Michelle Lee
Marketing 489
Th 16:00-18:45
February 19, 2015
Fiserv Takes on the E-Billing Market
I. Summary of Facts
A. Market – Financial services data processing industry
1. Fiserv acquired “CheckFree”, the market-leading electronic billing and payment pioneer in 2007
2. 70% of online households use electronic bill payments, but less than 20% regularly use e-billing technology to view their bills
3. 86 million out of 118 million are online receiving 10 bills per month
4. Electronic bill payments gaining wider acceptance
5. Competitors: IBM, Microsoft, First Data, and Citibank
6. Economic Market - Oligopoly
B. Product
1. Used by utility companies, cable/satellite TV providers, and financial services firms
2. “Outgoing” interactions assist indirect customers to pay bills electronically
3. “Incoming” interactions assist consumers to receive bills online electronically
4. Allow consumers to receive and view e-bills at a biller’s Web site
5. US market leader in core processing services and largest independent US check processor
6. Leading US Internet banking services provider and leader in bill payment and presentment services in Dec 2007
7. Benefits
a. Core- Ease of and efficiency financial transactions
b. Secondary
1) Penetration was driven by convenience in 2009
2) Savings on postage stamps
3) Improved perceptions of payment security
4) Ease of access to bills
5) Reduces clutter
6) Saves paper, saving trees
8. Product Life Cycle: Growth/Maturity
C. Price
1. Free to consumers
2. Processing and sending each paper bills costs an average of $1.25 per bill
3. Biller paid Fiserv $0.025 each time the consumer viewed the e-bill
4. Costs the biller $0.025 each time the consumer viewed the e-bill and $0.40 per month when consumers turned off paper bills in favor of e-bills
5. Cost to convert a consumer to e-billing is $4.50
6. Average cost