The future of transactions

Service design has a lot to do with future scenarios. A few months ago we developed the initial identity for ParkNOW!, a pay-by-cell phone parking payment operator in the US. During that project we talked a lot with them about different payment methods, and NFC (near-field communication) got mentioned too. In fact, all major mobile phone manufacturers have white papers on it and are working on making the technology usable.

NFC enables devices to talk to each other when they're close enough. It can let you share contacts, pictures or whatever data you want. The killer app though, is payments. Using your mobile phone (cell phone in the US) as wallet. In short, this will revolutionize monetary transactions in near future. And as always, for existing industries (banks) it will happen faster they can say "return on investment".

A few days ago, Financial Times published an article saying that Apple would incorporate NFC technology in their iPhone 5, which is due this fall. Surfing around the web seemed to confirm the story, because this week has seen a flurry of articles about the iPhone 5 and iPad 2 incorporating NFC. The really big deal is this, however: Apple has through iTunes credit card information on over 100 million people. This makes NFC not only a cool technology, but for Apple customers also an immediately available payment system with enough people tied to it, that for retail operations this can represent critical mass. Retail outlets therefore, will be highly incentivized to install NFC payment terminals in store. (Starbucks has, in fact, aldready developed an app for the iPhone to enable their customers to pay faster using their phone.)

This is what banks are charging for. (Image: Wikipedia)

The real impact of NFC payments, digital wallets and eventually peer-to-peer transactions using NFC will be felt in the bank. Banking relies on charging incremental fees from customers who are moving their own money around. Additionally banks earn interest lending out people's money. Purely digital money, manipulated directly by customers themselves, without a third party being involved, can represent a paradigm shift in transaction infrastructure.

Money, after all, was invented to facilitate trading. It was more effective than barter, because the relative value of each item was difficult to gauge. Money provided an independently assessable equivalent that was a lot cheaper to manage than barter trades. Today, money is everywhere. However, in reality money is like fixed line telephony. Developing nations don't bother to install telephone lines – they go directly to mobile phones. Similarly, the internet is not really being accessed by computers in developing nations but is used on smart phones, which are cheaper and simpler to use and need less fancy software. What if money, like fixed line telephones, is a legacy system that can be skipped?

In Africa, a mobile operator enabled their customers to send and receive money via an SMS system. There were few banks, with even fewer branches in rural areas making it difficult for people to trade with each other except by using cash. Credit cards aren't available and even if you've got one there is no guarantee that the store will accept it. This lead Safaricom to develop MPESA, a micro-payments system and Wizzit to provide mobile banking. From being on the fringes of the banking business, they have now effectively changed consumer's understanding of what banking is, and are leading the debate for the whole industry.

For early adopters, PayPal has introduced the mobile-to-mobile payments app. The talk of "can it be done" is already yesterday's news. With Apple's client base we are also over the "are there enough people to use it" question. So banks, thanks for all the fish.

Change Hurts

There has been a lot of discussion lately about changing identities of the world-famous brands. Well, the fuss has always been up in forums, but with social media gaining more public attention some logo redesigns have become matters of global importance. Namely Gap, Starbucks, Tropicana.

John Nunziato, the author of the featured article tries to cool the (often anonymous) crowd down. Changing a logo is influenced by so many factors that the "like-unlike" scale is just not a sufficient judging criteria. Critics often (mostly) have no clue what's behind that symbol replacement. Getting even the smallest amendments through is a long and painful process, especially in big corporations.

The situation here is Estonia is often quite the opposite, paradoxically. Marketing departments of locally famous brands quite too often regard radical identity change as a remedy against business slowdown. We at Brand Manual have a few examples of projects that start with a "we need a new logo" brief - and ending with a thorough fix of their current identity. You get bored by your face long before your customers do - that's the mantra we keep repeating. Look at Budweiser, it has kept the same appearance for the past 140 years - and is still one of the greatest brands there is (you have to admit that, even if you don't like the beer). I struggle to find a good domestic analogue, though.

The bottom line - just changing your brand's identity wouldn't improve your business, period. But when your offer has really risen to the next level, then a logo refreshment can be a pretty effective way of getting attention. Especially if you have fans (and aficionados are attracted by great service, not a logo).

Brave new year

Last year was different. We saw the rise of the iPad and the smartphone reigned over the mobile phone. Making websites has changed into creating content. Media is no longer the message, being on Facebook is not a strategy. Corporate and governmental systems are in disarray, as for the first time in history people can and do question government authority. Are your procedures reasonable? Is you profit margin reasonable, is it good for the community or the environment, is there another easier way of doing things? Power is with the people, not in the system, because now people can build systems of their own.

Brand Manual has acted as guinea pig for it's whole existence. We started this company to prove that quality can be sold. We preached branding as something companies do internally and that "the business idea" can never be "to make profit", but has to offer something valuable to the customer. We find it really tempting to grow in size, using the business model of design or ad agencies. But that would not help us achieve what we are aiming for, which is to become an change agent inside companies. It is easy to give good advice and leave, but our goal is to create lasting understanding and value through well designed products and services and a clearly formulated business proposition.

Now to the topic of the day: our website. We wanted to create something intuitive, something that works the way people surf the net. Jumping from interesting bit to interesting bit with no dominating structure impeding progress. Our previous site was a linear presentation, this one has no structure. Secondly we dropped Flash because of the personal grudge Steve Jobs has against Adobe. We don't really care who's right and who's wrong. We just like it when things work on iPhones too. And there's no mouse-over, because on touch screens that function doesn't really exist.

The problem we couldn't solve is how to make people read the copy, instead of just looking at the picture. The most valuable part of our work is not the graphic design, it is the thinking behind the design that matters. But without pictures the site would be a bit dry. Enjoy!