Vantiv Gets Recognized, Recognizes Future of Commerce (July 2013)

By Bill Grabarek, Senior Editor 

It’s been an eventful four years for Vantiv Inc. since it was spun off from Fifth Third Bank. In that period, which included an IPO last year, the Cincinnati-based payment processing and technology company has maintained impressive growth. So impressive, in fact, that Forbes last month placed Vantiv in this year’s list of “America’s Fastest-Growing Tech Companies.”

Vantiv, which was formed as a joint venture between Fifth Third Bank and private equity firm Advent International when the bank spun off its Fifth Third Processing Solutions unit in July 2009, ranked 20^th on the Forbes list with nearly $2 billion in sales within the last 12 months and three-year average sales growth of 27 percent. Forbes considered more than 2,100 publicly traded technology firms with minimum revenue of $150 million, among other criteria. 

Mobile: As Big as TV  Dean Seifert, Vantiv Inc.’s senior vice president of product strategy, on the impact of mobile technology.“The reason it’s so compelling and why it’s the biggest revolutionary event since the invention of the television and maybe the car, is because never before have consumers been able to be so connected to everything—how they engage with other people, how they engage with the brands they buy, how they engage with their financial institutions, how they manage their money. Naturally, that’s going to have a pretty significant impact on how they shop and pay for things. “It boils down to how long it will take retailers to figure out the impact of the mobile channel and how will they leverage mobility to create the customer engagement experience that they and that their consumers want? We’re seeing instances of this. Every week a retailer or financial institution announces the launch of a large mobile presence.”

“Forbes recognized the sustained, fast-paced growth we’ve had since going public, both in terms of revenue and profitability,” says Dean Seifert, Vantiv’s senior vice president of product strategy. “For the full year 2012, we’ve grown our net revenue about 18 percent and transactions by 19 percent.”

Uniquely Positioned

Vantiv, whose clients include small to midsize merchants and top-tier retailers, regional PIN debit networks and community banks, credit unions and large financial institutions, attributes much of its success to the company’s technology platform.

“Vantiv is … uniquely positioned to capitalize on changes in the industry because of our single integrated platform, which makes us efficient from a cost perspective, but also very adaptable and nimble to quickly roll out new technologies,” says Andrew Ciafardini, director of public relations at Vantiv.

“For example, we were the first processing company to be certified by most of the major brands for EMV processing capabilities,” he says. “We could do that because of the talent here and because of that single integrated platform.”

Other examples of Vantiv’s ability to adapt and roll out new technology include last year’s launch of Vantiv Accept, a payment card reader for smartphones; Vantiv Mobile Checkout, a cloud-based POS system for tablets; and Vantiv Mobile Wallet, a white-label e-wallet currently being tested with a top issuer and a large retailer. What’s more, Vantiv is one of the merchant acquirers working on the project that will enable PayPal account holders to make in-store payments with their PayPal accounts at any retailer that accepts Discover.

The Future of Commerce

“Although Vantiv is a relatively new name for the industry because we just went public and we rebranded, people are recognizing that we are a significant player in the payments space,” Seifert tells Paybefore. “We have assets on both the issuing side and on the merchant acquiring side, which give us a unique perspective on the market and has helped us identify where the market is heading and where the next big innovations are going to come from.”

And, where is the market headed? Why, mobile, of course.

“Retailers are starting to engage us in a much different conversation,” says Seifert. “It’s moved beyond: ‘How can you make sure I am EMV-compliant and how can you reduce my payment processing costs?’”

Merchants are “acutely focused” on drawing more customers into their stores, retaining current customers and increasing customers’ frequency of visits and the average ticket, Seifert says. To achieve these goals, retailers must consider what he calls the shopper’s journey—which starts the moment a consumer decides he wants to buy a product and ends after the transaction has been made.

Merchants recognize that mobile is much more than just another version of e-commerce. Mobile technology is a customer-engagement platform retailers can leverage for becoming smarter about who’s shopping in their stores. It gives them a distribution channel for advertising, promotions and incentives, and it creates a way to deliver new payment options, according to Seifert. “That’s why it’s so exciting for Vantiv to participate in this space. We can have an impact on that,” he says.