Archive for the ‘Marketing Fury’ Category

Launching A Digital Business – PCI

Tuesday, June 14th, 2011

Launching a digital business involves many decisions, but one of, if not the most critical decision that merchants must make is the process by which they become compliant with the Payment Card Industry Data Security Standards (PCI DSS), PCI DSS are in place to minimize credit card fraud via exposure.  The PCI standards outline how digital merchants need to protect personal information and secure payment transactions, no matter how small or large the merchant is.  It covers six key areas, with multiple requirements in each area.

The Six Categories of PCI Standards

Build and Maintain a Secure Network 1. Install and maintain a firewall configuration to protect cardholder data
2. Do not use vendor-supplied defaults for system passwords and other security parameters
Protect Cardholder Data 3. Protect stored cardholder data
4. Encrypt transmission of cardholder data across open, public networks
Maintain a Vulnerability Management Program 5. Use and regularly update anti-virus software on all systems commonly affected by malware
6. Develop and maintain secure systems and applications
Implement Strong Access Control Measures 7. Restrict access to cardholder data by business need-to-know
8. Assign a unique ID to each person with computer access
9. Restrict physical access to cardholder data
Regularly Monitor and Test Networks 10. Track and monitor all access to network resources and cardholder data
11. Regularly test security systems and processes
Maintain an Information Security Policy 12. Maintain a policy that addresses information security

Equally important as the actual security policies in place is instilling a corporate culture that augments and supports the PCI DSS standard to minimize incidents like the Sony PlayStation Network security breach.

The Latest PCI Data Security Rules

Despite all the literature, PCI remains an opaque issue, yet fundamental to every company that takes some form of credit and debit card payment for their service.  New guidance and clarifications in PCI compliance – known as PCI DSS 2.0 – is now upon us, and while the changes aren’t huge from the previous version, understanding them and their impact to your online business is critical.

PCI Compliance Enforcement

There are numerous costs – with financial and business implications – associated with non-compliance, ranging from fees from your acquiring bank to the actual liability of putting cardholder data at risk.  There are various levels of PCI DSS compliance and Vindicia, as a Level 1 Service Provider, goes through the highest audit bar every year, as we’ve done for the past six.  Learn more about how PCI compliance is enforced.

Sanjay SarathyTags: , , ,
Posted by Sanjay Sarathy in Best Practices, Marketing Fury, Payments 101.201.301 | 1 Comment »

Data, Insights, and Best Practices

Wednesday, April 6th, 2011

The volume of data that now flows through CashBox (over $2bn worth last year) allows the marketers at our client companies to truly understand what’s happening in their business and compare it to the broader universe of the digital merchants that we service.  I’ve discussed in the past how SaaS Billing is really a Marketing asset, not just an operational necessity.  We’ve also been extremely vocal about the need for our clients to focus on long-term customer lives, whether this be for a subscription-style service or for a microtransaction service that uses a virtual currency.

Here is an example from an existing client that illustrates the importance of data. The chart below represents a cohort analysis of the subscribers to their 1-month plan. What it shows is that the average lifetime for subscribers to the monthly plan is about eight months or so. This client, however, does not offer an annual price plan and asked us whether we thought it would make sense. Based on this data, we said that if they offered a plan that generated more revenue than their average monthly lifetime value and that was at a discount to the annual value of their 1-month plan then, yes, it would make sense to do so assuming it fit with their business goals.  To put this into concrete terms, if their monthly plan was $10/mo, they could offer an annual plan anywhere from $81 to $119 and have it still make economic and subscriber sense.

We learn a lot about consumer behavior through our clients and the relative importance of changes to product and pricing mix on subscriber acquisition and retention, and look forward to sharing more of these insights on this blog in the future.

Sanjay SarathyTags: , , , , , , , , , , ,
Posted by Sanjay Sarathy in Best Practices, Data Geek, Marketing Fury | No Comments »

Vindicia CashBox StoreFront

Tuesday, March 1st, 2011

Call me a masochist if you will but, as I remarked yesterday on Twitter, I do enjoy product launches and the underlying processes that lead to them: understanding client requirements, creating functional specifications, building the product, defining pricing, crafting the go-to-market strategy and publicizing the actual product.  We’ve been busy the last few months on a new initiative that reinforces our mission to help merchants build online revenue and we’re excited about the results of that work announced today: CashBox StoreFront.

CashBox StoreFront optimizes customer acquisition for merchants selling digital content and services. Yes, there are numerous storefronts in the market so our product name by itself doesn’t distinguish ours. Few companies, however, focus on the tight relationship between the typical operational focus of SaaS billing and the marketing focus of customer acquisition and retention. The combination of CashBox StoreFront and CashBox offloads the tedium that most marketers (like myself) have to deal with in maximizing customer lives, whether working with a subscription or a microtransaction-based service.  Given the ongoing burden that PCI compliance puts on merchants (with version 2.0 of the standard rolling out this year), the fact that CashBox StoreFront completely offloads this issue onto Vindicia removes yet another worry for merchants.

Contact us with any questions you have, and we look forward to helping you build online revenue.

Sanjay SarathyTags: , , ,
Posted by Sanjay Sarathy in Industry News, Marketing Fury, Vindicia Press Release | No Comments »

Payment Ecosystem Myths – Part 3

Wednesday, January 5th, 2011

Happy New Year!  Last month we posted Parts 1 and 2 of the Payment Ecosystem Myths series in which we highlighted topics ranging from being the “Merchant of Record” to the customer buying experience.  We have a few more myths to slay in this latest installment…

“There is no way to keep my chargeback rate below the 1% limit imposed by Visa” – This is a myth from companies that have a naturally high chargeback rate, such as gaming and dating, and that haven’t been able to control their chargeback rates in the past. This is simply not true and is a symptom that the company has limited resources and an incomplete knowledge of the possibilities afforded today by technology. As a reference point, we consistently help our clients stay under 1%.

“I don’t have a chargeback problem, our rate is at 0.2%” – On the flip side, many merchants have taken the opposite approach and dedicated resources to eliminating chargebacks altogether. This approach is also flawed for digital goods merchants. For a company with a cost of goods sold that is nearly zero, it makes no sense to turn potentially good customers away — the “false positive” problem of unwittingly turning away customers who could generate significant long-term value.  The cost of turning a good customer away — their lifetime value — often far outweighs the cost of a chargeback.

“Customers don’t like  _____________ (virtual goods, virtual currency, automatically recurring subscriptions).” – Companies regularly make decisions about their business models and customer experience based on incomplete knowledge or stories gleaned from bad past experiences. As many have advocated, testing is the best way to find what really works for your community.  The examples given in the title are encountered often and deserve special mention.

  • Virtual Goods / Virtual Currency – Virtual goods are a proven method to engage and monetize communities and the market is estimated to be worth several billion dollars, and virtual currency is the best method to date of enabling virtual goods purchases. Virtual currencies are ideal for many digital businesses and should be considered as an option for online monetization.
  • Automatically Recurring Subscriptions – In the same vein, many companies are afraid to offer subscriptions. Subscriptions come with their own set of complications (managing them requires additional thought and solutions), but they are the best method for monetizing digital goods and content that is available. Subscriptions work very well standalone, or in conjunction with a virtual goods business and create a fantastic and predictable revenue stream. Some companies are timid about making their subscriptions renew automatically, but the most common feedback from customers is that they are thankful to not bear the burden of managing their payment.

This list, spread over three posts, spreads some of the knowledge we’ve learned while helping digital goods merchants become successful. We’re always happy to chat with you further about these or other issues — just let us know if you have something else that you’ve always wondered about digital goods or payments.

Sanjay SarathyTags: , , , ,
Posted by Sanjay Sarathy in Best Practices, Marketing Fury, Payments 101.201.301 | No Comments »
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