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is just one part of that. The independent software vendor is
going to spend more time and attention on your merchant
because it is a bigger revenue source for that company Innovation happens in established
than it is for you. companies, but it usually comes from

When consumers buy something online through Amazon disruptors, which are typically startups.
or PayPal, those are sales that would otherwise have gone And four out of five startups fail in the
to your local merchants, the ones you have been calling
on for months. Previously, those consumers would have first five years. Not surprisingly, the
gone to the store and swiped their cards there. That's biggest reason for failure is the lack of a
bad enough, but now Amazon is signing up your local need in the market for the new product.
merchants to sell their products or service on Amazon
rather than run them through the terminals or gateways
you provided.

Encroaching competitors There is no easy answer. Calling on a small business
and saying, "I can save you money on your credit card
Amazon can process payments on behalf of merchants processing" is not going to work anymore. When I worked
because many consumers are already using Amazon at First Chicago Bank, we had a saying: Think like a
Prime and want transactions to flow through their customer. I believe this is the answer. But to think like
Amazon accounts, so they can get free shipping. Is there a customer, say for example in our CrossCheck primary
no business segment or vertical that Amazon does not market, new car dealers, you have to understand how they
want to dominate? operate and how they make money.

Then there are your prospects using Square. You ask, When you call on a general sales manager at a dealership,
"Why would they pay more and get less service than I the individual will know quickly if you are faking it, or
would give them?" But merchants don't see it that way. if you really understand their business model, their pain
They see Square as simple and easy to use. They like the points and the things they want to fix. You are not going
2.75 percent flat rate. It makes sense to them, more sense to learn all of this in a few weeks or even months. We have
than trying to read your statements. Yes, originally Square been providing payment processing and guarantee and
was for the micro-merchants that you couldn't really banking services to thousands of dealers for decades, and
underwrite anyway, but Square is moving into bigger it is a full-time job to keep up with trends and needs in the
merchants now, the ones you are calling on. auto dealer industry.
And there's Stripe. Stripe is a gateway that makes it easy for As an ISO or merchant level salesperson, your time is your
the merchant who is focused on payments made online, or most precious commodity. You have to use it where you
via mobile apps. Like Payment Processing Inc. did 20 years feel you will get the biggest reward. Focus on verticals and
ago, Stripe works with systems integrators, developers and segments that you truly understand. When you sit down
ISV channels and does not call on individual merchants. with a business owner you have to demonstrate that you
Stripe has been successful because traditional ISOs were have a good idea of the numbers that drive the person's
slow out of the gate on responding to the needs Stripe business, and must show you can provide worthwhile
addresses. ideas on how to increase revenue, and get more customers
and more dollars per sale.
This changing landscape is not limited to acquirers.
Look at what has happened in the banking industry. When you think like a customer, you increase your odds of
According to a study done by Accenture Payments, in fostering short-term success and long-term relationships.
2017, bank payments related revenue reached $163 billion. And if you do this, you will be able to determine if the
Banks used to dominate this market, but the same year, market really needs your new product idea, or whether it
nonbanks (PayPal, ApplePay, etc.) earned $136 billion is not ready for prime time yet. That knowledge will make
in payments revenue. As if this wasn't scary enough for you a better innovator, now and later.
banks, Accenture estimates that in two years the nonbank
share will rise to $177 billion, versus $167 billion for banks.
Brandes Elitch, director of partner acquisition for CrossCheck Inc., has
Thinking like a customer been a cash management practitioner for several Fortune 500 compa-
nies, sold cash management services for major banks and served as a
The prescription for banks is to introduce innovative consultant to bankcard acquirers. A certified cash manager and accred-
products (like Zelle), data analytics and artificial ited ACH professional, Brandes has a Master's in Business Administration
intelligence/machine learning. But this is easier said than from New York University and a Juris Doctor from Santa Clara University.
done, and most banks won't do that work.
He can be reached at brandese@cross-check.com.

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