Wednesday, September 02, 2009
The Luup side of Nokia Money
I have decided that I will not blog while on holiday, but the Nokia Money announcement is so big that it just cannot be ignored. While I am spending time with good food and wine in a beautiful region, I also cannot help thinking about mobile banking. So I decided to give my penny-worth:
I recently posted some of my observations on the hook-up of Luup with Deutche Bank (read more here). According to my understanding, Luup discarded their retail focus to hook-up with Deutche Bank to bring their mobile banking solution via the distribution reach of the bank to many countries in the world. Luup must be complimented on their focus on this initiative as this will allow them the best chance of succeeding.
In a similar way, Obopay have now teamed up with Nokia to bring their mobile banking technology to many countries by making use of the retail distribution network (and consumer brand) that Nokia allows them to use. I believe that this hook-up is similar to the Luup initiative and I would expect that Obopay would (over time) relinquish their own retail aspirations. It will also be difficult to develop an enterprise strategy at the same time as developing Nokia Money. It is not clear whether they will also (like Luup) focus exclusively on Nokia as a distribution strategy.
The biggest difference for me is the fact the the Bank is a much stronger distribution (almost retail) brand, whereas Nokia is a very strong product brand. A strategy based on utilising Nokia as a distribution brand would fail I think (with some exceptions like maybe India). It is my experience that Nokia is seldom distributed exclusively through a Nokia channel. Distribution networks in most countries also distribute other handsets. The impact of bundling a Nokia Handset with a Financial service will have to be evaluated carefully as I am sure Nokia cannot afford that their flirting with Money should impact their mainstream business.