Test Drive Our Expert

2012
03.12 By: Jill Ellis / Category: Prepaid

It’s that time of year again. The Prepaid Expo starts today and are team is excited to be representing Arroweye in Las Vegas and is looking forward to a jam-packed week of networking and new perspectives on this booming prepaid market.

This year, we’re proud that our own CEO, Render Dahiya, will be participating in the popular new session “Test Drive an Expert.” We thought we’d share Render’s interview with the Prepaid Expo here:



Render Dahiya is the CEO of Arroweye Solutions, he will be our featured expert on the topic of Personalization, Customization and Digital On-Demand Fulfillment at the 7th Annual Prepaid Expo, taking place this year in Las Vegas, Nevada, on March 12-13, 2012, where attendees will have the opportunity to schedule one-on-one meetings with Render and other experts from an array of Prepaid specialties.

We had a chance to gain some insight from Render before we head out to Las Vegas next week. Here is what we discussed:

What are the most pressing issues/trends in your subject area that prepaid professionals should consider and/or watch closely in the coming year?

Need for Flexibility:  The regulatory reforms over the last year drove numerous changes to card programs, which I expect to continue in 2012.  As the government and card issuers interpret the new regulations, we may see new changes to terms and conditions, as well as disclosure rules.  Program managers will have to evaluate if their card programs are flexible enough to handle those changes without destroying existing inventory and purchasing new, and whether they have the flexibility to easily change that language on carriers or the terms on the back of cards without incurring large transition costs.

More Targeted Marketing. Prepaid is the booming market within the financial services industry, and its attractive growth attracts more players to the market.  Card program managers are thinking about how to differentiate their programs.   Key questions they should be asking themselves include, do they have the ability to target niche markets affordably; and can they create custom cards and co-branded cards in smaller runs?

Getting to Market Quicker. The best part of prepaid is how fast it moves. In many cases, the decision cycles on programs are driven by marketing ideas that bubble up from corporations looking to boost sales or incentivize employees.   Once a decision has been made, they want to move quickly.   The key is whether or not they are aligned with a partner that can help launch the program fast, or are they stuck in a 6-8 week cycle, in danger of their customers losing patience and interest?

What are the 3 most commonly asked questions/concerns you hear from clients?

1. How can I launch programs that require new card designs faster than the traditional model?
2. I know digital on-demand is a faster proposition, but is it more expensive?
3. How can I remove the risk from my next program launch? I can’t afford to run out of cards, yet I don’t want to print too many and have to pay for destruction fees due to an overly optimistic forecast.

What is/are the most common mistake(s) and oversight(s) people make in the prepaid space related to your area of specialization?

People often don’t evaluate the entire cost of fulfilling a new program, although there are a handful of important aspects to consider.  Program managers should conduct a thorough TCO of printing cards, inventory carrying costs, secure shipping from the printer to the personalization house, destruction costs and spoilage. Almost all our clients started off with a concern on cost.  They approached us because they were excited by the opportunity to reduce inventory risk, speed up launches and target niche markets.  Once they completed a thorough analysis of their existing secure shipping costs, spoilage costs (one client reported up to 60% spoilage) and short run penalties, they found that the TCO of an on-demand program was at par or better than their current program.  In addition, they gained all the auxiliary benefits inherent to an on-demand model.  Now when talking to our clients, they indicate they will never go back.

When customers hear that we produce on-demand cards, they immediately think: photo cards.   Photo cards are just a small piece of the on-demand solution.  The idea of eliminating the vault of cards you maintain today, quickly launching co-branded programs, having the flexibility to make changes in days not weeks, eliminating risk and at the same time expanding your marketing muscle — these are the benefits on-demand has provided our clients.

About Render:


Render Dahiya began his career at Dallas-based FedEx Kinko’s where he last served as the company’s Senior Vice President of US Operations overseeing 16,000 team members at 1200 locations.  Dahiya joined Kinko’s in the company’s early years and is listed as one of its founding partners. He helped grow Kinko’s into a national brand that was eventually acquired by FedEx.  After 19 years at FedEx Kinko’s, Dahiya left the company to become part of the management team at Culligan International where he served as EVP of North American Dealers. There he helped lead a turnaround of the over 70-year-old brand, improving both sales and operating results.

Dahiya joined Arroweye in November 2007, and became CEO in May 2008. Once earning his stripes in the closed loop sphere—with a client roster that includes Macy’s, Borders and eBay, to name a few—Dahiya helped lead Arroweye into the open loop industry in 2009, by obtaining Visa Vendor approval.  This certification marked Arroweye as the first company to manufacture and print the Visa logo on-demand while simultaneously personalizing a payment card.

Test Drive a Personalization, Customization and Digital On-Demand Fulfillment Expert

You can schedule a meeting with Render Dahiya at Prepaid Expo here, if you need help implementing a custom card program, launching an online card ordering solution or fulfilling small quantities of custom or co-branded cards.

To register, visit www.prepaidexpousa.com
Call: 1 888-670-8200
Email: register@iirusa.com

New Message from Arroweye: You’ve Received a Gift on Your Facebook Wall

2011
12.07 By: Render Dahiya / Category: Social

If you have a Facebook account, as more than 800 million people worldwide do, you’re used to receiving information instantly. We’re accustomed to real-time access to the news, our friends and families and being able to purchase just about anything with a click of a mouse, or tap of the finger. Communicating electronically is the new norm — and we’re not talking about texting or email. Social media, specifically Facebook, has become the communication hub of choice for many and their news feeds are the new email.

This shift in expectations was demonstrated to me by my own son. I sent him an email this summer, which went unanswered. When I asked him if he got my email and why he didn’t respond, he promptly told me that email is only for school and that he communicates with his friends through texting and Facebook.

When Arroweye was founded, we set out to make the gifting experience better for the gift giver and the recipient. Over time, we’ve introduced new services and technologies to keep up with advances in the way we communicate, including virtual gift cards.

Now, our clients are able to offer their customers a new gift delivery option: through Facebook. Retailers who use our tools can offer gift delivery options that are as customizable as the gift itself. Customers have the option to mail a physical gift card, send an e-card via email or deliver the gift to the recipient’s Facebook wall. We’re excited to offer this service to our clients and allow them the gifting flexibility their customers demand.

Five Questions for Loraine DeBonis, Editor-in-Chief of Paybefore

2011
10.19 By: Jill Ellis / Category: 5 Questions

The prepaid industry has evolved dramatically, especially in recent years. The Straight & Arrow tapped industry veteran Loraine DeBonis, editor-in-chief of payments news leader Paybefore, for her perspective and insight into the evolution of prepaid and what we have to look forward to in its future.

S&A: In the course of your career with Paybefore, how has prepaid transformed?

LD: I’ve been covering prepaid for about five years now, and one thing that hasn’t changed is the excitement around the industry. Prepaid is still hot. And, it’s easy to see why—it makes payments accessible to everyone, which has huge implications, not just in the U.S., but particularly in emerging markets. The biggest change—if we avoid the regulation conversation—has to be the entrance of mobile players into the market. While, we haven’t really seen that happen in a big way in the U.S. yet, I think that’s one area where we’ll follow Europe’s lead. Mobile operators have great reach and the potential to get prepaid cards (physical or virtual) into millions and millions of hands. I think mobile operators and probably the Social Security program will do the most to raise prepaid’s profile among consumers in the next few years.

S&A There’s been a lot of shift in the payments industry from a regulatory standpoint. What segment is going to benefit? What’s the biggest change?

LD: CARD Act made some big changes, but the biggest impact has to be Durbin. There’s a lot of talk about how banks are going to flock to prepaid since there is a carve-out for GPR, but the Fed put a lot of barriers up to that when it issued its final rule in July. Regulating interchange, whether you’re talking about a traditional debit card or a prepaid card, is going to require some rethinking of the business model. I’m afraid the biggest loser is going to be open loop gift, which doesn’t have a lot of options for increasing revenue.

S&A: At the end of the day, we’re all customers too. From a consumer standpoint, what are you excited about? What new trends are you following?

LD: I live in a rural area and shop online a lot, so I’m excited about virtual/mobile gift card applications. I’m not much of an app user, but the PayPal “bump” app, which lets you send money to a friend by tapping phones sounds pretty amazing and is getting quite a bit of use from their customers.  

S&A: Talk of the mobile wallet is everywhere. From your perspective, where does it stand?  How far off from widespread adoption are we?

LD: That’s the million-dollar question. Despite all of the media frenzy—there’s another announcement, partnership or pilot announced just about every day—it’s going to take time. Everybody seems to be banking on NFC, but we have a ways to go before there’s truly enough merchant acceptance as well as NFC-equipped handsets. I’m interested to see where folks who aren’t relying on NFC can go and how fast.

S&A: What’s going to dominate Paybefore headlines the rest of the year?

LD: In the U.S., we’re not done with Durbin yet. We’ll be watching the small-issuer exemption closely because I think there’s still some concern about how that works in the market. Even if small issuers don’t lose interchange revenues to the extent that big issuers do, there’s a chance that interchange could go down. I’m looking for companies to rethink the business model and look for new revenue streams whether that’s through valued-added services that consumers are willing to pay for or loyalty and rewards programs that pay for themselves by increasing stickiness. We expect to continue seeing innovative product launches and intriguing partnerships or JVs that shake up the market. On the European front, we’ll be watching regulation but also the entrance of new players as e-money issuers. We’re excited to see the kinds of products they bring to market and the effect they can have on consumer awareness. Latin America and Asia-Pacific, particularly India and China, are markets to watch. And of course, we’ll be covering mobile!   

*Have any questions for Loraine? Contact her at ldebonis@paybefore.com.

Employee Spotlight: Bob McCormick, Arroweye VP of Operations

2011
09.29 By: Jill Ellis / Category: Employee

We’re proud of the team we’ve put together at Arroweye. Our employees are dedicated and committed to driving innovation forward in the industry. Today, we’re sharing a Q&A with Bob McCormick, our vice president of operations. Bob brought more than 12 years of experience to Arroweye when he joined us in 2009, and has fearlessly led our team in Henderson, Nevada, since. Read on to get to know Bob, and find out how a near-Olympic debut almost changed the course of his entire career.

Q.  Tell us where you got your start?

I’m a mechanical engineer by trade, but it’s not a direct line to how I got to where I am today. I wanted to be a physics teacher, but my teacher at the time found out and told me to go be a mechanical engineer instead. So I went to Bucknell University and did exactly that. From there, I decided pretty quickly that I didn’t want to be locked in a cubicle designing a nut or bolt. I wanted to be involved in the bigger picture, which led me into manufacturing engineering, or operations management.

 Q. What came next?

After college, I turned down every job offer in order to train for the Olympic trials in track and field. But my knee injuries ultimately got the best of me, and I got my start in the precious metals industry making catalytic converters for cars. After that, I joined a pharmaceutical packaging company because I wanted to grow in an innovative industry, and pharm seemed like the place to be. But, I soon realized that while there was a lot of innovation and growth on the drug side, there wasn’t necessarily growth on the packaging side.

Q. So how did you end up in the card industry?

I really wanted to experience technological innovation. And not just in the manufacturing environment, but in the product itself. I found myself working for Gemplus, but at the onset, I wasn’t actually convinced that the product itself would enamor me. Come on, it’s a plastic card right? Once I realized the depth of it, I was really excited and felt I’d found a meaningful niche.  Among other things, they had the first digital printing press for card manufacturing.  I was intrigued. The personalization and varied text made it possible to do so much more. But at the time, our facility, and really the marketplace, wasn’t quite ready for everything it could do just yet.

I actually went with Gemplus to run an operation in Europe. In that facility, we were on the leading edge of leveraging the Datacard VHD model of personalization — the “pseudo way” of doing what Arroweye does now. I spent about eight years with Gemplus, in England and the U.S., before leaving to be a plant manager for ABNote in its Argentina facility. These experiences, in England and Argentina, really taught me how technology plays a role in the global economy. 

Q. When did you hear about Arroweye’s digital on-demand model?

During my time with ABNote, I left Argentina to move to Tennessee and start a new secure facility. One of our goals was to take the 4-6 week lead time of our competitors and drop it to two weeks. We were successful, and felt like we’d achieved something big. But in the back of my mind, I always thought, there’s got to be another way. Then, I got a blind call from a recruiter that introduced me to Arroweye. The vision of a collapsed manufacturing time and innovation I had teasing me for so many years was being described to me on the other end of the phone.

I went out for a visit, and was floored. I could see it right away — this was a model that the industry needed. Not just for manufacturing, but for the marketplace. I was very excited. This company, founded by a bunch of non-card manufacturers, pulled together the beginnings of what is now and will continue to become a true leading-edge operation that will set the pace for where the industry and marketplace is going. These guys walked in as true entrepreneurs not knowing what they couldn’t do, and just did it. They handed me an amazing foundation to build upon.

Q. So two years have passed. How has digital on-demand advanced?

There’s no question that digital on-demand is gaining traction to the point where we’re seeing a lot of activity. But the message I keep hearing from manufacturers is, “We can’t put this model together.” I see two common obstacles for the industry. First, companies need the right technology for delivering the work to the shop floor. That’s huge! If you can’t get it there fast and accurately every time, you’ll never get the process right. Or secondly, companies can conceptualize it, but can’t figure out the manufacturing element. The real success of Arroweye is not either/or, but the having the whole package.

That said, I do see this type of technology emerging among the other players.  What’s eroding is the really large single design type runs. I’ve seen the evolution of the industry from 1997 – and it was changing then – when most orders were 100K cards or more – to today, where our average order size is probably 50. That’s where the market is headed, and the only thing holding it back from getting there faster is the adoption of the process.  But we’ve seen huge growth from 2010 to 2011, even more so than from 2009 to 2010. It’s an indication that this model is driving growth, and we hear it from our customers: people want the flexibility.

Q. From a technology perspective, what’s your take on mobile payments?

The way I see it, the challenge of going truly mobile comes down to standards. It’s going to take a long time to embody itself; even though the technology may be there, the actual ability to implement on a large global scale is at least a decade away. Plus you have the challenges of rebates and gifting, which brings application-specific challenges. The functionality and compatibility issues need to arrive at a scenario where you can conceive migrating from cards.

Parallel to this, when I first got started in the industry in the late 90s, the key players were focused heavily on contact chip cards, the standard in Europe. They took Europe by storm over the magnetic strip card and thought they’d convert the U.S market in three years. But, the catalyst [fraud] that made this takeover possible in Europe wasn’t present in the U.S.  You’re forecasting a takeover, but it doesn’t bring anything to the end user other than cutting down fraud. But unless you have a fraud problem, it’s meaningless. I think contactless represents just a small share of the market here. Really, people still would rather have a picture of their dog or cat than they would a contactless solution.

I believe that we’ll find a perfect marriage between the mobile NFC type handset application and the on-demand delivery of a card. It is going to be a long time before NFC will stand on its own and therefore the need for a companion card will be there for an equally long time.  If there is one thing that all my travels have taught me; it is that everywhere in the world people are the same: they would prefer a card that has a personal touch, and they would prefer that specific card tomorrow rather than in six weeks. 

There’s no question as we go into NFC world, it’s going to help drive the demand for digital on-demand and customization.

Holidays in July

2011
08.03 By: Jill Ellis / Category: General

Everyone has a busy season, and for Arroweye, it’s the winter holiday months. Early in our history, we decided that instead of hosting an annual company celebration in December, we would do things a bit differently and celebrate the holidays in July. It might not be a winter wonderland, but it’s a time where we can all get together and have some fun.

Here’s a few photos from our 2011 “Holidays in July” parties in Chicago and Henderson, Santa Claus piñata and all.

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Five Questions for Mark Johnson of Loyalty 360

2011
07.12 By: Jill Ellis / Category: 5 Questions

More companies are using loyalty programs than ever before to build and maintain relationships with consumers. The Straight & Arrow tapped industry expert Mark Johnson, President and CEO of Loyalty 360, business leaders’ trusted source for loyalty and consumer engagement insights, to get his perspective on how the loyalty market has evolved.

S&A: How has the loyalty market progressed in the last five years?

MJ: Folks are beginning to realize the definition of loyalty is changing. Loyalty is no longer about driving behavior with thresholds and rewards, like points and products. It’s quite dynamic, and we’ve noted a change in both the connotative and denotative meanings of the word. Loyalty (definition): the processes, technologies, techniques, but mostly the insights gleaned from a more systematic approach to the processes used in, and data insight gleaned from, all customer, consumer or brand touch points to create a more data driven interactive dialogue with consumers that helps enhance and increase the efficacy of the communications, customer experience, feedback resolution and process improvements so that the brand participant can become a long-term, profitable and engaged brand advocate who will influence others through a variety of media channels.

S&A: From your perspective, what companies are innovating in the loyalty space?

MJ: There are a lot of innovative companies. When you look at the arenas where loyalty programs were started – airlines and financial institutions – you see a number of them (e.g. Southwest Airlines, Citibank) are innovating to make their companies stand out and adapt to the realities of a changing marketplace. I think the area where we are seeing the most dynamic change is within the business-to-business arena. Those companies have been a little slow to partake in the best practices of loyalty and engagement marketing, yet I would argue they are looking at this arena and innovating like no one else. Programs at HP, Intel, Allergan, and P&G in the indirect space are more focused on creating loyal customers than others.

S&A: What about the payments space? Who is gaining a competitive edge with loyalty?

MJ: When you look at some of the loyalty products that a Parago and Young America are creating for customers, such as rebate/rewards and warranty fulfillment products, you see that they’re all based on a prepaid debit platform. But, they’re also creating long-term benefits for merchants (e.g. Best Buy) and brands (e.g. Sony) by creating value in their products and enhancing the shopping experience. These products provide value to merchants and consumers, while also effecting measureable behavioral changes that are mutually beneficial to both.

S&A: Do you see a marketing value in plastic cards since they essentially function as a billboard within the wallet? Do you believe rewards and customization help drive usage and loyalty in the credit, debit and prepaid space?

MJ: There has been a great deal of marketing innovation in the card industry. I think those who use those innovations in a manner consistent with their other brand building exercises have a great opportunity to enhance and influence the brand. What we hear from CMOs across all industries is they are looking for innovative products they can keep in the end-user’s hand, even after the value of the card has been used. One way to do that is through customization of prepaid cards, in addition to loyalty products to create a long-term consumer engagement with the card, so it is less likely to be disposed of, thereby creating incremental, personal, and subsequently more impactful brand impressions with consumers.

S&A: We’ve seen a dramatic rise in multi-channel loyalty marketing, particularly via mobile. How do you see loyalty marketers using plastic amid the other channels?

MJ: I think this space has a lot of interesting potential and we’ll see the overlap of card, mobile, and proximity marketing shake out over the next couple of years. We have been hearing that the dawn of mobile is “upon us” for quite some time, so it will be quite interesting to see how it evolves. I believe you are seeing unique card-based programs being used as a genesis of programs (getting the initial involvement by getting the cards in hands of end-users) and then subsequently creating a process for mobile engagement. I look forward to seeing how cards and mobile evolve over the next several years.

FinovateSpring Demo Reel

2011
06.23 By: Render Dahiya / Category: Finovate

Back in May, we had the honor of participating in FinovateSpring, an elite gathering of companies in the financial and banking technology space. We had a great time demoing Arroweye’s fully-integrated, digital on-demand card production platform and giving audience members an exclusive look into our world-class, Visa, MasterCard and Discover-approved, secure production facility.

All Finovate presenters are recorded so they can share their story with the larger audience unable to attend the conference. Ours is available now. Click the video below to see our Finovate moment and how our unique card production platform works, online and onsite in our manufacturing plant.

Five Questions for Matt Frye of FSV Payments Systems

2011
06.16 By: Jill Ellis / Category: 5 Questions

The prepaid market is experiencing dramatic growth — new technology, bursts of innovation and added channels to keep pace with.

The Straight & Arrow tapped industry pro Matt Frye, Chief Commercial Services Executive for FSV Payments Systems, leading prepaid processing solutions provider, to get his perspective on the growth of prepaid, and what to anticipate moving forward.

 S&A:  The prepaid market is expanding quickly with many companies jumping into the field. How can companies new to the market differentiate themselves from the pack?

MF: With so many niches and different components in the lifecycle of a payment, it should be easy enough to pick one, and become excellent. The problem has been trying to reinvent the entire wheel, when the spokes work just fine. It’s usually an extension of the existing solutions that turns heads, and can offer lucrative returns.

S&A:  What do you see as the biggest challenge to a new company entering the prepaid market? What are some trends that you’ve witnessed as those companies try to find their place in the market?

MF: Trying to do too much, or trying to do it all. The technology is moving so fast, that it’s hard as a start-up to truly cover all the bases without getting distracted. Delivery, acquisition, mobile, social…these are plenty to keep us focused without trying to tackle settlement and the flaws in ACH. I recommend that we stay focused.

S&A: Maximizing impact and adoption of a prepaid program are essential to the program’s success. How are companies doing it best?

MF: This is the question everyone wants answered, and cracking this code sets prepaid participants apart from others. But the truth is very different based on the vertical and the value proposition, and is complicated by distribution, card association and even differences with issuing banks. The regulatory environment makes it even tougher. The real winners are seen getting to know their customers better than ever before, whether an intermediary or the end-cardholder. With so much choice, knowing who your customers really are is the only answer.

S&A: Consumers can change their minds pretty quickly.  Do you see their mindset about prepaid shifting? What features are consumers looking for most in a prepaid product?

MF: Prepaid is being used and consumers do not even realize it. Some cards are still called ‘credit cards’ by the cardholders themselves. So it’s not necessarily educating about prepaid in some cases as it is about educating about the utility of the product and the features. A Visa, MasterCard, Amex or Discover card can be used in so many ways to help with disbursements, provide instant access to funds, replace a bank account, compel someone to make a purchase or simply as a gift. It’s just a matter of selling the service it offers, not the fact that a ‘prepaid’ card is delivering that service.

S&A: What’s next for prepaid? What will be the impact of mobile payments and how do you think the payments market will evolve?

MF: Mobile and social are both compelling initiatives for anyone engaged in prepaid. The development efforts will be focused there, and then its acquisition strategies and supporting technology. Mobile and social media have the means to change the delivery and form factors associated with payments in general and prepaid is best positioned to deliver on that promise.

Sweet Home Chicago: ITA Spotlight on Arroweye

2011
06.02 By: Jill Ellis / Category: General

We love being headquartered in Chicago. We love our sports teams, our hot dogs and our jazz music. We also love being a part of a very vibrant and growing tech community. Today the Illinois Technology Association put the spotlight on Arroweye. Read about how we got our start when our founder, Doron Friedman, had a (brilliant) idea after receiving a box of chocolates, and about why we celebrate the holidays in July instead of in December and about how we ended up in Chicago in the first place… we’re so glad we did!

Get all the scoop right here:  ITA Spotlight: Arroweye

Arroweye at FinovateSpring 2011

2011
05.09 By: Render Dahiya / Category: Finovate

This week, Arroweye has the honor of joining 60 companies in the financial and banking technology innovations space at FinovateSpring in San Francisco.  We’ll demo the industry’s first, fully-integrated, digital on-demand card production platform and give those in the audience an exclusive glimpse into our world-class, Visa, MasterCard and Discover-approved, secure production facility.

I’m looking forward to getting on the Finovate stage, along with our VP of Business Development, Matt Hillgard, to show all in attendance exactly what we do at Arroweye.  During the demo, we’ll walk the audience through Arroweye’s front-end card design software and our digital on-demand card manufacturing and fulfillment process, showing step-by-step the ease and flexibility afforded by the platform.  

From our vantage point, innovation in plastic is especially important now given the rise of mobile technologies. We plan on showing how digital on-demand technology eliminates the need for pre-printed inventory and gives financial institutions, card issuers and program managers the flexibility to offer truly customized cards that add value to the consumer.

Did I mention we only have, from start to finish, seven minutes? We’re ready to go — hope to see some of you there! We’ll be taking the stage during Session 2, at precisely 10:53 a.m.