Consumers are finally ready for paperless transactions. Are you?

DocuSign Chief Executive Officer Keith Krach Interview
Keith Krach, chairman and chief executive officer of DocuSign Inc., stands for a photograph after a Bloomberg West Television interview in San Francisco, California, U.S., on Tuesday, March 4, 2014. DocuSign Inc. is an electronic-signature software company. Photographer: David Paul Morris/Bloomberg via Getty Images
Photograph by David Paul Morris — Bloomberg via Getty Images

The next 12 months could bringing a tipping point in the adoption of electronic-signature technology, thanks in large part to consumer mobile device adoption.

Technology companies at the center of this movement, such as Adobe, DocuSign and Kofax, have spent the past several years talking up the potential corporate cost savings of going paperless. Now, the dialog is shifting to how digital transactions can reshape customer relationships.

“They expect to be able to do things in real time, on demand,” Kofax CTO Anthony Macciola told investors this week, using his 22-year-old son as an example.

With the exception of one visit to a local branch to set up his account, his Millennial offspring relies entirely on a mobile phone to consult balances and manage transactions. The idea of logging onto a computer to manage these tasks is “foreign” and “stupid,” Macciola said.

“All of a sudden, this notion of rapid customer interaction really started to drive things,” said Craig Le Clair, an analyst with Forrester Research. “The first phase was about companies reducing the cost of paper processes. Now, it’s the customer that doesn’t want to come to the office to sign a bunch of documents.”

As one example, Forrester cites the leasing process developed by electric vehicle company Tesla. The entire transaction is managed with a “tap and sign” application embedded into the car’s dashboard.

Right now the market for digital transaction management technology is pretty small: maybe $700 million annually. By the end of 2016, however, Aragon Research predicts 70% of big businesses will support an initiative. That could boost revenue related to digital transaction management to $30 billion by 2020. “Some verticals will move even more rapidly to an all-digital arena,” the market researcher notes. “For example, in the key financial services vertical, 90% of providers will offer [this technology] to consumers and business customers by year-end 2017.”

Kofax is investing heavily in mobile technology for enabling digital transactions. This week, it introduced a platform called Mobile ID for capturing proof-of-identity documents usually needed for processes such as opening bank accounts. The software helps validate the images.

The company also has made five acquisitions in as many years to support end-to-end digital transactions. The most recent was in early March with the buyout of Aia Holding, which sells software for delivering documents such as bank statements. The others were Singularity (case management), Altosoft (analytics), Kapow Software (integration technology), and Softpro (e-signatures).

DocuSign’s buyout this week of long-time business partner Algorithmic Research was likewise motivated by rapidly growing interest in digital transactions. DocuSign CEO Keith Krach said his company will gain more than 2,000 customers, including the likes of Bayer, Bechtel, GlaxoSmithKline, McKesson, and Novartis.

The deal was timed to coincide with DocuSign’s annual customer and partner conference. Also during the event, the company revealed a strategic partnership with SAP, which will sell DocuSign’s digital transaction and electronic signature technology alongside Ariba and SuccessFactors applications. The company also has created a foundation to bring digital transactions to non-profit organizations.

“People understand that what we are doing is transforming the way that business is done,” Krach said. “We are simplifying their lives.”

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