The Digital Economy 2016

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INDEPENDENT PUBLICATION BY
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28 / 01 / 2016
THE DIGITAL ECONOMY

03
DIGITAL TECHNOLOGY IS DRIVING

INNOVATION AND THE UK ECONOMY
A dynamic digital economy has become part of our daily lives
06
HACKERS COST
BUSINESS BILLIONS
Cyber security is climbing its way

up the UK boardroom agenda
10
FOLLOWING THE
MONEY IN 2016
Where are investors in digital

going to put their money?
14
MARKETING MUST
MIMIC THE CLICKS
Digital marketing techniques

are countering ad blocking
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THE DIGITAL ECONOMY
03
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RACONTEUR
THE DIGITAL
ECONOMY
DISTRIBUTED IN
RACONTEUR
PUBLISHING MANAGER
Nathan Wilson
PRODUCTION EDITOR
Benjamin Chiou
MANAGING EDITOR
Peter Archer
HEAD OF PRODUCTION
Natalia Rosek
DIGITAL AND SOCIAL MANAGER
Sarah Allidina
DESIGN
Samuele Motta
Grant Chapman
Kellie Jerrard
Digital is fuelling
the UK economy
CONTRIBUTORS
DAVID BENADY
HAZEL DAVIS
GABRIELLA
GRIFFITH
ANTHONY HILTON
Specialist writer on
marketing, advertising and
media, he contributes to
national newspapers and
business publications.
Business journalist and

diary editor at City A.M.,
she has worked for
Management Today and
LondonlovesBusiness.com.
DO YOU KNOW
WHICH TWO?
DIGITAL INNOVATION GROUP
HELPING YOU INNOVATE IN THE DIGITAL MARKETPLACE.

In todays digital marketplace
audiences are fragmenting,
new generations are
exploding, technology
is changing and there
are a multitude of new
communications platforms and
devices that are being used in
different ways.
Every day brands face new challenges

and keeping a brand current and relevant
using established channels is no longer
enough to survive and thrive in the
21st century.
Brands need specialists that can help
them understand and navigate the habits
of these new generations and their use
of technology; specialists that provide
the insight and tools to differentiate and
compete more effectively.
The Digital Innovation Group (DIG) is

structured to make sense and take
advantage of the digital eco-system
and is helping organisations transform
themselves, adapt and compete in the
changing marketplace.
DIG is behind many formative initiatives
in the UK and is now the largest
independent group of digital agencies
in the UK, bringing all digital specialisms
into one offering and providing a holistic
view of the evolving market and how to
compete effectively.
Author, journalist and

broadcaster, he is a former
City editor of The Times
and managing director of
The Evening Standard.
CHRIS JOHNSTON
TOM OMEARA
CHARLES
ORTON-JONES
SAM SHAW
Former business news

editor at The Times, he is
now a freelance journalist
writing on a wide range of
business subjects.
Award-winning journalist,
he was editor-at-large of
LondonlovesBusiness.com
and editor of EuroBusiness.
Digital technology is now central to UK business,

but investment in superfast broadband is in danger
of lagging behind global competitors
Freelance business writer,

she contributes to The
Times, Financial Times,
The Daily Telegraph and
The Guardian.
Editorial director of
analysts Pivotl iQ,
he specialises in
business intelligence
on digital media.
Freelance writer and

editor, she covers a
range of topics including
business, finance,
technology and travel.
EMMA WOOLLACOTT
Specialist technology
writer, she covers legal
and regulatory issues,
contributing to Forbes and
the New Statesman.
Although this publication is funded through advertising and

sponsorship, all editorial is without bias and sponsored features
are clearly labelled. For an upcoming schedule, partnership inquiries or feedback, please call +44 (0)20 3428 5230 or e-mail
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BUSINESS
CULTURE
OVERVIEW
CHRIS JOHNSTON
ith internet access now

as ubiquitous as electricity and running water, and a smartphone
in almost every handbag or pocket,
the digital economy has become part
of our daily lives. It is also providing
jobs for an increasing number of people some 1.4 million in the UK or 7.5
per cent of the workforce.
UK technology companies raised
about 2.5 billion from venture capital investors last year, according to
recent research by CB Insights and
London & Partners, a body that promotes the capital. That was 70 per
cent higher than the figure for 2014
and underlines the rising confidence
among investors that British startups are world-class, although the
total for US companies was almost
ten times greater.
Gerard Grech, chief executive of
TechCity UK, a government-funded body that supports technology
companies, says a number of factors
are responsible. As well as a pool of
highly skilled talent and the right infrastructure, particularly in London
and south-east England, government schemes that offer investors
up to 50 per cent tax relief on capital
gains have played a role.
Mr Grech says his organisation
serves as a feedback loop for government and that digital economy
minister Ed Vaizey recently called
on the industry to identify barriers
they think need to be dismantled.
The Commons Business, Innovation and Skills Select Committee is
also considering what action ministers could take to enhance the UK
FINANCE
HEALTHCARE
LIFESTYLE
digital economy above and beyond

existing initiatives.
As well as startups, such as property
website Zoopla and takeaway delivery services Deliveroo and JustEat,
proving attractive to investors and
consumers alike, the UK is proving
particularly adept at fostering new
companies in the financial technology sector. These include TransferWise, Cubit, Funding Circle and Zopa.
London is fast becoming the fintech capital of the world because
theres a critical mass of expertise in
software development, technology
and digital innovation, as well as
expertise in banking services, says
Mr Grech. That
cross-fertilisation
is all happening
very quickly.
Some companies
have even moved
to the UK to take
advantage of the
fertile startup environment.
One
example is online language learning
platform BuSuu, which was founded by a pair of entrepreneurs from
Liechtenstein and Austria, who relocated the company from Spain to
London, and now boasts 50 million
users globally.
Ning Li had been running an online
business in France, but six years ago
decided to cross the Channel and
became a co-founder of furniture
retailer Made.com. He says the UK
benefits from drawing talent from
both Western and Eastern Europe,
while hiring experienced workers
from further afield is much easier in
Britain than in France.
Mr Li describes the UK as very entrepreneur friendly and attractive

to US venture capital firms, making
London the best place in Europe for
startups to secure funding. The furniture retailer raised $60 million in
mid-2015 to help fund its European
expansion plans and is taking aim at
markets including France, Germany,
Italy and the Netherlands.
Although furniture is a category that is yet to prove as attractive
to online shoppers as travel or entertainment, Mr Li says Made.com
is aimed at thirty-somethings, who
have grown up with
the internet and
are more willing to
buy a sofa or table
online than their
parents.
Nevertheless,
the company has
opened a small
number of showrooms that act as
brand
beacons
where
customers
can view a selection of products and fabric samples.
What will make a difference for a
business like ours is our ability to innovate, he says.
Physical retailers have been
forced to rise to the online challenge and even that bastion of the
high street, John Lewis, now makes
more than a third of its department
store sales online. Charles Knight,
senior lecturer in management at
Edge Hill University, says the digital economy is all about disrupting
existing business models, partly
because online operators have
lower overheads than their bricksand-mortar rivals.
Despite the UK
being a global leader
in e-commerce, it
could seriously fall
behind because we
are not spending
enough on
infrastructure
SUSTAINABILITY
TECHNOLOGY
INFOGRAPHICS
Despite the UK being a global leader

in e-commerce, he warns that it could
seriously fall behind in the digital
economy race because we are not
spending enough on infrastructure.
Businesses are hungry for superfast
broadband, but once you get outside
the big cities, its hit-and-miss whether your connectivity is fast enough.
How are you going to run a digital
economy business if youre in the slow
lane? Dr Knight asks.
Quick, reliable internet access not
only allows businesses to offer a
wider range of services to customers,
but also can cut costs by using cloudbased accounting applications, for
example. If you havent got superfast broadband for your business,
that is difficult to do, he says.
The clear business benefits mean
the government should be investing more in the digital economy,
according to Dr Knight. This call
is echoed by Mr Grech, who says
ministers must ensure initiatives
such as the Seed Enterprise Investment Scheme continue and that UK
companies can still recruit the best
talent from outside the EU.
In addition, he says the government
has a role to play in helping small
and medium-sized companies bid
for government contracts, a goal the
G-Cloud procurement platform has
gone some way to helping achieve.
TechCity UK is increasingly working with existing companies as well
as startups to help them provide
the online services customers now
expect as a matter of course. As Mr
Grech concludes: They have little
choice but to make that change.
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THE DIGITAL ECONOMY
05
COMMERCIAL FEATURE
Now is the time to exploit the full potential of

automation technology and redefine the role
of marketing
Average B2B firm
ESTIMATED %
OF SATISFIED
CUSTOMERS
ESTIMATED %
OF REVENUE FROM
EXISTING CUSTOMERS
% OF MARKETING
BUDGET ALLOCATED
TO RETENTION/
EXPANSION
arketing is a business function

that has been transformed
by automation technology,
impacting demand generation in a
way that has reaped huge financial
benefits for organisations. But as ActOn Software, a leader in marketing
automation, points out, theres still
much to do.
It is an issue that Act-Ons chief
executive Andrew MacMillan is
passionate about. He talks about a
huge misalignment of marketing effort
within the majority of business-tobusiness or B2B companies, with too
much focus on customer acquisition
and not enough on retention. As
a result, organisations and their
marketing functions are missing a trick.
Traditionally,
the
marketing
function within most B2B companies
is focused on demand generation,
says Mr MacMillan. This involves
finding new prospects, assessing their
suitability and fit as a prospective
client, scoring their interest, and then
handing the next stage of the client
acquisition and retention process to
the sales function.
While the adoption of marketing
automation in the last few years
has speeded up and effectively
streamlined the demand-creation
process, its use has been primarily just
for that acquisition marketing.
Now the widespread adoption of
marketing automation is reaching
a tipping point. As the use of the
technology becomes a majority
strategy, the early adopters are looking
for ways to retain a competitive edge.
And it is the forward-thinking chief
marketing officers (CMOs) who are
recognising the broader applications for
their marketing automation platforms.
This comes at a time when greater
demands are being placed on the
CMO, in terms of engaging customers
with the brand, yet as Mr MacMillan
says, no one is actually accountable
for the customer life cycle.
We can see huge opportunities for
the CMO to step into this role, he says.
The use of marketing automation
has just scratched the surface; the
technology can also provide the
structural framework for monitoring,
measuring and engaging with

customers across the life cycle. The
same techniques used for demand
generation can be used to score and
nurture other business relationships,
including influencers and end-users.
As more businesses turn to a
subscription-based model, more of
their revenue eventually starts coming
from existing customers than from
signing new prospects. As a result, the
extended use of marketing automation
for customer retention will grow.
We are seeing more and more
companies apply their marketing
automation to the renewal process.
By incorporating predictive analytics
they can apply a much more
prescriptive approach to marketing
across the entire customer life cycle,
explains Mr MacMillan. This allows
organisations to manage and trigger
communications based on life-cycle
stage or customer behaviours. They
can identify who the brand advocates
are among their customers, taking
marketing intelligence to a new level.
A study into the customer
engagement life cycle, carried out
by Act-On Software and Gleanster
Research, involved a survey of
marketing professionals. It found that
top-performing marketing teams
made better use of certain tactics
than average companies. For example,
top performers were twice as likely
as all other companies to trigger
personalised messages by stage, based
on prospect behaviour, demonstrating
a clear understanding of the customer
life cycle. Top performers also
leveraged data using technologies
that include marketing automation.
The way to grow a business is
to increase the number of quality
prospects, says Mr MacMillan. It is a
major driver of potential revenue. With
marketing automation they can also
retain and engage those customers.
Some marketing professionals
may have concerns that moving
from more traditional manual
marketing interactions to automated
processes could undermine the
customer relationship. In fact, it can
bring a more personal touch to the
customer relationship, moving beyond
68%
30%
70%
90%
50%
50%
Know it all and win business

Smart technology is now extracting greater meaning from more connected information sources with
the potential of benefiting society and the bottom line
DATA
SAM SHAW
Acquisition
Retention
Acquisition
Retention
52%
Acquisition
44%
Retention/
expansion
% OF TIME SPENT
COMMUNICATING
WITH EXISTING
CUSTOMERS
TOP 3 METRICS
FOR MEASURING
ACQUISITION EFFORTS
Top performers
Retention/
expansion
Acquisition
48%
34%
Number of leads
Response rates
Number of inquiries
Sales accepted leads
Response rates
Sales qualified leads
alking to a friend about

this article, she asked
me what information of
everything meant. I explained that it encompassed, among
other things, the automatic sharing
of information between connected
devices, big data, the internet of
things and the cloud.
Oh, Ive heard of the cloud, she tells
me. But I dont really understand it.
It took me to a scene in that mildly
amusing rom-com Sex Tape when
Jason Segels husband screams at
Cameron Diazs wife after a misplaced video file finds itself unfortunately lost in the ether: Nobody understands the cloud! Its a mystery!
Perhaps hes right. But maybe
we should understand the cloud.
With the global cloud computing
markets estimated worth of more
than $120 billion with a compound
annual growth rate of 26.2 per cent
a year, according to research firm
MarketsandMarkets,
businesses
are turning their backs on their
erstwhile long-term server con-
tracts and embracing the benefits

of cloud-based solutions.
Its pay-as-you-go model helps with
cash flow, inverts the cost-per-number-of-users relationship and offers
all-important agility in todays less
certain working environment.
Listed as one of its Top 10 Strategic
Technology Trends for 2016, Gartner
defines the concept of information of
everything as using smart machines
to extract greater meaning from a
rapidly expanding set of sources,
networks, algorithms and devices.
Barely recognised as an algorithm
for being so integral to the primary
function, Amazons recommendations service grows its sales by 10 to
15 per cent.
Gartner senior analyst Steve Prentice says: Perhaps less famous, but
equally valuable, would be the asset
optimisation algorithms used for
predictive maintenance in industrial equipment, variable-pricing
algorithms in the airline industry
or customer-specific offers as part of
retail loyalty programmes.
The pace of growth is such that 90
per cent of all data in existence today has been created in the past two
TOP 3 METRICS
FOR MEASURING
RETENTION EFFORTS
Word of mouth
Inquiries
Inquiries
Anecdotal evidence
Satisfaction surveys
Facebooks server
farm in Oregon
WHERE WILL BIG DATA HAVE THE BIGGEST IMPACT ON YOUR ORGANISATION
IN THE NEXT FIVE YEARS?
GLOBAL SURVEY OF FIRMS THAT HAD COMPLETED

AT LEAST ONE BIG DATA IMPLEMENTATION
Word of mouth
Getty Images
KEEPING
CUSTOMERS
AUTOMATICALLY
POST-SALES IS THE NEW SALES
TOP THREE
IMPACT
TOP IMPACT
Customer
relationships
Redefining product
development
Changing the way we
organise operations
Making the business
more data-focused
Source: Rethinking the Role of Marketing, Gleanster/Act-On, Q1 2015
Optimising
the supply chain
conventional market segmentation

and engaging customers on an
individual basis.
Mr MacMillan says: We are seeing
companies recognising they can still
create a very personalised customer
engagement experience, but in an
automated way. The way to do this is
by using data and rule sets to ensure
every single prospect and customer
feels they are constantly being
dealt with as an individual and in a
We are seeing companies

recognising they can still create
a very personalised customer
engagement experience, but in an
automated way
personalised way. This is where people

start to feel engaged with a brand.
Does this mean that marketing
professionals need to acquire a
whole new set of skills to be able to
use marketing automation in a more
sophisticated way? Or will there be a
need to bring in technology experts to
run the system for them?
It means neither, according to Mr
MacMillan. We believe that you can
have powerful technology that is
easy to use. With our own products,
you do not need to have a database
admin or specialist IT expertise. They
are designed to be simple to use by
marketing professionals. Basically,
the scoring processes within the
automation technology takes the raw
data and boils it down into something
that you can use, he says.
The business world is becoming
increasingly customer centric, with
a growing demand for companies

to treat the customer life cycle
of engagement as a continuing,
seamless process rather than a series
of stages to be managed separately
by different functions within the
business. Marketing automation
technology is the key to delivering
a more holistic management of the
customer experience throughout the
buyers journey.
We are seeing more and more
companies globally rolling out
marketing automation, and it is
happening very quickly, says Mr
MacMillan. The CMOs within the topperforming companies are becoming
the new managers of the customer
relationship. And using marketing
automation to focus on and manage
the entire customer life cycle leads to
higher levels of customer satisfaction
and engagement with the brand.
Fundamentally
changing the way
we do business
0%
Source:
Accenture 2014
10%
20%
30%
40%
50%
60%
70%
years, according to IBM. The technology behemoth categorises big

data into four Vs volume, variety,
velocity and veracity.
Each can be illustrated with some
rather fantastical-sounding examples: 2.5 quintillion bytes of data are
created every day; 30 billion pieces of
content are shared on Facebook every
month; the New York Stock Exchange
captures a terabyte of trade information during every trading session; and
poor data quality costs the US economy $3.1 trillion every year.
But its important not to be blinded by figures, says Andy Lawson, UK
managing director at cloud-based
customer relationship management
platform Salesforce.com.
The key thing for businesses to remember about the internet of things
and the big data it creates as a result
is that data can effectively power
greater customer success, he says.
Mr Lawson reminds business
owners that behind every one of
the worlds six billion smartphones
there is a customer, or potential customer, waiting to be understood.
The vast majority of businesses
compete almost entirely on customer
experience and to perfect that experience they need to be able to take advantage of the customer insight provided by the connected objects that
surround us. Our hyper-connected
world has become the source of a vast
FORECAST CONNECTED DEVICES, 2014-2020
INSTALLED BASE OF INTERNET OF THINGS UNITS BY CATEGORY, MILLIONS OF UNITS
Source: Gartner 2015
14k
13,509
20,797
20k
12k
10k
15k
8k
2,277
3,023
4,024
2,880
815
623
2014
2015
2016
Consumer
2020
2014
2015
1,092
2016
Business: cross-industry
1,065
898
2020
10k
6k
4,408
2014
2015
1,276
2016
4k
3,807
4,902
6,392
5k
2k
2020
Business: vertical-specific
2014
2015
2016
GRAND TOTAL
2020
amount of valuable data and were

only just waking up to the potential
this data represents, he says.
Stylists at mens online personal shopping service The Chapar
cloud-capture customer information from their favourite brand of
jeans to their occupation, inviting rapport while respecting their
healthy fear of the high street.
Instead of having to pound the pavement or even stress over an online selection process, a trunk arrives full of
Behind every one

of the worlds six
billion smartphones
there is a customer,
or potential
customer, waiting
to be understood
recommended garments, which are
tailored according to their preferences with each subsequent order.
Since the firm was founded in 2012,
trunk retention rate has increased by
25 per cent, its customer base doubles
every three months and revenue has
grown 650 per cent over the past year.
Its easy to assume that this digital overhaul falls largely at the feet
of denim-clad Silicon Valley types,
brainstorming over a pool table.
While it undoubtedly does, Highways England is undergoing a transformation of its own and its somewhat more down to Earth.
Cast your mind back to 2007. The
Environment Agency says more
than 55,000 homes and businesses
were flooded, with no early warning
system for 35,000 of them. Insured
losses have been estimated at nearly
3 billion with the government forecasting the cost of total flood damage could rise to 27 billion by 2080,
compounded by recent torrential
rain and yet more flooding.
Inspired by the Smart Cities initiative

led by Innovate UK, Lancashire-based
software developer InTouch is rolling
out an intelligent gully data system
to tackle the serious blockage problem
threatening our roads.
Currently utilised in one million
gullies around the country, the firm
has developed a smart water flood
prediction system, harnessing data
from a sensor network around particular regions.
Taking weather input from the Met
Office, tree listings to indicate expected leaf litter and traffic volumes, the
data is processed by algorithm software resulting in practical information such as anticipating levels of silt
blockage and the ability to treat accordingly without wasting resources.
Alan Williams, head of business
solutions at InTouch, says: The
Victorian drainage system operating across much of the UK simply
wasnt designed to cope with the
levels of rain we see today. If we
could have predicted the effect of
the floods on the road systems, the
councils would have been much better equipped to tackle the problem
of the blocked gullies.
Regardless of sector, those at the
forefront with their digital strategy
will be on average 26 per cent more
profitable than their peers, according to a Capgemini paper, entitled
The Digital Advantage: How digital
leaders outperform their peers in
every industry, which says the insurance industry should be leading the
digital revolution.
James Blake, co-founder and chief
executive of Hello Soda, an unstructured data analysis platform utilised
by the lending, gaming, recruitment
and insurance sectors, says: Traditional data has not really changed
since the 1970s. Since then weve had
the Facebook and Google revolutions,
and there is a lot more information
available on individuals.
Claiming a 62 per cent average uplift
on previously thin credit files, Hello Soda helps businesses understand
their customers needs through analysing their digital footprint.
We specialise in text analytics, so
understanding the context of conversations. We have an employment
indicator, which will recognise the
number of times someone talks
about going to work, he says.
Its hard to teach a machine to recognise whether youre talking about
going to work or whether it was hard
work at the gym last night. But through
psycholinguistics, natural language
processing and Bayesian [probabilistic] belief networks, we believe we are
able to make those distinctions.
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THE DIGITAL ECONOMY
28 / 01 / 2016
Shutterstock
06
PERCENTAGE OF IT BUDGET SPENT

ON CYBER SECURITY BY SECTOR
RACONTEUR
2015
RACONTEUR
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28 / 01 / 2016
THE DIGITAL ECONOMY
07
COMMERCIAL FEATURE
2014
THE NEW DIGITAL BUSINESS HEROES
Telecommunications
Services
Technology
Carphone Warehouse reported in

August 2015 that
up to 2.4 million
customer details
had been accessed
by hackers
Retail and
distribution
The digital transformation of business is happening at a phenomenal pace and company executives must be prepared to seize
Government
the opportunities this change brings or risk being left behind. The good news is technology consultancy Devoteam can help
Financial services
make that digital transformation happen
Property and
construction
Health
Travel, leisure and
entertainment
Utilities, energy
and mining
Education
Organised hackers are

costing the UK billions
0%
Cyber security is climbing its way up the boardroom agenda as UK

firms face determined attacks from organised hackers
CYBER CRIME
ANTHONY HILTON
The UK boasts one of the worlds

most dynamic technology sectors.
The cluster of tech startups in central London has created so many
hundreds of businesses and tens
of thousands of jobs in the last five
years that venture capitalists from
Silicon Valley come here looking
for ideas to back. What economist
Doug McWilliams called the flat
white economy, as a reference to
the number of businesses which appeared have started life in the coffee
shops around Old Street, has made
London one of the worlds most economically successful cities.
But there is a downside. Among all
the worlds developed economies,
no country suffers as many cyber
attacks. We are the computer crime
capital of the world, from the victims standpoint if not from that of
the perpetrators.
According to a survey published
by Trend Micro, a software security
company based in Marlow, Buckinghamshire, the estimated average

number of targeted cyber attacks
reported by UK organisations is almost 40 per cent higher than the
European average coming in at 8.6
attacks per business against a European average of 6.2, with the last attack on average having taken place
in the previous 80 days in Britain
and 87 days in the rest of Europe.
And the threat is increasing. The
firms Europe-wide research questioned 500 senior IT decision-makers from organisations with more
than 2,500 employees and found
two-thirds believe the attacks have
increased year by year and that further increases are almost inevitable.
They think the increase in the UK last
year was more than 60 per cent. And a
more sinister trend is that the attacks
are becoming much more professional and organised. Career criminals are
taking over from the amateur hacker.
The sliver of good news in this is
that defences in the UK seem to be
more developed than in many countries. This means not only that the
BARRIERS TO EFFECTIVE CYBER DEFENCE
SURVEY OF NORTH AMERICAN AND EUROPEAN IT SECURITY DECISION-MAKERS

Low security awareness among employees
3.22
Lack of budget
3.15
Too much data to analyse
3.10
Lack of skilled personnel
3.05
Lack of management support/awareness
3.01
Poor integration/interoperability between security solutions
2.98
Inability to justify investment
2.90
Lack of contextual information from security tools
2.89
Scale of one to five, with five being highest
Source: Blue Coat Systems 2015
attacks are proportionately less likely to succeed with less data stolen,
but also the cost is lower. According
to the Trend Micro survey, an attack here costs the average business
172,000 against 243,000 in the
rest of Europe.
Bear in mind, however, that survey
evidence is not the same as statistics
and to many experts these figures
seem far too low. Unfortunately, however, in contrast to the United States,
there is no legal requirement to report
security breaches in the UK. Consequently, it is believed many go unreported as companies do not wish to
advertise their weakness and the true
scale of the problem is unknown.
Nevertheless, it is pretty big. The
UK government publishes an annual
Information Security Breaches Survey put together for it by consultants
PwC in association with Infosecurity
Europe. The 2015 version said that
90 per cent of large companies and
74 per cent of small businesses in the
UK had a security breach last year.
The corresponding figures for 2014
were 81 per cent and 60 per cent.
This survey also reports a sharp increase in the resultant costs. It says:
For companies employing over 500
people, the starting point for breach
costs, which includes elements such as
business disruption, lost sales, recovery
of assets, and fines and compensation,
now starts at 1.46 million as against
just 600,000 the previous year.
It could be much more with the
top of the cost range for big companies reaching 3.14 million. Remember too that this is the cost of
just one breach but, according to
the survey, a company may experience several during the year. Indeed the median number for large
organisations last year was 14 while
5%
10%
15%
20%
25%
30%
Source: Department for Business, Innovation & Skills 2015
172 k
is lost by a
UK business
on average in
the event of a
cyber attack
243k
is lost by
European
businesses
Source:
Trend Micro 2015
smaller firms, where the costs

range from 75,000 to 311,000,
were hit on average four times.
It needs to be emphasised, however, that not all security breaches are
a result of criminal activity. Perhaps
as many as half are blamed by firms
on human error by employees and
contractors, either inadvertently or
because they failed to follow established security procedures.
But crime still imposes a huge cost.
The Centre for Economic and Business Research (Cebr), in its June 2015
report The Business and Economic
Consequences
of
Inadequate Cyber
Security, said cyber attacks cost UK
firms 34 billion a
year in revenue losses and subsequent
increased IT spending. This splits between 18 billion of
lost revenue and 16
billion in increased
expenditure.
Again, however, these figures can
be considered an under-estimate because they dont take account of the
share price decline, which can result
when news of a successful attack
becomes public, or the reputational
damage that may last for years and
is notoriously hard to quantify.
Share price damage is often repaired in a few days, but again this
cannot be assumed. In a couple of the
worst cases in the United States, the
share price of AOL was still down by
a quarter one month after it was attacked while that of Heartland Payment Systems was down by a half.
Closer to home, the shares of UK mobile and internet supplier TalkTalk
were trading at 290p on October 20
just before the company announced
what seemed initially to be a massive
theft of customer data. They were languishing at 217p at the end of the year.
In round numbers that is a loss of
750 million of market capitalisation
though the company said the direct
costs of the attack were likely to be
between 30 million and 35 million.
Another cost, which is impossible to
quantify, is the effect of cyber security
on the development of the wider business. According to the Cebr report, 70
per cent of chief technology officers
polled believe their current cyber security policies inhibit innovation to

some extent, a finding which implies
risk management policies need to be
reviewed in this context.
Nor is it easy to quantify the cost of
a souring of business relationships.
The US arm of T-Mobile reacted
very negatively when Experian announced it had been hacked and had
lost personal data on potential new
customers of T-Mobile, which it had
put up for credit checks.
Similarly annoyed were the customers of Moonfruit. It acts as host
for a lot of smaller
company websites.
When it was attacked just before
Christmas
these
businesses lost their
websites, albeit only
briefly, in what was
for them the busiest
period of the year.
Some companies
neglect their cyber
security defences
because they say they have nothing worth stealing. However, the
Cebr report says that in 70 per cent
of cases cyber attackers are not interested in the primary victim, but
their main motive is to use the extracted information to generate the
real attack.
And while the majority agree the
most determined criminals will
probably penetrate any system in
the end, the same report says that
a few simple procedures, which are
in effect good housekeeping, can
greatly enhance effective defence.
Cebr says the top five controls that
help prevent cyber breaches are
web-application testing, two factor authentication, verifying the
need for internet-facing devices
patching or isolating web services, and logging and verifying outbound traffic.
That said, cyber security clearly needs to move up the list of
boardroom priorities. In finance
this has already happened with a
recent banking study from the Cyber Security Forum Initiative listing it as the number-two concern.
It seems only a matter of time before the commercial world comes
to the same conclusion.
A few simple
procedures, which
are in effect good
housekeeping, can
greatly enhance
effective defence
evoteam, which describes

its
people
as
digital
transformakers, is using the
companys wealth of technology skills
and expertise, and the experience
gained from its own transformation,
to help some of the biggest brands
become digitally enabled.
The company was launched 20
years ago in France, a time when
the countrys telecommunications
industry was being deregulated. It
was founded by two brothers who
recognised that the increasing
complexity of technology systems
resulting
from
deregulation
would create a huge demand
from the larger telcos for IT
consulting services.
Today, under the leadership
of its co-founders, now joint
chief executives, Devoteam has
broadened its IT service portfolio,
adopted cutting-edge technologies
and applied its expertise across
industry, and with average growth
of 15 per cent a year, has 3,600
professionals working with clients
in 20 markets across Europe.
Everything is going digital; there
is no escaping it, says Devoteam
UKs country manager Derek
Nutley. Every business needs to
be connected, agile and responsive,
in real time and across mobile
platforms. Weve gone through our
own transformation and rebranding
process to become a very modern
organisation that is in step with the

latest developments in technology,
and we are helping other companies
to do the same.
In
offering
their
business
transformation services, Devoteam
realises that companies face some real
challenges. Not only do organisations
want to make a bigger impact with less
spend, they also want to commit to a
digital promise in which everything is
done in a mobile way.
This impacts all companies, from
the smallest and newest, to the
largest and longest established, says
Mr Nutley. We are working with
older organisations, helping them to
become more flexible and embrace
new technologies, as well as with
younger, high-growth businesses
that need to achieve a balance of
flexibility and stability in order to
present a professional image and
maintain a competitive edge.
The idea of change being driven
by new technology is a popular
misconception. Change is being
driven by the people who are
using the technology customers,
competitors, employees and
this has led to a paradigm shift
for the IT function, moving the
chief technology officer and chief
information officer roles into a
more strategic position.
Mr Nutley says: Traditionally
the chief technology officers and
their teams were responsible for
managing the expectations of

technology within the organisation.
Today their responsibilities have
changed because companies now
expect their IT champions to lead
business transformation as well.
Another key driver of digital
transformation
comes
from
within the organisation, from the
people who work there and who
increasingly expect a digitally
equipped working environment.
People nowadays want to be
able to do their jobs using the
same digital technology they use
when they are at home, says Mr
Nutley. They want smartphone
technology, not outdated computer
systems, and this is impacting on
a companys ability to attract and
retain top talent.
In a rapidly changing business
environment, where everything from
consumer buying habits to competitor
sales strategies increasingly hinges
on digital technology, businesses
are under pressure to stay ahead of
new developments.
If companies are to achieve
sustainable growth, they need to
understand how to harness the
power of social, mobile, cloud
and big data for their business,
and where to source the tools and
technological expertise they need
to overcome the challenges and
reap the rewards.
To help companies reach their
transformational
objectives,
Devoteams digital transformakers
adopt a strategy that focuses
simultaneously on three pillars
business, IT and people.
This entails the implementation of
innovation processes within the business
model, the creation of a flawless
technology platform and the activation
of the organisations collective
intelligence, putting employees at
the heart of the transformation.
The result has a profound impact
on the organisation at all levels.
Efficiencies can be made across
many areas of the business, from
operations and administration to
sales and logistics, while workforce
productivity also receives a boost,
as greater automation effectively
frees up peoples time. In addition,
the mobility and flexibility facilitated
by digital technologies allows
employees to be at their most
creative and productive at a time

and place that works best for them.
Ultimately, a business that is
digitally enabled and employs digital
workers will be better equipped
to deal with the challenges that lie
ahead. Those that opt out risk being
destroyed by the new generation of
disruptive technology entrepreneurs
who are constantly redrawing the
battle lines of business.
Look at the disruptors, the
Ubers and Airbnbs of this world,
former small players that have used
technology to shake up traditional
business models. Organisations
that thought they were safe, and
perhaps became complacent, are
now seeing their industries being
turned upside down by these new
technologies, says Mr Nutley.
The message from Devoteam is
that in order to succeed businesses
have to be ahead of the game. And as
a company at the leading edge of the
digital revolution, they believe it is a
journey they are best placed to help
others make. They use disruptive
technology, such as Google,
ServiceNow and AppDynamics, as
building blocks for their expertise to
solve business challenges.
Mr Nutley concludes: With
success these days measured in
ease of adoption and time to value,
we focus on business outcomes not
on IT outputs. This has resulted in
Derek Nutley, UK
country manager
Devoteam
A business that is digitally enabled

and employs digital workers will be
better equipped to deal with the
challenges that lie ahead
300 Google projects and 100 new

ServiceNow deployments across
a full range of verticals in the UK,
elsewhere in Europe, the Middle
East and Africa in the last 21 months.
We see companies with visionary
boards that welcome change and
know how to do it, those that want
to do it but need help in working
out how to do things in a different
way, and boards that worry about
change upsetting the business and
risk inertia as a result.
Sometimes you need to let IT take
the lead. For too long it has been the
whipping boy of the boardroom. In
companies that have recognised
the need to embrace the new digital
age and drive through the necessary
changes to the way they do business,
IT has the opportunity to become
the business hero.
For more information contact
roger.okelly@devoteam.com
07985 393739
www.devoteam.com
08
raconteur.net
THE DIGITAL ECONOMY
28 / 01 / 2016
RACONTEUR
RACONTEUR
raconteur.net
28 / 01 / 2016
THE DIGITAL ECONOMY
09
COMMERCIAL FEATURE
Put customers at centre of digi tal strategy

Adidas
For next-generation customer experience to maintain and increase sales, businesses must keep pace with technology and the expectations of a digital generation
CUSTOMER EXPERIENCE
HAZEL DAVIS
ince the telephone was invented in the late-1800s,

customer service has been
evolving and in 2016 the
customer has never been so involved in the buying process.
Research from digital experience
company Acquia shows that wearable technology and mobile devices, for instance, represent online
commerces greatest opportunity
and challenge.
Experts say this is why businesses
should be putting customer experience at the heart of their digital
strategies and constantly striving
to improve it. Not all businesses are
catching on so fast though.
Ronan Gruenbaum from Hult International Business School says:
Gartners Hype Cycle shows how
the point at which adoption and implementation of technologies by the
general public and organisations
lags behind the hype surrounding
the technology. That time-lag could
be months, but in the case of some
technologies it could be years, virtual worlds and augmented reality
being a case in point.
It is only now, ten to fifteen years
after people started talking about the
potential of virtual worlds and multi-user virtual environments, such
as Second Life, that the hardware
is finally catching up through immersive 3D viewers like Oculus Rift
and the kind of non-tactile interface
provided by the type of technology
running the Microsoft Kinnect gaming console, in the same way that 4G
connectivity and the speed of mobile
phones allows for augmented reality
to become a viable proposition.
Wearables, Mr Gruenbaum says,

have gone through a much shorter
hype cycle, with consumer-oriented
products such as the Apple, Samsung
or Motorola watches, being desirable
gadgets selling in large numbers.
There are large segments of the population, who might be a core target
audience for a particular organisation
for whom these new technologies are
used on a daily basis. Organisations
can only know this by understanding
their customers through research,
communication and insight, he says.
People are becoming more impatient as the variety of information
they have available on their mobile
devices allows them to be more connected, share their content more
easily and find information quicker.
A result of this, any organisation
which puts obstacles in the way of
allowing a customer to complete
their desired task in the moment is
BARRIERS TO EFFECTIVE CYBER DEFENCE BY LARGE FIRMS

AIMING TO IMPROVE CUSTOMER EXPERIENCE
DIGITAL CHANNELS ARE KEY TO CUSTOMER EXPERIENCE

Creating a dedicated user/
customer experience group
Using communities and
other types of social
Improving the phone
self-service customer
experience
Improving the store/branch
customer experience
Adding or improving mobile
customer experiences
Improving the experience
of interacting with a call
centre agent
Improving cross-channel
Improving the online
customer experience
Source: Forrester 2015
0%
10%
20%
30%
40%
50%
60%
70%
in danger of losing that customer to

a competitor, says Mr Gruenbaum.
Jamie Merrick, head of industry
insights at software tech company
Demandware, says millennial shoppers are using the high street as a
giant showroom. He cites the rise in
technologies such as magic mirrors,
which allow shoppers to compare
outfits side by side and visualise different options without even having
to leave the changing room. These
options are communicated to associates who can access stock.
High street fashion retailers are
relying on mirror technology to
transform the changing room experience, says Mr Merrick. Companies,
such as Italian clothing firm OVS, for
example, have embraced the magic
fitting room by implementing large
touch-screen mirror displays and
QR codes so that customers can snap
selfies of their outfit from different
angles on their phones.
Shoppers can also send a message to the sales associates iPad
for them to view in-store availability and bring different products to
the customer. Magic mirrors and
other innovations, such as adidass
interactive window, offer shoppers
a dynamic and bespoke experience
to the in-store retail environment,
says Mr Merrick, Integrating the latest technology with the traditional
store brings an added dimension to
the shopping experience, enabling it
to compete with online. The result is
engagement with consumers in ways
that are both familiar and exciting.
This year looks set to be the year
that virtual and augmented reality
really hit the mainstream, particularly as technologies, such as the
Microsoft HoloLens, gain traction
with their ability to layer interactive
3D holograms on top of a customers
physical surroundings.
Stuart Dorman, head of apps at
contact centre technology specialist Sabio, says: Virtual reality will
adidass interactive window in

Nuremberg
allow consumers to experience a 3D

reproduction of a physical store in
their home, opening up significant
retail opportunities. Augmented reality offers real potential in sectors
such as utilities and service management by allowing skilled operatives to guide customers through
complex procedures, demonstrate
products and visualise new places
and experiences.
The Acquia research also found
that wearables are now a crucial
buying platform,
with owners using them for the
pre-purchase (66
per cent), purchase
(58 per cent) and
post-purchase (58
per cent) stages.
However, wearables represent their
own problems and
the research found
that almost half of
consumers become
irritated with them
nearly three times a
week, says Martyn Eley, Europe, Middle East and Africa vice president at
Acquia, which works with customers
including the BBC, the Brit Awards,
Lush, LV=, Timex and Warner Music.
He says: Consumers want to embrace new technologies, with 77 per
cent of wearable device owners putting up with the frustrations that
come with early adopter use, but
businesses cant keep up. Brands
should focus on delivering consistent and relevant content at multi-
ple points in the customer journey

through an ever-increasing number
of channels. The research shows
desktops are still the go-to device for
buying online and brands that neglect this channel do so at their peril.
Brands are battling against technology itself to deliver much-needed digital-buying experiences via
wearable devices. Organisations
must focus on developing seamless
customer interactions across all
channels, ensuring customers can
pick up the buying
process on another
device if needs be.
Robin
Collyer,
marketing and decisioning specialist at
software company
Pegasystems, says
digital technology
has raised the bar
for every customer
service experience
to be as good as
face-to-face interaction with a member
of staff who really
knows the individual customer.
The balance of power has shifted
towards the customer, but thats not
to say the customer is king, he says. In
fact: Artificial intelligence [AI] is key,
in the form of a decisioning brain that
uses real-time predictive and adaptive models to determine the nextbest action for an individual.
If I have a customer service issue, I expect the organisation to
weigh up their relationship with
me, consider my value to them and
Integrating the latest

technology with
the traditional store
brings an added
dimension to the
shopping experience,
enabling it to
compete with online
ACTIONS LARGE FIRMS ARE TAKING TO ADDRESS DIGITAL DISRUPTION
CUSTOMER EXPERIENCE IS A TOP DIGITAL INITIATIVE
51%
Clearly define digital

ownership, funding,
and operations
49%
Create a digital-oriented
collaboration/joint
venture with new or
existing business
partners
52%
Establish new digital

governance and
transformation
management
56%
Assess the impact

of digital as it relates
to customer experience
Source: Forrester 2015
41%
Transform IT
systems to make
them more agile for
the digital world
37%
Create a skunkworks or group

separate from the
main company to
experiment with
digital initiatives
23%
Hire a C-level
executive who is
focused on digital
24%
Create smarter
and more digitally
aware connected
products or services
do the right thing. Gone are the

days of product marketers calling
the shots on segments of customers to be targeted like a military
campaign with out-of-context offers, says Mr Collyer.
Those product marketers now
design intelligent decision strategies that ensure the right action
is taken with the right customer at the right time in the right
channel. Ultimately, this is much
more effective, efficient and elegant for the organisation, while
also being much better for the customers experience.
AI can and should be used to drive

efficiency, says Jo Causon, chief executive of the Institute of Customer Service. She concludes: Used intelligently it can speed up things so customers
no longer have to spend as much time
going through processes, instead
using the time saved to speak to real
people. In other words, AI can take the
emotion out of processes to put emotional intelligence at the heart of the
customer-organisation relationship.
raconteur.net
CASE STUDY: JOHNNIE WALKER WHISKY

The Johnnie Walker Blue Label
bottle, launched last year, uses
thin, electronic sensors that
can tell if the bottle has been
opened and where it is in the
supply chain.
Diageo worked with app
builder and cloud platform
provider Selinko, packaging
company Amcor, NFC (nearfield communication) antennae
manufacturer Inside Secure
and creative agency RPM to
produce the bottle, which
allows shoppers to tap and
interact with it on the shelf.
The customer has access to a
unique app that enriches their
experience of the drink with
content and access to exclusive
tastings and dining experiences.
James Poletti, head of digital strategy at RPM, says: Consumers tap
their bottle to unlock regular unique real-world experiences and, in this
way, the bottle brings a service to the previously inaccessible use phase.
For the marketer, this opens up opportunities to influence frequency,
encourage consumers to share their experiences and even be on
hand when its time to replenish the product. Most importantly, it
deepens the bond between customer and brand by really enriching
the value created in that exchange.
In fast-moving consumer goods, the marketer has traditionally
been unable to influence the customer experience much during
the ongoing-use phase, beyond simple on-pack promotional
marketing. But technologies are rapidly changing that and bringing
to life the interactions we have with products, moving us from a
communications or promotional paradigm to a service or experience
paradigm, says Mr Poletti.
Diageo is pioneering the smart bottle through its innovation
programme Diageo Technology Ventures, which is collaborating with
a range of emerging technology companies. Diageos innovation
marketing manager Sam Maguire says: Connected objects and
the internet of things are the future. As people become more tech
savvy globally, our smartphones are now the primary source of
information and will become increasingly important as consumers
are fast changing their buying habits, and the way they discover and
experience brands.
KEEPING
CUSTOMERS HAPPY
Digital technology is incredibly flexible, but sometimes that very
flexibility can be its downfall as firms struggle to create seamless
he very best digital strategies are

stripping away complexity and
promoting efficiency in order to
make everything digital user-centric.
Where this manifests itself most
noticeably is the contact centre.
Making an insurance claim has
historically been both time consuming
and complicated, with many parties
involved and multiple steps to follow.
By contrast, todays seamless digital
customer experiences combine
the unique advantages each digital
channel provides.
Combining smartphone, voice
and video digital channels enables
customers to submit pictures
during their insurance claim call. For
some home insurance claims this
has meant a reduction in the claim
cycle from weeks to hours, with
an associated boost in customer
satisfaction. For the insurance firms
this means lower costs as assessors
are able to review many more cases,
while reducing fraud, by using the
customers smartphone to tag
where pictures were taken.
According to recent research
by Avaya and BT, 73 per cent of
UK consumers say they are more
likely to buy more from companies
who make it easier to do business
with them. This is a 30 per cent
increase in UK consumers saying
convenience is more important than
price, compared with two years ago.
This level of customer service
As consumers, we really
do want it all... Our job
is to help businesses
develop digital
strategies to deliver
customer service at
consumer speed
isnt unique to insurance. Imagine
if your broadband provider called
to arrange installation of a new
set-top box even before you knew
your old one was faulty or calling
your bank when you experience a
problem online and, rather than
being directed to the next available

agent, you actually get routed to
your local branch.
For anybody whos ever been
on hold for hours, this type of
concierge-level customer service
must seem like fantasy. In fact,
both are real-life customer service
scenarios. One is an European
broadband provider, the other a
progressive UK bank, both clients
of Avaya, the only vendor to be
consistently positioned as a leader
in the Gartner Magic Quadrant for
Contact Center Infrastructure for
15 years.
However, keeping customers
happy is a whole lot trickier than
it was 15 years ago. The Avaya-BT
research found that 71 per cent of us
demand being able to communicate
with customer support while online,
while 63 per cent want to switch
from social media or web-chat
to the telephone when we need
a hand. As consumers we want
convenience and speed, but were
also demanding the personal touch.
Martin
Snellgrove,
Avayas
consulting director, says: As
consumers, we really do want it
all. Think of your own customer
experience. It probably starts online,
continuing days or even weeks later
with a call, possibly finishing in a
local high street shop.
The difficulty of tracking and
predicting a customers moves,
capturing the information and
delivering back to them the level of
service they require over the correct
medium is increasingly difficult when
you consider that their touchpoints
with a brand might be mobile, face
to face and phone.
Our job is to help businesses
develop digital strategies to ensure
a seamless experience throughout
the customer journey. We believe
in delivering customer service at
consumer speed.
But it doesnt stop at mapping the
customer journey. Mark Cunnell,
Avayas digital enterprise director,
argues that if customer touchpoints
are the eyes and ears of a digital
business then analytics is the brain
making sense of the diverse realtime interaction information. He
cites real-time analytics as one of the
73%
of UK
consumers
say they are
more likely to
buy more from
companies who
are easier to do
business with
71%
of us demand
being able be
communicate
with customer
support while
online
63%
want to switch
from social
media or webchat to the
telephone when
we need a hand
most overlooked tools in any digital

customer engagement strategy.
In the era of social media, the
ability to assess levels of customer
satisfaction in real time, without
waiting for questionnaires or feedback
surveys, and adapt their experience
accordingly is an incredibly persuasive
approach, he says.
This level of immediate and
actionable insights enables our
clients to demonstrate they know
each customer personally. This
brings incremental advantage over
their competitors. They are able to
adapt their approach immediately in
response to an individual customers
experience, curbing discontent
and churn before it impacts
the business.
After all, it was Steve Jobs, a man
who certainly knew a thing or two
about delighting customers, who
said: Youve got to start with the
customer experience and work back
toward the technology.
raconteur.net
A feature of 2015, drones will be one of

the topic areas that again dominate tech
hype in 2016. Expect many more drone
tests and lots of noise made about them,
especially when one or more inevitably
create high-profile incidents in the sky
as they disrupt traditional flight paths.
Venture-capital investment in drones
hit $418 million last year, which is more
than five times the $77 million invested in 2014. Investment will definitely
increase again this year, particularly in startups addressing industrial
use cases. Using drones in emergency
response scenarios will become more
commonplace.
2
157
No of deals
169
212
208
184 189
223 217
259
238
220
255
212
227
225
209 202
173
163
256
247
244
328
305
303
279
272
254
235 237
217
Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
2013
Jul
2014
Jul Aug Sep Oct Nov Dec
2015
MOST ACTIVE DIGITAL VENTURE CAPITAL

INVESTORS IN 2015
01 E-COMMERCE AND E-SERVICES DIGITAL VC INVESTMENT BREAKDOWN
No of deals
$5.17bn
115
Amount ($bn)
ANDREESEN
$1.18bn
NEW ENTERPRISE
5.68
E-commerce
software
Finance
and banking
2.7
Web
analytics
Health
Payment
0.82
0.62
0.51
Deals and
group buying
Automotive
Identity
12
12
199
0.46
0.39
Recruitment Collaboration
19
87
149
No. of deals
1.71
0.31
0.31
0.26
0.13
0.03
E-commerce
and e-services
Travel
Dating
E-learning
Mapping
Property
App stores
22
10
25
49
14
33
40
$0.89bn
36
BESSEMER
164
227
FOUNDERS FUND
$0.57bn
15
INTEL CAPITAL
$0.53bn
33
$0.52bn
21
$0.5bn
32
REDPOINT
$0.41bn
28
$0.36bn
6
GREYCROFT
15
16
RIGHTS AND
INTELLECTUAL
PROPERTY
NEWS AND
INFORMATION
TOOLS
$0.01bn
$0.04bn
24
$0.18bn
14
TELECOMS
INFRASTRUCTURE
AND SERVICES
13
TELECOMMUNICATION
SERVICE PROVIDERS
GAMING
17
$0.3bn
33
12
PUBLISHING
11
$0.39bn
89
$1.07bn
75
10
BROADCASTING
09
$1.33bn
65
$1.36bn
86
08
MUSIC VIDEO
07
$1.47bn
71
$1.74bn
06
SOCIAL MEDIA
HARDWARE
180
145
05
SEARCH
04
$2.49bn
74
$2.6bn
$3.15bn
273
ACCESS INDUSTRIES
03
54
$0.97bn
30
KLEINER PERKINS
0.001
0.35
$2.3bn
$1.1bn
31
GOOGLE ENTERPRISE
3.17
506
02
45
FIRST ROUND
$4.62bn
01
$3.11bn
92
ACCEL
14.17
Marketplaces
216
167
SEQUOIA
3.44
299
282
ADVERTISING
05 DRONES
221
208
5
$1.28bn
India
236
266
293
287
Amount
COMMUNICATIONS
Internet commerce is still evolving.

And this is why venture capitalists
continue to pour more money into it
than virtually any other digital sector. E-commerce attracted almost
$23 billion in investment last year, up
from some $17 billion in 2014 on the
back of major investments in online
taxi, meal delivery and travel services. Having likely reached the ceiling
when it comes to huge deals and hyper
valuations in sectors such as ride-hailing, this pace of growth is unsustainable. There will also be a shift in the
types of e-commerce models receiving backing. In the wake of the likes
of Gilt Groupe and One Kings Lane
being sold for much lower than the billion-dollar valuations they once flirted with, expect investor enthusiasm
for flash sale sites to wane. Fashion
will continue to attract interest, but
also expect more investment in companies with innovative approaches to
e-commerce logistics or deliveries
just dont expect your shopping to be
delivered by drone this year at least.
259
288
277 282
No of deals
OTHER
02 E-COMMERCE
Amount
04 INTERNET OF THINGS
In 2015 the internet of things (IoT) was

established as a concept thats here
to stay. But it is yet to come of age in
terms of investment in a startup sense.
Venture-capital investment actually
dipped last year to $1.3 billion compared with $1.5 billion in 2014. Expect
it to remain steady during 2016, and expect more and more devices to become
connected to the internet, but dont expect a lot of investment at a startup level in smart platforms. Consumers dont
care about the platforms and there
are other elements of IoT software for
startups to explore.
2
$0.47bn
Japan
319
WHERE DIGITAL VENTURE CAPITAL INVESTMENT WAS FOCUSED IN 2015
658
Last year analysts Pivotl iQ predicted an upswing in venture capital investment in financial technology, but
didnt expect quite such an explosion.
Total investment hit $7.3 billion in
2015 compared with $4.1 billion the
previous year. Investment in fintech
is not about to stop, but unless a couple of astronomical bets come out of
nowhere, dont expect it to ratchet upwards at quite the same eye-watering
rate. Consolidation will be a theme
in 2016 and expect more mergers
and acquisitions particularly in payments, which is the most mature, but
also the most fragmented segment,
in the fintech space. The burgeoning co-operation between startups
and traditional banks that began
in 2014 and grew more pronounced
during 2015 will continue in 2016.
Keep an eye out for challenger banks,
such as Atom, Mondo and Number26,
in this context. Finally, expect an influx of capital into startups looking to
shake up the insurance industry. A lot
of backing is likely to come from the
corporate investment arms of insurance companies, as well as traditional
venture capitalists.
VR or virtual reality evangelists seem

to declare every year a watershed
one for VR and theyre always proved
wrong. But while were loath to label
2016 a breakthrough year for the technology, we do expect it to be an interesting one. This is because much of the activity will move from the testing studio
into consumers hands, with a number
of major products, such as Oculus Rift,
hitting the shelves. From an investor
perspective, this should increase activity as a number of startups scrabble
to offer compelling content for the new
devices. This doesnt mean investment
levels will necessarily hit a record level. Investment in VR and augmented
reality startups reached $492 million
in 2015, down some 30 per cent on the
$706 million raised in 2014. But the
2014 total is almost entirely the result
of Magic Leap, which took on nearly
$600 million that year. In that context,
2015 was an encouraging year in investment terms and this appetite should
continue this year.
Value
2012
$11.55bn
01 FINTECH
03 VIRTUAL REALITY
2
$0.26bn
Israel
THE DIGITAL ECONOMY
10
21
$6.13bn
China
2
$0.7bn
Germany
US
raconteur.net
28 / 01 / 2016
MONTHLY DIGITAL VENTURE CAPITAL DEALS, 2012-2015
1
$0.53bn
Sweden
2
$0.32bn
France
59
$15.15bn
RACONTEUR
No of deals
4
$0.88bn
UK
SOFTWARE
DIGITAL INVESTMENTS
Value
1
$0.17bn
Luxembourg
1,571
Where are investors in the digital

economy going to put their money in
the year ahead? Here is Pivotl iQ editorial
director Tom OMearas strategic view
TOP 100 DIGITAL VENTURE CAPITAL DEALS

IN 2015 BY LOCATION
$35bn
Following the
smart money
in 2016...
RACONTEUR
28 / 01 / 2016
Value ($bn)
THE DIGITAL ECONOMY
E-COMMERCE
AND E-SERVICES
10
INDEX VENTURES
$0.36bn
25
BENCHMARK
$0.34bn
12
NORWEST
$0.28bn
12
MAYFIELD FUND
$0.28bn
14
GREYLOCK
$0.28bn
12
LIGHTSPEED VENTURE
$0.27bn
16
500 STARTUPS
UNION SQUARE
HASSO PLATTNER
VENTURES
$0.24bn
77
$0.16bn
12
$0.02bn
1
TOP 10 DIGITAL VENTURE CAPITAL DEALS OF 2015

LYFT
01
US
UBER
02
US
SOFI
03
US
UBER
04
US
05
SPACEX
US
06
DIANPING
China
07
MEITUAN
China
08
ELE.ME
China
09
KUAIDI DACHE
China
10
DELIVERY HERO
Germany
E-COMMERCE AND
E-SERVICES
Ride-sharing marketplace
E-COMMERCE AND
E-SERVICES
Taxi-hailing marketplace
FINTECH
Marketplace lender
E-COMMERCE AND
E-SERVICES
COMMUNICATION
Aerospace
technology
E-COMMERCE AND
E-SERVICES
Online restaurant platform
E-COMMERCE AND
E-SERVICES
Group deals website
E-COMMERCE AND
E-SERVICES
Food delivery marketplace
E-COMMERCE AND
E-SERVICES
E-COMMERCE AND
E-SERVICES
Food delivery marketplace
$1bn
$1bn
$1bn
$1bn
$1bn
$850m
$700m
$630m
$600m
$567m
February
July
Source: Pivotl iQ 2016
11
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THE DIGITAL ECONOMY
13
Responding to the rise of online marketplaces

Internet-based businesses are disrupting tradi tional marketplaces, but the newcomers may also offer new opportunities for established players quick enough to respond
DIGITAL BUSINESS MODELS
Getty Images
THE DIGITAL ECONOMY
01
DAVID BENADY
BUSINESS MODEL
nline marketplaces are

revolutionising the economy. Using mobile apps,
some clever algorithms
and a customer review system, businesses such as Uber, Airbnb, Alibaba and eBay have transformed what
it means to be a middleman.
These modern day intermediaries
connect buyers and sellers, and offer
reassurance that goods and services
will arrive, meet expectations and
be paid for without problems. They
are weightless businesses with few
assets; Uber owns no cars, Airbnb
owns no property and Alibaba holds
no stock. They outsource risk, they
piggyback on other peoples technology and connectivity, and some play
hard and fast with regulation. They
often manage to conjure up new markets from underused assets.
But the rise of the online marketplaces poses a massive challenge to
the wider economy. Established operators are struggling to match the new
business models and many are seeing
their livelihoods under threat.
Taxi drivers around the world
have challenged the legality of Uber,
while Airbnb has also faced legal
constraints on its model of rental
accommodation. But these startups
grow so fast they are already huge
before established interests can organise a fightback. Companies are
facing up to the reality that their
profit model could be disrupted
within a few short years by unexpected startups that come from nowhere to wipe out
their business.
As Tom Goodwin,
senior vice president for strategy
and innovation at
Havas Media US,
says: Technology is
making incredible
things now possible. Every company,
regardless of what
business they are in,
seems to be looking
at new technologies
and the new behaviours that come from those technologies and looking to leverage them.
Mr Goodwin refers to the online
marketplaces as skins, small businesses connecting huge numbers
of buyers and sellers. It is about
owning no assets, where possible
skirting regulations, employing a
small number of staff, and doing the
minimum job so you are outsourcing the risk and the responsibility to
the buyer or the seller. In becoming
a connector, that allows you to grow
incredibly quickly, to grow around
the world in a way that doesnt require local staff, he says.
Users pay for product/service with their data rather than their money,
then are charged to upgrade to a full offer
SPOTIFY, LINKEDIN,
DROPBOX
Involves selling personal data or advertising eyeballs harvested

by offering consumers a free product/service
GOOGLE,
FACEBOOK
MARKETPLACE
Provides a digital marketplace that brings together buyers and sellers

in return for a transaction/placement fee or commission
eBAY, iTUNES, APP

STORE, UBER,
AIRBNB
ACCESS-OVEROWNERSHIP
Provides temporary access to goods/services traditionally only

available through purchase; includes sharing economy disruptors
ZIPCAR, PEERBY,
AIRBNB
HYPERMARKET
Brand bombing using sheer market power and scale to beat

competition, often by selling below cost price
AMAZON, APPLE
EXPERIENCE
Disrupts by providing a superior experience, for which people are

prepared to pay
TESLA, APPLE
PYRAMID
Recruits an army of resellers and affiliates who are often paid on a

commission-only model
AMAZON,
MICROSOFT,
DROPBOX
ON-DEMAND
Monetises time and sells instant access at a premium; includes taking a

commission from people with money but no time who pay for goods/
services delivered by people with time but no money
UBER, OPERATOR,
TASKRABBIT
ECOSYSTEM
Sells an interlocking and interdependent suite of products/services that

increase in value as more are purchased, creating consumer dependency
APPLE, GOOGLE
FREE
The leading
companies in each
industry are as
actively invested in
experimenting and
creating the future
as any of the
startups are
02
01
London taxi
drivers blockaded
Whitehall in June
2014 in a protest
over Uber
02
Ubers rapid global
growth has led to
widespread criticism from licensed
taxi drivers who
claim unfair competition due to a
lack of regulation
of private hire
vehicles
you can see why they are becoming

very valuable businesses.
Mr Kanji adds that in the early days
of the internet, many believed the
technology would lead to the end of
middlemen and people would be able
to interact directly. In reality, it turns
out intermediaries are vital.
He believes it is hard for established
businesses to combat these new business models. Becoming a competitor is darn near impossible for bigger
companies. It is not like Marriott,
Starwood or Hilton hotels can go and
CASE STUDIES: DELIVEROO, TRANSFERWISE AND JUSTPARK

Some of the UKs brightest
new companies are using
digital business models
to open up new markets
and challenge established
interests.
Deliveroo, co-founded in
London by Americans William
Shu and Greg Orlowski,
delivers meals to customers
from quality local restaurants
using an army of cycle and
scooter drivers. Its smartphone app allows customers to
choose from a number of restaurants in their area with
delivery promised in about half an hour.
Since it launched in London in February 2013, the service
has expanded to 34 cities in the UK and overall 55 cities
worldwide in 12 countries. It is now launching in Asia. The
company, which employs some 300 people, has raised
$200 million in funding from backers and has been valued at
between $350 million and $660 million.
A truly disruptive business in the financial sector is
EXAMPLES
NETFLIX, APPLE
MUSIC
FREEMIUM
Crucial to the growth of many online marketplaces is the way they

have used technology to change
peoples behaviour and attitudes.
He adds: A while ago, companies
would have assumed that people
didnt want to spend the night in a
strangers house, that they wouldnt
really trust a stranger to drive them
around. But with the customer review system, there is an implied
trust in the brand itself. You presume Uber is doing its due diligence
on its drivers, you presume that Airbnb is making sure that you are not
going to feel unsafe in the property.
These businesses thrive on the
network effect the more buyers
and sellers they
unite, the more
valuable they become to new participants. This has
helped them rapidly achieve huge
scale. Ride-hailing
app Uber launched
in 2009 and is now
present in 300
cities around the
world. Five years
after launch, apartment rental service Airbnb offers
500,000 homes in 34,000 cities. Chinese e-commerce business Alibaba
connects buyers and sellers across
China and across continents as well.
Hussein Kanji, a partner at venture
capital specialists Hoxton Ventures,
which backed restaurant delivery
service Deliveroo, says it is hard to
tell if a new business model is going
to succeed. They dont look all that
interesting in the early days because
you cant tell if they are going to get
scale or not, he says. You cant often tell if they can succeed as an intermediary. Once they start maturing and they are one or two years in,
DESCRIPTION
Takes a product/service traditionally purchased on an ad hoc basis
and locks in repeat customers by charging a subscription fee
SUBSCRIPTION
Shutterstock
12
TransferWise, which has transformed international money

transfers and created stiff competition for banks. It has
massively reduced the fees for making cross-border
money transfers by using an algorithm to match requests in
different currencies.
No money actually crosses any borders, but if someone in
Europe wants to send 100 to the UK, this is matched with
the equivalent in pounds from someone in the UK wanting
to send money to Europe. This system enables the company,
which is based in London, to charge minimal fees. So far
some 3 billion has been transferred via TransferWise.
Another venture that has unlocked value from previously
underused assets is JustPark, which connects drivers
looking for a parking space with people who have a drive
or piece of land they want to offer for parking. It has been
described as an Airbnb for parking.
The service charges a 20 per cent commission on parking.
With 750,000 registered users and some 150,000 parking
spaces, the business turned over 3.7 million in 2014, with net
revenue of 1 million. It has received venture capital funding,
an investment from BMWi and last year raised 3.5 million on
crowdsourcing site Crowdcube, a record for a UK startup.
build a competitor to Airbnb, he says.

Once they win, its a winner-takes-all
market and they become dominant.
Established players must watch
out for new, disruptive digital business models. They can become early
investors or partners, or get involved
in some way. For instance, a hotel
group with an eye for transformative
startups could have listed its properties on Airbnb in the early days to
gain an early-mover advantage.
Another strategy is for an established business to work out how to
piggyback the new services. For
instance, car manufacturers could
create a healthy business insuring
and renting out their cars to the
growing numbers of Uber drivers.
Many businesspeople are wary of
what has come to be known as uberisation, where established business
models are disrupted by a low-cost digital platform, just as Netflix is threatening the network TV model and new
mobile-based banks could take market share from established banks.
But according to Mike Sutcliff,
chief executive of consultancy Accenture Digital, fears of uberisation
have been exaggerated. The leading companies in each industry are
as actively invested in experimenting and creating the future as any of
the startups are, he says.
All major car companies have a
presence in Silicon Valley, he says,
and have venture capital units following the progress of interesting
new startups. The automobile businesses all have labs working on driverless cars and battery technologies.
What we talk to clients about is
not only the industry they are in and
their existing competitive set, but

we ask them to think about the adjacent industries and whether there
is an opportunity to bring a different
economic model that would disrupt
the profit pool they are playing in today, says Mr Sutcliffe.
He points to US business Zenefits, which offers free software to
run the employee payroll and other
labour services for small and medium-sized businesses in return for
those companies using it as a health
insurance agent. It has been highly
successful and provides stiff competition to the established players in
employee benefits.
They have taken an adjacent market play and said the market Im in
is being an insurance agent, the adjacent market that I am disrupting
is the market of providing employee benefits, so all the players in the
employee benefits market would
describe themselves as being uberised, says Mr Sutcliff. So it is an adjacent market entry that many businesses need to look out for.
Established businesses need to
hold their nerve in the face of the
profit-destroying new digital business models. As Mr Goodwin of
Havas Media US concludes: You
should be both wary and excited at
the same time. The worst thing you
can do is ignore this; the best thing
you can do is bring in people who
understand the changes that are
now possible in order to figure out
the opportunities this will offer.
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28 / 01 / 2016
RACONTEUR
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28 / 01 / 2016
TOP 5 MARKETING TIPS
Marketing strategy
must mimic clicks
INSTAGRAM
Stephanie Carr of Marin Software says: Those with access to Instagrams
ads API [application programming interface] will now have unprecedented
control over their social budgets so they can optimise and manage their
campaigns more effectively. Instagram is being treated as a targeting
placement option for Facebook ad sets. So with just a click of a button, you
can replicate your existing Facebook ads on Instagram. This means theres
access to the audience targeting capabilities of Facebook, removing the
guesswork and friction of launching on a new publisher. Brands can deliver
a positive user experience and keep the audience engaged by using rich
visuals and considering other creative options such as image format, and
the viability of using the same creative across audiences and platforms.
New digital marketing techniques are countering ad-blocking

to achieve return on investment
his year began with one

of the most surprising
spectator events in memory. On Wednesday January 6, the world started watching
a puddle in Newcastle. The small
pool of water was beamed out on
live-streaming app Periscope and
became a social media sensation
as people watched with increasing
fervour how members of the public were getting around the puddle.
#DrummondPuddleWatch trended
internationally and garnered some
50,000 Twitter posts.
The event was not only seen as a
bit of fun, but for some it was a marketing opportunity. Dominos Pizza,
Hunter wellies, PG Tips, Marmite,
Greggs and a whole host of others
joined the conversation, adding
their witty quips on Twitter.
This reaction was a great example
of the trend for moment marketing.
WARC and Deloittes Trends Toolkit
recently put moment marketing as
the number-one global marketing
trend for 2016. Its all to do with reacting to events, quickly and cleverly, in your online marketing.
Put simply, moment marketing is
the ability to instantly connect your
digital marketing to whats going
on in the world at that time, says
Antione de Kermel, Europe, Middle
East and Africa (EMEA) managing
director of brands and agencies
platform TVTY.
Campaigns can be synced to a
wide range of events that are likely
to impact consumer behaviour, for
example a change in the weather,
the score of a football match or the
screening of a major TV ad campaign. Its about ensuring your message connects at the exact moments
when consumers reach for their
smartphone to react on social media
or search for more information.
These days the media landscape
is a noisy place. Digital marketers
have to make their voices heard over
a cacophony of content hurtling towards consumers from a number of
devices and a range channels. This
tsunami of information has created a generation whose attention
span is waning, so the message to
brands is clear if your messaging
is going to get heard, its got to be
memorable and get attention for the
right reasons. Moment marketing is
one of the ways that brands can cut
through the noise and get noticed
for the right reasons relevance.
Another popular and effective way
of reaching people in 2016 is influ-
encer marketing. The rise of social

media stars on channels such as
YouTube and Instagram has opened
up a whole new avenue for brands
to reach audiences. Working with
vloggers and social influencers is an
increasingly powerful, not to mention effective, way of communicating with, converting and retaining
customers, says Jenny Halpern
Prince, founder of social talent
agency The&Collective and public
relations agency Halpern.
A recommendation from a trusted
influencer is more credible than a
message that comes directly from a
brand. Studies show partnering with
influencers increases retention rates
by 37 per cent and boosts conversion
rates ten times over, she says.
Digital
marketers have
to make their
voices heard over
a cacophony of
content hurtling
towards
consumers
Ms Halpern Prince and her agency
have seen a steep rise in demand for
influencer marketing over the past
two years, with at least 75 per cent of
marketers now investing in it and 60
per cent set to increase their spend
with vloggers over the coming year.
Put simply, brands that arent investing will lose out, she adds.
Creating the right kind of content
is the first challenge facing the
marketing community in the coming year. The second is choosing
where to place this innovative and
engaging content. Which channels
will create the best returns? Has
social media eclipsed traditional
methods such as e-mail? Should
marketing budgets be ploughed
into paid search?
According to some, different
channels have a range of benefits
and a healthy mix of all is the way
forward. With more competition
for clicks online than ever, brands
must ensure their digital marketing
strategy mimics consumers online
behaviour across an increasingly
complex media landscape, says
Stephanie Carr, EMEA vice president of Marin Software.
Although search and social both
engage large audiences online, they
serve very different purposes along
the consumers path to conversion.

For example, while the benefits of
social media can be seen at the start
of a customers decision-making
process, the return on investment of
paid search is apparent more quickly and often leads to the all-important final conversion click, she says.
Having a good spread across multiple channels is just one part of the
puzzle. Research by Marin Software
has found there needs to be a joinedup approach across these channels
to get the best results. Advertisers
achieve 68 per cent higher revenue
per conversion from their search
campaigns when they are managed
together with social advertising
campaigns, says Ms Carr. In fact,
we know that users who clicked on
both search and social ads are more
likely to buy and spend more.
One of the elements of social marketing tipped to really take off this
year is video. More and more video
is being consumed through social
channels and content producers
such as Now This News, with clips,
designed to be watched with or without sound, tailoring to the mobile
market, are gaining prominence.
In 2016, the battle between video superpowers Facebook and YouTube will heat up and newcomers
like Snapchat will contribute to
overall growth in the time we devote to video content on social media, says Merinda Peppard, EMEA
marketing director of Hootsuite.
The way brands advertise will also
change and become much more social as new mobile formats and social media products offer advertisers efficiency and promise relevance
for consumers.
INFLUENCER MARKETING
Getty Images
DIGITAL MARKETING
GABRIELLA GRIFFITH
90%
of marketers
believe social
media marketing
results in
increased
exposure for
their company
Source:
Social Media
Examiner 2015
So if search and social both have

their places in the mix, what about
the more traditional avenue of
e-mail marketing? It may not be as
trendy as its counterparts, but according to many, it still has its place.
E-mail will continue to rank
highly as the most effective digital channel for digital marketers,
says Andrew Davies, co-founder
and chief marketing officer of Idio,
a content marketing platform.
Unlike social media platforms or
SEO [search engine optimisation],
which are always subject to the fickle whims of Facebook or a Google
algorithm update, marketers fully
control their mailing list.
The efficacy of e-mail will improve as content personalisation
technologies get better at understanding what each recipient is interested in and automatically select
the most relevant brand content to
put in each e-mail.
The coming year is certainly an
exciting one for digital marketing,
but the black cloud of ad-blocking
still looms large across the industry. According to the Internet Advertising Bureau UKs Ad-blocking
Report conducted by YouGov, one
MARKETERS COMMONLY USED SOCIAL MEDIA PLATFORMS
56%
Google+
71%
LinkedIn
55%
YouTube
45%
Pinterest
36%
Instragram
in seven British adults are currently using ad-blocking software, and

a joint report by PageFair and Adobe found ad-blocking is estimated
to have cost publishers almost $22
billion globally in 2015.
The stats may be dramatic, but
the general consensus among marketers is the industry will adapt
and the end-product will be a better user experience for consumers.
While ad-blocking wont be the
Armageddon that doomsayers are
predicting, the industry will realise that it has a collective responsibility to act, argues Nick Hugh,
EMEA vice president at Yahoo.
Publishers will adopt a more user-centric, additive approach to
advertising which will bring native advertising to the fore and the
buy-side will adapt accordingly.
The rise in ad-blocking will drive
even more innovation with this
ad format, delivering yet higher
audience engagement and return
on investment. The industry will
fight back.
raconteur.net
15%
SlideShare
14%
Forums
13%
Social review
sites, such
as Yelp
9%
Social bookmarking,
such as StumbleUpon and Reddit
7%
79%
Twitter
Geo-location,
such as
Foursquare
4%
Vine
93%
Facebook
2%
Snapchat
Source: Social Media Examiner 2015
Jenny Halpern Prince of The&Collective says: Relevance is key. It is

important that time is spent researching the digital influencer you are
looking to approach, to ensure they are the right fit for your brand. Its also
smart to identify influencers who have already shown your brand some love
online. Digital influencers like to be part of the creative process, so try and
work as collaboratively as possible. In 2015 we saw brands starting to loosen
control on content and let digital influencers speak to their audiences
in their own language. Millennials specifically are more engaged with
messages that are authentic. Importantly, always ensure you are adhering
to advertising guidelines. If a digital influencer is paid to promote a product,
they must clearly label their content as having been paid for.
VIDEO
Nick Hugh of Yahoo says: Were going to witness a huge growth in
social video in the next 12 months. Horizontal video has perpetuated
in popularity simply because it is a legacy of platforms such as TV and
cinema. However, on mobile, now the dominant platform of all, vertical
video is an invariably better user experience and we can expect to see
more campaign videos made in portrait mode. Also social video will be an
opportunity for marketers to utilise what is a familiar format in new and
exciting ways, such as in the use of GIFs [graphics interchange formats].
Tumblr, often hailed as the home of the GIF, has a staggering 23 million
GIFs posted every day and GIFs will become a staple tactic of brands
seeking better social media engagement.
FACEBOOK
Olly Honess of Cubaka says: Facebook is a smart operator that continually
develops its targeting algorithm to placate marketers. These increasingly
intelligent and tighter targeting mechanisms should lead strategic thinking
in 2016, a year when the one-size-fits-all creative will no longer be relevant.
With Facebooks new detailed ad-targeting option giving marketers the
ability to define and reach different groups within their overall audiences,
its savvy to place more consideration on multiple types of creative that will
resonate better with these subtly differentiated groups. Now more than
ever is the right time to keep a close eye on the platforms incremental
targeting changes.
E-MAIL
Georgia Marshall Brown of MMP says: Mobile use is growing, offering
users multiple brief interactions, anywhere and anytime. E-mail content
should reflect this and content can be optimised into bite-sized chunks
offering users instant access to the information they need, right from
the palm of their hand. Responsive design e-mail templates are a good
way to optimise. They offer the ability to update this well-established
communications channel by dynamically resizing content to fit the
screen of any users device. Also as e-mails are trackable, it is simple
to take a test-and-learn approach to your marketing strategy. This
might include A/B testing of subject lines and/or content to ensure
marketing communications deliver against specific business objectives
as effectively as possible.
raconteur.net
THE DIGITAL ECONOMY
15
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THE DIGITAL ECONOMY
How to build a
better business
A software-to-software interface which
connects businesses and opens up new revenue
streams is reaping rewards for early adopters
API STRATEGY
EMMA WOOLLACOTT
here can be few organisations nowadays that dont

see data as fundamental to
their business. But while
theres a natural tendency to think
of this data as a private resource to
be carefully guarded, organisations
are increasingly reaping value from
opening it up to the world.
Businesses such as Amazon allow
third-party merchants to hook into
their site, review sites use Google
Maps to display nearby restaurants
and websites of all types encourage
users to share pages on Facebook.
Key to all this sharing is the application programming interface or API,
which simplifies and standardises
the way different applications hook
up. And while these are effectively invisible to the end-user, they are central to most internet businesses.
An API is a set of programming instructions and standards for accessing a web-based software application
or web tool. Using one, a third-party
application can access an organisations data without the need for software to be written from scratch or for
developers to have to share the whole
of their softwares code.
This plug-and-play approach allows enterprises to create new marketing strategies, such as targeting
customers through influencers
rather than directly, and helps them
move into different markets by creating new products and services

from their assets, data or processes.
Holiday companies, for example,
can automatically keep travel price
comparison sites updated, boosting
business for both. Meanwhile, telecom firms can provide APIs to enable developers and partners to build
mobile and web applications based
on their services.
Using APIs can help organisations
be more responsive and innovate
more quickly. In many cases, organisations can charge for access, creating new revenue streams.
For any company in any industry who wants to stay ahead of their
competition, APIs should be at the
forefront of their digital strategy. APIs
allow businesses to easily and safely
share their data and service through
multiple apps, and can expose opportunities for businesses to enhance
customer experience and create new
digital services, says Chet Kapoor,
chief executive of API management
company Apigee.
For example, APIs can enable location-based mobile apps to have
access to integrate information
about entertainment, shopping,
hotels and restaurants, providing
customers with new levels of information and convenience.
APIs are at the heart of supermarket
Morrisons Match and More loyalty
site and mobile app, which provides
a price match guarantee against Aldi,
Lidl, Tesco, Sainsburys and Asda.
The scheme requires the sharing of customer data, loyalty-card

information, and both digital and
physical vouchers with the supermarkets partners, along with
promotions and a live stream of
personalised mobile offers when
customers are in-store.
Apigee has helped us to streamline digital and technology processes within Morrisons to allow the
creative teams to concentrate on the
experience rather than create disparate front-end systems for each
activity, says Tom Foster, the supermarkets head of platform strategy and architecture. This creates
exciting new opportunities, as well
as driving efficiencies, enabling us
to swiftly enter the digital age in a
well-managed way.
And there are extraordinary financial benefits to be gained. According
to Apigees UK Digital Business Survey Snapshot, companies using APIs
are eight times more likely to report
increased revenue than those that
deliver apps alone.
And while the overall median reported increase in revenue from
successful digital initiatives is
487,000, this rockets to 9 million
where APIs are involved.
Meanwhile, for Francis Hellyer,
chief executive of online ticketing
business London Theatre Direct,
the biggest advantage of opening up
the companys APIs has been a huge
reduction in administration.
The company was founded in
1999, but has moved on in recent
years from a purely ticket agency
business model to start offering
selected partners direct access to
London theatre by developing a
full API solution with Tibco Mashery, as well as a business-to-business booking engine and a range of
affiliate solutions.
Through APIs, it has opened up its
booking platform, spanning London
musicals, plays, ballet and opera, to
numerous partners and channels,
giving a seamless booking experience
at any part of the customer journey.
Our partners have access to pretty
much everything we have as a business, so its very exciting to think
what other partners can do, says
Mr Hellyer. By allowing open access, we hope to get a faster uptake.
If someone comes up with a really
good idea for an app or a service, we
can work with them very quickly.
The system combines access to
tickets from different services, and
theres great variation between the
different contracts and agreements.
The way we charge depends on the
type of partner and there are different levels of commission, he says.
The company has recently added
the ability to book New York Broadway shows to its range of services.
And the next step, says Mr Hellyer,
is to start including the ability to
28 / 01 / 2016
make travel bookings. So weve

added into the mix hotels, flights,
entertainment and travel, he says.
Organisations can future-proof
their activities by using APIs internally too. Forrester Research
says systematically implementing core business capabilities and
assets as business APIs can help
companies become much more
responsive and enable rapid business reconfiguration.
To stay ahead of the game in
identifying which business APIs
Companies using
APIs are eight times
more likely to report
increased revenue
than those that
deliver apps alone
to build, connect API strategy to
business architecture and specifically to its definitions of business
capabilities and domains, according to Forresters vice president and principal analyst Randy
Heffner. These form the basis for
identifying major areas of business data, transactions, processes
and events that are candidates to
become business APIs.
Organisations can identify their
greatest assets in terms of data or
RACONTEUR
applications and then recruit potential partners that can take advantage of them to create new services
for customers. Ground your API
strategy in an understanding that
innovation can come from anywhere, says Mr Heffner.
Its a rapidly growing trend, with
Forrester predicting that this year
will see a huge uptake in the use
of APIs. US companies alone will
spend nearly $3 billion on API management over the next five years,
it predicts, and annual spend will
quadruple to $660 million by the
end of the decade.
And as they do so, says Nick Knupffer, director of international marketing for API management firm Tibco Mashery, business processes are
becoming far more responsive.
Fuelled by the proliferation of
mobile applications, by delivering
data where and when is needed,
APIs are slaying the usual business
and technology boundaries to better
reach and engage with customers,
the workforce, and partner and supply chain access, he says.
By bringing services and information together in one place,
and extending the brand potential
accordingly, revenue streams are
optimised creating new customer
services and leveraging the intellectual property of a wider, integrated, fluid network.
raconteur.net
APIs REFRAME BUSINESS STRATEGY AND DESIGN THINKING
TRADITIONAL
BUSINESS
DESIGN
BUSINESS DESIGN
IN THE API
ECONOMY
BUSINESS
COMPETENCIES
What business are we in?
What are we uniquely good at?

What are our unique assets?
CUSTOMERS
Who are our customers?
CHANNELS
Through what channels can we
reach our customers?
PARTNERS
Which partners can help us
reach through those channels?
Where design for external integration begins
16
ECOSYSTEMS
What ecosystems can benefit
from our assets and capabilities?
RELATIONSHIPS
What relationships will allow us
to enter those ecosystems?
CONNECTIONS
Which capabilities do we
connect to which relationships?
LEVERAGE
EFFICIENCY
How can integration increase
value chain efficiency?
RACONTEUR
Why three billion consumers in

developing markets need a different
approach to mobile
rands looking to seize the digital

opportunity in developing
markets will fail if they replicate
their developed-world strategies
they need a technology partner
versed in these markets.
With advanced economies fast
reaching saturation point and
consumer acquisition becoming more
challenging than ever, the developing
markets, with their three billion-plus
consumers, are an enticing prospect
for tech brands from Google and
Netflix downwards.
Even with the current slowdown,
the purchasing power of these
consumers is increasing rapidly.
International Monetary Fund reports
forecast developing market growth
to average 5.2 per cent between
2015 and 2020, compared with just
1.6 per cent for developed markets.
Mobile will be a critical area
of opportunity, given it is more
accessible to users than laptops or
tablets. However, the challenges
are serious and those looking to tap
into enticing new markets in Africa,
Latin America and BRIC countries
Brazil, Russia, India and China with
their vast potential will be making a
serious mistake if they use the same
marketing strategies that worked in
the developed world.
To deliver mobile services that

successfully resonate with
consumers, you need to be aware of
the marketing limitations specific to
developing markets
The world is not flat, says
Marco Veremis, chief executive
of Upstream, a leading mobile
commerce enabler to the next three
billion consumers in high-growth
markets. These new consumers
behave very differently compared to
those in the West. A one-size-fits-all
solution, when it comes to acquisition
and monetisation, wont work;
rather to deliver mobile services
that successfully resonate with
consumers, you need to be aware of
the marketing limitations specific to
developing markets.
First, these new markets have a lower
GDP per capita, with considerable
variations from one country to another.
This affects consumers ability to pay
and so requires differential pricing.
The Global Findex data set shows that
access to financial services in lowincome countries is in stark contrast
to those in the developed world, with
DEVELOPING MARKET DATA

PENETRATION RATES, 2014
Payment cards
Mobile handsets
Multiplier difference [x]
120%
x1.58
80%
APIs, or application programming interfaces, are seen

as building blocks of the digital economy, enabling
innovation, new products and offerings through
a plug-and-play approach. Simply put, an API is a
common interface for building software that allows
two or more apps to communicate with one another
and use each others functions, without the need for
software to be written from scratch.

Using a basic example, an API allows computer users
to cut information from one program and paste it
into another. APIs also allow apps, such as Yelp and
Uber, to display their services on a Google Map or
enable BuzzFeed readers to share articles with their
Facebook friends without even leaving the website.
17
THE WORLD
IS NOT FLAT
100%
WHAT IS AN API?
THE DIGITAL ECONOMY
COMMERCIAL FEATURE
How do we continuously
optimise connections to win,
serve and retain new consumers?
Source:Forrester
raconteur.net
28 / 01 / 2016
x15.3
60%
40%
20%
Developed
Developing
Source: Global Findex, World Bank/GSMA Intelligence
only around 1 per cent having a credit

card and 6 per cent having a debit card,
leaving consumers virtually unbanked.
The only way to charge customers
for services is to do it through
a digital currency consumers
pre-paid mobile airtime balance,
explains Mr Veremis. The complexity
of billing is illustrated by comparing
the top-up frequency of users. In
Brazil people recharge their mobile
credit once a month, whereas
Nigerians top up multiple times per
week with a very small amount,
he says. So, when you set up a
subscription-based service, should
you bill your subscribers monthly
or weekly? If you opt for monthly
in Nigeria, youll face problems
with failed charged attempts due to
peoples insufficient credit.
The second challenge for digital
brands is technological. Wi-fi usage
is extremely limited and so the key
providers of internet access are
mobile network operators (MNOs).
Additionally, internet access is slow
and patchy. While speeds of around
30Mbps (megabits per second) might
be standard in the United States,
in Brazil theyre only about 10Mbps
and Nigeria might only achieve one
hundredth of that speed.
Smartphone usage here is much
less than in the West, mobile devices
are mostly basic feature phones or
web-enabled handsets, says Mr
Veremis. Therefore, rich media with
video-streaming
and
data-heavy
content, for example, will struggle
with expansion due to low bandwidth
and limited device compatibility. Nor is
this situation about to change any time
soon; by 2018 smartphone penetration
will remain below 50 per cent.
The third hurdle for those moving
into the developing markets without
an experienced partner is cultural.
If products and services are to be
engaging, they must be localised and
adapted to take into account local
languages and cultures, Mr Veremis
points out. In a 2014 study conducted
by Upstream and Ovum, The Next
Mobile Frontier, 78 per cent of
developing market consumers cited
the importance of mobile content
being offered in their local language.

Upstream is a leading end-to-end
m-commerce facilitation platform
of valuable digital services across the
developing world. It already has more
than 65 million users through a micropayments subscription model offered
via direct carrier billing and is growing
at around 50 per cent year on year.
Present in 41 developing markets and
leveraging its integration with mobile
operators, Upstream reaches more
than one billion consumers, providing
its offerings across all types of mobile
devices and internet access.
Working with Upstream, content
providers and app developers can
distribute and monetise their offerings
effectively.
Upstream
facilitates
providers of mobile services with a
seamless billing process (like PayPal),
effective subscription management
(like Zuora), while maximising
customer acquisition (like iProspect).
Companies looking to grow in the
developing markets are realising that
customer acquisition is far trickier
because of the lack of reach of large
Western aggregators that utilise the
advertising opportunities provided by
networks such as Google and Facebook.
To target and meaningfully
engage new customers in developing
markets, deep knowledge of MNO
channels is essential, as is the
technical capability to integrate and
carry out sophisticated targeted and
optimisation processes.
On top of Western-like digital
channels,
Upstream also utilises
20 to 25 different channels across
operators, from traditional SMS,
SIM Toolkit to IVR and smart push
notifications, and tests a wide variety
of different combinations to see
which appeals to which audience and
is best for each operator.
Upstreams proprietary technology
platform MINT utilises gamification
across each and all channels, and
compares against various promotion
mechanisms such as prizes or
upgrades to new products. MINT can
accurately identify which marketing
offers will suit which consumers
be that a free trial or a freemium
version as well as how to promote
bundles of different digital services

effectively and offer highly valuable
mobile experiences to consumers.
Guy Krief, Upstreams chief
marketing and innovation officer,
explains:
Through
intense
optimisation, you end up with
a selection of story boards
combinations of audiences, channels,
messaging and marketing set-ups.
In a recent case study in South
Africa, where Upstream, working with
a leading local mobile operator ran a
campaign to distribute a video portal
service, it managed to recruit 8 per
cent of the targeted user-base to the
free version of the service. Following
that, 27.4 per cent of the recruited
users opted in for the subscriptionbased premium version. Overall,
success rates were much higher than
in typical developed markets, says
Nir Aloni, general manager for subSaharan Africa at Upstream.
Western companies are also
increasingly approaching Upstream
for help to unlock the complexity of
billing. Billing through the pre-paid
mobile airtime balance, the most
ubiquitous digital wallet of highgrowth markets, is not a standardised
commodity. Instead, its a science
a combination of identifying the
optimal price, and then knowing
exactly where and when to collect
fees from the customer.
Just blindly enabling operator
billing in developing countries, like
other mobile payment providers do,
would yield charge success rates
of just 5 per cent or one in twenty
subscribers billed successfully. With
Upstreams optimisation techniques,
such as credit-based billing and halfbilling, and its unique capability to
integrate to the MNOs live top-up
feed, charge success rates can soar
to 50 per cent.
Entering these markets can be like
walking into the wilderness without a
guide youll not survive, says Mr
Veremis. However, if you have a
partner with detailed knowledge and
a proven track record like Upstream,
the opportunities are tremendous.
www.upstreamsystems.com
18
raconteur.net
THE DIGITAL ECONOMY
28 / 01 / 2016
RACONTEUR
RACONTEUR
28 / 01 / 2016
6 TOP DISRUPTIVE STARTUPS
Disruptive startups aim to make billions

01
STARTUPS
CHARLES ORTON-JONES
he most important list

in technology is the CB
Insights league table of
unicorns. These are the
tech startups valued at more than
a billion dollars. At the top are
household names like Uber ($51
billion), Airbnb ($25.5 billion) and
Spotify ($8.5 billion).
Scroll through the list and one obvious thing stands out to be a unicorn you need to be a disruptor. You
cant just imitate an existing business. Youve got to revolutionise an
industry with an innovative business model. Uber is a taxi firm with
no taxis. Airbnb turned homeowners into hoteliers.
Spotify gave the
music industry a
way to fight piracy.
This is what every
tech startup wants
to do to disrupt
an industry and
in doing so wind
up on the unicorn
league table.
The UK already
has a growing roster of unicorns.
Transferwise shook up foreign currency. Funding Circle let business
borrow direct from savers, cutting
out banks. The newest entrant to
the unicorn paddock is Skyscanner, which pioneered online price
comparison in the travel industry.
Now the race is on to found the
next generation of unicorns and
there is no shortage of candidates.
This is a golden age, says Tom
Blomfield, founder of Mondo, an
app-based digital bank which aims
to reinvent high street banking. I

founded my first startup ten years
ago when I was at university. My
co-founder quit his job at Deutsche
Bank. Everyone thought he was
insane. He was an Oxford graduate and was leaving an investment
bank to join a startup. Now? The
number-one pick for MBA grads is
startups. Investment bankers and
young lawyers all want to work at a
disruptive startup.
Naturally, the prospect of vast riches is a big part of that. When Instagram sold for a $1 billion, a pool of 13
employees shared $100 million. The
company had only been running for
15 months. But theres more to disruption trends than that.
Perhaps the key factor is the simultaneous emergence of a string
of new technologies. KPMG polled
business
leaders
to ask what innovations are having
the greatest impact right now and
interviewees were
spoilt for choice.
They cited the
cloud, the internet of things, data
analytics, mobile
platforms
and
apps, artificial intelligence, digital
currency and payment platforms,
and 3D printing. Each one of these
technologies is young. Each has explosive potential. And each feeds
into the other.
The rise of the cloud has made artificial intelligence accessible to all.
Digital payment means mobile apps
are commercially viable. The internet
of things is generating huge amounts
of data, which needs powerful data
analytics to provide useful insights.
Level39
The race is on to
found the next
generation of
unicorns and there
is no shortage of
candidates
02
Getty Images
The UK is fast becoming an incubator for startup companies with the potential to disrupt business
models and make a fortune
01
East Londons
Tech City near Old
Street, formerly
known as the Silicon Roundabout, is
home to one of the
largest technology
startup clusters in
the world
02
Workers at the
Level39 fintech
incubator at One
Canada Square in
Canary Wharf
SECTOR BREAKDOWN OF UK DIGITAL COMPANIES

Software
development
Advertising
and marketing
Media and
entertainment
Marketplace/lead
generation
Data management
and analytics
E-commerce
Hardware
and devices
Fintech
Telecoms and
networking
Edtech
Healthtech
Games development
and publishing
Electronics
and components
Other
0%
5%
10%
15%
20%
Source: Tech City UK 2015
Best of all, these technologies are

cheap to use. Joe Schorge, managing partner of venture capital
house Isomer Capital, believes the
boom in disruptive tech startups
owes a huge amount to the plunging cost of tools. You dont need
10 million to get started. Its more
like 10,000. In fact, many cloud
providers offer their services free
at first. Transaction costs are close
to free. You can found a company
and run it for next to nothing, then

scale it up, he says.
This low cost of entry, plus the
lure of a payday, means the number
of disruptive startups is sky high.
Investors like Mr Schorge are more
than happy to fuel the trend. We
believe in trying lots of ideas, he
says. The more shots you take, the
more goals you score. He explains
that his investment model relies on
a small number of companies sup-
plying the bulk of the returns. Lots

will not come to fruition.
An under-appreciated ingredient
in the rise of disruptive startups
is the supportive environment for
entrepreneurs. Take Property Partner, a novel crowdfunding concept
which allows consumers to invest
in the UK property market. Founder
Dan Ganesha recruited experienced
entrepreneurs to help him develop
his concept. Ed Wray, who founded
Betfair, is an investor and non-executive director, says Mr Ganesha.
To found a disruptive business
you need people you can bounce
ideas off. It takes more than just
money. You need guidance from
people whove been through the
phase of hyper-growth. The US has
had that for a while and I think we
have it in the UK now too.
Startup incubators and accelerators are soaring in popularity. Level39 in Canary Wharf is Europes
largest accelerator of fintech companies. High-growth companies
are given priority. Crammed into
three floors of the One Canada
Square skyscraper youll find several dozen young companies, each
with the potential to reach the magical billion-dollar valuation. Barclays Bank has an accelerator, as
does Santander, Citibank and UBS.
Tax is a lubricant. The Seed Enterprise Investment Scheme (SEIS) and
Enterprise Investment Scheme (EIS)
offer big breaks for anyone taking a
punt on a startup. Property Partner
pinpoints tax as a big reason it flourished so fast. We used both the SEIS
and EIS to raise 1.4 million before
launch, says Mr Ganesha. The
right tax scheme means investors
can write off losses. They can back
an ambitious idea. If nine out of ten
dont work, its OK because of the tax
safety net. It encourages bold ideas.
Add up all these factors and you
have the perfect conditions for disruptive digital startups. Its the cool
thing to do, says Mondos Mr Blomfield. The movie The Social Network
[portraying Facebook founder Mark
Zuckerberg] was the moment. When
Justin Timberlake wants to play a
startup founder you know something special is happening.
Is the trend sustainable? The key
metrics point to the affirmative. For
example, the internet of things is
forecast by McKinsey to have a total
economic impact of $11 trillion by
2025. Mobile data traffic is rising by
around 60 per cent annually, says
Gartner. Some of the most exciting
digital technologies, such as virtual
reality, have barely got started.
If anything, this is just the dawn of
the disruptive startup.
raconteur.net
PEAK Founded 2013

What does it do? Neurological improvement games.
Why so hot? Peak combines the best of science, education and technology
to create therapeutic games. Peaks game Wizard improves episodic
memory and has been trialled to diminish the symptoms of schizophrenia.
Its brain-training app is targeted at consumers. Peak has $10 million in
funding and the team is astonishingly well qualified. Scientific advisers
include Bruce E. Wexler, professor emeritus of psychiatry at Yale School of
Medicine, and Barbara Sahakian, professor of clinical neuropsychology at
Cambridge University. The gaming industry is bigger than Hollywood. Peak
hopes to pioneer a bold new future for the sector.
ELLIPTIC Founded 2014

What does it do? Security and management of blockchain.
Why so hot? Blockchain is the underlying technology behind Bitcoin and
its billed as the most exciting niche in tech right now. Elliptic beat 270
companies to win The Banker magazines security project of the year award
for its work on Bitcoin. Founded by derivatives trader James Smith and
consultant Tom Robinson, Elliptic has developed profoundly versatile
blockchain technologies, which can be used for payment, fighting money
laundering and storage. Its early days for blockchain, but if the hype has
any substance, Elliptic should have a golden future.
GUEVARA Founded 2014

What does it do? Peer-to-peer insurance.
Why so hot? Instead of buying insurance from a faceless multinational
corporation, consumers are pooled by Guevara into groups of up to 250
people. Any claim is paid by the group. The idea is to reduce frivolous claims by
making it clear where payouts come from. We are still testing and tweaking,
says co-founder Rich Philip. The incumbents dont have the ability to change.
We believe we can bring about real behavioural change in insurance.
AIMBRAIN Founded 2014

What does it do? Adds behavioural clues to passwords.
Why so hot? Ah passwords. So vital, yet so flawed. AimBrain aims to redeem
passwords by adding extra elements to the security mix. It watches how you
type passwords speed, pressure and rhythm will matter. It also has facial
and voice biometric identification methods. AimBrains founders are two
Lithuanians who met on a flight to Edinburgh on route to the university. The
startup won 350,000 from venture capital fund Episode 1 and a place on
Accentures Fintech Innovation Lab London programme. Its a huge global
market as the biometric ID market ought to triple in size in the next few years.
VIZEAT Founded 2014

What does it do? Arranges dinner parties for strangers at a hosts house.
Why so hot? Just as Airbnb turned homeowners into hoteliers, VizEat
hopes to turn amateur chefs into restaurateurs. Use the website to book a
meal at a hosts house, and then show up and dine with other gastronauts.
VizEat has competition from Grub Club, EatWith and Shareyourmeal.
Disruptive? The French restaurant union Synhorcat thinks so, demanding
a clamp down on uninsured and uninspected restaurants. A sure sign
the concept could really shake up the fine-dining market.
REVOLUT Founded 2015

What does it do? Zero-commission currency transactions.
Why so hot? Go on holiday and youll pay a fortune in foreign currency
fees. And while companies can now use Transferwise to cut these costs,
consumers are still poorly catered for. Revolut aims to change that. It offers
an app and MasterCard which process foreign currency payments at the
mid-market rate. No spread, no fees either. Founded by Nikolay Storonsky,
a former trader, Revolut is a tenant at Level39 in Canary Wharf, with
backing from Balderton Capital. The market is 500 billion annually.
raconteur.net
THE DIGITAL ECONOMY
19
20
THE DIGITAL ECONOMY
raconteur.net
28 / 01 / 2016
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raconteur.

THE DIGITAL ECONOMY

DIGITAL TECHNOLOGY IS DRIVING

A dynamic digital economy has become part of our daily lives

Cyber security is climbing its way

Where are investors in digital

Digital marketing techniques

THE DIGITAL ECONOMY

DIGITAL AND SOCIAL MANAGER

Business journalist and

HELPING YOU INNOVATE IN THE DIGITAL MARKETPLACE.

Every day brands face new challenges

The Digital Innovation Group (DIG) is

Author, journalist and

Former business news

Digital technology is now central to UK business,

Freelance business writer,

Freelance writer and

Although this publication is funded through advertising and

ith internet access now

digital economy above and beyond

Mr Li describes the UK as very entrepreneur friendly and attractive

Despite the UK being a global leader

THE DIGITAL ECONOMY

THE DIGITAL ECONOMY

Now is the time to exploit the full potential of

Average B2B firm

arketing is a business function

measuring and engaging with

Know it all and win business

Sales accepted leads

Sales qualified leads

alking to a friend about

tracts and embracing the benefits

GLOBAL SURVEY OF FIRMS THAT HAD COMPLETED

POST-SALES IS THE NEW SALES

Source: Rethinking the Role of Marketing, Gleanster/Act-On, Q1 2015

conventional market segmentation

We are seeing companies

personalised way. This is where people

a growing demand for companies

years, according to IBM. The technology behemoth categorises big

FORECAST CONNECTED DEVICES, 2014-2020

INSTALLED BASE OF INTERNET OF THINGS UNITS BY CATEGORY, MILLIONS OF UNITS

Source: Gartner 2015

amount of valuable data and were

Behind every one

Inspired by the Smart Cities initiative

THE DIGITAL ECONOMY

PERCENTAGE OF IT BUDGET SPENT

THE DIGITAL ECONOMY

THE NEW DIGITAL BUSINESS HEROES

Carphone Warehouse reported in

make that digital transformation happen

Organised hackers are

Cyber security is climbing its way up the boardroom agenda as UK

The UK boasts one of the worlds

company based in Marlow, Buckinghamshire, the estimated average

BARRIERS TO EFFECTIVE CYBER DEFENCE

SURVEY OF NORTH AMERICAN AND EUROPEAN IT SECURITY DECISION-MAKERS

Too much data to analyse

Lack of skilled personnel

Lack of management support/awareness

Poor integration/interoperability between security solutions