1. In association with
A wave of digital change:
Trends in digital
E-nnovation 2013
1

2. Keynote
Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Just this year, Europe has experienced double
digit growth rates, and expects to see
sales reach over 300 billion euros by 2016.
Electronic and apparel online shopping,
particularly cross-border, have been on the
rise, trending throughout the continent at
rates that are predicted to double by 2015.
In the past, Western and Central Europe
have taken the lead in B2C markets, but
Eastern Europe is quickly gaining speed
to its neighbors. With Poland right in the
middle of it all, we feel we have the best
seat in the house. Our B2C market is more
mature than Eastern Europe, though we’re
still part “underdog” in comparison to the
Scandinavian countries, UK, Germany,
Netherlands and France.
This autumn, between the 24th and 25th of
October, the city of Poznan will become the
special place, where the greatest companies,
brands and business ventures touching
e-commerce come together for the fourth
edition of ‘e-nnovation’ confernce.
‘E-nnovation’ channels all parts of the world,
bringing together top players of global
e-commerce, in efforts to not only spread
industry knowledge and exchange successful
practices, but to jump start discussions on
the future of the business market we’re all
a part of. Global trends will be compared
with current developments in the Central and
Eastern European markets. The conference
provides an ideal meeting place for people
who have the greatest influence on the
trade in the region, including CEOs and
top management of the most important
companies in the sector, experts and
experienced practitioners of e-commerce,
as well as young, creative entrepreneurs
engaged in innovative projects.
As part of the ‘e-nnovation’, Deloitte, Allegro
and PayU have prepared this report – which
outlines some of the important digital trends
that are currently shaping e-commerce
industry and society more broadly.
We strongly believe that following the
example of the previous editions, the
e-nnovation 2013’ will create a space that
will help your form new partnerships and
cooperation, and will contribute to the rise
of new international initiatives.
Economic
Impact
Implications
About us
2

3. Keynote
Introduction
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
It’s been twenty years since Mosaic, the first
web browser was released to the public
in 1993. Since then, we’ve seen several
waves of digital change shift how we live
our day-to-day lives. First, we could suddenly
access information from around the world,
or send e-mail to friends on other continents
in an instant. Then, we could download
music, do our banking, or trade shares from
our PCs. Each time customers changed their
behaviour, businesses reacted, and there
were both winners and losers. The next
great wave of digital change is now with us
– and business must take notice.
The first waves of digital change have already
hit business. In the beginning we saw the
growth, and then the burst of the Dot Com
bubble. Afterwards, digital business was
more mature – here we saw digital firms
disrupt, successfully compete with – and
in some cases, outcompete traditional
companies. The businesses that adapted to
our changing digital habits survived. Those
that didn’t struggled. Blockbuster succumbed
to the rise of video-on-demand and Netflix:
after first rejecting an offer to partner with
their digital rival1. Borders did not adapt
quickly enough to Amazon and customer
desire for a convenient digital channel. And
how many of us attended auctions before
the advent of Ebay and Allegro?
The next wave of change is now upon us
Social media has come into the mainstream,
while cloud computing and big data
are doing the same. The shift in ways
of doing business is perhaps reflected
in the bankruptcy of Kodak and the rise
of Instagram. The former once employed
62,000 people and filed for bankruptcy
in 20122. The latter employed 13 staff and
was bought by Facebook for $1 billion USD
in the same year3.
The changes we see are underlaid by
broader shifts in technology and society.
The adoption of mobile means that
smartphone and tablet sales have overtaken
PCs this year. In the US, the percentage
of smartphone owners was 11% in 2007.
It’s currently at 31% in Poland – and has
grown to around 50% in the US4,5. Cheaper
sensors and connectivity means that objects
from trucks to handbags are gaining
internet connectivity, as the ‘Internet of
Things’ expands. The internet is becoming
ubiquitous.
Not only does the Internet surround us,
it is changing the way we act, what we
expect and potentially, how we think.
We now check prices on our phones while
at the shops, and sit on the couch with our
tablet while watching TV. We don’t require
physical bank branches (or ATMs) to carry
out most of our transactions – and we
expect the digital channel to work. Medical
researchers have pointed to the “plasticity”
of the human brain, and noted that even
in adulthood, we’re constantly adapting,
learning and changing – “neuroplasticity
is not only possible, but [. . .] it is constantly
in action”4. Consequently, arguments have
been made that the Internet is changing how
we think and reason. Negative perspectives
argue that we’re becoming more superficial,
and easily distracted. Others point out that
we’re capable of both ‘skimming’ and ‘deep
diving’ into information, and can now
process and analyse information much
better than before6. Whichever is the case,
the Internet has changed our daily actions
and expectations.
The current changes in digital technologies
constitute both threats, and significant
opportunities for business. This report
contains an analysis of how digital currently
affects us and the economy, as well
as practical examples of what is being done,
and what is possible in the digital space.
In writing this report, we hope that it will
trigger ideas, inspire, and if necessary,
spur to action. For the professionals
who contributed, we thank you
– and for our readers, we invite you to join
the conversation.
We’re also seeing the first generation
of ‘digital natives’. This new generation
is comprised of people who have grown
up with the internet throughout their lives.
Digital natives not only want, but expect
a great experience in the digital channel,
whether it’s in social media, banking,
or shopping. Poland is not immune to this
generational shift. We have one of the
highest social media usage rates in the world
– higher than Germany, France or Japan,
but also one of the biggest gaps between
young and old – and not all areas of business
seem to have noticed.
The combination of smartphone adoption,
ubiquitous internet, and the rise digital
natives and our own expectations mean
businesses needs to respond, or risk being
left behind by those that do.
3

4. Keynote
Key take-aways from this report
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
1
2
3
4
How we use the internet is changing
We’ve reached a tipping point. There are now more smart phones and tablets being sold than there are personal computers
– and we are no longer tethered to PCs when accessing the internet. The web comes with us when we’re browsing at a shore,
paying for items, or watching TV. Companies can now design for phenomena that merge the physical and the digital, and weren’t
commonplace a few years ago: showrooming, social commerce, and mobile payments to name just a few.
Customers no longer just want digital, they expect it
Customers are becoming used to digital options in their interactions with companies, and have come to expect it delivered
with a sound user experience. Social media is now regularly used for tasks from customer service to recruitment, in addition
to advertising and maintaining brand presence. A seamless mobile experience is also becoming ‘expected’ and the production
and use of apps around the world has mushroomed, while the payments space in particular is being disrupted by mobile.
Customers’
expectations
in digital are
changing, and
business needs
to respond.
Business can adjust to current needs…
Big data can help businesses refine their understanding of just what those customer needs are, and inform decision making. Data
analytics is cheaper than ever, allowing even smaller businesses to benefit. User Experience and mobile payments are already on
the radar for many businesses, while security should not be forgotten as an immediate concern. As the digital channel becomes
more and more important, it also becomes a more lucrative target.
… and prepare for new ones
Analysts predict that the Internet of Things could contribute $14 trillion to the global economy by 2022. Though it’s still in its
infancy, IoT it is creating a buzz, and is a space to watch. Not only can it help retailers track their logistics and internal processes,
it can revolutionise how we interact with our physical space – from products and billboards, to each other. Finally, it’s likely
that cloud, will give us access to technologies that aren’t even invented yet – without requiring us to invest in infrastructure.
Consequently, businesses should have a sound understanding of cloud to prepare for the future, whatever it may be.
About us
4

5. Keynote
Our trends
Introduction
Our trends
Big data
Mobile
Retailers have the opportunity
to change mobile from a threat
to an advantage.
Cloud
Big data
Data and analytics are at the heart
of developing customer insights.
Social
Cloud Is bringing us some futuristic
technologies without the upfront cost
– but integration is challenging.
Social media has gone mainstream
– but is business getting the most
out of it?
Mobile
Cloud
Social
UX
User Experience
Payments
“Sell and cell” – smartphones will be
shaping the world of payments.
Internet of Things
Payments
A focus on user experience is no longer
an option – it’s a must have.
Security
The Internet is changing the way we
live…again.
Think you can’t be hacked?
Think again.
The Impact of e-commerce
on the Polish economy
Our analysis of the impact of
e-commerce on the Polish economy.
It also presents
an analysis of
the impact of
e-commerce
on the Polish
economy.
Overall implications for
business
A short summary of how businesses
can respond.
The internet
of things
Security
The report
covers eight
digital trends
and their
implications for
business.
Economic
Impact
Implications
About us
5

6. Keynote
Big data
Introduction
Our trends
Big data is getting bigger
than it used to be
We’re generating a huge
amount of information
And with big data easier
to acess than ever,
the market is growing...
Big data
500M
Mobile
tweets sent
per day
Cloud
Social
Then
Now
UX
Payments
The internet
of things
100TB
200TB
Size of Amazon data
warehouse in 1999
Avg. amount of
stored data for each
US company with
over 1000 staff
Security
About us
DATA
40%
Projected year on year
growth in Big Data
$1B
Invested in companies
focusing on big data in 2012
Market size for Big Data
Resulting in
Economic
Impact
Implications
BIG
12TB
of data generated on Twitter daily
$48B
2015
$10B
2012
Sources: 4,7,8,9,10
Data and
analytics are
at the heart
of developing
customer
insights – and
with Big Data
becoming ever
cheaper, it’s
easier for the
little guys to
take part.
The world’s data is growing at a pace and
volume not seen before in the history of
the world. In 2013, 500 million tweets
are sent each day, and 30 billion pieces of
content – including GPS, social interaction,
or sentiment data – are shared monthly by
Facebook’s 1.15B active users. Companies
like Amazon and Wal-Mart have long used
this ‘big data’ effectively to develop real
customer insights. But there’s a twist. Big
data and the analytics that can put it to work
are now accessible to small and medium
enterprises, not just market giants.
6

7. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
Using big data can lead to big insights – for large and small business
Over a decade ago, three characteristics
were coined as making data ‘Big’: Volume,
Velocity, and Variety. All three have grown
since then. In the US, the average volume
of data stored by a company of over 1000
employees in 2012 was 200TB – More than
double Wal-Mart’s data store in 19999.
The pace at which data is being generated,
as well as the forms it has taken has also
skyrocketed. The web of a decade ago
did not feature Facebook or Twitter, while
clickstreams and geo-tagging were in their
infancy. But the point isn’t just that there’s
now a lot more data being generated in the
world – it’s what we can do with it.
By combining multiple, seemingly unrelated
data sources, businesses can draw business
insights like never before – and the explosion
of data sources available has allowed
organisations to do just that. Retailers like
Burberry combine their SAP data with social
data to make timely adjustments to their
supply chain. Wal-Mart uses transactional
data, coupled with social media interactions,
blog posts, and location information to help
gauge business demand when launching
new products4. Both Netflix and Amazon
utilise ‘recommendation engines’ which can
suggest a product that we’re more likely to
buy – not just based on our past purchases,
but on our online behaviour. The benefits of
this are considerable. Some analysts claim
retailers can improve their margins by up
to 60% through better use of big data11.
But supercomputers and number crunching
have been around for a long time – so in
relation to Big Data, what else is new?
60 000
data scientists offered by Kaggle to solve analytics problems
For one, it’s likely big data will become
a more integral part of our day-to-day work.
Deloitte has predicted that it’s probable
that “more users across the value chain
will need to be able to consume insights
as part of their daily workflow – or risk
being left behind”4. Secondly, the speed at
which we deal with data and analytics will
need to increase – with so much data being
generated so quickly, we need to extract
insights and signals from data streams in near
real-time, instead of storing “everything” for
later consideration10.
Day to day use, as well as speedy processing
of data were evident at the London Olympic
games. The Games’ Organising Committee
(LOCOG) established a big data process that
delivered a report (mostly from feedback
via social media) to major Olympic games
venues every morning to action aspects that
could be improved for the next day12. This
kind of data processing immediacy is just the
beginning – and solutions such as real-time
data visualisations, helping human experts
gain insights with the aid of number
crunching are also gaining use.
But big data is not reserved for Industry
giants. Small and medium businesses can
benefit too. Importantly for them, big data
has become cheap8 . Kaggle offers more
than 60,000 data scientists4 across the world
in a ‘bidding-style’ format that allows even
small companies to access high end analytics.
Services like Factual, Intuit, or Allegro.pl share
location, industry, or sales volume data with
customers, allowing them to derive customer
insights. Small businesses are taking
advantage, using big data to understand
‘who’ customers are, engage them through
their preferred channels, and outcompete
much larger rivals11. Big data is a powerful
business tool, and now it’s for just about
everyone.
Retailers like
Burberry
combine their
SAP data with
social data to
make timely
adjustments
to their supply
chain.
7

8. Keynote
Introduction
Big data case studies
Netflix – Selecting investment based
on customer behaviour
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
In the US, Netflix uses big data not only
to recommend products for its customers,
but to inform decisions about which shows
to invest in.
In a well-publicised case, Netflix made an
investment of around $100M to produce
26 episodes of ‘House of Cards’, directed
by David Fincher and starring Kevin Spacey
based in part on its analysis of big data.
The decision has resulted in Nine Emmy
nominations and according to Netflix – the
most streamed show in the US and 40 other
countries13,14.
Netflix gathers viewing data from 30 million
“plays” a day, including when customers
pause, rewind and fast forward. This is
blended with data from social media
interactions, web searches, as well as
comments generated by thousand of viewers
(paid by Netflix) who make notes on genre,
mood, and other elements in every moment
of screened shows14,15.
Looking at its customer data, Netflix knew
that those who had streamed films by
director David Fincher also tended to like
films featuring Kevin Spacey. Likewise,
a significant portion of their audience liked
the original BBC “House of Cards” miniseries. Netflix judged a significant enough
‘intersection’ in these groups to determine
that the show had a market and was worthy
of investment. They then used their data
driven confidence to outpace rival bidders
by indicating the company would not even
require a pilot to be developed before
committing to the entire series.
The use of big data went further. Even trailers
for the show were delivered depending on
data analysis. Kevin Spacey fans saw trailers
featuring him, women watching ‘Thelma
and Louise’ saw trailers featuring the show’s
female characters and serious film buffs
saw trailers that reflected [David] Fincher’s
touch14.
According to the company’s chief
communications officer, the use of big data
gave Netflix “confidence that [they] could
find an audience”14 for the show. This kind
of approach is spreading, and competitors
like Amazon are also looking to use a datadriven method to select original content.
In one case, Walmart launched a new
range of spicy chips in California and the
South West based on analysis of social
media chatter and transactional data of
various chip products across the country.
Big data was successfully used to identify
a market opportunity, and successfully launch
a product for a specific geographic area.
GE – Improving operations
GE’s ‘Grid IQ Insight’ tool mines social data
to help electrical utility companies identify
and validate service outages in a timely
manner, determine the resources needed
to address them, and accelerate the repair
process4.
The tool mines social data – including
tweets with mention of electrical outages,
geo location data and attachments such
as photos – to verify and gain more detail
on incidents. Photos and videos of the
environment, such as fires or downed trees,
help personnel select appropriate tools for
the task, while ‘clusters’ of social media
data can help validate whether an incident
has occurred. All of this assists in planning
a faster, more effective response.
Netflix made
an investment
of $100M to
produce 26
episodes of
‘House of Cards’
based in part on
its analysis of
big data.
Walmart – Launching products with
big data
As part of its ‘Social Genome Platform’
Walmart uses multiple types of data,
including social media updates, blogs,
transactional data, images and location
data to help the business effectively predict
demand and launch products86.
8

9. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
My Perspective
Big Data introduces a new generation
of technologies and architectures for coping
with the size, diversity, and change that
characterize data sources in the modern
business ecosystem. The possibilities
presented by Big Data are numerous and
together with advanced Analytics they offer
exciting new capabilities for analysing highvolumes of rapidly evolving data streams,
particularly unstructured data representing
social media, geospatial data or click streams.
However, Big Data is not a magical panacea
for achieving business goals like better
understanding of customers, enhancing
service differentiation, reducing risk
or improving performance. Big Data is still
data and it should be approached it the same
way as any other Enterprise Information
Management challenge.
Companies should start with asking the right
business questions and then work to find
the appropriate choices of data sources and
technologies to address their needs. I believe
the most important advantages of embracing
Big Data today refer to getting to know
customers better – where the customers
are, what their needs and preferences
are or how they want to be contacted.
Furthermore, the answers to these questions
change dynamically so businesses should
work on understanding the drivers and learn
to track the changes, so that they’re able
to present customers with better tailored
products and offers in a timely way.
Very few companies embarking on Big Data
programs understand that the strength and
quality of Big Data analysis bear little relation
to the tools that have been bought.
Rather than capturing terabytes of data and
rushing into large programs, organizations
need to focus only on the data needed to
deliver well defined and specific outcomes.
In many cases it doesn’t immediately require
looking at social media or other new external
sources of data.
According to big data research by the
Economist Intelligence Unit, more than
75% of senior executives from over 500
companies say that they are wasting more
than half the data they already hold.
Companies need to learn how to make
better use of what they already have.
Over the last ten years, companies
invested heavily in ERP, CRM or core
systems, processing millions of customer
transactions daily but are still unable to
answer fundamental questions like which
customers are most likely to buy specific
products, or what is the acceptable price
range for a product in a specific market
or for a group of customers. Very few have
started using the information in their systems
to build models approximating customer
lifetime value, or discovering events that
make customers more interested in specific
products. One example of such event
from the financial services area might be
a situation where a customer without credit
card starts traveling abroad (e.g. the bank
can infer it from debit card transactions)
– It might be a good opportunity to call him
or her with a credit card and insurance offer.
Taking a lean approach, defining the
right business questions, looking at the
internal data available today – as well as
opportunities to gradually supplement it
with external data sources would allow firms
to use data in a more efficient and intelligent
way. This will allow them to listen, learn and
engage better with their customers in the
future.
Dariusz Flisiak, Deloitte
Dariusz Flisiak is a Director at Deloitte
Poland specializing in Analytics, Big Data,
Performance Management and Information
Management solutions. He has thirteen years
of experience in business and IT consulting,
with an emphasis on enabling strategic
information for clients.
He has developed and implemented Analytics
strategies and solutions for Financial,
Consumer Goods, Telecommunication and
Public Sector companies worldwide.
Dariusz holds an Executive MBA from
Warsaw School of Economics and the
University of Minnesota, Carlson School
of Management.
9

10. Keynote
Implications of big data
– and what you can do
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
1
2
3
4
Define what you want
Before you start, define your priorities and opportunities in big data. You can consider selecting a specific domain in which to
begin (e.g. customer, product, pricing or risk). Asking yourself questions about ‘sticky’ business issues can help determine your
focus – “Who are the next 1,000 customers we’ll lose – and why?”, “What factors most influence our customers’ loyalty?”, “Which
facilities are using more energy than they should?”.
Start small and deliver
Don’t try to do too much at once. Instead, start small and aim to deliver a success quickly, while you have momentum. Focus on
areas where your organisation has the most expertise, and focus on a tangible, bounded project. Run some experiments to test
the data and deliver results. But once the scope is set, don’t limit your data to just one domain. Feel free to investigate seemingly
‘unrelated’ data sets – it’s at the intersection of different types of data that valuable insights often occur.
Invest in talent
Combining human expertise with machine learning, data visualisation and other tools can produce timely results with less
investment in infrastructure – and gives a higher tolerance for error. Imperfections in data sources and the limitations of machine
learning can be counteracted by human insights and domain knowledge. To make big data effective, you’ll first need people
to help understand the information assets at your disposal and understand business priorities. Only then can you move to
determining technology needs.
Combining
human expertise
with machine
learning, data
visualisation and
other tools can
produce timely
results with less
investment in
infrastructure.
Keep your data disciplined
If you’re investing in big data, you’ll need to invest in data discipline – Core data management, master data management,
integration, and stewardship are important, even during your smallest pilot projects. Data discipline is one of the foundations
on which your big data investment will be developed, so build it well.
Implications
About us
10

11. Keynote
Mobile
Introduction
Companies are catching up
Our trends
Big data
62%
60%
52%
Mobile
Mobile is overtaking PC
Cloud
Future 100
companies
have
a publically
available app
Future 100
companies
have mobile
enabled
websites
WIG20
companies
have
a publically
available app
Social
But the customer is already there...
70%
65%
UX
50%
30%
Payments
2009
The internet
of things
20%
2013
Global market share
PC/Laptop
Mobile
Security
13%
2017
80%
33%
customers
multiscreen
customers
showroom
...and habits in Poland are starting
to reflect the latest trends
Economic
Impact
Showrooming with a mobile
Implications
31%
UK
About us
Sources: 4,10,16, Deloitte
28%
US
20%
Finally, we’ve reached a tipping point
– there are now more smart phones
and tablets sold globally than there are
PC’s. Mobile is changing the way customers
purchase, from research, to browsing
and payment. A large number of customers
are ‘showrooming’ – checking product prices
and reviews on mobile devices while in store,
before making a purchasing decision. Near
field communications have realised new
possibilities in mobile payment, and taken
location-based marketing possibilities to
a new level. Mobile is here, and businesses
that don’t take notice may lose out.
25%
PL
(avarage)
Mobile access
to the internet
is shifting how
customers shop
– and retailers
have the chance
to change mobile
from a threat to
an advantage.
PL
(16-30 y.)
11

12. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
A new way of shopping is already here
For Lenovo, the milestone came in August
201317 – the company now sells more
smartphones than it does PCs and laptops,
and is rebranding itself as a ‘PC Plus’
company. This ascendancy of mobile device
numbers is echoed in the strategies of other
firms. Furthermore, some researchers claim
that it’s not just the amount of devices sold,
but the time spent on ‘non-voice’ mobile
devices which now exceeds that of PCs18.
The hundreds of millions of internet devices
now in our hands are changing the way we
act – and the way we shop. There are several
key mobile trends of which retailers should
take note:
Multiscreening – using an internet
connected device while watching TV is
now a common activity, and it is offering
new ways of interacting with brands.
Heineken’s UCL “Star Player” and Coca
Cola’s ‘Chok! Chok! Chok!’ campaign
in Hong Kong provided mobile content
matched to TV. The upcoming Zeebox
platform goes further, and will allow viewers
to buy items inspired by shows, while
watching them live19. Multiscreening can
be used to lead customers all the way from
initial interactions up to purchase.
Research online, purchase offline
Mobile devices are even more likely to be
used at an earlier stage, for initial product
research. The practice of ‘Research Online,
Purchase Offline’ (ROPO) has been around
since the beginning of e-commerce
– Research implies that around 50%
of consumers actively research products
online before purchase20. And now, we are
becoming more likely to look for product
information on an iPad or a smartphone than
on a PC. Herein lies the difference – unlike
the PC, mobile devices come shopping with
us.
Showrooming – Around one third of
customers admit to showrooming – going
to stores to browse and try out products
– before purchasing them somewhere
else. Mobile allows customers to search
for information and compare prices during
their visit – 28% of shoppers in Poland21
showroom with their mobile. Electronics
and homewares20 are categories that are
particularly affected.
Showrooming constitutes a threat for
retailers – In the US, Best Buy and Walmart
suffered as customers browsed in their
stores, only to complete the purchase
elsewhere online. Early attempts to
counteract this were unsuccessful – in one
well publicised case, an Australian speciality
food store attempted to charge customers
$5 for ‘just looking’6.
More mature retailers have responded
by treating showrooming as a chance to
finalise sales in store by targeting users of
mobile devices. This turns showrooming
into an opportunity. BestBuy, Target (US),
as well as Media Markt and Saturn (Poland)
allow customers to compare prices with the
competition in store – and some employ
aggressive price matching to convince the
customer to make the purchasing decision
there and then. Walmart goes further, with
mobile apps that guide showroomers around
their store – and successfully encourage
them to use Walmart’s online channel while
on the premises.
One third of
customers admit
to showrooming.
Mature retailers
have responded
by treating
this as an
opportunity
to finalise sales
in store.
Smartphones in Poland
6M
8M
Mobile is already here – and the businesses
that embrace and adapt to new practices
stand to gain ground.
2012
2013
12

13. Keynote
Mobile case studies
Best Buy – Working with showrooming
played over 12 times for every teen in Hong
Kong19.
Introduction
Silvercar – Mobile first
In the US, Silvercar utilised the increasingly
popular ‘mobile first’ approach in designing
their online presence. Rather than designing
a new website, followed by a mobile version
as an ‘add on’, the company built the mobile
version first. This allowed the company to
start with a small investment and scale up.
It also helped design a better user experience
(what works on mobile usually works for
web – but not the other way around) all
while capturing more of the growing mobile
channel25.
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
The electronics and appliance categories
are amongst those most affected
by showrooming. Recently, one of the
biggest retailers in the game has responded
with a model solution. Best Buy is using
the mobile channel to bring customers
into the store. The retailer has created
an application that makes use of the
company’s existing ‘ecosystem’ and works
on a number of levels:
1) Using a geo-tagging, the app allows
customers to ‘check-in’ at physical store
locations to receive rewards points on their
existing loyalty program – Customers are
incentivised to come into the brick and
mortar stores
2) The app also features ‘deal of the day’
discounts specific to in-store items, further
driving foot traffic
3) The above are coupled with an aggressive
pricing strategy. Best Buy will match the
price of deals customers find online,
lowering the relative benefits of leaving
to purchase elsewhere. “If I’ve found the
The showroomer
is presented
with a list
of comparison
prices... and can
pay and check
out directly from
their phone.
product I want cheaper on the web, and
I can get it for that lower price right here,
than why not?”. This way ‘showroomers’
can be directly converted into paying
clients on the spot.
These methods have both advantages
and pitfalls, but some analysts are already
pointing to this strategy helping halt last
year’s 3% fall in sales23,24. Whatever the
contributing factors, Best Buy’s 2013 sales
have remained steady, and the share price
has more than doubled in the 12 months
from September last year.
Coca Cola – Brand interaction
In Hong Kong, Coca Cola launched what
became the territory’s most successful
branded app by combining mobile
functionality with a TV ad – which featured
a Coke bottle being opened and the cap
falling off. Viewers could ‘scan’ the caps with
their mobile phone as they fell, and capture
instant prizes. The results were impressive
– sales rose by 11%, and the game was
13

14. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
My Perspective – The mobile revolution
“Every once in a while a revolutionary
product comes along that changes
everything…”.
That’s how Steve Jobs began his presentation
of the very first iPhone, in January 2007.
From today’s perspective it’s still hard to
believe what kind of breakthrough this
product has made in most of our lives.
In the latest Mary Meeker’s Internet Trends
presentation, we can see that mobile traffic
as a percentage of total internet traffic is
growing one-and a half fold per year. This
will get faster. The latest Cisco research
shows that by the end of 2013 there will
be already more mobile connected devices
than there are people in the world. From
a different perspective, approximately 370
thousand babies are born per day, but in that
same time, more than 500 thousand iPhones
are sold and around 2.4 million Android
devices activated.
So, with the mobile revolution happening
in front of our eyes, how do we achieve
success? Who is playing this game and what
are the rules?
The difference between smartphones and
other revolutionary devices (the likes of print,
radio or TV) is that smartphones are really
smart! They are permanently carried, are
always on and already have built-in sensor
mechanisms that can not only automate
lots of our daily activities but also completely
reinvent the way we interact with our
environment.
The way we should think about designing for
those devices also needs to be revolutionary.
If we journey back to the last twenty plus
years for a few examples – Radio was
not TV, the Web was not Print and it’s
the same today, Mobile is not a PC. Using
the Print vs Web example and referring
to the Newspaper Association of America
report, Newspapers have lost $40 Billion in
advertising revenue since 2000. If you don’t
want to lose the mobile game, make sure
you are ready for a complete revolution
in your product design, in your business
orientation and most importantly in your
customer behaviour.
When we look at the statistics of daily mobile
usage, we can see that we do in fact perform
a very similar set of activities on a mobile as
on a PC: we interact with friends, we play
games, we watch videos and we shop. But
on a 4-inch screen it’s just a very different
experience. And our biggest job is to make
all that new interactions effortless. Simple
transfer of the big Web into a mobile device
is a very common mistake, especially in
eCommerce.
The best example of the revolution, online
(research) to offline (purchase) and vice versa
(showrooming) is happening already. In the
2013 Future of Business Report, Brian Solis
states that Millennials already trust strangers
over family and friends. They lean on UserGenerated Experience to aid purchasing
decisions. Look at this, and other similar
examples, as an opportunity to reinvent the
rules of your business.
Przemysław Budkowski, SVP Marketplace,
Allegro Group
Responsible for managing transaction
platforms, Comparison Search Engines
and eShop solutions in CEE.
He was previously managing director
of Allegro – the largest Polish marketplace.
Before joining Allegro Group he worked
as CEE Product Marketing Manager Google
in Ireland, US and in Poland as well for
Orange Business Services (France Telecom
Group) in Ireland.
To win, drive all your decisions through one
goal only: deliver an exceptional customer
experience (and the rest will follow).
In today’s world this means being able
to adopt quickly and also, being able to
question all your previous accomplishments.
But take that risk, because winners will
always be the ones that follow the consumer.
14

15. Keynote
Implications of mobile
– and what you can do
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
1
2
3
4
Provide a mobile option
With the proliferation of mobile devices, the chances are that a lot of your customers will want to consume information about your
organisation and products via mobile – Or more likely, they already are. Confirm this, and ensure that you’re effectively providing
information and functionality through the mobile channel. This could take the form of apps, a mobile optimised website, or other
solutions depending on your needs.
Embrace showrooming
If your brand is affected by showrooming, there are several things you can do. Consider if there are benefits to building a mobile
application that rewards shoppers for purchasing in-store or within your own online channel. If your customers are already online
while they shop, try to keep them within your own online ecosystem. In addition, make sure that you monitor review websites as
well as competitor’s prices online to ensure that you’re aware of what your shoppers see when they are showrooming – and look
for ways to differentiate.
Be relevant
Context is everything, so map a ‘customer journey’ for your client segments to understand where and how you could use mobile
during the purchase process in a way that is relevant to them. Reviews, prices, and deals are currently what shoppers primarily
look for on mobile devices – so check if you are providing this information through your mobile channel, and how it fits into
your customers’ retail journey. Consider delivering content that is targeted to the customer’s geo-location. This ability is a key
differentiator between mobile and PC, and adds relevance for the client.
Go mobile first
When considering your online presence or launching new digital services, think about going mobile first – before designing a
traditional web solution. Not only are customers consuming more and more information through mobile devices, there may be
substantial cost savings associated with first designing a mobile version of the site instead of building a traditional website and
‘tacking on’ a mobile solution at a later date. Mobile design forces you to focus on the elements that are most important to the
customer, and if techniques like responsive web design are used, mobile web can be translated to a ‘full screen’ version relatively
easily. Starting mobile first generally requires lower investment, is more user focused, scales, and allows you to capture both
mobile, tablet and PC customers right away.
Context is
everything, so
map a ‘customer
journey’ for your
client segments
to understand
how you could
use mobile
during the
purchase process
in a way that
is relevant to
them.
About us
15

16. Keynote
Cloud
Introduction
Our trends
Business is well and truly in the cloud
There are a wealth of benefits to be had
Big data
Increased ROI
Security
Faster
deployment
Mobile
Greater scalabilty
70%
Cloud
One size fits all
Control and
compliance
Lower up front
investment
Cons
Focus core competencies
Social
Some of the initial concerns regarding cloud
(security, remote location of your data) are
being resolved, but new challenges are
arising for early adopters and their followers.
Pros
UX
of businesses globally already employ some form of cloud solution
As a company forays into the cloud with
its first cloud-based application for a single
department, other business units may follow
– each with a cloud solution. So how will you
manage a hybrid of all those clouds?
Payments
And the global cloud market is growing
The internet
of things
Implementation times are quicker
Project completion times for a sample group of projects
Global cloud market
Business is
certainly
adopting the
cloud – the
next challenge
may now be
integration.
On demand
(cloud)
On premise
Security
Economic
Impact
Implications
$40,7B
$241B
59%
56%
2011
32%
2020
About us
Sources: 10, 27, 29
28%
11%
<3 months
9%
3-7 months
>7 months
16

17. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
Business is in the cloud – integration is the next challenge
Cloud computing has created a lot of buzz in
recent years – and has caught attention with
some advantageous characteristics.
These include:
• Flexibility and scalability – assigning
computing as needed
• Mobility – ubiquitous access and location
independence
• Resource pooling
• Pay-per-use – predictable pricing.
This in turn led to financial benefits such as:
cost effectiveness (as one paid only for what
was used) and lower upfront investment
(as no expensive hardware was required to
be purchased). On the other hand, cloud
also triggered anxiety related to data security,
availability and performance, data control,
and provider maturity.
Integrating cloud
As cloud solutions become more mature
and adoption becomes more widespread,
corporations have become more willing to
make use of IaaS, PaaS or SaaS. Launching
non-business-critical applications (such
as sales, services, marketing and human
resources) into the cloud, can be relatively
‘nice and clean’. However, dealing with
complex, applications with sophisticated
multilevel user management, which need to
be integrated not just with local master data
management, but with other SaaS solutions
can be a huge challenge. For this reason,
business rules management for processes
that depend on multiple cloud services will
be an important trend.
Hyper-hybrid clouds
All sorts of organizations have been trending
towards hyper-hybrid clouds. This is evident
at start-ups, with their cloud-first mentality.
As spending is prioritised towards marketfacing products, rather than infrastructure,
these organizations are setting the standard
for the hyper-hybrid environment, using
it to guide new operating structures and
IT delivery models. Meanwhile, larger
enterprises can use cloud to enhance their
large legacy system investments and ERP
solutions. Core in-house systems can form
the foundation upon which emerging
technologies are deployed – without
sacrificing business compliance and controls.
Organizations that can bridge hyper-hybrid
clouds with their core systems will be at the
forefront of improving business performance
with the next wave of digital innovation28.
Security and data integrity
Security and data integrity still remain
a concern. Regulators have raised their
awareness of cloud-computing and have
been introducing regulations regarding data
processing, supervision, and ownership.
In particular, recent issues regarding “the
possibility of the personal data being subject
to intelligence gathering or surveillance
by third-country authorities”29, provoked
discussion of introducing the so-called
“Schengen for data” – a law that allows
citizens within the euro zone to cross borders
without a passport, but does impose hurdles
for others. Business may be ‘in’ cloud, but
the space continues to evolve.
Cloud
computing is
a model for
delivering
on-demand,
self-service
computing
resources with
ubiquitous
network
access, rapid
elasticity, and
a pay-per-use
business
model87.
17

18. Keynote
Introduction
Cloud case studies
Pfizer – Reducing R&D costs by $600
million with cloud
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
When Pfizer was considering increasing
the utilisation of cloud technologies in its
organization it chose to focus on R&D,
the core engine that drives success for
pharmaceutical companies30.
The R&D department was responsible for
analysing, organising and computing large
amounts of complex data to provide reliable
results back to their scientists as fast as
possible. However, Pfizer was not keeping up
with the increasing demand for computing
power required to process the information
at a fast rate and a low cost. Both these
factors were critical to Pfizer’s success in the
marketplace.
To solve the problem, Pfizer partnered with
a provider to create a private cloud solution.
Taking advantage of cloud computing
compressed compute time from weeks to
hours. This enabled the company to make
quicker financial and strategic decisions,
resulting in gains measured in millions of
dollars. Furthermore, the solution freed up
scientists’ time to focus on core tasks (rather
than on data processing) decreasing Pfizer’s
R&D costs by 7%, or $600 million, since the
company implemented cloud in 2010.
The deployment of cloud resulted
in adoption and behavioural changes across
the R&D group – and boosted Pfizer’s
competitive advantage. It also opens
possibilities for deploying cloud to other
areas of the company – or even using it to
collaborate with other areas of industry30.
USA.gov – Savings due to cloud
computing
The US General Services Administration has
migrated all of the core resources of the
USA.gov Web portal to The Enterprise Cloud
IaaS solution to enable scalable on-demand
resources. The Cloud based solution provided
number of benefits and savings: enabling
higher transfer volumes and accommodating
huge traffic spikes on one side, while
avoiding paying for idle capacity on the
other. The Office of Citizen Services, has
indicated that that the move to Terremark’s
cloud platform would “reduce costs by 90%,
while improving capabilities”31.
the implementation of a new cloud based
system to deliver improved communication
and collaboration services to employees. The
rollout and uptake of the system has resulted
in:
• Savings of approximately 60% compared
with previous IT solution
• Saving approximately 100 hours a month
in IT resources time
• Better collaboration which helps to
improve patient care32.
Telefónica – Mobile operator goes cloud
In 2011, the Spanish telecommunication
provider Telefónica, decided to take
advantage of hybrid private-public cloud and
to consolidate 27 European data centres
containing approximately 18,000 physical
servers into extensively virtualized solution of
around 6000 servers. Cloud-computing was
expected to reduce IT costs by 15%, cut the
delivery of server resources to the business
from 20 to less than 1 week, and bolster
data centre reliability33.
Taking
advantage of
cloud computing
compressed
processing time
from weeks to
hours.
Bambino Gesù Hospital – Improving
patient care and lowering costs
The Vatican hospital “Bambino Gesù
Hospital” is one of Italy’s largest paediatric
research and treatment centres. The hospital
was receiving complaints from staff about
the effectiveness of data sharing between
doctors and nurses working in the operating
rooms, the clinic, at the office and in their
homes. The main issues were related to
schedule sharing and management, patient
data exchange and communication on
treatment related issues. The old ways
involved e-mail and other ‘legacy’ methods.
In the end, the IT department supported
18

19. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
My Perspective
Cloud computing has been undergoing
a rapid evolution in recent years.
What started as a novelty quickly became
mainstream and it’s hard to imagine a
modern enterprise that is not using any cloud
services.
However, the term “cloud computing” has
became very stretched due to the hype
that surrounds the movement. Many quite
distinct types of services are labeled “cloud”
and sometimes it’s hard to understand why.
It’s a little similar to ‘Big Data’ where even
firms analyzing a company’s payroll data
(hundreds of thousands records, trivial by any
contemporary means) are claiming that they
provide Big Data services.
Types of cloud companies
First, there is a large group of traditional
Software as a Service web applications
and application suites that have rebranded
themselves as cloud applications. These
offerings have matured significantly
over time, especially given the fact that
those types of applications have been
present on the market since late nineties.
While they offer a compelling replacement
for the traditional on-premise applications
they remain relatively closed and
self-contained.
A new breed of cloud applications
The new breed of cloud applications
that came later leveraged open protocols
and provided the rich APIs that enabled
unprecedented possibilities of constructing
sophisticated cloud-based solutions based
on multiple services provided by different
vendors.
An even more dramatic change is happening
at the infrastructure level. The movement
towards virtual cloud environments
is completely changing the way we think
about managing infrastructure. On one hand
it enables a radical simplification and
standardization of the underlying
hardware as the capacity of the individual
virtual machines are defined in software.
On the other hand, for the first time,
we can treat our infrastructure not as
a hardware with some configuration but
purely as software objects that can and
should be managed as code. Therefore,
an “infrastructure as a code” approach
is emerging and it opens up possibilities
to bring a rich array of techniques from
the software development world to
infrastructure. This will enable proper
versioning, change management and testing
of virtual infrastructure. The emerging
software defined networking (SDN) solutions
will nicely complement the mix, and
ultimately enable the virtualization of the
whole environment (data, application and
networking).
Challenges and possibilities
Of course, the cloud is not without its
challenges. On the application side,
the usual data security and confidentiality
issues arise. The recent PRISM scandal
was a serious cold shower to the whole
industry. Data management and integration
is posing as big challenge as with traditional
applications. Combined with the relatively
slow throughput of an internet connection
vs. high-speed internal networks, it creates
an interesting challenge for the data intensive
enterprises.
On the infrastructure side, the cost equation
is not always positive: if your computing
power consumption is highly variable then
public cloud will be a great way to handle
it with the minimal cost. If it has a significant
fixed part then you can most probably run
it internally (using a private cloud) and it’ll
be a financially better proposition. Looking
at the current trends, it’s inevitable that
companies will eventually adopt a hybrid
private-public cloud model and it will
enable mix-and-match usage and optimal
spending for the services. The vast majority
of applications running in today’s companies
are not cloud-ready and it’s one of the
stumbling blocks on the wide cloud adoption
path. However, it’s inevitable that the
next generation of apps will support cloud
– and this will pave the way for cloud’s wider
deployment.
Krzysztof Dąbrowski, CTO, Allegro Group
Management Board member responsible
for IT development and IT operations in the
Central and Eastern Europe. For the last two
years, Krzysztof is busy transforming Allegro
Group into a modern, agile software house.
He initiated one of European largest groupwide Scrum transition and is a big proponent
of Lean and Agile methods. Being a former
programmer and engineer by calling he
values clean, minimalistic designs and code
craftsmanship. Being manager by choice,
he tries to change the world for the better
by nudging people around him. He previously
built and led software development practice
at Roche’s shared service center in Warsaw.
19

20. Keynote
Implications of Cloud
– and what you can do
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
1
2
Payments
The internet
of things
Security
Economic
Impact
Implications
3
Consider if cloud is right for you
If you’ve never considered applying a cloud solution in your firm, maybe it’s high time to think it over. The benefits can be
considerable. Cloud does always present a risk associated with lessened control, but part of this can be mitigated by evaluating
cloud based solutions for the non-core functions of your organisation, such as CRM, sales, HR, payroll or collaboration functions.
These are points of entry that are often easier to introduce, and can be implemented in a way that makes them seem ‘familiar’ to
your workforce, aiding uptake. However, always bear in mind the downsides and security implications – and weight them up with
the advantages.
Determine where cloud may be the best fit
If you’ve decided you want to implement cloud solutions, you’ll need to evaluate where cloud services models are suited to solve
your business problems – and whether they fit your technical environment. Cloud could be a fit if you require:
• Predictable pricing: You want to be charged based on usage, rather than on perpetual licensing or allocation
• Ubiquitous network access: The service offered is available wherever and whenever the network is available
• Resource pooling and location independence: Multi-tenant, with shared resources that subscribers cannot explicitly specify
or partition
• Self-service: The service can be directly accessed by users, features on-demand provisioning, while services are readied in close
to real-time
• Elasticity of supply: Ability to scale up or down to meet resource demands28.
You’ll need to
evaluate where
cloud service
models are
suited to solve
your business
problems.
Effectively integrate clouds and local infrastructure
If your organisation already has a sizeable cloud footprint and you’re looking to further integrate cloud systems into your business,
you should evaluate them first, and see if they’re meeting your original business requirements. Integrating underperforming cloud
solutions presents a risk – it will cost money, increase technology dependencies, and complicate future migration strategies.
Consider creating common platforms for identity, access, data correlation and business rules. Separating these out from discrete
cloud-based functions may help in the future. Consider cloud-based integration ‘platform-as-a-service’ solutions to complement
enterprise integration layers or service buses. These platforms can manage the interactions between in-house enterprise
applications and cloud services28.
About us
20

21. Keynote
Social
Introduction
Our trends
Social media is becoming
ubiquitous around the world:
Poland has one of the highest
rates of usage in the world:
Facebook has
Big data
Mobile
1 billion
1 billion
503 million
503 million
359 m
The internet
of things
8,78M
Sina Weibo
Twitter
and global business is starting
to implement it internally:
UX
Payments
86%
YouTube
Cloud
Social
Polish companies on social media
Facebook
Google
70%
2011
active users in Poland
...and just overtook local service Nasza Klasa
Rates of social media usage globaly
52%
50%
50%
40%
39%
38%
34%
30%
29%
Implications
About us
90%
38%
30%
23%
20%
18%
15%
10%
8%
Facebook
YouTube
LinkedIn
Google+
Goldenline
Twitter
Blogs
Nasza Klasa
Yammer
UK
US
Russia
but social media could still be
used much more effectively:
Poland
France
Italy
Germany
62%
Facebook use in Poland by age
35%
28%
Social media is ubiquitous, and in business
it’s being used for everything from brand
promotion to customer service to social
shopping. However, getting the most out
of social media requires a lot more than
using it as an advertising channel, or simply
‘being’ on Facebook and Twitter. Social can
open up a wealth of possibilities if used
properly. And if you’re not using it to your
full advantage, your competition probably is.
11%
Increasing sales
With around
half of the
world’s internet
users making
use of Facebook
alone, the power
of social media
in the digital
space is beyond
doubt.
Recruitment
25%
but one of the biggest gaps
between young and old:
Influencing brand
image
Better understand
customers
Greece
59%
Keeping up with
trends
Japan
Security
Economic
Impact
Business in Poland is getting
on board:
Reducing customeracquisition costs
2013
Fortune 500 companies who have
or are establishing a social network
Sources: 4,10, 34, 35, 36, 37
29% 29%
20%
13%
9%
5%
2%
13-17 18-24 23-34 35-44 45-54 55-64 65+
21

22. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
Social media goes to work
Most brands already realise the importance
of social media in managing their image,
both in terms of brand building and crisis
control. Communication with the costumer
is no longer unidirectional – a dialogue is
possible – and the conversation takes place
in the public sphere. Positive, as well as
negative experiences can be seen, shared
and amplified to a network of millions.
In Poland, many companies have realised this
– and more than 50% of Polish companies
on social media are there to manage their
image34.
Social media has also changed the way we
relate to brands and products, as consumers
rely more and more on reviews and ‘social
validation’ online. A Deloitte study found
that while older generations were more
likely to rely on “tried and tested” brands,
younger consumers and are far more likely
to engage through the Internet, looking
for reviews and recommendations from
peers in order to make a judgement on
products4. Social validation is now critical
for the credibility of products and services.
Already, 33%36 of consumers view social
media reviews before making a purchase –
and ‘businesses like TripAdvisor, UrbanSpoon,
Allegro, and eBay all rely on social reviews as
a cornerstone of their service.
But social is not just an image tool – it can
also be used to drive e-commerce more
directly. ‘Social shopping’ services such
as Feyt and Pose use social media and
sharing to ‘curate’ clothing and accessories
specifically to a customer’s needs through a
“find out what to wear, then buy it” business
model. ‘Social network commerce’ allows
Social is not just
an image tool
– its a diverse
toolkit
from which
organisations can
select the best
tool for the job
at hand.
users to buy products while within a social
network like Facebook or China’s Qzone36,
and firms like Shopify and Soldsie are offering
services to facilitate the process. Social media
content can even become currency – Services
like paywithatweet.com allow companies to
‘sell’ reports and electronic media in return
for a user ‘tweeting’ or posting a Facebook
message about a product.
Customer service is another area in which
social media use is growing, as it provides
a relatively low-cost channel through which
customer service teams can offer support
and triage customer issues. With around
1/3 of customers preferring to contact
brands through social media than by phone,
it is especially important to offer this channel
option. In Poland, ING Bank Sląski, mBank
and Dbaj o Zdrowie all offer support through
their Facebook sites. Social can even be
used to crowdsource customer service.
Australian telecommunications firm Telstra
and Commonwealth Bank have both created
platforms where employees and members
of the online community can respond to
customer queries and help solve problems.
Finally, organisations can use social to
improve their own processes and functions.
LinkedIn is regularly used for recruitment.
Tools like Yammer (a cross between Facebook
and Twitter) have been widely adopted by
corporatations. Tasks like standing up and
saying “Has anyone ever done…” are no
longer limited to the local team sitting in
your room – they can be asked across offices,
cities, and countries.
Deloitte has suggested that companies
can transform how they do business by
harnessing social media internally. This
is affected not just by ‘bolting on’ social
media tools to improve collaboration, but
by reengineering whole business processes
to overcome constraints like limited context
for decision and action, or “same-time,
same-place” requirements for employee
productivity10.
In this area, business has not sat still
– By the end of 2013, more than 90%
of Fortune 500 will have at least partially
Enterprise Social Networks (ESN)4, and while
the US is ahead in this regards, the rest of the
world will likely follow.
Clearly, social media is a diverse toolkit from
which organisations can select the best
instrument for the job at hand – and there’s
more to choose from than just the hammer
of ‘being’ on Facebook.
22

23. Keynote
Social media case studies
KLM – Social care
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
KLM began using Twitter in 2009 and
Facebook in early 2010 – But truly saw
the value of social media as a customer
service channel following the eruption
of the Icelandic volcano Eyjafjallajökull later
that year. With call centres jammed, Twitter
and Facebook were used to respond to
customer service requests and provide regular
updates on services. This allowed KLM
to maintain high levels of customer service
at a potentially damaging time, and resulted
in a lot of positive press – leading the
airline’s CEO to declare an added focus on
investment in social media capabilities38.
KLM has indicated three key factors about
their social media strategy38:
• KLM strives to deliver excellent
customer support via social media.
KLM provides a 24/7 service and aims
to respond to every user comment
or question within 60 minutes. Each issue
must be resolved within 24 hours.
• KLM recognizes that Social
is a space where brand is affected
Consumers converse about brands on social
media, meaning that brand reputation can
be affected in a very public manner. KLM
choses to engage in that conversation.
• Social media is a great acquisition channel.
Given that customers are more likely
to be influenced by peers than
by ‘traditional’ marketing messages39,
KLM sees that by proactively monitoring
and influencing the conversation around
the brand, they are carrying out valuable
marketing work.
In pursuing these benefits, KLM has
expanded its social media team to over
100 people serving customers in 9 languages
on a variety of platforms20, and is recognised
as a global leader in social customer care.
Danone Poland – Brand promotion with
Mały Głód
In Poland, Danone effectively used
a ‘brand hero’ (a promotional character)
in conjunction with social media to directly
increase sales and improve brand recognition.
The company launched a brand promotion
which revolved around an “invasion” of the
country by millions of “Little Hungers”. ‘Little
Hunger’ toys were bundled with Danone’s
dairy products and physically delivered
to stores, with the campaign then being
driven primarily through Facebook, where
consumers were encouraged to interact with
the ‘Little Hunger’ invasion narrative, both
on the web, and in ‘real life’ locales.
The campaign resulted in 57,000 Facebook
fans, extending to 170,000 fans after
a follow-up campaign. More importantly,
sales to the target group rose by 7%
– and brand reputation improved by 15%
after the campaign, in what was one
of Poland’s most social media campaigns
at the time41,12.
GE – Collaborating through social
In order to dismantle organisational
siloes and improve collaboration, GE
has implemented Colba – an internal,
‘Facebook-like’ platform for staff. Beyond
standard functions such as displaying
profiles and messaging, the system also
allows users to file-share in the cloud, as
well recall the context in which the files
were used through recorded conservations,
attached meeting notes, and collaboration
history. The platform has been a success,
with subscription growing from 0 to over
120,000 users in a year, and with strong
support from the CEO, more features are
being planned10.
KLM has
expanded its
social media
team to over 100
people serving
customers in 9
languages.
Deloitte Australia – Engaging for
recruitment
Deloitte Australia has long used people
networks for recruitment, and has taken
to social media as a natural extension.
Graduate recruitment efforts are aided
by an active “Your Future at Deloitte
Australia” Facebook site, where graduates
can ask questions about Deloitte, its people,
career opportunities, and the application
process. This is further backed by Deloitte’s
“Join Us’ iPhone app which streams video
and photo content from Deloitte YouTube
and Facebook accounts, as well as other
relevant information. The approach has seen
Deloitte named the ‘top graduate recruiter’
in Australia for 2011, as well as a series
of other recruitment awards37.
23

24. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
My Perspective – Social media in business
As far as social media in business, we’ve
come a long way, and have a long way
to go. The below is just a sample of my
social ‘journey’ in the workplace.
Years ago, when I had started at Deloitte in
Australia, the entire practice was expected
to check their voice messages each morning.
Our CEO and other senior staff would leave
us firm-wide voicemail to share news – we
jokingly called it the weather report, as every
message would begin with something like
“It’s a cloudy day in Sydney, and I’m calling
to tell you about…”. The communication
was unidirectional, and cumbersome. There
was no real way to engage. Fortunately, the
winds of change blew. After staff took up
Facebook and Twitter, the firm didn’t look up
in alarm, but tried to realise some benefits.
We introduced Yammer – an internal social
network. Its use was led by none other than
the CEO himself – a social media skeptic
turned true evangelist.
The Australian firm established what was
one of the biggest active Yammer networks
in the world – and now Deloitte has a much
wider, global network. In practice, the effects
are amazing. In a 20-person firm, I could
stand up and say: “Has anyone ever…?” and
mention a topic – and whoever was in the
room could drop me a helpful hint. Now I
can do this online across buildings, offices,
or countries, targeted to the groups I need
to reach. Engaging staff from Warsaw to
Melbourne, or London in conversation – and
getting results – is simple. It’s not unusual
to see a post from the CEO saying “I’m
off to see client X tomorrow to talk about
social media – what are the top three things
I should tell them?”, and see a flood of
responses, including case studies, statistics,
and customer quotes social works. Deloitte
now also uses social media for recruitment,
even building an iPhone app for graduates
to disseminate relevant information.
A lot of businesses have been making
a similar transition with regards to social
media. First resistance, then acceptance,
then a growing realisation of what could
be done – though we’re still a little lacking
on the latter. We need to understand that
using social media effectively is a lot more
than ‘being’ on Facebook. Need to lower the
cost of customer support? Why not consider
a Facebook or Twitter support channel?
Replies to problems you solve are shareable,
and can be seen by many – which can
mean less load on your support staff – and
customers will appreciate a channel they can
access anytime. In Australia, I’ve observed
Australia Post make a real effort in ‘social’
customer care this way. Poland is quite
a ‘social’ country, and I see organisations like
Poczta Polska, Generali or mBank are realising
the benefits and getting on board. Of course,
social care is the tip of the iceberg. There are
other prospects too – from better targeting
and the use of big data, to direct sales, brand
monitoring, or improving internal processes
by utilising systems like Yammer.
The opportunities in social are substantial.
But the landscape is always changing,
so regularly check to how you could
leverage social media to improve the way
you do business. Remember – even I was
using a landline to check my business
communications six years ago.
Marcin Łaszkiewicz, Deloitte
Marcin is a manager at our Warsaw practice.
Prior to his transfer from our Melbourne
office, he worked with our Deloitte Digital
team in Australia, and helped define digital
strategies for some of Australia and New
Zealand’s most significant organisations.
Marcin focuses on the intersection between
business and IT, but has almost a decade
of experience across a broad spectrum
of technology projects. Prior to Deloitte,
he worked in positions involving network
and system administration, IT security,
coding, and even cultural studies research
into the impact of computer games
on society.
24

25. Keynote
Implications of social media
– and what you can do
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
1
2
3
4
Don’t wait – and do not ignore the cost of inaction
Don’t be an ostrich and bury your head in the sand. If you’re not already using social media, examine what your competition
could be (or already is) doing, and what you may be set to lose out on. If you’re already on Facebook or Twitter, make sure you
re-examine your social strategy on a regular basis. It’s a rapidly changing field, so regularly check up to see if how you’re using the
medium is still appropriate - and whether new opportunities to improve how you do business have arisen.
Define your social media goals
One thing we consistently hear from social media leaders is ‘don’t act without a plan’. To start, select an area of the business
which could be disrupted if viewed through a social media lens. Are there any customer areas where a natural community
exists, but has not yet been tapped? Are there any customer pain points that could be solved through better communication
– or connections to experts and peers? What are you trying to ‘solve’ in your business? Think through your business objectives and
then act.
Look at both customers and yourself
In investigating how you could use social media, look inside and outside the organisation.
Would your customers benefit from an online customer service channel, and does it make sense for them to engage with your
brand online? Perhaps they’d like to engage with others about your brand?
Likewise, don’t forget your internal processes – Can you break down silos, simplify decision making, or speed up internal processes
by connecting your people differently?
It’s a rapidly
changing field,
so regulary
check up to see
whether new
opportunities
to improve how
you do business
have arisen.
Pick your tools
Once you understand your goals and needs, it’s time to pick the right tools. Twitter for running social care? Instagram to promote
a visual identity? What about some social monitoring tools to keep tabs on what the Internet is saying about your brand? How
about integrating it all with a CRM that will allow you to track your customer interactions? Ensure that you select your system
methodically, and consider support and staffing needs - not just the acquisition costs.
About us
25

26. Keynote
User experience
Introduction
Our trends
User experience is important
for custormers
And the benefits to business
are real
68%
Big data
Mobile
of users leave a website
of poorly designed UX
A major internet retailer
– saw gains of
$300M
Cloud
through improved UX
Social
User experience is also
important for developers
UX
Payments
The internet
of things
44%
of shoppers will tell friends about
a bad online experience
85%
Wells Fargo reported a
Security
Economic
Impact
Implications
About us
$
of UX problems
can be solved
by testing with
62%
of customers based future
purchases on past experience
5
users
50%
increase in online
loan applicationss
after UX improvements
to the home page
Good user
experience
is ceasing to be
just an option
and is becoming
a requirement.
User experience (UX) is the sum of a user’s
experience with a company, including its
services, products, and customer facing
interactions. In the digital context, it dictates
how a customer perceives the experience
of using an application or device, based not
just on ‘look and feel’, but on the customer’s
perception of ease of use12, efficiency,
and whether they can accomplish the tasks
they want to.
In the digital space, UX has become
a battleground for competing brands.
Ease of use, appeal, and functionality play
key roles in determining success15. Thanks
to leading organisations such as Apple
or Google, customers have come to expect
a clean and elegant customer experience
regardless of what platform they’re using.
Moreover, customers don’t just expect
a great user experience from industry giants,
they expect it from whoever they’re dealing
with13 – and organisations need to be ready.
Sources: 43, 44, 45, 46, 47
26

27. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
A focus on user experience is no longer an option – it’s a must have
A brief introduction to UX
The practice of user experience design
typically involves tasks like ethnographic
research to understand customer needs,
visual design to define the look and feel of
the interface, information architecture design
to define how information is organised on an
interface, and elements such as interaction
design and usability disciplines.
Retailers in particular have become
increasingly adept at designing user
experiences that take customers on
an efficient journey through the sales
process. Good UX ensures relevant product
information is provided at appropriate points,
with customers being helped through critical
steps in the process - particularly around
payment and delivery. Mature retailers
have also become adept at providing
useful and engaging search options, with
products returned in search results displayed
graphically and often accompanied by
contextually relevant filtering options.
But in addition to these practices, several
other items have been ‘trending’ in UX
recently.
Trends in UX techniques
There are several techniques currently
impacting on UX practice.
Mapping the customer journey – The use
of ‘customer journey maps’ to show how
customers interact with a brand across
channels and through their customer lifecycle
is becoming more and more universal.
Journey maps help visualise a customer’s
experience – and the pathways they may
take through the content and functionality
of a digital service or product. They focus
on users’ experiences including how they
feel, what they’re thinking and any issues or
concerns they may have.
Responsive, adaptive and predictive design
– are also competing for ‘attention’ in the
UX world. Responsive design allows websites
and apps to scale and change depending
on the device they’re displayed on (allowing
design once for multiple devices), while
adaptive design couples the aforementioned
with user needs – so that websites look
and feel ‘similar’ across various platforms.
Predictive design goes further, and is aimed
at discovering or understanding a user’s
needs and patterns, then modifying the user
experience accordingly. Organisations need
to understand which of the above fits their
capabilities and users’ needs best.
Gesturing - is also being increasingly
explored. This involves interacting with
devices not just by ‘pressing’ buttons on
a touch screen, but by using broader range
of interactions with the device48. Users can
already ‘shake’ an iPhone to undo typing,
or gesture with their body to control the
Xbox Kinect. Google’s Gesture Search,
replaces typing with simple hand gestures.
our immediate attention – both in Gmail
and its Google Glass prototype.
In addition to these individual trends,
organisations are finally considering
Digital as part of a broader ‘multichannel’,
or ‘ominchannel’ experience, where users
can seamlessly switch between channels
to perform an action. A customer may
research a product on their mobile, and order
online from their PC, before picking up and
paying at a physical store.
All this means that companies must
design increasingly complex but consistent
experiences that extend beyond just the
physical space.
UX comes to the heart of the enterprise
More broadly, UX as a discipline
is being given more and more weight
by organisations around the world.
Companies in the private sector are putting
increased focus on UX skills, and banks from
Ceskomoravska Sporitelna, in the Czech
Republic to Commonwealth in Australia are
boosting their UX teams. Elements of the
private sector are following suit, and the
UK government’s reorganisation of their
web presence has seen strong internal user
experience capabilities built at Gov.uk.
Customer
journey maps
help visualise
a customer’s
experience
– and the
pathways they
may take
through the
content and
functionality
of a digital
service.
Calm technology – As we are bombarded
with more and more information, the use
of ‘calm technology’ is also becoming
more prominent. The technique focuses
on cutting down the “digital noise” and
reducing distractions to users without losing
functionality49. Google uses this to filter
emails, displaying only the most urgent for
27

28. Keynote
User Experience case studies
Major Internet retailer – The $300M button?
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
Even the biggest internet retailer in the world
can benefit from better UX – In the case of
one, the benefit of a few simple changes was
estimated to have delivered the company up
to $300M46.
Analysis found that users were abandoning
purchases. Subsequent UX research found
that a major reason for this was that
the users resented having to ‘sign up’
before completing the purchase. Repeat
customers often couldn’t remember their
user ID and password combination, and
requested password resets – of these, only
a small portion continued shopping. In the
meantime, new users didn’t want to sign up
at all. During testing, one customer captured
this attitude in the phrase “I’m here to buy
something, not to enter into a relationship”.
The UX team responded by shifting the
registration option to after the user had
checked out. This allowed customers
to complete the core task of buying the
product, while still allowing those who
wanted to sign up afterwards.
went up by 45%. Revenues increased by
about $6 million in the first week, which
remained roughly constant, while password
reset requests dropped by about 80%.
The investment in UX testing most certainly
paid off44,46,47.
Time magazine – responsive design
With increasing number of readers using
mobile devices like smartphones, iPad,
and other tablets to visit its website, Time
magazine utilised responsive design in order
to better reach its readers.
The redesign team utilised responsive design,
which allowed content to scale and change
depending on what device readers were
using. Furthermore, they paid particular
attention to performance, search engine
optimisation, and the use of photography
(so critical to the TIME brand).
As a result, the bank decided to employ
a highly simplified homepage, with
a straightfoward search interface that
allowed their customers to bypass navigation
and get their answers quickly, whether
they were looking for products information
or support.
The approach paid off. Since launching,
Bankwest saw a 25% increase in new visitors
in the first 3 months since launch, and the
website won the Interactive Media Awards
for the ‘Banking’ category in 201151. Since
then, other banks have also adopted a more
graphical, user centric approach – examples
include UBank Australia, and mBank
in Poland.
After the
redesign, mobile
and tablet went
up from 15%
of total traffic
to 25%.
After the redesign, mobile and tablet traffic
went up from 15% of total traffic to 25%,
but more importantly, the engagement with
users improved. Readers view more pages
per visit than before, across PC, tablet and
mobile (a 23% improvement on the latter)
and time spent on the homepage has also
increased by almost 10%50.
Bankwest – UX inspiration from retail
In redesigning its website in line with its
“Happy Banking” initiative, Bankwest chose
to break with its industry peers. The site
would not look like that of other banks
– instead, interactions would be based on
internet shopping experience.
The UX change saw an immediate jump in
sales. The number of customers purchasing
28

29. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
My Perspective – Design thinking pays off
When we are looking for something, today
we have grown accustomed to simply
googling it and a world of information
is at our fingertips. In essence, we now
simply expect information on everything
to be instantly and readily available, on any
device, wherever we are.
This immediacy results in significant
challenges for product and service
organisations. Consumers have increasingly
high expectations of intuitiveness, richness
and engagement in the products and services
they use. Today it is no longer enough
to be functional or feature rich. In addition,
we also expect everything to be easy to use,
integrated, and personalised to our needs.
We expect this in all contexts, even as
employees using internal systems of large
corporations.
Design Thinking Process
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
Inspiration
• Immersion
• Empathy
• Understanding
Ideation
• Brainstorm
• Create ideas
Prototyping
• Low-Fi prototypes
• Hi-Fi prototypes
Deployment
• Create
• Deploy
Expedia, an online travel portal, suffered
from a lack of customer focus, costing
them $12 million dollars a year. The culprit
for this loss was a single form field, which
confused customers when trying to pay for
a holiday they had selected online. Once they
removed it, the booking numbers rose almost
overnight. UX pays.
Investing in user experience design for
your products and services is not optional,
but essential if your organisation is to be
competitive and have a differentiated
offering in the marketplace. Focused user
experience design facilitates the creation
of solutions and products that are tailored
to your specific target audience and meet
or exceed their expectations. The side effects
of applying user experience design often lead
to your organisation also becoming more
effective, efficient and crucially – innovative.
In our experience of working with
organisations large and small, we frequently
encounter the following common challenges:
• Inefficient internal systems – every minute
that an employee spends trying to use
a non user-friendly internal system costs
the business money
• Inability to innovate – large organisations
in particular sometimes find it hard to
think ‘out of the box’ due to long standing
practices.
• Undesirable user interfaces – are also less
likely to generate demand for third party
licensing or ‘white labeling’ of the system
– thus cutting off a potential revenue
stream
• Costly workarounds – Undesirable user
interfaces are not used as much as they
should be – users find workarounds
which are often costly to the business,
e.g. calling support helplines or deliberately
mis-entering information
• Design is seen as a nice to have
– instead of a must-have. An engineering
driven design process results in
products for engineers in the same
way that a marketing driven process
results in products customers need
to be convinced to use.
These challenges can be overcome by
investing in UX, applying design thinking
and a user centred design approach. Design
thinking means taking the time to immerse
yourself in client problems and brainstorm
– rather than trying to retro-fit a ready made
solution.
The three key benefits of applying Design
Thinking are:
1. Improved Efficiency of Use
2. Increased Desirability and Adoption
3. Innovation on Demand
Efficiency is a simple measure– it is essentially
how easy is it for your users to do what they
want / need to do.
Desirability is especially important for
consumer products – it drives whether your
customers want to use your products and
in future will remain loyal to it.
Innovation on demand becomes a part of
the organisational culture – once accustomed
to having the right tools to create, the
freedom to experiment and fail, employees
are more likely to think outside the box even
for day to day challenges.
All of this leads to happier customers and
employees, and ultimately generates profit
and saves costs.
Philip Bonhard & Amanda Salter,
Newt Idea
Philip and Amanda are directors and
co-founders at Newt Idea, a design
consultancy based in London.
Philip
Driven by curiosity about how people
and technology interact, Philip has been
designing people friendly tech for more than
10 years. He loves rapid prototyping.
Amanda
Amanda is passionate about taming complex
problems through good design. She is an
agile UX coach and advocate of lean UX.
Design thinking
means taking
the time to
immerse
yourself in client
problems.
29

30. Keynote
Implications of UX
– and what you can do
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
1
2
3
4
Start with the user
Take a user-centric approach to your products and to your organisation. Before starting projects, take time to understand who the
stakeholders are, how they live and work, what their needs are, and what problems you’re trying to help them solve. Investing in
ethnographic research can help achieve this, and the use of a ‘persona based’ approach can help embed user centricity in your
project, from design, through to development, and service.
Test early, and test often
Leaders in the UX space have a real commitment to trialling and testing. Winning designs are rarely found by accident – they are
the result of a methodical testing process, employed from the earliest phases of the project. Techniques like using low-fi prototypes
will help solicit feedback from users before coding has even begun. A/B and multivariate testing can be used to choose whether
one variation of a design is more effective than another – and can be carried out on a live system, with the results coming directly
from real customers.
Winning
designs are
rarely found by
accident – they
are the result
of a methodical
testing process.
Ensure consistency
Consistency is a key element of successful UX. Investing in UX standards, guidelines and tools like content libraries will help
organisations deliver a consistent experience across digital touch points and beyond. Remember that ‘consistent’ does not mean
‘identical’, so adjust user interactions where required. User needs may be different when they use a PC compared to when they
use a smartphone – and the difference may be more substantial than just clicks and scrolls becoming taps and swipes.
Continue to invest in User Experience
If you are serious about providing outstanding customer service, you need to invest in building and maintaining a user experience
capability. This can take the form of bringing in UX experts or building a UX capability internally. If you do build this capability,
embed it in the heart of the business, so that it can shape concepts through the lifecycle of a project, from initial concepts, right
through to implementation and improvement.
Implications
About us
30

31. Keynote
Payments
Introduction
Our trends
The mobile payments market is growing
Young consumers are leading the trend
Global mobile payment user base
Who is using mobile payments? (source BBVA)
384M
Big data
Mobile
212M
Young boomers
(40-50)
Gen Y / millenials
(18-26)
Cloud
Social
18%
39%
70M
9%
Old boomers
(51-61)
31%
Gen X
(27-39)
UX
Payments
The internet
of things
2009
Value of global mobile payments
Security
Economic
Impact
2012
2015
$472B
And industry is getting on board
Mobile
carriers
$171B
Deployed
/ ready to
deploy
$26B
32%
Fraud
Institutions
Merchants
30%
17%
Trialling or
planing
Implications
About us
3%
Seniors
(62+)
2009
2012
2015
64%
66%
No interest
so far
5%
3%
64%
9%
Smartphones
are shaping
a new world
of payments.
While there’s a lot happening in the world
of payments at the moment, the key trend
in the area is Mobile. Mobile payments
are attracting attention throughout the
world due to their capacity to improve user
experience for customers and provide new
opportunities for financial institutions, mobile
operators, third-party processors providers,
merchants and application developers. Driven
by a growing customer demand for rapid
payments and the growth of e-commerce,
mobile internet and smartphone usage,
mobile payments are attracting more
attention from new players other than
„traditional” financial institutions. According
to Gartner, the number of mobile payment
users globally will reach 384 million by the
end of 2015 – that’s more than four times
more than it was in 2009 and almost 80%
more than in 2012.
A global battle for market share is being
fought out in mobile payments. The market
is growing, and a tremendous range of
mobile payments innovations have sprung
up around the globe. Only time will show
which of them will come to dominate.
Sources: 52, 53
31

32. Keynote
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
“Sell and cell” – smartphones will shape new business models for payments
Over the past few years, consumers have
made smartphones their preferred mobile
devices. Like POS, ATMs and online banking
services before them, smartphones are giving
consumers greater convenience and more
options than older technologies. Customers
are now able to bank wherever and
whenever they want, carry out transactions
and access account information without
physical access to bank branches, ATMs,
or even computers. What is more, they’re
now starting to expect this convenience54.
Users driving the change
While members of Generation Y (Millennials)
are the frontrunners in adopting all things
mobile, Deloitte expects baby boomers
and older consumers to increase their
usage of mobile banking as it becomes an
established and familiar channel. In fact,
it’s likely that mobile banking will surpass
online banking as the most widely used
banking channel by 2020 – if not sooner.
Most large banks around the world have
already gone mobile or are just about to
invest there. Smaller financial institutions
aren’t far behind, and on top of that mobile
network carriers, credit card processors and
third-party payment processors offering
web-based and mobile solutions are also
fighting for their market share.
Smartphone applications (leveraging NFC,
Bluetooth Low Energy (BLE) and geo-location
capabilities) enable the provision of
innovative real-time payment solutions to
end users. Apps currently on the market
support transferring money to individuals
(P2P) and to retailers (B2C), regardless of
whether the transaction is conducted in
close proximity or remotely. This moves the
focus from premium SMS based transactional
payments and direct mobile billing models to
mobile web payments, mobile app payments,
and contactless payments.
Opportunities for local firms exist
Mobile payment offerings around the world
vary in terms of solution maturity and market
penetration. While global players are pushing
to build their own standards, the diversity
in local markets is still huge. Local market
players are taking different business and
technological approaches with their offerings
– and must often develop various alliances to
build business models that are suited to their
specifics of their own markets.
With the rapid increase in smartphone
penetration, the marketplace is crowded with
competition from a variety of sources. As is
the case with many emerging markets, the
speed of change is rapid, and firms must be
prepared to adapt accordingly. A window
of opportunity may exist for early adopters
to establish a leadership position in the
market, but they will need to act quickly54.
iKO by PKO BP or PeoPay by Pekao S.A.),
as are third-party payment processors. Global
leaders have introduced Google Wallet,
Amazon Payments, and Apple’s Passbook.
Local players have responded with their own
solutions – sQuid in UK, Beam in Dubai,
mPay or skycash in Poland. Local mobile
carriers are also building their own mobilewallet solutions (eT-Mobile in Slovakia; O2
wallet and EE in UK; ISIS by T&T Mobility,
T-Mobile USA and Verizon Wireless; mBank
MasterCard Orange Cash in Poland and
T-Mobile MyWallet in Poland). Mobile POS
solutions like ANZ’s Fastpay are proliferating,
and some vendors are offering services
that involve appending hardware devices
to smartphones to enhance proximity P2P
and C2B transactions without traditional
POS – like PayPal Here, Square, GoPayment,
ROAMpay.
It’s clearly a busy time in mobile payments
and with so much innovation occurring,
consumers are sure to benefit.
The payments
ecosystem may
require different
industries to
work together
to bring mobile
payments
services to
the market.
However, many
of the key
players…do not
share the same
interest.
A crowded marketplace – and whole lot
of innovation
The payments space has already seen several
‘waves’ of payment innovations. The NFC
technology first widely used in credit cards
was recently adopted on smartphones,
and may now be succeeded by BLE and
location-based solutions which focus on
enhancing proximity payment experience
(e.g. PayPal beacon or Placecast). Banks
are introducing mobile-wallets (in Poland:
32

33. Keynote
Payments case studies
PayPal Beacon – hands free payments
Introduction
Our trends
Big data
Mobile
Cloud
Social
UX
Payments
The internet
of things
Security
Economic
Impact
Implications
About us
In September this year, PayPal introduced
PayPal Beacon – a Bluetooth Low Energy
device allowing merchants with PayPal
compatible POS to connect with customers
using their mobile phones. The device works
across multiple platforms, doesn’t require
internet connectivity, uses little battery power
and claims secure operations for users and
merchants. By using Bluetooth LE, the device
detects when a customer with a PayPal app
is nearby and allows them to start their own
personalized experience. For instance, it can:
• Initiate an interaction with the customer by
displaying a targeted offer,
• Identify and display the customer on POS
so the seller may greet them by name and
access information about their preferences
and purchase history (CRM-like experience),
• Support a proximity payment of up to 50 m
removing the need of to wait in queue
• Conduct a hands-free payment – using just
verbal and visual confirmation is enough
for payments from identified customers,
for POS payments to go through.
Moreover the platform is open for developers
– and could accept other methods of
payments than PayPal55,56.
iKO Plus – A unified standard for Polish
Banks?
After first introducing its own ‘IKO’ payment
application in March 2013, PKO BPO
(Poland’s largest bank) teamed up with
five of it’s other major competitosbanks:
BRE Bank, Bank Zachodni WBK, ING Bank,
Millennium and Alior Bank (while Pekao S.A.,
the second largest, deployed its own solution
– PeoPay) to deliver iKO Plus – a unified
platform supporting all of the partner banks,
and serving around 70% of bank customers
in Poland57. The solution provides customers
with a mobile payment option. All that’s
required is a smartphone app and an internet
connection – integration with local carriers
or NFC is not required. In addition to user
adoption, overall success of mobile payments
depends on degree of merchant support,
which may be impacted by the planned
decrease in the interchange fee charged for
payment cards transaction.
processor Square. Starbucks’ mobile wallet
allows customers to pay in their coffeeshops and collect points – customers receive
benefits, while Starbucks collects loyalty data.
In the meantime, Square provides payment
solutions and its own mobile wallet, allowing
customers to pay using QR code scanning,
credit card payment, or an NFC enabled
mobile pack that can be used appended
to most smartphones and tablets. Square
is to become a payment option in around
7000 Starbucks stores – expanding its
already significant footprint in US mobile
payments52,59,60.
The device
permits hands
free payment
– using verbal
and visual
confirmation
is enough
for payments
from identified
customers.
ISIS – unified platform from mobile
operators
ISIS, is a joint venture between AT&T,
Verizon, and T-Mobile. It provides several
payment related features through
a smartphone app. NFC payments, mobile
wallet and payment cards support for
major issuers. Visa, MasterCard, American
Express and Discover, as well as merchants
loyalty cards are supported. The ISIS pilot
commenced in October 2012 and is
accessible in the USA58.
Starbucks goes into mobile step by step
Not only has Starbucks developed their own
mobile wallet application but it has also
signed a partnership with the third-party
33