourth in a series of bi-annual studies sponsored by the leading EFT networks that tracks the ongoing evolution of the ATM industry.
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The Stratification of the ATM Industry:
Highlights from the 2006 ATM Deployer Study
Two years ago, the 2004 ATM Deployer Study painted a picture of an industry in search of a new model. Presented with challenges like declining transaction volume and terminals that are losing money, ATM deployers have had to ask themselves some difficult questions: How can we continue to expand ATM access for our customers while simultaneously containing our costs? Is the ATM simply a cash dispenser or can it be an opportunity to provide one-to-one customer service?
How deployers are answering these questions underpins their ATM strategy, and determines how they manage their ATM networks—from how many they deploy and where they deploy them, to what functionality they support and what software they run. As a result, we are now entering a new phase in the evolution of the ATM industry, one that is characterized by the stratification of deployers’ ATM strategies: the search for a new model has resulted not in one new model, but many new models. Deployers are bifurcating along two dimensions: ATM access (proprietary vs. shared) and user experience (differentiated vs. undifferentiated).
The 2006 ATM Deployer Study, co-sponsored by CO-OP Financial Services, NYCE, PULSE, and STAR, provides an in-depth look at the trends that are shaping the ATM industry, benchmarking key performance metrics (including transaction volumes, surcharge rates, and operating expenses), exploring recent developments (check imaging, ATM branding), and providing insight into deployers’ strategies and priorities. It also presents an outlook for the ATM industry over the next few years, as the industry’s business model(s) evolve and deployers’ strategies diverge.
Click here to read an overview of the 2006 ATM Deployer Study.
Welcoming Steve White
We are pleased to announce the latest addition to Dove Consulting, Steve White.
Steve rejoins Dove as a Director in our Financial Services Group, focusing on Retail Banking.
Steve was previously with Dove from 1994 to 1996. For the past ten years, Steve has run his own firm, White Consultancy. Prior to his time with Dove, he founded Global Concepts and Collective Dynamics and was also a co-founder of Speer & Associates. Steve’s primary focus today is helping banks improve customer retention and loyalty. He also works closely with clients with large consumer billing operations, helping them reduce the cost of turning receivables into cash.
678-627-4917.
ATM Debit & Prepaid Forum
It was good to see many friends and colleagues at this year’s ATM, Debit & Prepaid conference, which took place early last month in Las Vegas. More than 50 speakers covered topics ranging from ATM Deposit Automation to Debit Rewards to HSA prepaid cards, and this years attendance was 50% higher than in previous years’.
In addition to concurrent sessions focused on specific ATM, debit, and prepaid topics, key note addresses from many of the leading payment providers offered insights into the big picture trends for the industry: innovation, litigation, enterprise strategy, and global trends. As usual, the conference included the EFT Network Showcase featuring representatives from CO-OP Network, MasterCard, NYCE, PULSE, STAR, and Visa, who shared their thoughts on a variety of topics, from sustaining debit growth rates to providing fee-free ATM access, from competing in prepaid to selecting the right EFT network.
We hope to see you all at next year’s event, which will be held October 3-5, 2007 at La Costa Resort & Spa in Carlsbad, CA.
The Search for Contactless Life
After monitoring the development and evolution of contactless payments, our fearless reporter Chris Allen wanted to really get his arms around this new payment product. So, he conducted his own primary research to understand the contactless payment experience from the consumer point of view, testing his Blink card at McDonald’s, CVS, Wawa, Ritz Camera, and Walgreen’s.
Cick here to read Chris’s account of his experience with contactless payments—and the lessons he took away from this experiment (see page 47).
This article was published in the October issue of Digital Transactions Magazine.