Digital contents, gift cards and a worldwide cash in network

1. A Euronet Worldwide Company
New trends in the Gift
Cards markets & global
cash collection in Europe
Giuseppe Di Marco
epay Italy Managing Director
Prepaid Cards Summit
Milan, 13th of October 2010

2. A Euronet Worldwide Company
Contents of Presentation
Today there are two main drivers that are pushing the prepaid digital
market:
(becoming Digital Goods)
(mobile phones, music players, game consoles, E-books readers, TVs,
tablets, etc.)
This market involves many players:
Large Retailers (willing to sell their goods using new ways)
Contents Providers (needing new ways to distribute and sell their products)
Devices suppliers (aiming to fill their new marvels)
TelCo Companies (bored to provide roads making other to get the money)
Financial Institutions (interested in new ways of managing payments)
Trusted Third Parties (needed to integrate all these players)
We will go through this new way of selling goods
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Evolution of virtual goods
The evolution of virtual goods, maybe, is not giving us the right
perspective:
Once there were just Mobile Top Ups and other telephone related
products. This has been and is even now a huge market. But the
margins are decreasing
Other products joined the Mobile Top Ups:
Pay TV Top Ups
Financial Products (Open Loop Cards, eVouchers, etc.)
Music Top Ups (i.e.iTunes Cards)
Moreover many Retailers and Contents Providers created their own Cards
All of them have been seen as Cards, Gift Cards, in general
PRODUCTS
But, given the wide range of virtual goods might be, we need to
change the focus we look at this market
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Today Cards and Gift Cards have become a
CATEGORY - these are no more just a product!

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Gift Card How much
Did you know that: *
Today the Gift/Prepaid Category
The #2 category in sales at grocery
stores
The #1 fastest growing category
The #1 in margin per square meter
The #1 in revenue per square meter
The average overspend amount is 72%
* Source: FirstData

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Gift Card - Why
Why a Customer decide to choose a card as a gift? *
Receiver can buy what they want71%
Convenient to purchase50%
Flexibility in redeeming a gift card35%
He doesn't know what else to buy the gift receiver33%
* Source: FirstData

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How to approach to the European gift card world
Distribution
Content
New
Products
We need to make the flyweels start....
on the Consumer
side and ...
... on the Retailer
side
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8. A Euronet Worldwide Company
Distribution
Content
New
Products
RETURN ON
INVESTMENT
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How to approach to the European gift card world
DESIRE FOR A
VARIETY
CONVENIENCE &
TARGETING
PROMOTION &
INNOVATION
SERVICES
TURNKEY SOLUTIONS

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Marketing and destination merchandising
Source: Mercator, 12/09
consumer brands
Destination
merchandising
both in store and
in third party
malls
Increased sales,
profits and brand
exposure
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How to approach the Consumers
DESIRE FOR VARIETY
Today the European prepaid market is dominated by Mobile Top Ups
We need to enrich this offer, even if already important, with a wide range of
products, that is extending in different sectors, both Global and Local
contents:
Digital Contents: Gaming, Music, eBooks, Software, Social Networks Credits,
etc.
Physical Contents: Fashion, Electronics, Toys, Dining Out, Pet, Travel,
Recreation, Luxury, Home, etc.
Transportation and Ticketing (Transit)
Financial Products: Open Loop Cards, eVouchers, etc.

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How to approach the Consumers
CONVENIENCE & TARGETING
Different Targets for the different Retailers:
Once in 2 months
Large Retailers:
Women 25/65
(The Decision Maker)
Independent Retailers:
Cross 15/65
(The Self-Shopper)
TARGET
Electronic Large
Retailer:
Adults 25/40
(The Specialist)
People buy here specific products:
accessories for pc,
People buy here products and services
Top ups, pay TV recharge,
People go here for grocery shopping
They can find also other services:
Once a week
Once a day
Through the Gift Card Mall, choice has extended, and cards,
issued by a company, may be sold through a wider network (Hypermarkets,
Supermarkets, Convenience Stores, Bars, Newsagents, etc.)

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How to approach the Consumers
INNOVATION
We have to find the best ways and release
soon new solutions to integrate the gift
cards with the contactless technology to
give new services to the customers
We must deliver new applications to bring
the Gift Cards, Couponing and other
related contents on smart phones and on
the other types of new devices very
shortly

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How to approach the Retailers
TURN-KEY SOLUTIONS
Technology, Merchandising and logistics: sales systems (cash
registers and POS Terminals) integration, card printing, fixture
installation, display maintenance, inventory management
Marketing and promotion: full loyalty program to allow SMS, email,
and or mail campaign management
B2B Sales: availability of sales portal to allow marketing to B2B
customers including ordering, shipping and fulfillment
RETURN ON INVESTMENT
When redeeming their gift card, over a quarter of receivers purchase an item
they had not planned to spend money on and an additional one in ten buy a
more expensive version of an item they were already planning to buy
Gift cards are a great way for businesses to spread the brand, while
simultaneously improving cash flow (the gift card sales are for a retailer a no-
interest cash advances)

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How to approach the Retailers
VALUE ADDED SERVICES
The Merchants platform must allow consumers to self-register, so Merchants can
truly acquire their customers
Self registration allows card issuers to capture names, addresses, phone numbers,
email addresses, and demographic information
The Merchants platform must allow card issuers tools to send SMS messages,
create cash back or points-based promotions, couponing, create email
campaigns, or send direct mail offers to consumers

15. A Euronet Worldwide Company15
Case History: Euronics
Euronics is one of the major Electronic Large
Retailer in Europe and in Italy there are 270
Points of Sale, active to epay system
Closed-loop gift card, issued in 3 denominations:
50 euro
100 euro
200 euro
Can be used also for the Internet purchases
Target: not only B2C, but also B2B

16. A Euronet Worldwide Company16
THANK YOU
For further information:
Giuseppe Di Marco
gdimarco@epayworldwide.com
Mobile: +39 335 7716461