A next generation payments system for Australia

In payment systems, reliability, scale and speed are key considerations. Seeking to build on strengths in all three areas, BPAY joined COIN - the Community of Interest Network - in March 2010. COIN enables the rapid exchange of payment and settlement data between BPAY and Member Financial Institutions.

COIN was established by APCA - the Australian Payments Clearing Association. APCA provides network services and connectivity for Australia's EFTPOS and ATM, direct debit, direct credit and cheque payment systems as well as BPAY which together represent around 98% (by value) of Australia's non-cash retail payments. We mentioned the importance of scale and COIN certainly has it!

According to APCA, COIN is a "collaborative core infrastructure". That means it replaces multiple links between individual organisations with universal connectivity to a central cloud-based hub. As a result, it reduces the number of links each Financial Institution has to pay for and significantly reduces data transfer times.

• CBA was the first Member to submit their BPAY transactions via COIN (April 2011). The process dramatically reduced transaction times, with file transfers taking less than 90 seconds compared to the old time of over an hour.
• NAB and Westpac migrated their BPAY traffic to the COIN network in August. In doing so they cut transfer times from an hour to around six minutes.

In October this year, Bankwest traffic will migrate to the COIN network. APCA expects the migration of around 200 existing connections to be complete by the end of 2011.

By joining COIN, BPAY is taking advantage of the latest technologies, technologies that provide faster and better payment processing and so provide a better service to our customers. If you'd like to know more about COIN, please contact Pramila Bhaskar, BPAY's Acting Operations Manager on 02 9646 9222 or email her at pbhaskar@bpay.com.au.

How Ergon Energy energised BPAY take-up

Ergon Energy is the electricity retailer for one million square kilometres of regional Queensland. They have more than 650,000 customers and wanted to improve their BPAY payment volumes. So they asked the BPAY marketing team to join them in a campaign.

The shape of the campaign
According to Nigel Mann, Residential Segment Specialist - Customer and Stakeholder Engagement, the joint campaign used classical direct marketing techniques including segmentation, a competition and direct mail to drive response numbers.

"We selected customers that we wished to migrate from more high cost payment methods like credit cards, Australia Post or cheque and communicated the benefits of paying their electricity bill by BPAY to them ," says Nigel.

Around 10,000 of these customers were sent a flyer highlighting BPAY's key benefits and offering them a chance to win an Apple laptop if they paid their next bill by BPAY. A follow-up flyer was dispatched with the targeted customers' next bill (one to two weeks after the first flyer).

Campaign results
"We were looking for a typical direct marketing conversion rate of 5%," says Nigel Mann. Instead Ergon Energy's campaign achieved a stellar conversion rate of 12.4%. The company is monitoring the targeted customers over the next 12 months to make sure these results stick. Depending on long term stickiness, they plan to run a similar campaign next year.

BPAY and your business
Could your business benefit from higher BPAY take-up? For expert campaign assistance, contact your Financial Institution or the BPAY Marketing department on 02 9646 9222 or marketing@bpay.com.au.

The SME campaign

Small and medium sized enterprises (SMEs) are a key part of the Australian economy. In looking to serve this important sector, BPAY recognised that SMEs needed additional support to sign up to BPAY - hence the launch of the BPAY Biller in a Box initiative by four of BPAY's banking Members.

The Biller in a Box initiative dramatically simplifies billers' sign-up process, making BPAY easier to implement for SMEs. To take just one example, the previous BPAY agreement for SMEs ran to 40 pages. Now it's just two pages long.

Given the success of the four banks' Biller in a Box initiative, BPAY decided it was time to promote BPAY to small businesses. The SME campaign was launched to combat the mistaken perception that BPAY is only for big business.

The campaign
To drive home this message, BPAY marketing launched a month-long integrated marketing campaign in late June. Given the excellent media results achieved, the campaign was then extended until mid September.

This campaign involved:

• Sponsored search word activity
• Electronic Direct Mail (EDM) targeting small businesses in the professions and the medical and construction industries
• Web Banners
• Two small space ads placed in the classified sections of more than 100 community press titles.

All campaign activity was designed to drive response to a BPAY web landing page specifically focused on small billers. To make the benefits of BPAY more real, BPAY marketing commissioned a media article that included the real-life stories of some small billers. This article was run on various small business websites as PR and in advertorial format. You can read one of the case studies in the next article and see all three on the BPAY website.

Campaign scoreboard
The campaign easily exceeded its initial media objectives, resulting in:

• Over 1.1million web banner views
• 43,000 visits to the BPAY SME page
• The opening of more than 100,000 EDM pages

The success of the SME campaign highlights the interest in this service amongst Australian SMEs. Billers who want to know more about offering BPAY as a payment option should contact their Financial Institution.

MySparkyGuy tells us why BPAY works

One of the first things electrician Jay Morgan did when he started his business MySparkyGuy in November 2010 was make a decision about the payment options he was going to offer his customers.

"When I opened my business in November 2010 my bank gave me a few options for customers to make payments. The options were cheque, mobile EFTPOS and BPAY," he says.

"I discounted cheque immediately and mobile EFTPOS was going to cost me at a minimum $55 a month – even if no transactions were done," says Morgan, explaining that he was reluctant to offer cheque payment because of the delay it would mean in terms of receiving payment for a job and the subsequent negative impact on cash flow.

He says "BPAY was the best option because it helps keep my costs down and as a start-up I'm really focused on keeping my outgoings to a minimum."

Morgan says another reason he opted for BPAY as his primary payment option for customers is because of its streamlined set-up processes. "It's so easy to set up. I was emailed a piece of software that was simple to install and I can generate 50 or 100 BPAY reference numbers at once."

According to Morgan, BPAY is also a great solution because of the benefits it delivers to his customers.

He says "BPAY is attractive to my customers because everyone knows how to use it – since I started the business around 80 per cent of my customers have used it to pay me."

"BPAY is fantastic. Customers use the same number for every job and it's also easy to manage from an admin perspective because the BPAY customer reference number matches my bank records. It's been around for such a long time and people feel safer using BPAY than using their credit card in a mobile machine. I'd recommend it to any business owner."

How BPAY works with biller partners

This year the BPAY marketing team has been busy helping billers run campaigns for BPAY and BPAY View. Here are some highlights from campaigns that are either complete or currently in market.

Complete campaigns:

Organisation and Product

City of Greater Geelong. BPAY View

Database targeted:

First Wave: 55,000 rate payers (instalment payees)
Second Wave: 108,000 rate payers (all rate payers)

The Campaign:

A direct mail campaign via quarterly statement runs using DL flyer insertions and BPAY View branded envelopes. Ratepayers were offered a chance to win $1,000. The first wave campaign ran May to June with a second wave running from 1 July to end September.

To complement the direct mail campaign, advertisements were run in the local media in both press and radio. The City of Greater Geelong also used Community Update (its own community newsletter) its website and on hold messages to promote BPAY View.

Campaign Results:

BPAY View registration has grown steadily since the start of the campaign.

Organisation and Product

AMIST Super (meat industry fund). BPAY Payments

Database targeted:

60,000 fund members

The Campaign:

A three-month integrated campaign promoting BPAY as a means of making contributions to the Fund and increasing awareness of the Government Co-contribution, though half-yearly statements, statement envelopes, the Fund newsletter, its website and SMS and email marketing.

Campaign Results:

Payment numbers more than doubled that of prior years were received between April and June 2011.

Organisation and Product

Wyndham Vacation Resorts (holiday ownership company). BPAY Payments

Database targeted:

30,000 customers

The Campaign:

A four-month campaign using customised DL flyers to encourage customers utilising payment methods other than direct debit to pay their maintenance fees and loans by BPAY.

Campaign Results:

Payment volumes rose by over 200% in the course of the campaign.

Campaigns currently in the market:

Organisation and Product

SA Water. BPAY Payments

Database targeted:

SA Water serves almost 1.5 million customers.

The Campaign:

The SA Water campaign will run from 1 October 2011. The organisation is promoting the use of BPAY by offering customers a chance to win one of four $500 pre-paid credit cards if they make a BPAY payment during the competition.

Organisation and Product

EnergyAustralia. BPAY View

Database targeted:

Approximately 1.5 million customers were targeted

The Campaign:

This is the second BPAY View campaign and is based around existing above-the-line advertising (eg "Coach Allen wastes energy explaining the finer points of the game"). It uses DM postcards, customer bills, on-hold messages, an e-mail campaign and advertising in the EnergyWise newsletter to promote the paper-saving benefits of BPAY View. All customers who signed up before 16 September received a free Bitton cookbook.

Organisation and Product

Ruralco Holdings Limited (Agribusiness). BPAY Payments

Database targeted:

Tasmanian property management operations - more than 2,500 real estate tenants

The Campaign:

The objective of the campaign was to encourage tenants to pay rent by BPAY rather than EFT, bank deposit or alternative rent payment facilities. It uses DL flyers in a direct mail campaign as well as BPAY posters in 25 regional and rural offices.

The results of the above three campaigns will be made available later in the year. Contact your the BPAY Marketing department on 02 9646 9222 or marketing@bpay.com.au if you would like assistance with running a BPAY campaign.

A questionnaire on the BPAY B_Informed newsletter

B_Informed is a newsletter designed to provide businesses with information around bill payments and the BPAY Scheme.

We are looking to make improvements to the newsletter and better tailor it to your needs. We therefore are keen to get your input and thoughts on the content and current format.

To make it easy the link below takes you to an electronic survey which only takes around five minutes to complete.

We thank you in advance for your input.