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The Future of Money - People's Insights Magazine


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In this issue, we start off with an overview on how community, technology and data are changing the Future of Money. Then we look at thirteen inspiring projects that are re-defining how people earn, …

In this issue, we start off with an overview on how community, technology and data are changing the Future of Money. Then we look at thirteen inspiring projects that are re-defining how people earn, raise, manage, exchange and spend money.

For more on Future of Money, visit:

The People’s Insights Quarterly Magazine pulls together insights from MSLGROUP’s Insights Network — a private network created on our proprietary People’s Lab crowdsourcing platform — in which 100+ planners within MSLGROUP share and discuss thought-provoking research and inspiring projects in the areas of social data, crowdsourcing, storytelling and citizenship.

Every week, we pick one project from the MSLGROUP Insights Network and curate conversations around it — on the network itself but also on the social web — into a weekly insights report. Every quarter, we present the thirteen insights reports to you, along with original research from our global network, as an online magazine.

We have further synthesized the insights to provide foresights for business leaders and changemakers — in the ten-part People’s Insights annual report titled Now & Next: Ten Frontiers for the Future of Engagement, also available as a Kindle eBook.

For more, see

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  • 1. Volume 2, Issue 2 100+ thinkers and planners within MSLGROUP share and discuss inspiring projects on social data, crowdsourcing, storytelling and citizenship on the MSLGROUP Insights Network. Every week, we pick up one project and curate the conversations around it — on the MSLGROUP Insights Network itself but also on the broader social web — into a weekly insights report. Every quarter, we compile these insights, along with original research and insights from the MSLGROUP global network, into the People’s Insights Quarterly Magazine. We have synthesized the insights from our year-long endeavor throughout 2012 to provide foresights for business leaders and changemakers — in the ten-part People’s Insights Annual Report titled Now & Next: Ten Frontiers for the Future of Engagement. People’s Insights In 2013, we continue to track inspiring projects that are shaping the future of engagement. Do subscribe to receive our weekly insights reports, quarterly magazines, and annual reports, and do share your tips and comments with us at @PeoplesLab on Twitter. People’s Insights weekly report People’s Insights quarterly magazines People’s Insights Annual Report
  • 2. Inside Foreword by Pascal Beucler 04 Editorial by Nidhi Makhija 05 16Amex Sync on Twitter Social Data Crowdsourcing 51Barclaycard Ring 57Dart Registry 21 62PlanBig KBC Bank 28 67 Tesco Wine Co-BuysTrustCloud 33 Kiva Zip 72 Bitcoin 78 Pledgeit 85 38PeopleLikeU 44CommBank’s Kaching Future of Money by Gaurav Mishra & Nidhi Makhija 06
  • 3. Volume 2, Issue 2 Pascal Beucler, SVP & Chief Strategy Officer, MSLGROUP projects at the intersection of social data, crowdsourcing, storytelling and citizenship for eighteen months. We continue to be inspired by organizations and entrepreneurs’ diverse explorations in these areas, and the new ways in which people are beginning to engage with each other and with organizations. I would like to take this opportunity to share that People’s Insights has just crossed the 950,000 views mark. We thank you for your overwhelming support and for sharing our weekly reports, quarterly magazines and our annual report Now & Next: Future of Engagement. Feel free to write to me at pascal.beucler@ to share your feedback on the magazine, or to start a conversation on how to engage stakeholders in today’s Conversation Age. For long, social media has been credited for giving power to the people and enabling them to rally around shared passions and shared purpose. Today, social media is joined by the growing forces of community, technology and data, which are empowering people in new ways, often to achieve success in their personal and professional endeavors. In this issue of the People’s Insights Quarterly Magazine, we focus on how social and mobile technologies are changing the way people earn, manage and spend money. We also look at how brands, organizations and entrepreneurs are adopting and embracing these new tools to re-invent their relationship with people. Our global network of 100+ planners has been sharing insights around Foreword
  • 4. 5 Editorial Nidhi Makhija, Senior Manager - Insights, MSLGROUP People’s Insights The People’s Insights Quarterly Magazine pulls together insights from MSLGROUP’s Insights Network — a private network created on our proprietary People’s Lab crowdsourcing platform — in which 100+ planners within MSLGROUP share and discuss thought-provoking research and inspiring projects in the areas of social data, crowdsourcing, storytelling and citizenship. Every week, we pick one project from the MSLGROUP Insights Network and curate conversations around it — on the network itself but also on the social web — into a weekly insights report. Every quarter, we present the thirteen insights reports to you, along with original research from our global network, as an online magazine. We have further synthesized the insights to provide foresights for business leaders and changemakers — in the ten-part People’s Insights annual report titled Now & Next: Ten Frontiers for the Future of Engagement, also available as a Kindle eBook. People’s Insights Quarterly Magazine, Volume 2, Issue 2 In this issue, we start off with an overview on how community, technology and data are changing the Future of Money. Then we look at thirteen inspiring projects that are re-defining how people earn, raise, manage, exchange and spend money. • How brands like American Express and Tesco are encouraging people to talk about the brands on social media in return for discounts and freebies. • How virtual currencies like Bitcoin and banking apps like Commonwealth Bank’s Kaching are facilitating smoother and quicker peer-to- peer transactions over web, mobile and social networks. • How brands like Chrysler-Dodge and non- profits like Leukemia & Lymphoma Research are creating their own dedicated crowdfunding platforms to help people raise money for themselves or for a cause. • How non-profits like Kiva are creating peer-to- peer lending platforms to connect lenders and borrowers directly. • How banks like Barclays and Bendigo & Adelaide Bank are experimenting with long- term co-creation communities to enable customers to co-create financial products and to help entrepreneurs crowdsource feedback and advice, respectively. • How banks like KBC Bank are creating collective intelligence platforms to crowdsource data, and present it back to entrepreneurs with added value. • How organizations like Intuit-Mint and UBank are using data to help people manage and compare their personal finances. • How start ups like TrustCloud are using aggregated social data to help people measure and showcase their reputation on social networks and collaborative consumption platforms. Do subscribe to receive our weekly insights reports, quarterly magazines and annual report, and do share your tips and comments with us at @PeoplesLab on Twitter.
  • 5. Volume 2, Issue 2 Future of Money The Future of Money How social and mobile technologies are changing the way people earn, manage and spend money Source: opensourceway on Flickr First, these technologies are helping us create, store and access value in new ways. We are creating value by sharing content (Wordpress), photos (Flickr) and videos (YouTube)) online for free to express ourselves; collaborating with likeminded others to co-create open source content (Wikipedia), software (Linux) and hardware (Arduino); and participating in open innovation communities to co-create solutions for a better world (OpenIDEO). We are thus storing value in the commons, using the Creative Commons License for artistic works like content and the GNU General Public License for practical works like software, to enable others to reuse, remix and reshare our creations. As a result, not only participants in such peer-to-peer networks, but also everyone else in the world, can access Second, these technologies are helping us accumulate, measure and exchange new types of currencies in new ways. We are participating in ecosystems that recognize and value social currency, not only financial currency. We are accumulating whuffie2 and karma through our actions in social networks (Facebook, Twitter, LinkedIn), content sharing networks (Wordpress, Flickr, YouTube) and peer-to-peer networks (eBay, TripAdvisor, Stack Overflow). We are measuring our social currency or social capital through services like Klout, Kred, PeedIndex and TrustCloud. We are then using our social currency to build trust and influence, improve our experience in peer-to-peer marketplaces, and even save time and money. For more, see Rachel Botsman argue that the currency for the new economy is trust. Tim O’Reilly on the Economic Value of Open Source 1 A gift economy, gift culture or gift exchange is a mode of exchange where valuables are given without an explicit agreement for immediate or future rewards (via Wikipedia) 2 Whuffie is the ephemeral, reputation-based currency of Cory Doctorow’s science fiction novel Down and Out in the Magic Kingdom (via Wikipedia) and benefit from free content, media, software and hardware created through the gift economy1 . For more, see Tim O’Reilly outline an approach to calculate the economic value created by open source communities. Nidhi Makhija, Senior Manager - Insights, MSLGROUPGaurav Mishra, VP of Insights, Innovation & Social, Asia, MSLGROUP What is the Future of Money? Social and mobile networks, and the rich data streams that emerge out of them, are fundamentally changing the way people 1) create, store and access value 2) accumulate, measure and exchange currencies and 3) earn, manage and spend money.
  • 6. 7 Rachel Botsman on Trust as Currency Third, these technologies are helping us earn, manage and spend money in new ways. We are earning and saving money by selling or bartering our things (eBay), spaces (Airbnb) and time (TaskRabbit) on peer-to-peer marketplaces. We are gifting, lending and investing money with our peers on crowdfunding (Kickstarter, Indiegogo), peer-to-peer microlending (Kiva, Prosper) and social investing (eToro, Zulu Trade) communities. We are managing our money by setting goals and comparing our spending against similar others (Mint, Payoff), and using mobile wallets (Lemon Wallets, Isis Wallet) to replace paper money and plastic cards. Finally, we are not only moving our spending to peer-to-peer transactions, but also using new payment methods like virtual currencies (BitCoin, Dwolla), online payments (PayPal, Visa, mobile payments (PayPal Here, Intuit GoPayement, Square) and social payments (Pay with a Tweet, Flattr). For more, see Sapient Nitro explore the future of payments. Sapient Nitro on the Future of Payments Collaborative Consumption In this report, we will focus on how social and mobile technologies are shaping the future of money. We will explore how such technologies are enabling new ways of earning, saving, managing, gifting, lending, investing, and spending money, now and in the future. Specifically, we will explore the following models: 1. Sharing economy and peer-to-peer marketplaces 2. Crowdfunding, microlending, crowd investing and social investing communities 3. Online, mobile, social and virtual payment ecosystems 4. Money management applications and mobile wallets We will also explore how traditional banks and financial services firms are exploring such models to compete with new players, and engaging their customers in grassroots change movement and collaborative social innovation initiatives. The rise of these platforms and apps can be attributed to three broad trends. First, the continued recession has made people sharpen their focus on maximizing the value of their money and assets, prompting them to find new ways to earn, manage and save money. Second, the widespread adoption of online social networks has inspired entrepreneurs to explore the power of their networks, resulting in an explosion of new peer to peer platforms. Third, the wealth of financial data available through financial institutions’ APIs has made it possible for entrepreneurs to aggregate data from multiple sources, analyze it and present it back to people with valuable insights about their own behavior. 1. Sharing Economy and Peer-to-Peer Marketplaces People are earning and saving money by selling or bartering things, spaces and time on peer-to- peer marketplaces. The sharing economy is an important groundswell that is changing the very nature of ownership and consumption. We are prioritizing access over ownership, and choosing sharing,
  • 7. Volume 2, Issue 2 Future of Money renting, swapping, bartering and gifting over buying. We are sharing products, services and spaces with others in our communities, or around the world, using community-driven peer-to-peer marketplaces. In doing so, we are saving money by borrowing or renting from peers and earning money by renting out our unused assets. Peer-to-peer marketplaces are particularly disruptive because they use technology to directly connect people and eliminate the need for service organizations like hotels, universities and banks. The platforms invest in creating a community and build trust between users through social connections, verified profiles, peer reviews and offline meetups, and typically make a margin on the transactions between users. Some of the most popular categories for peer- to-peer marketplaces are mobility (BlaBlaCar (video), RelayRides (video), Spinlister, Sidecar (video), Lyft (video), Zimride (video)), spaces (Airbnb (video), Wimdu (video), DeskWanted (video), Landshare (video), ParkatmyHouse (video), ParkingPanda (video)) and services (TaskRabbit (video), DogVacay (video), Rover (video), Skillshare (video), WeTeachMe (video), italki (video)). In addition, several multi-purpose collaborative consumption platforms enable people to sell (eBay, Craigslist, Zaarly (video)) or rent (Zilok, Rentoid (video), Uniiverse (video)) all types of products, services and experiences. As peer-to-peer marketplaces become more widespread, services that map our online reputation and trust will become more important (Klout, Kred, PeedIndex, TrustCloud, Connect. me (video), Credport, Fidbacks, Virtrue, MiiCard (video), Lenddo (video)). Some of these peer-to-peer marketplaces have achieved significant scale and success. For instance, Airbnb has 4 million people who have shared 300,000 listings in 40,000 cities and rented 10 million nights. We believe that the growth of the sharing economy will fundamentally change our relationship with money and ownership. We expect product organizations (like auto companies) to redesign their business models from selling products to renting services and create peer-to-peer marketplaces for second- hand products and add-on services (like parking spaces). We also expect service organizations (like banks and universities) to create peer-to- peer marketplaces for services they cannot provide profitably (like microloans (see Kiva Zip & Prosper) and hobby workshops (see Skillshare & Craftsy)). Finally, we expect banks to design trust- rating services that aggregate users’ trust scores across peer-to-peer marketplaces and establish trust as a currency that is both universal and context-specific (see TrustCloud & Lenddo). How to Airbnb? Patagonia + eBay Green - Common Threads Initiative What is Lenddo? For instance, GM has partnered with car-sharing service RelayRides (video) and BMW i has invested in parking-sharing service Park at My House (video)). Nike with NIKEiD (video) and Converse with Design Your Own have created platforms to enable customers to customize and sell their products, while Vancl with Star and Magazine Voce (video) have created platforms to enable customers to create their own storefronts and sell products to their own networks. Finally, Patagonia and eBay partnered to create the Common Threads Initiative (video), which uses to the eBay platform to enable people to resell used apparel to others.
  • 8. 9 2. Crowdfunding, Microlending, Crowd investing and Social Investing Communities People are gifting, lending and investing money with peers on crowdfunding, peer-to- peer microlending, crowd investing and social investing communities. We are using crowdfunding platforms to collectively fund a wide variety of projects we are passionate about, through donations. Typical projects include technology (gadgets, games, applications), art (music, movies, books), citizen journalism, scientific research and societal causes. In return, we receive a reward, which might include a product, a customized experience, equity, or simply recognition, depending on the type of platform and project. Crowdfunding platforms focus on a wide range of projects, including creative projects (Kickstarter (video), indiegogo (video)), personal projects (GoFundMe(video)), music projects (ArtistShare (video)), non-profits (CrowdRise(video), Razoo (video)), patients (GiveForward (video), Watsi), public spaces (SpaceHive (video)) and food businesses (Credibles (video)). Source: analogica on Flickr indiegogo Crowdfunding Platform We are using microlending communities to give loans to small entrepreneurs and people in need, based on their personal story or project idea, to help them achieve their goals or earn better returns for ourselves. Some microlending communities focus on peer-to-peer loans with the promise of better returns (Prosper, Zopa (video), Lending Club) while others focus on helping those in need (Kiva Zip (video), Rang De (video), BuzzBnk (video), Zidisha, United Prosperity, Vittana (video), LendWithCare (video)). Kiva Finally, we are using crowd investing platforms to put money in promising startup ventures for equity, in the hope of exponential financial returns. The current crowd investing platforms typically work with high net worth experienced investors to reduce risk (Symbid (video), Seedrs (video), CrowdCube (video), WeFunder (video)), but we expect truly peer-to-peer crowd investing platforms to emerge as government regulations allow such platforms. These crowd investing platforms are different from social investing communities (Currensee (video), eToro (video), Zulu Trade (video), Ayondo (video), Tradency (video)), on which investors can follow and replicate each others’ investment portfolios, share investment tips and earn both reputation and financial returns. Symbid in 60 seconds All these types of platforms follow a similar model. People seeking funds post a project, share their own personal story and the details of their project, and try to attract a community. The community funds the project through donations, loans or investments and supports it on social media. In return, the project owner gives them the promised reward and shares updates on the progress of the project.
  • 9. Volume 2, Issue 2 Future of Money Some of these platforms have achieved significant scale and success. For instance, almost 1 million Kiva lenders have given $460 million in loans to 1 million borrowers. 4.6 million Kickstarter backers have pledged $745 million in donations to more than 45,000 projects. In the future, we expect niche crowdfunding, microlending and crowd investing platforms to focus on specific geographies and markets, and larger platforms to expand into new areas through organic growth, acquisitions and partnerships. We also expect some niche crowdfunding platforms to focus on connecting brands with creators and backers. Finally, we expect corporations, including banks, to create their own crowdfunding platforms, and ask their community members to fund projects and non- profits on a matching grant basis. For instance, brands are now creating dedicated crowdfunding platforms (Dodge Dart Registry (video), Microsoft Windows Chip In) or partnering with niche crowdfunding platforms to help people find funds to buy their products (Hyundai & Motozuma (video)). Financial institutions are also creating platforms (Volksbank Bühl - Viele Schaffen Mehr (video)) and apps (Fidor Bank) to help customers interested in crowdfunding or crowd investing. 3. Online, Mobile, Social and Virtual Payment Ecosystems People are not only moving spends to peer-to- peer transactions, but also using new payment methods like online payments, social payments and virtual currencies, and mobile payments. - Crowdfunding in der Volksbank Bühl Source: Kaching: The Future of Payments As much of our shopping shifts to online and mobile, we want to use payment options that don’t require us to share credit card details with each merchant, carry our credit cards around with us, or pay merchants a commission for payments to friends and family. To this end, we are using online payment systems from established players like PayPal and Visa (video), but also startups like free peer-to-peer payment platform Ripple (video) and prepaid card platform Akimbo (video). We are also using a range of social payment platforms and virtual currencies to pay online. Chirpify (video)) lets us pay inline on social networks, Flattr (video) lets us ‘tip’ our favorite content creators every month, and Pay with a Tweet (video) lets us pay content creators with online word of mouth. Virtual currencies (BitCoin (video), Dwolla, Ven (video), Feathercoin (video)) let us make online payments, including peer to peer payments and merchant payments. These currencies are created and supported by software algorithms, instead of governments and central banks – although some governments are beginning to experiment with their own virtual currencies (Canada’s MintChip (video)). What is Bitcoin? We are also using a range of mobile payment options, including peer-to-peer mobile payments, and contactless NFC or QR code enabled mobile payments. Peer-to-peer mobile payment platforms like M-PESA (video) and Venmo (video)), let us transfer money to family and friends, often without paying a transaction fees. Contactless mobile payment solutions, enabled by NFC (Square Wallet, Visa PayWave, VeriFone PAYware (video), MasterCard PayPass (video)) or QR code (PayConnect (video), LevelUp (video)) let us make payments without handing over our cards to merchants, by simply tapping our cards on sensor enabled readers or making cloud payments on our smart phones.
  • 10. 11 Some of these platforms and apps have achieved significant scale and success. PayPal has 132 million active registered accounts in 193 markets and supports payments in 25 currencies. Bitcoin sees $45 million of activity per day, with 11 million Bitcoins, worth $1.1 billion, currently in circulation. 4.5 million people have bought products online with social payment system Pay with a Tweet. Introduction to M-PESA: Mobile Money in Developing Economies In the future, we expect all banks to create online, mobile and social payment platforms as a core offering. We expect retailers to create custom mobile payment and loyalty apps, apart from adopting third party apps. Finally, we expect banks and retailers to create programs that recognize and reward social currency. For instance, banks are already creating mobile and social apps to let people make peer to peer payments (CommBank Kaching for Facebook and Mobile (video), DenizBank Facebook Branch, American Express Serve (video), Barclays Pingit (video), ANZ goMoney (video)). Several of these bank apps have crossed the 1 million users mark. As we are making payments via a range of mobile payment options, we are also seeing merchants, including small retail and service businesses use connected mobile devices like PayPal Here (video), Intuit GoPayment (video) and Square (video) to accept such payments. These devices also power advanced billing registers and provide extensive data analysis and insights to merchants (Square Business Analytics). Source: Mobile Payments (Infographic by Elise Gilbert) View the full infographic at Starbucks has created its own custom mobile payment app (video) and also partnered with Square Wallet to create one (video). Finally, American Express with Sync (Twitter (video),
  • 11. Volume 2, Issue 2 Future of Money Source: Facebook, Foursquare), and Tesco with Wine Co- buys (video) are creating programs that enable customers to earn discounts or freebies by paying with word of mouth. 4. Money Management Applications & Mobile Wallets People are managing money by setting goals and comparing spending against similar others, and using mobile wallets to replace their paper money and plastic cards. Amex Sync On Twitter The Best Free Way to Manage your Money We are becoming smarter about managing our money by using personal finance applications that enable us to set financial goals, compare our spending with similar others, and tap into the power of our networks to reach our goals. These apps use a combination of quantification and gamification to give us insights and help us change our behaviors (Mint (video), Payoff (video), Simple (video), Moven (video), Check (video), SaveUp (video), Easy Envelope Budget Aid (video)). They ask us to link our bank, credit card, loan and other accounts to get access to our financial data streams. They then break up our spending into categories, help us set smart goals by comparing our category-wise spends against similar others, and track our category-wise spending against budgets. We are also using money management apps that focus on niche areas, like managing medical payments (Simplee (video)), gift cards (Gyft (video)), frequent flier miles (Superfly), grocery lists and coupons (GroceryIQ), and bills (BillMinder). Similarly, business owners are using data analysis apps to find patterns and manage their transaction activity (Square Register (video), TabbedOut (video), Clover). We are also replacing our physical wallets, with mobile wallets that store all our credit card, debit card and loyalty card details, and enable us to make payments with our smart phones without carrying around our cards. Banks, financial services firms, mobile operators, internet startups and retailers are all creating a range of mobile wallet services, either on their own, or in partnership with others. These include Square Wallet, Google Wallet (video), Toro NFC Wallet (video), Visa Digital Wallet (video), Lemon Wallets (video), Droplet (video), WingCash (video), (video), Isis Wallet (video, by AT&T, T-Mobile and Verizon) and MCX (by Walmart, Target and BestBuy). Isis Mobile Wallet for Smartphone Payments Some of these platforms and apps have achieved significant scale and success. 10 million people manage 2 million financial goals on and have tracked $80 billion in credit and debit transactions and $1 trillion in loans and assets. In the future, we expect all banks to create such money management applications and mobile wallets as a core offering. We also expect that mobile wallets will offer similar analytics and insights as money management applications, and replace applications that help us manage only one type of transactions. We believe that the
  • 12. 13 PeopleLikeU: The World’s First Econographic Tool mobile wallets of the future will not only track our financial transactions, but also integrate social currency. Finally, we expect that mobile wallets will offer seamless online, mobile and social payment options that we outlined in the previous section. For instance, banks are already creating data analysis platforms that compare people’s spending habits to similar others (Capitec Bank Budgetanator (video), Commonwealth Bank Signals (video), UB Bank PeopleLikeU) and money management dashboards that 5. Grassroots Change Movements and Collaborative Social Innovation Initiatives Traditional banks and financial services firms are not only exploring the services we outlined above to compete with new players, but also engaging their customers in grassroots change movements and collaborative social innovation initiatives. Multiple studies (Capgemini’s World Retail Banking Report 2013 and JD Powers’ 2013 U.S. Retail Banking Satisfaction Study) show that satisfaction with banks has increased in the last year, as banks are actively addressing consumer’s unhappiness. At the same time, banks are trying to win over the trust of their customers, by creating grassroots change movement and collaborative social innovation initiatives around a shared purpose. help people analyze their spending (MBank (video), Knab (video), ICICI Money Manager). Source: opensourceway on Flickr Collaborative social innovation initiatives involve businesses, governments, non-profits and change makers coming together to co-create innovative and sustainable solutions around a shared purpose. Such initiatives typically focus on the areas that have the highest potential to create shared value: environment, energy and sustainability; health, wellness and nutrition; education, learning and capability building; and governance, public services and public spaces. Change makers are typically rewarded with prize money, recognition, funding or support; organizations find solutions to important challenges; and society at large benefits from the innovative solutions. A number of banks are creating collaborative social innovation initiatives. Some banks sponsor pre-existing social innovation initiatives. For instance, Citi partnered with NBC News and NewSchools Venture Fun to launch the annual Citi Innovation Challenge to reward innovation in education. Other banks are creating their own initiatives and collaborative communities.
  • 13. Volume 2, Issue 2 Future of Money Small Business Saturday 2012 Barclays encourages customers to co-create a new community driven credit card with Barclaycard Ring (video). Fidor Bank encourages customers to advise each other on financial planning (video). KBC Bank created the collective intelligence platform The Gap in the Market (video) to crowdsource local opportunities for entrepreneurs and reward the best business ideas. Finally, Bendigo and Adelaide Bank created PlanBig (video) and American Express created OPENForum (video), ecosystems that connect and support communities of entrepreneurs and small business owners. Grassroots change movements involve a large numbers of people acting as change agents, in their own lives or in their communities, in a way that their actions can be aggregated or coordinated, leading to significant impact and meaningful change. Grassroots change movements might be catalyzed and managed by organizations, including corporations, or they might be sparked by an event and spontaneously spread through the initiative of volunteers, as we have seen with the recent string of political movements across the globe. Now, many organizations are applying a similar approach to catalyze behavior change and create shared value in the areas of environment, energy and sustainability; health, wellness and nutrition; education, learning and capability building; and happiness, kindness and human potential. A number of banks are creating grassroots change movement initiatives. For instance, American Express inspired millions of Americans to shop at independent vendors to support local businesses on Small Business Saturday (2010 video, 2011 video, 2012 video). Chase and American Express inspired large numbers of people to support their favorite causes through crowdvoting giving initiatives like Chase Community Giving (video), American Express Members Project (video) and American Express Partners in Preservation (video). In Summary In summary, we believe the following three patterns will shape the future of money, and the future of banking: 1. Banks and financial services firms are now competing with internet companies, mobile operators, retail chains and six-person startups to invent the future of money. We expect banks and firms to not only learn best practices from these players, but also partner with them, and even acquire them to fuel innovation. As an example, Intuit acquired cloud-based money management platform to complement its largely desktop-based software Quicken. 2. Financial services firms need to engage their customers around at least one of two motives: shared purpose and self-improvement. Specifically, we expect banks and firms to heavily invest in quantification and gamification technologies that promote financial literacy and well-being among consumers and small business owners. As an example, Aetna acquired self-improvement game MindBloom to help customers achieve wellness goals and maintain better health in the long run. 3. The meaning of value, currency, money and payments itself is changing. We expect banks to not only invest in online, mobile, and social payments, but also build services around the sharing economy and social currency. As an example, American Express recently expanded its AmEx Sync features to let people redeem discounts and purchase products via social networks directly. As we mention in our report on the future of engagement, we believe, like William Gibson, “that the future is already here, it’s just not very evenly distributed.” For the banks and financial services firms of today to survive in the future, it is crucial for them to innovate, engage and diversify not just to stay ahead, but to stay relevant at all. PlanBig - Ideas Made Bigger
  • 14. Social Data
  • 15. Amex Sync on Twitter
  • 16. 17 What is Amex Sync on Twitter? In 2012, American Express introduced Amex Sync on Twitter, which allows card members to sync their card to their Twitter account and earn credits by tweeting special hashtags. In early Source: 2013, American Express introduced a new feature to this program, which allows card members to make direct purchases by tweeting special hashtags. Blogger Adi Robertson highlights the significance: “The results here are functionally similar, but you’re not just doing some advertising in exchange for credit — you’re putting an actual purchase history online and asking American Express to charge your card through Twitter.” Thinkers, bloggers, marketers and American Express card members note that this move further streamlines the process of shopping online, and speculate upon the role financial institutions and social networks will play in the future of ecommerce. Several have also shared privacy and security concerns over merging their banking and social media accounts. How it works Card members sync their accounts online at the American Express website, and then follow @AmericanExpress to find out about the latest credit offers and purchase offers from American Express and its partners. CNN’s Heather Kelly explains the process of loading credit offers:
  • 17. Volume 2, Issue 2 Future of Money Source: Social Data Amex Sync on Twitter Source: Source: Source: (spotted on TechCrunch) Source: Amex Sync On Twitter - American Express “On Twitter, you tweet the hashtag for an offer and then go make the purchase in person or through a separate online store. The discount is then applied to your American Express account within eight weeks.” Card members must use their synced card when making purchases at partnering stores. Social Commerce Today’s Paul Marsden explains the process of making direct purchases through tweets: “Amex cardholders sync their Amex card with Twitter at Then, when Amex/Amex retailers offer deals (published in the @AmericanExpress Twitter feed), cardholders can buy them by simply tweeting the deal’s special hashtag – e.g. #BuyAmexGiftCard25.” To prevent accidental purchases, Amex requires a second, confirmation tweet. TechCrunch’s Natasha Lomas notes: “Payments are made by tweeting a purchase hashtag, and retweeting the confirmation tweet from Amex within 15 minutes of receiving it. The product will then be shipped to the account billing address synced with Twitter, and payment taken from your synced Amex account.” Irresistible launch offer American Express launched the new feature with an irresistible offer - buy a $25 Amex gift card for $15. Bloggers and online media spread word about the offer, as did card members who tweeted to avail of it. Discounts are an increasingly common – and effective – way for brands to promote their online & mobile payment initiatives. For instance, in mid-2012, Starbucks made headlines for selling a record 1.5 million $10 virtual gift cards on daily deals site LivingSocial at a discount of 50%. Strategist Jeremy Jacobs attributes this rise in real-time and impulse sales to increased connectivity on mobile devices: “Putting the right offer in the right context in the right time frame is so much easier now than it ever was before, so consumers are responding by being willing to say, no matter where I am at – whether at home watching TV or at my kid’s soccer game – I can make this purchase right away.” In addition to the $25 Amex gift card, card members could also choose to purchase other items, such as an Amazon Kindle Fire HD or Microsoft Xbox 360, at discounted rates.
  • 18. 19 Source: Source: Commitment to social In addition to Amex Sync on Twitter, American Express also engages card members on Foursquare and Facebook. As Mashable’s Todd Wasserman reported: “Last July, the brand launched a program called “Link, Like, Love” that tailored deals to you based on your Facebook “likes.” (For instance, if you “liked” Whole Foods, you might see an offer on your Facebook dashboard.) The brand also linked with Foursquare last June for a national program that rewarded users with a loyalty card-like credit when they checked in.” Other social American Express initiatives include the Social Rewards campaign in 2011, which, as AdAge’s Beth Snyder Bulik noted, encouraged “customers to think about spending rewards points in less traditional ways” and share their experience on Facebook: “What’s the most memorable thing you’ve picked up with Membership Rewards points -- great trip, cool gadget? Do tell!” Bloggers and thinkers, like Fast Company’s Austin Carr, believe that American Express’ social media partnerships and initiatives help differentiate the brand as a modern-day social company: “With the [Twitter] partnership, AmEx helps fortify its role as the credit card for the social media generation.”
  • 19. Volume 2, Issue 2 Future of Money Source: “Social spending” Similar to the Social Reward campaign, Amex Sync on Twitter encourages people to talk about their spends on their social networks, resulting in free promotion for the offers and brands involved. As Mashable’s Todd Wasserman noted: “For AmEx, the move may be less about boosting a fledgling ecommerce platform and more about promotion; With each hashtag, users give a tacit endorsement to the program and, by extension, the AmEx brand.” Source: This same philosophy is shared at, a service which allows people to exchange their virtual items for a tweet of endorsement: “In today’s world the value of people talking about your product is sometimes higher than the money you would get for it.” Some thinkers, like Red Ant CEO Dan Mortimer, note that the purchase-with-a-tweet feature streamlines the shopping experience, but doubt that convenience is the only criteria for online shoppers: “Shortening the payment cycle for impulse purchases through social is certainly an interesting field and should definitely be followed closely by certain retailers. The timing of the announcement by Amex, one week after Twitter is hacked and loses 250,000 passwords is certainly very brave as is the assumption that consumers want to make all of their purchases public and traceable.” Ecommerce implications Marketers note the Amex Sync on Twitter program presents ample opportunity for measurement which can help Amex develop its program further, glean insights from consumers and share this back with partners. Some, like Paul Marsden, believe the program paves the way for American Express to enter the ecommerce field: “The Amex pay-by-tweet initiative is part of a broad industry move for financial services companies to get more intimately involved with e-commerce.” Fast Company’s Austin Carr remarked: “AmEx aims to be the connective tissue between merchants and consumers on social media that will provide a mix of offers, data, and branding to its members.” Consequently, several thinkers believe the program can help Twitter establish its validity as an ecommerce platform. GigaOm’s Eliza Kern pointed out: “Most of Twitter’s monetization efforts so far have come through marketing and advertising, such as promoted tweets which now cost up to $200,000 a day, but this partnership that allows purchases through tweets could move the company toward e-commerce opportunities as well.” WSJ technology reporter Shira Ovide shared a similar view: “Marketers for the most part devote a small chunk of their advertising budgets to Twitter, partly because it’s tough to prove a tweet or an ad on Twitter leads to a sale. Being able to directly show consumers seeing a Twitter message and buying a product may prove that connection.” Social Data Amex Sync on Twitter
  • 20. 21
  • 21. Volume 2, Issue 2 Future of Money What is is a free platform that helps people manage their money. Founded in 2006, Mint currently helps 10 million people manage 17 million financial accounts at 16,000 North American financial institutions. Source: The Best Free Way to Manage Your Money Blogger Ann Carns explains: “Mint allows users to track multiple financial accounts, including bank and credit card accounts, in one place. To do so, users register at Mint and enter account information and passwords, so the program can obtain the information electronically and aggregate it. ( was acquired by the financial software company Intuit in 2009.)” Source: Caters to people who want convenience, automation and a helping hand Mint aggregates data from multiple financial accounts and presents it in one place. The platform is accessible across devices including web, mobile and tablets, and built its user base around the promise of convenience. As Mint user John Stevens commented at the Google Play store: “I have been using Mint on two devices and really like having [access] to all my accts in one place, especially when traveling.” Mint also promises automation: after a one time set up, the platform automatically pulls transactional data from people’s bank accounts, auto segregates it into different spending buckets like auto and groceries, and reminds people to pay bills on time. Social Data
  • 22. 23 Blogger Tim Murphy said: “No matter how responsible we try to be, everyone forgets to pay bills from time to time. Rather than hoping our memories get better with time (unlikely), why not leverage technology when you can?” As a result of the automation, Mint users share Blogger Jill Tooley notes that Mint is always looking out, “kind of like a parent who’s never fully satisfied with accomplishments and always pushes their kids toward excellence:” “It’ll sometimes warn you that you spend too much on X, Y, or Z. It’ll inform you if you fell short on your budgeting goals. It’ll suggest ways you can cut down on expenses whether you ask for that or not. “And even if you’re doing great in every aspect, it’s still involved in your business. A sparkling credit score and zero credit card debt doesn’t necessarily mean you’re on Easy Street, because there may be something you could improve.” Gamification helps people improve their behavior Mint uses gaming elements such as goals, points and rewards to guide people’s actions and keep them motivated. People can choose from a preset list of financial goals, like “Buy a Home” or “Trip to Hawaii,” or create their own goals. Their progress is then monitored and presented visually through bars. The editorial team at LaptopMag notes: “You get scores for how financially fit you are, a list of tasks and specific points you need to consider in order to achieve this fitness and bars showing how far along you are in your budget for the month.” Upon completing a goal, Mint encourages people to share their achievement on their social networks. Mark Henricks, a contributor to the Mint blog, explains: “In the final screen, verbally slaps you on the back with a congratulatory, “Boom!” Then you get some good advice: make your commitment more public by posting details via social media. It’s been shown that people do better sticking to goals when others get involved.” In addition to the gaming elements woven into the platform design, Mint also creates challenges to engage people and encourage good behavior. In his review of Mint’s “Financial Fitness” feature, Techcrunch’s Jason Kincaid notes: “Yes, it may sound like a bizarre combination at first – personal finance and fun aren’t exactly two things that go hand in hand. But it’s also a smart move on Mint’s part, as it looks to turn the mundane and often confusing activity of getting your financial affairs in order into something a bit more tolerable while increasing Mint’s engagement in the process.” Source: they feel secure about their transactions and financial well being. Mint user Charlene Hapeman commented: “[Mint] connects to my account securely and adds transactions so I don’t have to worry about forgetting to write them down.” Mint user Timothy Beldock commented: “[Mint] provides a nice financial summary across multiple accounts. I don’t always use the advice, but it’s nice to know that account activity is monitored.”
  • 23. Volume 2, Issue 2 Future of Money Source: Source: Beyond recognition, Mint also occasionally hands out tangible rewards, like cash prizes.’s Jeff Lopez shares: “A great example was 2010’s “Drop Your Debt Challenge” that rewarded players who had the greatest declines in personal debt.” Data and comparisons keep people motivated Mint uses data and comparisons to motivate people in two ways. First, Mint tracks people’s behavior and draws comparisons to their own past behavior. Source: Second, Mint aggregates users’ data to draw comparisons, both between Mint users themselves, and also between Mint users and non-Mint users. This helps people plan their expenses better and to see their progress. Social Data
  • 24. 25 Source: Personal finance blogger Erik Folgate said: “You can compare your own saving and spending habits to trends that other Mint users are setting. Using this data, you might realize that you’ve set an unrealistically low food budget for your neighborhood, or that you’re overspending on your gym and fitness costs.” Data and comparisons also encourage people to evaluate and share their own experiences, resulting in active discourse and sharing of tips and financial strategies. Even the ads help people save more Mint remains a free service by recommending financial products to people, and earning a percent of sales. The recommendations are tailored to people’s spending behavior and usually help people save even more money – resulting in many favorable reviews. Mashable’s Lauren Drell said: “Mint makes money by helping you save money — based on your spending and saving habits, Mint can recommend thousands of products. If you switch those products, Mint earns a kick-back, so it’s a win-win for Mint and for the user.” PCMag’s Jill Duffy said: “It’s free and ad-supported, but even the ads add value to a fantastic tool for managing your money.” Source: Source: Source: Privacy and security issues deter new users Quite a few people have avoided using Mint because they are not comfortable with sharing their bank passwords and account details. Response to the question “How much is in your emergency fund, Minters?” on
  • 25. Volume 2, Issue 2 Future of Money Source: YouTube user augustuslxiii shared his skepticism of third party web platforms: “I’m a bit wary about giving away any passwords to anyone else. I know isn’t a scam, but even so. It’s my bank password. I feel like I’d be whispering my vault combination to someone I just met.” Another commenter highlighted the increase in online security breaches: “What with all the security breaches and leaks these days, I’d never give out account information to some third party, no matter how secure or not it is. I’m not keeping my savings tucked under my mattress, but there is a certain degree of distrust with extremely sensitive information like that.” Yet another commenter stressed that web platforms must guarantee protection of data to make new users feel secure: “I [don’t] trust anyone’s cloud until they start defining the damages they are willing to cover for violated data privacy and provide a means to validate the my data is secure online.” Increasingly, people are also worried about ownership and usage of their data. NYTimes blogger Jennifer Saranow Schultz wrote: “Even if a site promises now not to sell aggregate data about customers, it could change the agreement at any time and go ahead and sell the data. In addition, if such sites go bankrupt, even if they currently don’t sell data, trustees may decide to sell it to maximize the value of the assets.” The recent global outrage over the US National Security Agency’s collection of personal data will further fuel privacy and security concerns in the future. As brands and organizations continue to collect user behavior and transaction data with new and existing digital properties, they will need to become more effective and proactive in creating, co-creating and communicating their policies. Acquisitions challenge people’s loyalty People are also increasingly skeptical of acquisitions of their favorite web platforms. For many, acquisitions imply a change in operating policies or mission, and –more seriously - the eventual death of the platform. Several Mint users have complained of usability issues following Intuit’s acquisition of the platform. Xconomy’s Wade Roush commented: “The trouble, for me, began about 18 months after the Intuit acquisition, when the team decided to stop using Yodlee as their data provider and switch to Intuit’s own back end. The reasoning behind the change was understandable, but for users, it was a huge pain.” Others noted a drop in quality of customer care and product upgrades. Mint user Acitrano commented: “The #1 biggest problem with Mint is that Intuit seems like they’re trying to kill it by resource starvation. The support is terrible and they seem completely unwilling to improve the product.” Acquisitions are now a red flag for savvy internet users. We have seen this at scale with the recent Yahoo acquisition of Tumblr: Yahoo CEO Marissa Mayer announced the news with a promise not to “screw up” Tumblr, and Techcrunch’s Matt Burns noted that 72,000 blog posts were transferred out of Tumblr within a single hour: “Tumblr users are afraid Yahoo is going to ruin it. After all, Yahoo has set that precedent after scooping up sites like Geocities and only to abandon development and let the sites rot in the Internet sun.” Social Data
  • 26. 27 Money management tools and apps Several platforms like and Save Up, integrate elements of data collection and analysis, and gamification to help people manage their money. We are also seeing niche money management platforms, like Simplee which helps people manage their medical expenses. Source: Source:
  • 27. KBC bank’s Gap in the Market
  • 28. 29 What is Gap in the Market? In February 2013, KBC bank in Belgium launched The Gap in the Market – a collective intelligence platform to crowdsource local business opportunities, aggregate data and present it back to local entrepreneurs. The bank accompanied the platform with a vote-based contest to crowdsource business ideas and supported popular ideas with coverage and prizes. Source:* 171,157 gaps in the market were reported in three months – an average of 560 reports per town or city – and 1,500 business ideas were submitted. The program also piqued the interest of marketers and advertisers and won a Gold Lion in the Direct category at Cannes Lions 2013. Purpose-inspired marketing With The Gap in the Market, KBC establishes a sound overlap between people’s interests and business interests. The program helps local entrepreneurs identify opportunities and also helps KBC promote its banking, loans and insurance services for entrepreneurs. In addition to helping entrepreneurs identify opportunities, KBC also encouraged entrepreneurs to discuss their ideas with local KBC executives and awarded 20 contest winners the use of company cars for 6 months, to help them set up their new business. Source: Blogger Pierre-Nicolas Schwab commented: “Kudos to KBC. We usually see banks as a hurdle in the entrepreneurial process but this time someone seems to think differently and wants to re-invent the process.” The program is quite timely too, as copywriter Hugo pointed out: KBC has done what any bank would do given the current economic situation: truly help citizens to start businesses and thereby improve the economy.* Indeed, purpose-inspired programs are becoming the new standard, as MSLGROUP’s Pascal Beucler points out in his reflections as a PR Lions juror: “It’s a purpose-led world: more and more big corporations and brands are embracing a ‘bigger-than’ USP and even old style social responsibility. For engaging Gen Y, and soon Gen Z, this is no longer an option.” Crowdsourcing “gaps” People submitted gaps in their local market online using the Gap Finder tool. Then, entrepreneurs browsed through this data on an interactive map, and filtered to see the top businesses needed in a specific region and compare needs across regions.
  • 29. Volume 2, Issue 2 Future of Money Source: Source:* The interactive map displayed gaps shared by people and also statistic data collected by yellow pages business Truvo. Using statistical data as seed content KBC pre-seeded the map with statistical data to create a base of content, which would then inspire the first wave of visitors to create additional content. Here’s a slide from KBC’s The Gap in the Market case study that explains the value of seeded content: Typically, we see marketers use social conversations around a hashtag or real-time data feeds and indexes to populate content on collective intelligence platforms. Reactions to the program The program sparked conversations around local businesses, as people shared gaps, analyzed the data and commented on the methodology of the platform. Source:* Source:* Bart Rosseau commented on the presentation of data: *Translation via GoogleSocial Data KBC bank’s Gap in the Market
  • 30. 31 Source: Moustache vond het gat in de markt Source:* Source: haberdasher28 on Instagram Source:* Olivier Maes and Wouter Lecluyse noted the use of the data in identifying general trends. Crowdsourcing business ideas After the gaps were identified, KBC invited entrepreneurs to ‘fill the gaps.’ To help entrepreneurs come up with ideas, KBC created videos featuring stories of successful entrepreneurs. Bart Claeys, a creative director, wrote: The second phase of the campaign is now focusing on the potential entrepreneurs. Three TV spot… and five different ads show examples of original companies and companies that should inspire people with good ideas to venture. The program then entered Phase III: Social Battle – a contest in which participants gathered support from their networks for the chance to win one of twenty company cars. Sixteen cars were awarded to the most popular idea in each of the 16 regions where KBC operates. The remaining four cars were awarded to the next most popular ideas in four other regions. Promoting The Gap in the Market KBC promoted The Gap in the Market through localized PR stories and advertisements – posters, radio ads, TV spots, online ads and innovative outdoor ads on empty store windows. Bart Claeys reported: Every village, town and city received personalized posters in their offices KBC (eg: What is missing in your opinion Halle?). Messages were stuck on vacant premises in shopping areas. Regional sections of the newspapers elaborated on the specific needs of each municipality. *Translation via Google
  • 31. Volume 2, Issue 2 Future of Money Source: Source: Source: KBC: The gap in the market KBC partnered with leading newspaper Het Nieuwsblad to provide local coverage across the country and to create a special micro-site – – which presents interviews with participants, results by region and top business opportunities based on third-party data and people’s submissions. The micro site also features results of an iVOX survey commissioned by KBC to study people’s satisfaction with the shops and services around them. Entering national discourse The Gap in the Market brought attention to the lack of local businesses and inspired both people and public leaders, like Daphne Dumery, to join the conversation. Trend: Move from saying to doing Marketers from across the industry are calling for more programs, like The Gap in the Market, that highlight people’s problems and deliver effective solutions – especially as technology creates new opportunities to do so. Razorfish’s chairman Clark Kokick penned the entire book Do or Die to inspire what he calls “effective marketing: moving from just saying things to your audience to actually doing things people find entertaining, useful, and relevant”: “In the past, you could simply turn up the volume if you wanted to get your message across. Today, you have to turn up the value. You have to give consumers something they actually prize in order to have them pay attention to you.” AKQA’s chief creative officer Rei Inamoto just recently argued that “Brands should aim to solve real problems by providing connected services over 365 days and by inventing new businesses that benefit people, not just the brand”: “Creativity and innovation are about finding unexpected solutions to obvious problems or finding obvious solutions to unexpected problems. We should use our creativity to provide better businesses and solutions rather than constantly trying to disrupt what people are doing.” Other examples of brands that are actively helping people include Adelaide and Bendigo Bank with PlanBig, and beyond money, Nike with the FuelBand. Social Data KBC bank’s Gap in the Market
  • 32. 33 TrustCloud
  • 33. Volume 2, Issue 2 Future of Money Source: Blogger Paul Smith explains: “They break it down into three layers: verification, behavior, and transaction. “The verification layer includes email, physical address and SMS verification. The behavior layer looks at who you are across social networks in an interesting way … The transaction layer looks at your ratings on sites such as eBay, Trustcloud’s algorithms sifting out the gamed ratings.” In addition to past data, TrustCloud also enables people to ask for endorsements and to endorse others for various ‘virtues’ like generosity, accountability and punctuality. To prevent people from gaming the system, TrustCloud limits the number of times people can endorse or +T each other (similar to LinkedIn endorsements). Blogger Michael Martine explains: “You get limited points to spend endorsing the trustworthiness of others in various categories. Because the number of points is extremely limited, you can’t just go around spamming and trading these with other people in order to artificially jack up your TrustScore (and defeating the whole purpose).” TrustCloud currently lets people connect networks including Facebook, LinkedIn, Twitter, Google+, Klout, eBay and TripAdvisor, and will soon support GitHub, Quora, Yelp and Yahoo! Answers. Social Data TrustCloud
  • 34. 35 Source: Trust Cards TrustCloud lets people display their TrustScore across the web with TrustCards that update every fifteen minutes to reflect the latest scores. Lora Kolodny noted: “TrustCloud users can display their scores with any listings or profiles they create on marketplaces. Or, they can save the scorecards for use in private email correspondence.” Source: TrustCards feature people’s scores, names, connected networks and Trust Badges – badges that depict their area of specialty. For example, people who are very active on social network earn the badge Interactive. Source: The list of badges available can guide people in deciding what they want to be known for, and also in understanding how to improve their TrustScore. Several TrustCloud users have shared that the TrustScore algorithm places more weight on transactional data than on social data. How P2P platforms foster trust Collaborative consumption platforms have explored a diverse range of reputation systems to foster trust within the platform. Paul Davis wrote: “The existing reputation systems that collaborative consumption services have developed in-house are piecemeal and offer little portability of user reputation data. House-sharing services such as Airbnb provide user feedback rankings and plug into users’ Facebook connections to provide an added layer of social vetting, while Couchsurfing verifies identity by through a $25 credit card verification fee, which is also their main revenue source. Taskrabbit performs background checks, while UK-based p2p lending site Zopa opts for identity and credit checks.” The presentation Trust and the Sharing Economy provides a broad overview of the types of steps that have been taken.
  • 35. Volume 2, Issue 2 Future of Money Social networks like Facebook (which requires people to provide their real names) have contributed greatly to the creation of reputation systems that rely on identity verification or social connections. Jeremy Barton and Rob Boyle, co-founders of the now defunct reputation system Legit, said: “On Airbnb, Facebook is used to tell you if your host went to the same college, or whether a friend of yours has stayed there before you. When you sign up for Lyft, you have no option but to connect with your Facebook account to provide proof of your identity. Facebook is a core piece of infrastructure for many marketplaces as the source of your offline authenticity and reliability.” The presentation Just Trust Me: How to Design Trustworthy Products provides an in-depth view into the creation of trust in the virtual world, the challenges faced by individual platforms and the homogenous solutions these have resulted in. Source: Source: General Assembly also highlights one of the challenges in simply aggregating data and porting it to different platforms: “Brand and context around a rating are extremely important and you risk losing that if you merge it into a unified score.” The evolution of trust and reputation systems TrustCloud acknowledges that their method of aggregating social data and analyzing it with an algorithm is not a perfect solution, and is actively collaborating with experts and users to improve their system. Xin Chung, Founder & CEO commented: “TrustCloud is not perfect-- we strive to improve your experience through research with trust experts (, leading university sociologists, and our very active user group ( trustcloud). This discussion inspires us to continue our work to empower peer-to-peer trust online.” TrustCloud has also sponsored a series of posts on Trust and Community on Shareable to encourage more discussion around the challenges in creating a portable reputation system and potential solutions. For instance, some thinkers believe data aggregated from social networks is irrelevant to an individual’s trustworthiness. Blogger Paul Davis commented: “Many [reputation systems] prioritize the sort of accomplishments and metrics that are primarily relevant in the workplace, which are not necessarily effective representations of an individual’s trustworthiness — say, valuing someone’s networking prowess over real connections made with other individuals. It suggests a further mixing of our professional and personal selves that makes me very uneasy, and perpetuates a false impression of the values that make an individual trustworthy.” Some, like blogger Promod Sharma, believe that algorithms will play a large part in the future of trust economy: “You may skeptical about algorithms but they already make predictions for you. Google predicts your search query as you type and gives results tailored for you. Amazon predicts Social Data TrustCloud
  • 36. 37 Source: Source: what you may also want to buy. Netflix predicts what you want to watch (your personalized Top 10) and how much you’ll like a movie (actual rating vs your projected rating).” Some, like marketer Sam Fiorella criticize the endorsement feature of networks like TrustCloud and LinkedIn: “There’s no context to the action nor verification that the person offering the endorsement is qualified to do so. So what’s the value, other than to gamify the network to encourage greater traffic and thus generate more ad revenue?” Others, like TrustCloud User Group admin Berrie Pelser, believe that endorsements are simply a part of the whole: “TrustCloud endorsements are meant to offer additional context to the TrustScore by providing users looking at your profile with extra information about you. The endorsements themselves do not have a significant influence on your TrustScore.” Some, like Dimitris Tzortzis, are wary of the reliance on past online activity and the impact on people new to P2P platforms and social networks: “In 5-10 years there will be many more sharing networks than now. Let’s imagine lots of people use them and that we have a trust currency that we can carry around on the web to use on P2P transactions. Immediately, that marginalises those who don’t have that currency. People who have lived their lives offline, who have not participated in an organised sharing network online.” And some, like Lora Kolodny speculate on the impact of reputation systems on the future of insurance: “A longer-term monetization strategy for TrustCloud is to become an insurance agent, as well. Michael K. Crowe, a serial entrepreneur who sold two Medicare-compliance ventures to publicly traded insurance companies in the recent past, has joined TrustCloud’s board.” Other approaches to foster trust Several entrepreneurs are working on solutions to measure trustworthiness, from aggregating all sorts of data, to only transactional data, to creating a common API for all P2P networks. Blogger Francesca Pick summarized the state of the reputation space: “A considerable number of startups and projects with an array of different promising approaches to building trust pulled the plug after several months (or have been very quiet recently), among them Scaffold, Briiefly, Peertrust, Project Trust, Truly. Of this first wave of startups, TrustCloud is in fact the only company left.” “Last fall a new wave of startups with interesting approaches to the topic emerged: Credport maps your social relationships, Fidbacks summarizes all your ratings in one place (without using social networks at all) and Virtrue offers enterprises and p2p marketplaces verifications for their users.” Other startups include MiiCard (video), an online identity verification service for online banking, shopping and dating, and Connect. me (video), a platform that aggregates social activity and relies heavily on endorsements.
  • 37. PeopleLikeU
  • 38. 39 What is PeopleLikeU? PeopleLikeU is an interactive platform that enables people to compare and benchmark the spending habits of different types of people. The platform was created by Australia’s UBank and uses aggregated consumer data collected by the bank. Source: Source: How it works PeopleLikeU capitalizes on people’s curiosity and the growing trend of self-quantification. Blogger Susan Abbott commented: “We all love to peek and compare. A new service from an Australian bank lets people peek in a more organized way.” People begin by logging on to the platform and creating their own profile. People enter demographic data such as gender, age, income, living situation (single, couple, family), housing and location (restricted to Australian pin codes). Source: PeopleLikeU uses this data as a filter and then generates a Uniqueness report which shows the spending habits of similar people, in categories including food & drink, travel, shopping, house & home, real estate, holiday and bills.
  • 39. Volume 2, Issue 2 Future of Money Source: Source: Several people, like PhD student Kale, shared their report findings on blogs and forums: “I tried it out and there are 147 people like me. I spend less on rent (even with my current increase) and more on groceries than the people like me  And also way less on travel – apparently people like me spend $500 a month on travel!” PeopleLikeU also lets people see the most popular stores based on transactions – a feature we haven’t seen in other data comparison tools. Social Data PeopleLikeU
  • 40. 41 Source: Source: : Source: : Source: The World’s First Econographic Too People can scan this data to find new stores to visit in their own locality, or in other locations when they are traveling or holidaying. The press release states: “What’s even better, you can also get the inside scoop on emerging new bars and restaurants that people like you visit, as well as tips on hotels and restaurants abroad and in other Australian cites. So wherever you go, People Like U can make sure you’re always making the most informed decision about where and how much to spend.” PeopleLikeU lets people compare their own profile with the average Australian and also with other custom profiles and other districts. People can see spends across the different categories – by monthly spend, spend per transaction and yearly frequency. In addition, people can compare their spends on monthly bills, like insurance, energy and phone bills. People use this data to validate their own budgets. Here’s what one user commented: “The interesting stuff for me though is the bill check with the comparisons to other people in our postcode, for communications we are the same as 10% of people in our postcode, and well below the average which is good, apparently we have a good phone/internet deal” Finally, the platform offers Real Estate and Holiday planners to help people identify popular locations and to see how much they budget for these larger expenses. Here’s a video in which Jennie Bewes, Digital Director at UBank, introduces PeopleLikeU. The PeopleLikeU Database UBank worked with data specialists Quantium to aggregate and analyze de- identified consumer data, combine public spending stats and normalize the data to the population count of Australia.
  • 41. Volume 2, Issue 2 Future of Money Source:* Emily Olive explains: “Data consultancy agency, Quantium, has worked for the last four years to create a Market Blueprint database that provides insight into consumer trends and habits. A combination of census data, consumer spending information, aggregated savings goals, balance information and summarised mortgage data from UBank and NAB make up the database.” Liz Tay reported: “The publicly available PeopleLikeU site took UBank six months to develop, leveraging a four-year relationship with analytics firm Quantium.” Opportunity for data collection While data collection is not a major focus of PeopleLikeU, there are a few stages at which people can enter their own data, like how much they spend on charity, movie tickets or the salon. Blogger Sarah pointed out: “And there’s the option to ‘update’ the information – and this is gold to both the bank – but also to the bank’s clients.” While the reactions to PeopleLikeU have been mainly positive as people compare their spends and evaluate their budgets, some people question the ethics of collecting data and the opportunity for organizations to eventually sell this data to third parties. Blogger Patrice Bernard shared his concerns around organizations’ forays in big data: Anyway, the gap is now open and it may trigger one side (the banks), a rush to a new source of income and the other (the consumer), a movement hazardous release (again) for the image of financial institutions. Achieving a balance between these two poles of opposition will take some time ...* We explore some of the sensitivities around collection and use of data in our People’s Insights report on Vicks Mobile Ad Campaign. Using data to go beyond comparisons On the other hand, some people are excited about the potential of big data. Simon Arden commented: “what we are seeing is the banks starting to put their toes into the water, giving customers some insight into trend analysis using broad segmentation. “the next and far more valuable phase (for the banks and their customers) is leveraging big data by applying predictive analytics to provide a more forward-looking view. so the conversation changes from “x number of people in your suburb own houses” to “x number of people in your suburb are likely to buy a new house in the next 12 months” – this insight can then be used to drive better and more targeted marketing efforts from banks to customers – and can also help customers to make better future financial decisions.” Other organizations getting on the big data wagon Several financial institutions have created platforms that enable people to share and compare their expenses with similar others. For instance, Credit Agricole created Diagnostic Epargne to help people understand their savings, Capitec Bank created The Budgetanator app on Facebook Social Data PeopleLikeU
  • 42. 43 Source: Source: to help people track their expenses, and Commonwealth Bank created Signals (video) to help people compare their financial profile to Commonwealth customers with similar demographic profiles.
  • 43. CommBank’s Kaching
  • 44. 45 What is Kaching? Launched by Australia’s Commonwealth Bank, Kaching is a set of mobile and Facebook apps that lets customers make instant peer-to-peer transactions via SMS, email and Facebook. Kaching also allows customers to manage their accounts from their mobile phone or Facebook, and allows iPhone users to make contactless payments at MasterCard PayPass terminals. Source: Source: Kaching has been recognized as an innovative new product and has successfully encouraged almost a million customers to adopt these new channels of banking. Forrester analyst Benjamin Ensor reported: “In the 18 months since launch in October 2011, some 800,000 people have downloaded the Kaching app (compared with the bank’s 4.3 million active online banking users). Those customers used Kaching to transfer or pay more than $1 billion in 11 months from October 2011 to September 2012. “Since then, Kaching users have transferred or paid a further $5.7 billion, for a total of $6.7 billion in transfers and payments in the first 18 months.” Kaching mobile: Pay anyone, anytime, anywhere. To use Kaching, customers must first register for the bank’s NetBank service and then download the iPhone or Android app. Then, they can sign in using their netbanking details and select an account from which they will make and receive P2P payments.
  • 45. Volume 2, Issue 2 Future of Money Source: The future of mobile payments People use Kaching to send money to anyone in their phone address book or in their Facebook friends list (they can also manually enter the phone number or email ID of the person they want to send money to). Blogger Ross Catanzariti explains how it works: “Kaching for Android allows Commonwealth Bank customers to make peer-to-peer payments (P2P) via mobile, e-mail and Facebook. The app links to the phone’s address book to enable mobile and e-mail payments, and links directly to your Facebook ID to enable payments via the social networking service.” “The Kaching for Android app also enables mobile, e-mail and Facebook payments to non Commonwealth Bank customers by directing these users to a secure, external site to collect payments.” P2P payments among Kaching users are deposited directly into their accounts. Non-Kaching users can use the collect payment feature on CommBank’s website. App reviewer Jenneth Orantia explains: “Once you make a payment through the app, the recipient gets notified via Facebook, email or SMS. This is all well and good, but you’ll still need to send them a unique payment number separately – which Kaching generates – by copying it to your smartphone’s clipboard, and pasting it into a second message to that person. Recipients then enter that payment code, along with all their account details, into the Kaching website to claim the money.” Kaching aims to make payments extremely easy and secure. For instance, people can opt to create a 4 pin password instead of using their netbanking password for each log in. Renai LeMay reports on some of the app’s security features: “The app will be locked to only one smartphone handset for security, users’ passwords will be encrypted and no personal banking information will be stored on customers’ phones. In addition, all funds which are not retrieved through the system after 14 days will be credited back to the original payer.” John Kavanagh points out: “And you don’t even need to know the payee’s account details.” People can also use Kaching as a typical netbanking app, to check and manager their bank account and cards. A new update to the app allows people to pay off their bills online using BPay. Non-Kaching users can explore the mobile app using this interactive demo, or watch the introduction video below. Kaching iPhone: Contactless payment Kaching for iPhone allows customers with MasterCard PayPass enabled cards to make contactless payments under $100 at PayPass terminals across Australia. PayPass works on NFC technology. The Financial Brand provides an overview of the PayPass penetration in Australia: “This NFC (Near Field Communications) payment system only works in those retailers with MasterCard PayPass enabled terminals. However, there are currently over 42,000 such readers installed across Australia, and over seven million MasterCard PayPass cards already in circulation. In August this year, the number of Mastercard PayPass transactions processed in Australia topped million for the first time.” Social Data CommBank’s Kaching
  • 46. 47 Source: Source: Source: Source: Blogger Alex Kidman noted: “There is, as you’re no doubt aware, no NFC chip within the iPhone; instead the Commonwealth Bank will offer a specific NFC- enabled iPhone case to its customers to make the phone NFC capable.” iPhone users will have to order an NFC- enabled iCarte case for an additional $50 to avail of this service. PayPass contributes to Kaching’s goal of making payments easy and secure. Gizmodo reader Steve commented: “Personally, paying with my phone doesn’t really interest me when i can do the same thing with my credit card these days but the idea of being able to easily transfer cash without having to exchange bank details sounds excellent.” PayPass is not available on Android devices, much to the ire of Android users who claim their phones are already NFC-enabled and that they expect to be treated as ‘equals’ to iPhone users. (CommBank alleges that Google has not approved Kaching’s NFC capability, and also that 79% of the mobile usage comes from iPhone devices implying the bank has more customers that use iPhones.) Kaching Facebook: promoting peer-to-peer payments People can access Kaching on Facebook, and can manage their accounts and make peer payments from within the social network. In addition, Kaching for Facebook leverages the social network’s unique features like events, groups, public timelines and private messages. Source:
  • 47. Volume 2, Issue 2 Future of Money Source: Source: and Source: Adam Bender explains the app’s features: “The app lets users send payments to Facebook friends as well as group and event administrators on the social media site. Users can also request payments from friends and keep track of all their Kaching transaction across Facebook and the mobile app.” Chris Griffith reports: “Customers can also post payment requests for joint birthday presents and holidays on their friends’ timeline or by private message.” CommBank highlighted the ability to ‘request payments’ using Kaching for Facebook in their launch campaign with a fun campaign to “settle the estimated $1.8 bn ‘mate debt’ in Australia. SMS Verification and 100% Security Guarantee Many people – both Kaching users and non- users – have found the concept of banking on Facebook “terrifying.” To alleviate security concerns, CommBank introduced an SMS verification process similar to Kaching mobile, and a 100% security guarantee for fraudulent payments. Blogger Jim Marous explains the SMS verification: “To address the common concern of security and privacy, Commonwealth Bank will secure transactions using a combination of a 4-digit PIN code to log into the Facebook app in conjunction with a six-digit confirmation pin sent via SMS. The code is also used by the payee to receive the payment.” As per the website: “Commonwealth Bank offers a 100 per cent security guarantee on all transactions, meaning it will cover any losses should someone make an unauthorised transaction via a customer’s Facebook account.” “Keep it simple, stupid” People have applauded CommBank’s efforts to simplify the process of mobile payments and attribute the adoption of Kaching to the apps ease of use and multiple touch points. Forrester analyst Benjamin Ensor noted: “By enabling so many types of payment through a mobile phone, Commonwealth Bank is teaching its customers that if they want to make a payment – in any situation – they should use the Kaching app. In doing so, the bank is successfully encouraging customers to adopt mobile payment without the magic of a single ‘must-have’ transaction.” Social Data CommBank’s Kaching
  • 48. 49 Here’s a comment from Android app user Berlin Friswell: P2P payments growing in popularity Banking apps that simplify peer to peer payments are increasing in popularity across the world. For instance, in the UK, Barclays’s P2P mobile app Pingit claimed 800,000 downloads and £10 million in transactions in its first 100 days. In Australia, ANZ’s P2P mobile app goMoney claims 1 million users.
  • 49. Crowdsourcing
  • 50. Barclaycard Ring
  • 51. Volume 2, Issue 2 Future of Money A “crowdsourced” credit card? In April 2012, Barclays US launched Barclaycard Ring – a credit card whose policies, fees and rewards are co-created by card members. The credit card attracted early adopters and frustrated credit card users with its promise of straight forward fees, transparency and collaboration. Source: Paul Wilmore introduces the Barclaycard Ring Vision to change the credit card industry Barclays envisions the card will be “built on transparency, authenticity and a community,” and invites card members to “to start changing the credit card industry.” Here’s a video in which Paul Wilmore, Managing Director - Barclaycard Branded Products, shares the story behind the card: Source: Source: In his review on the card, financial blogger David Weliver highlighted the two way channel of communication: Social Data Barclaycard Ring
  • 52. 53 Source: How it works Barclaycard Ring attracts people with its unique proposition and innovative Giveback rewards program; builds a community based on open communication; keeps people engaged with a calendar of co-creation opportunities and financial literacy content, and incentivizes participation. Card members can access a private online dashboard which displays the different actions they can carry out, features or rewards they can vote on, and monthly performance of the community and the card. Card members can also ask & answer community questions. Blogger Laura Edgar summarizes the opportunity for card members: “As a Barclaycard Ring card customer, you’ll be able to go online and see how the company is performing through an online profit and loss statement. You’ll get to vote anytime Barclaycard suggests raising fees, changing the APR or altering the card’s terms and conditions. You’ll also get to weigh in on marketing ideas and website enhancements through online forums. “Basically, if you have ideas or concerns, you’ll always be able to discuss them with other cardholders and a Barclaycard “community manager”, who has the dual role of customer service representative and forum moderator.” “Barclay’s is calling this a “crowdsourced” credit card. According to the bank, they are “actively listening” to card members and will change the card’s features in real-time according to feedback.” A blog post by the Unibul team highlighted the appeal of such a unique product: “What I like most about Barclaycard Ring is its avowed transparency. Banks know better than anyone just how unpopular with their customers they’ve become and are looking for ways to reverse the trend (or at least some of them do).” This comment on the Barclaycard Ring Facebook page reflects a similar sentiment: Community managers regularly introduce new topics on the public blog, and direct card members to discuss these on a private member- only platform. Community managers also document the decisions and successes of the community on the blog, and share results of the card’s monthly performance. Source: Barclaycard Ring Community Website Overview Members can contribute to the health of the community by participating actively and to the health of the card by using their cards regularly, making regular payments, referring friends and opting for paperless e-statements. Source:
  • 53. Volume 2, Issue 2 Future of Money Barclaycard’s Paul Wilmore shared the inspiration behind this model: “We were inspired by the sense of community shared among credit union members, as well as the way social media is helping people learn from each other. “Our online community allows for these two ideas to converge. Just like real-life circles of friends and communities of like-minded people, we’re building an online community that enables our card members to gather information, share knowledge, and have a role in the card’s future success.” Giveback program keeps the community on track To prevent members from voting for features that would harm the financial performance of the Barclaycard Ring, Barclays introduced an innovative rewards program called Giveback. As TIME’s Martha White pointed out: “Since most consumers don’t care about a bank’s bottom line, Barclaycard US set up an incentive system to get customers to consider these costs. In lieu of a traditional rewards program, Ring cardholders will get periodic “givebacks,” in the company’s parlance, of profit the bank earns above a predetermined threshold. “Customers will vote on whether they want that money distributed as statement credits, donated to a charity, or some combination.” Giveback presents customers with a win-win situation, as CreditDonkey blogger David R noted: “The novel, community-driven approach allows cardholders to vote on what benefits or features they want and share in the estimated profit of the community’s financial performance.” Jared Young, Senior Director at Barclaycard US and community manager of the community explained how members can qualify for Giveback: “We accumulate the [Giveback] pool through two different programs: Barclaycard Ring returns and referrals from members. An individual card member is eligible to earn Giveback™ from both pools only if they participated in contributing to them. “For example, you can only receive money from the referral pool if someone applied from your referral through the module on our website. And, you can only earn Giveback™ from the returns calculation if you actually used your card.” Bad behavior, such as late payments, results in a portion of the member’s Giveback going to charity. The program also incentivizes ‘good community behavior,’ as financial blogger David Weliver noted: “when account holders opt in for paperless statements and pay their bills on time, the community benefits; the card will kick back more of a reward to account holders.” While some card members have earned rewards through the Giveback program, potential customers are skeptical of the benefits of this new model versus traditional rewards programs. Card member Philipwhuf commented: “I just [received] $90 back via the “Give Back” feature which will be applied to my statement and this was with moderate usage.” A potential customer commented: “This card has no reward points as I am used to but gives a profit sharing percentage back. I havent used the card yet and I am on the fence whether the profit sharing is better than rebate points.” Gamification keeps the community engaged In addition to incentivizing good behavior, Barclays is using elements of gamification to encourage active participation and to reward active participants. Fast Company’s Kit Eaton noted: “It’s all about promoting active user involvement in adjustments and refinements to Ring’s ongoing financial design… “If you actively participate to improve the Ring experience and performance, then you’ll be rewarded--using mechanisms that the community itself can adjust. That’s brilliant, as it could mean the users themselves are working to refine Barclaycard’s own design, for their own gain as well as Barclaycard’s.” Card members can view their participation or ‘achievements’ online, as well as their latest community standing - depicted by the colors on their badge or “ring”. Social Data Barclaycard Ring
  • 54. 55 Source: Benefits to Barclays The active channel of communication between Barclaycard Ring and the community helps the bank collect real time feedback around features. For example, in a blog post titled “Crowdsourcing the Design of Your Card,” Barclay’s Jared crowdsourced views on RFID chip enabled credit cards: “The RFID chip – Is it worth the $1 per card? It seems to me like the community is pretty split over this one. Will mobile payments surpass RFID chip technology and make it obsolete, or will more merchants start accepting RFID making it a nice feature?” In addition, the model of changing policies over time – with card member support – gives Barclays a great playing field to experiment with new policies, like getting rid of the 1% foreign country fee. Card members can choose to support the experiment and are equally responsible for its success or failure. Source: Credit card analyst Jenna Herron explained how the badges work: “The creators of Barclaycard Ring and the online community realized that part of social media is creating status. Think of Foursquare’s mayorship, Pinterest’s repins, Twitter’s retweets or getting dozens of “likes” on a Facebook post. So Barclaycard introduced “badges.” “Cardholders earn badges by behaving in a way that helps the card’s community... Once you earn a badge, your online avatar receives a ring of color. The more colors, the more badges.”
  • 55. Volume 2, Issue 2 Future of Money Source: Promoting transparency & understanding of the credit card business Another notable aspect of Barclaycard Ring is the culture of sharing information freely with card members. Community managers candidly explain the cost of various transactions and the monthly earnings from each transaction. They also share overall performance results on a monthly basis along with an analysis of what worked and external events that impacted results – giving card members a better understanding of the impact of their decisions. Can the Barclaycard Ring also promote larger financial literacy? Thinkers, card members and the Barclaycard Ring team believe the Ring community has an opportunity to promote financial literacy amongst members. Julia Roy, digital influencer and card member, envisions more discussion around financial health in the Barclaycard Ring community: “The number of active community members at this points is pretty small and conversations in the forums is mostly centered around questions and issues specific to the card, versus discussions around more personal financial matters. I am hoping that the conversations shifts from technical questions about the card to more in- depth conversations about financial learnings and financial health.” And, Barclays too is exploring this space with the introduction of The Financial Planter series in honor of Financial Literacy Month: “Starting in May we will be introducing a year-long series called “The Financial Planter.” We will spend a few months on each stage, using the 2nd week of every month for a specific topic related to that stage. An in-depth blog post will be published on Monday, then on Wednesday we will feature third- party articles, set up a Q&A or interview an industry expert to get another point of view. And, Friday will focus on “fun” with a variety of Do’s/Don’ts, videos, fun apps or other light-hearted materials to make you smile.” Paloma Vega, Director of Consumer Practice at Andreoli MSL and member of the MSLGROUP Insights Network, highlights the important of financial literacy for consumers and banks alike. Source: Social Data Barclaycard Ring
  • 56. Dodge Dart Registry
  • 57. Volume 2, Issue 2 Future of Money What is the Dart Registry? In January 2013, Dodge launched the Dart Registry, a crowdfunding platform to help customers request friends and family to sponsor parts of the new car for them. People share their story, set funding goals and recruit support from networks – while generating word of mouth around the Dodge Dart and drawing attention to the car’s parts. How it works People sign up at the Dart Registry, customize the car they want, set a funding goal accordingly and then ask friends and family to fund individual parts of the car. Each step is designed to connect fundraisers and potential funders with the various parts and features of the Dodge Dart. Source: Source: Adweek’s Tim Nudd explains the process: “You sign up for the program, configure and customize a Dodge Dart (choosing from 12 exterior colors, 14 interior color and trim options, three fuel- efficient engines, three transmission choices, safety features, aerodynamics, etc.), and set a goal for the amount of money you want to raise to fund it. The site then itemizes components of the car—like a steering wheel, shifter, seat or engine—and allows friends, family or anyone to sponsor the parts.” Source: ------ Crowdsourcing Dodge Dart Registry
  • 58. 59 Source: Source: Several thinkers have likened the campaign to a wedding gift registry. AdAge’s Shareen Pathak said: “Chrysler is trying to redefine a wedding ritual with “The Dodge Dart Registry,” a site that lets engaged couples raise money toward purchasing a new car by asking their friends and family to chip in.” Blogger Jeffrey Ross said: “The Dodge Dart Registry allows people to build and customize a new Dart exactly how they want it, then let other people purchase some or all of the components as gifts.” Similar to crowdfunding platforms The Dart Registry is modeled after conventional crowdfunding websites like Kickstarter, with elements like progress bars, funding tiers and countdowns. People can set the fundraising duration as 30, 60 or 90 days, and can customize four funding tiers for acquaintances, friends, family and supporters. The registry then assigns different car parts to the different tiers and prompts potential funders to explore and choose a part to sponsor. At the end of the fundraising timeline, fundraisers receive all the money raised minus a hefty 9% processing fee. Dodge acknowledges that “it will be tough to raise the full price of a new car,” and gives fundraisers the power to spend their funds towards the car or as they wish: “Your goal instead can be to raise enough for a down payment, or enough to lower your monthly payments.” Recruiting support around a story or for a cause The story or cause behind the fundraising campaign is crucial in recruiting support from friends, family and other benefactors. Examiner’s Brandon Seiler points out: “The case itself is the most important part of setting up the profile. Here users write and/or post a video to explain why they deserve help buying a Dart. The more endearing the message the more likely people feel compelled to donate.”
  • 59. Volume 2, Issue 2 Future of Money Source: US PIRG - A new direction in driving trends Source: In fact, one of the Dart’s Registry’s largest success stories centers around a registry that was created to crowdfund a car for a cancer patient. Jody Mostoller, who created the registry with his wife Teri, commented: “Teri immediately thought about our friend and how creating a registry would be an easy way for people to help her get the new car she so desperately needed. The community rallied behind the idea and it was so much fun to watch it all unfold.” The powerful story led to a large amount of support from local communities and cancer survivors elsewhere. AutoGuide’s Jason Siu reports: “More than 260 friends, family, and fellow parishioners contributed to the registry raising over $22,600 in 21 days. As a result, an all-new 2013 Dodge Dart SXT was purchased and everyone from the local community was present when the keys were handed over to their friend.” Generates word of mouth Marketers have applauded Dodge’s use of social media and crowdfunding to raise awareness around the car. Forbes contributor Matthew de Paula noted that the program should help get the Dodge Dart “on the radar of potential buyers”: “The way the Dodge Dart Registry ties in social media could prove helpful in that regard. As would- be car buyers post updates on their fundraising, they’ll be helping to boost awareness of the compact sedan.” Forbes’ Joann Muller commented that the program does a better job of raising awareness than driving sales: “I don’t see a lot of money flowing through this scheme. I will say, however, that it’s an ingenious way for Dodge to draw attention to the Dart, which so far, is being overlooked by many.” Targets millennials Marketers also believe the Dart Registry will help Dodge reach millennials - a coveted audience for automakers. Millennials are less likely to drive cars compared to previous generations (according to recent report from U.S. PIRG) and have more options for mobility (such as car-sharing and ride-sharing programs, which we outline in our report on collaborative consumption). TIME’s Brad Tuttle highlighted some additional challenges in reaching this audience: “The marketing and selling of cars to millennials is a tricky business. This demographic is lukewarm about car ownership, and is more likely to hate the usual car-buying process—haggling especially. If they are interested in automobiles, they tend to be drawn to quirky car models with flashy colors (the Dart qualifies).” Creates a new audience – people who previously couldn’t afford cars Some thinkers believe that crowdfunding programs like the Dart Registry will help luxury brands reach a new audience of people who cannot afford their products. Here’s a comment posted on car blog Jalponik: “This isn’t so much a campaign to sell the cars, more of a campaign to help people afford them. Everybody would be driving a new car if they could easily afford one. This is a novel marketing campaign that attempts to get people who otherwise would not be able to afford ANY new car, to be able to afford one.” Crowdsourcing Dodge Dart Registry
  • 60. 61 Source: Source: How to change buying cars forever Similar programs from Hyundai and Microsoft Hyundai partnered with niche crowdfunding platform Motozuma in 2011 to help people crowdfund cars and has reportedly sold 1,600 units. In comparison, the Dart Registry has reportedly sold only 2 units since January 2013. Source: Brand Channel’s Dale Buss attributes Hyundai’s success to a matching contributions scheme and wider range of eligible cars: “Hyundai may have gained an edge in the auto industry’s early crowdsourcing initiatives by matching contributions on Motozuma dollar for dollar, up to $500, as consumers try to round up contributions from friends and family for a down payment on a new car. It may also help that Hyundai doesn’t focus on a particular nameplate in the promotion.” Blogger Charles Luzar believes that this approach has potential to play a bigger role in reaching millennials in the future: “Although the reach is limited for now, the approach could pay dividends in the long run as car manufacturers struggle to gain traction with Millennial car buyers.” Non-automotive brands too are exploring crowdfunding solutions with matching contributions to make their products more affordable. For instance, Microsoft recently launched a dedicated branded platform Chip In to help people crowdfund Windows PCs.
  • 61. PlanBig
  • 62. 63 What is PlanBig? In February 2010, Bendigo and Adelaide Bank in Australia created the PlanBig platform to connect changemakers and support them in bringing their ideas to reality. Changemakers create plans for personal or social good projects and solicit advice, resources and support from the community to successfully execute the projects. Community members offer feedback to help their favourite plans succeed and to build their own reputation on the network. Source: Source: Blogger Jason Berek-Lewis wrote: “PlanBig works so that anyone and their idea, as small as it might be, can work towards something big with the help from others. Anyone can put their own idea up on the interactive site and anyone can support it. It brings together “a community who is passionate, engaged and eager to lend a hand or an ear” and sometimes, it’s that hand or ear which can make all the difference.” Marketer Kate Kendall noted: “It’s a place for sharing ideas and making them happen. Kind of like a Kickstarter or Pozible without the crowdfunding aspect.” Three years later, the platform is still active and has succeeded in creating a vibrant “community of people with tools, skills & know-how turning big ideas into reality.” Purpose-inspired initiative PlanBig was created by Bendigo and Adelaide Bank as part of its purpose to help people realize their dreams. Blogger Charlotte wrote: “The website is an initiative of the Bendigo and Adelaide Bank, which started as a building society in 1858 to create prosperity and strength for the community. The Bank has not forgotten its roots, and its core business ethos today remains to behave as banks once did, by providing resources to keep communities sustainable and prosperous. PlanBig is the online iteration of what the Bank has always done – facilitate community outcomes.”
  • 63. Volume 2, Issue 2 Future of Money Source: Source: Blogger Kathie said: “PlanBig draws on the strengths of social networking to enable people to efficiently share information, build partnerships and support each other to make their plans become reality”. How PlanBig works Changemakers and project-starters share their plan online and continually request help in areas such as advice, goods and space. Pro Bono Australia explains how it works: “Users upload their plan to the free website, including information on their motivation and what help they need for their plan.” “They can then participate in a wide range of activities - asking people to volunteer their time, seeking or providing space for events, and seeking donations for specific items. In a similar vein to Facebook, users can ‘like’ a plan, subscribe to updates from the plan, and share it across other social media sites.” In turn, community members provide advice, encouragement, ideas, resources and publicity for their favorite plans. After the plan has been successfully completed, project starters share their experience. The entire plan, process, request for help, conversations and case studies are presented in one place, for the benefit of future project starters. Crowdsourcing PlanBig
  • 64. 65 Source: Source: “Help Cards” Help Cards are an interesting element unique to PlanBig. Help Cards are designed to help people kickstart their plan and cover a wide range of topics. Source: The “Becoming Thirty” team blogged: “One of the most challenging things with any plan can be knowing where to start, however, PlanBig has a range of Help Cards available on the site, created by experts on a variety of topics, which can help people propel their plans or overcome roadblocks.” Project starters can bookmark help cards for future reference and request Help Cards on specific topics. Both community members and PlanBig community managers have created Help Cards. Rewarding activity PlanBig uses elements of gamification like points, badges and leader boards to encourage activity and reward the most active members. Chris Jovanov, the art director who helped design the PlanBig platform, shared: “The latest update to the site has focused on using gamification to encourage engagement and create a more addictive user experience.” For instance, community members can earn 200 points for helping out on projects. Points are visible one each member’s profile page and also on an activity stream on the PlanBig homepage. Like many social platforms, PlanBig uses badges to encourage specific activity and establish the reputation of active community members. PlanBigger Luke Owens shared: “I have been personally motivated by Points & Badges earned; they provide a cheeky little incentive which, if you’re like me, you will want to attain them all!” Quid pro quo system The more active members are on the PlanBig platform, the more visibility their project gets and thus more support. BusinessMomBlog’s Melissa noted “as with any other networking opportunity, the more you get involved, the more you get out of it,” and recommends members to actively engage with others: “Spend a bit of time browsing other plans and answering questions. Not only will this help people get to know you, but you are also likely to get people checking out your plan.” Several members, like Nick, reach out to their personal networks to kickstart activity around their project: “The more people we get jumping in there and liking the project, adding comments etc the higher
  • 65. Volume 2, Issue 2 Future of Money Source: Source: it will track on the site, and the more likely we are to receive some assistance to polish or even redevelop our web platform – for a future Australian launch and network.” Since most members follow the unspoken rule of helping others to attract help for themselves, most members are able to find the support they need. PlanBiggers Lisa and Duncan shared: “I like the collaborative underpinnings of the site and that it creates a place (online) that people can come together to talk about ideas, share inspiration, offer advice and assistance to help make ‘Big Plans’ happen, regardless of geography.” Blogger Rebekah Lambert noted: “People are genuinely supportive and you can great some great free advice along the way. You can also discover new ideas you may not have uncovered on your own!” Source: The power of a community Ecosystem to support changemakers Bendigo and Adelaide Bank hopes that PlanBig will soon become a self-sufficient ecosystem to support changemakers and project starters. Broadly speaking, the PlanBig platform is similar to collaborative social innovation platforms, like OpenIDEO and Mahindra Spark the Rise; each has its own nuances and collaboration framework, but they are all designed to “connect, catalyze, crystallize, and celebrate.” These four dimensions, which we explore in our Now & Next: Future of Engagement report on collaborative social innovation, are crucial to facilitating collaborating and creating a sustainable ecosystem for innovation: “First, platforms need to connect stakeholders so that they have a context to engage with the organization and with each other. Then, platforms need to catalyze interactions so that new ideas and projects can emerge organically. Next, platforms need to synthesize these ideas into solutions that benefit from and build upon the best ideas. Finally, platforms need to celebrate the most powerful or popular ideas, actions and stories by highlighting them.” Celebrity PlanBigger Sarah Allen reflected that her collaboration with others added to her own personal growth and success: “Providing advice and ideas to other Planners on their journey, whether a message of support or feedback or specific suggestions, buying and reviewing their product or donating to their cause or attending their event – all which gave much more back to me than I gave to them!” Crowdsourcing PlanBig
  • 66. 67 Tesco Wine Co-Buys
  • 67. Volume 2, Issue 2 Future of Money What are Tesco Wine Co-Buys? In May 2013, Tesco partnered with buyapowa to launch Wine Co-Buys – a group buying platform which enables people to refer friends to buy cases of wine at better prices. The model relies on the power of people’s networks and on Tesco’s commitment to deliver genuine value. Marketer India Warman wrote: “All retailers are battling to come up with innovative ways to attract customers at the moment. With online sales being so high and customers dictating how they want to buy, Tesco may have got the right idea!” Source: Source: Power to the People Through the Wine Co-Buys, Tesco shifts some power to the people, giving them more control over the product pricing and a say in which products should be included in the next Co-Buy. According to Social Commerce Today’s Paul Marsden, the program is an example of “social commerce for the empowered customer”: “What we particularly like is that it appears to be demand led; customers are able to choose wines they want to buy together in bulk – and set a maximum price they’d be willing to pay. The more people that sign up, the heavier the discount – with the person who recruits the most co-buyers – via social sharing – getting a case of wine for free. Sweet.” How it works Tesco announces upcoming Wine by the Case Co-Buys on its website and invites people to sign up for an email notification. Once a Co-Buy goes live, people can go to the buyapowa website and “join” the Co-Buy. People enter their name, address and payment details, pay a £1 joining fee, and commit to purchasing the case of wine at the final price achieved by the Co-Buy. Source: The starting price for the product is already discounted, and people drop the price lower by inviting friends to participate in the Co-Buy and purchase the product. As Alex Lawson pointed out: “Shoppers commit to a maximum price but the price point falls as the number of people that purchase the product increases.” Mommy blogger Leanne Amy explains “how the ‘prices drop as people shop’ thing works”: Crowdsourcing Tesco Wine Co-Buys
  • 68. 69 “There are three price drops, and the obvious goal is to get enough people to join the co-buy that the third price drop (and therefore the lowest price) can be achieved. “Typically, there will be 100 units of each product to be sold. If between 1 and 24 people join the co-buy, they will pay BuyaPowa’s starting price for the item (which is already lower than RRP). Once more than 25 people join, the price will drop some. At 50 people, it will drop again. At 75 people (up to 100 when the items sells out), the third price drop will happen and everybody receives the product at BuyaPowa’s best price.” Source: Source: Source: The number of participant slots for the Tesco Wine Co-Buys varies from 25 to 150, depending on stock. As a result, most Tesco Wine Co-Buys last only a few hours. At the end of a Co-Buy, Tesco issues participants an eCoupon which they can use to buy the specified case of wine at the best price achieved. The eCoupon includes a further £1 discount, to make up for the joining fee, and must be redeemed within two weeks. Source: Tesco Co-Buys: The more people who buy, the better for price… for Everyone! Power of People’s Networks Tesco encourages people to use the power of their networks with more than just the price drops – the person to refer the most number of friends in the least amount of time “Wins the Co-Buy” and receives the case of wine for free. The leading participants are featured on a public leaderboard, increasing the sense of competition between players and egging them to recruit more friends. To further widen its reach, Tesco recently introduced the “Share to Win” feature, which allows people participate in “Win the Co-Buy” without actually placing an order. This feature seduces people with large social followings to promote the Co-Buy without making a commitment to buy. In the event of a tie, the paying participant would take priority over the “Share to Win” participant. Blogger beccacaddy wrote: “This means there’s also quite a big social element to Buyapowa, as users are encouraged to get more people to buy the product they want. No matter how sneaky you might think that is on Buyapowa’s part, you can’t deny it’s a pretty clever selling tactic, get someone else to promote the products on your site for you.”
  • 69. Volume 2, Issue 2 Future of Money Source: Source: Source: Source: People can also use the power of their network to request products for future co-buys. Tesco’s rules note: “When three or more people nominate a product they would like to buy in a one-week period, we will immediately get to work on their behalf to see if we can create a Co-buy deal, and we will always do our very best to make it happen.” Promoting the Co-Buys Tesco promotes the Co-Buys through its blogger network of Tesco Wine Ambassadors and its own online wine community. At the launch of Tesco community managers typically announce the individual Co-Buys on the Tesco wine community blog. But with the steep competition and short timeframes, community members now make the announcements to ensure their friends – and referrals – get the chance to participate. the platform, the ambassadors introduced and explained the concept of Co-Buys in their blogs. Genuinely good prices The success of the Co-Buys rests heavily on Tesco’s commitment to deliver genuine value. Potential participants are typically skeptical of the claim of “best price,” as community member Aimetu pointed out: “I’m just not sure about this - the lowest prices depend on purchasers but I’m sure the low prices have been available at various times throughout the year or various promotions.” Tesco’s community manager Charlotte Stebbings was quick to counter: “We ran an offer on Jackson Estate Stich Sauvignon Blanc in March of this year with a promotional price of £54 for a case of 6. The final price of the latest Co-Buy at £45 for a case of 6 is significantly below this and is a fantastic price for a wine of this quality and reputation.” Crowdsourcing Tesco Wine Co-Buys
  • 70. 71 Source: Source: Source: Is the buyapowa model here to stay? The concept of group buying was previously introduced by deal sites like Groupon, which tend to focus on services. buyapowa, on the other hand, focuses on a wide range of products – from household items (Crest WhiteStrips), gadgets (Amazon Kindle) to beauty products (Lancôme mascara, YSL nail polish, Jean Paul Gaultier perfumes). Mommy bloggers like Sylvestrix applaud the model for making high end products more affordable: “I originally started keeping an eye on it for household items, but I’m super excited about the potential it has for bringing high end beauty products down to a more accessible level.” Other innovative buying schemes Entrepreneurs and organizations are experimenting with new buying schemes designed to build loyalty. Two examples in the wine category, via Social Commerce Today, are Club W which offers a curated selection of wine every month, and naked wines which invites people to support independent winemakers and become ‘naked angels.’
  • 71. Kiva Zip
  • 72. 73 What is Kiva Zip? Founded in 2011, Kiva Zip is a true person-to-person micro-lending platform which enables people to lend directly to entrepreneurs in the U.S. and Kenya without a middleman. Entrepreneurs share their business ideas online and lenders can directly contribute to the amount they need. Like Kiva, Kiva Zip does not charge any fees, and service provider PayPal waives its fees. Because there is no middleman, borrowers receive loans at 0% interest. Source: Kiva Zip is still in alpha, but is a good indication of where charitable lending is going: from indirect P2P to direct P2P and from supporting overseas borrowers to supporting local and foreign entrepreneurs. Source: Background: How Kiva works Founded in 2005, Kiva was the first online platform to indirectly connect lenders with borrowers in developing countries, via its extensive network of field partners (microfinance institutions, social businesses, schools and non profits). Field partners approve borrowers, collect their photos and stories and share this with Kiva volunteers, who translate and upload these to
  • 73. Volume 2, Issue 2 Future of Money Source: Source: How Kiva Works Blogger David Roodman pointed out the importance of these stories: “People donate in part because it makes them feel good. Giving the beneficiary a face and constructing a story for her in which the donor helps write the next chapter opens purses.” Lenders browse through borrower profiles, by location and type of loan (educational, personal etc), pick a borrower to lend to and transfer money to Kiva using PayPal. Kiva aggregates the micro loans and distributes money to its field partners who in turn lend it to the next set of borrowers. Over time, borrowers pay back the field partners who return the capital to Kiva, which in turn returns the loan to lenders as Kiva Credits. Lenders can choose to withdraw their money, or fund another loan. Several lenders have reported the process can be addictive. Luz Iglesia reflected: “You can link Kiva to your social network, so you can celebrate with your friends – like Greg and Lindsay and Pearl – when they make a new loan or get a repayment. You can be on a lending team, like we are at the Ian Martin Group, and work together to increase your pool of loans. You can recruit friends with “free” loans so that they can try it out (the loans are funded by angel donors). And if you’re nerdy like me, you can track your Kiva metrics against the averages of other users.” While Kiva does not charge any money from these transactions, Field Partners charge interest fees to cover their costs and safeguard against defaulters. Kiva covers its operation costs through grants, donations and discounted services from corporations and foundations. To date, Kiva has enabled 951,000 people to lend $449 million to 1 million borrowers in 69 countries. From Kiva to Kiva Zip: Demand for a true P2P Network The design of makes it seem like loans go directly to the borrowers that Crowdsourcing Kiva Zip
  • 74. 75 Source:, and lenders have picked. This is not so. Borrowers actually receive the loan before their profile is uploaded to – the money lent “backfills” all the loans – a fact that not many lenders were initially aware of. In a comprehensive post on this topic, micro- finance specialist David Roodman explains why Kiva follows this process: “What Kiva does behind the scenes is what it should do. Imagine if Kiva actually worked the way people think it does. Phong Mut approaches a MAXIMA loan officer and clears all the approval hurdles, making the case that she has a good plan for the loan, has good references, etc.” “The MAXIMA officer says, ‘I think you deserve a loan, and MAXIMA has the capital to make it. But instead of giving you one, I’m going to take your picture, write down your story, get it translated and posted on an American web site, and then we’ll see over the next month whether the Americans think you should get a loan. Check back with me from time to time.” Lender Monika Jankun-Kelly commented: “I find it very troubling that Kiva *needs* to rely on mythology and oversimplification to draw in lenders, yet that’s the way it is. Human nature is what it is, our society is what it is. Let’s improve those, and Kiva’s advertising methods will follow suit.” However, many lenders were unhappy when they understood the process. Some shared their discomfort through their blogs and videos. Source: The Truth About How Kiva Works Others were unhappy that they money was going to causes they did not support, like a loan to support a cockfighting business in Peru (legal in Peru but illegal in California). Yet others were unhappy with the heavy interest rates charged by the middlemen, especially when other platforms, like Zidisha, had found a way to connect people directly at significantly lower interest rates. Lender melliecarma commented: “after 106 microloans to kiva borrowers in two years time i came to a similar conclusion and invest on now as i’m fed up with micro finance institutions getting in the way between lenders + borrowers.” Some, like pss1, justified the need for interest rates: That “middleman” fee covers the cost of making the loan and working on the KIVA platform. As described above, they are paying people (and a relatively high local wage) to vet the clients to eliminate scammers, take pictures, write the client stories, and put them on the internet. Interest rates are much lower than the typical local “money lender” rates. To address the concerns of lenders, Kiva introduced many design changes to and introduced Kiva Zip. How Kiva Zip works The Kiva Zip platform is similar in design and concept to crowdfunding platforms (like Kickstarter). Instead of facilitating loans to anyone in need, Kiva Zip focuses on entrepreneurs in the U.S. and Kenya. The Kiva Zip website says: “Now, Kiva Zip will enable lenders in the United States to make loans more directly to
  • 75. Volume 2, Issue 2 Future of Money Source: borrowers. Instead of working with a local partner on the ground to facilitate your loan, we’re sending your funds to the borrower electronically (e.g. using mobile and electronic payment methods). This increased efficiency allows for 0% loans to the borrower, but a greater risk for the lender.” (Emphasis in original) Blogger Dave Algoso wrote: “Kiva [Zip] is using mobile and other technology to offer very low cost loans to borrowers who don’t even have access to normal microfinance institutions. Pilot borrowers for the new system are in the United States and Kenya, because of M-PESA. In place of local microlending partners, Kiva Zip uses “trustees” who vouch for the borrowers but never handle any money.” Trustees and borrowers must both submit an application online to be considered for a loan. Once the loan is approved, it is posted on Kiva Zip and must be funded within 90 days. If the loan is not fully funded, the money is returned to the lenders. On Kiva Zip, the minimum loan amount is $5. This new model adds even more importance to the reputation and social presence of borrowers and even the trustees. Borrowers need to rely on their networks to recruit support. Trustees need to rely on their reputation to increase the borrower’s chances of getting loans. Fast Co Exists’s Alex Goldmark points out that Kiva Zip makes loans available to people who may not qualify for bank loans, and stresses the importance of distributed risk and trust: “The average Kiva lender puts up $25, not a disaster if it vanishes. That helps increase the risk tolerance for users. And the average loan size is just $250 to Kenyan borrowers and $4,000 in the U.S. The small scale keeps defaults from devastating any one lender’s assets. But nobody likes to lose their money. So the trust network remains an important, if still experimental, aspect.” In addition to endorsing borrowers, trustees also help identify local businesses and entrepreneurs who could benefit from Kiva Zip. Here’s the role Kiva Zip Trustee AEDC will play: “AEDC is partnering with the Alaska Small Business Development Center (SBDC) to identify Alaska businesses that would benefit from the Kiva funding model. As a trustee to Kiva Zip, AEDC will play a crucial role in the program by recommending borrowers for the Kiva Zip loan and ensuring they meet the criteria for the program. In addition, AEDC and SBDC will provide borrowers with ongoing support and business coaching.” The Kiva Zip model ensures that borrowers receive financial support and also community support. Trustees and lenders can offer business advice and feedback, and promotional support to help them successfully fund their loan. They may also become customers of the new businesses they helped set up! Crowdsourcing Kiva Zip
  • 76. 77 Source: Pushing the barriers of micro- lending In addition to connecting lenders and borrowers directly and creating a local support system for borrowers, Kiva Zip is also exploring partnerships to help borrowers succeed in their businesses. Source: Pando Daily’s Carmel Deamicis reports on Kiva’s new partnership with startup Zaarly: “Kiva is giving micro loans to a handful of Zaarly’s storefront owners that need a loan to take the next step in growing their businesses. In exchange, Zaarly will provide online storefronts and resources for a few Kiva borrowers.” Other approaches to P2P lending We are seeing several types of P2P lending platforms in the social good space. Zidisha connects lenders and borrowers directly, and allows lenders to decide the interest rate. Vittana (video) focuses on borrowers who need educational loans. United Prosperity uses micro-loans to guarantee borrower’s bank loans, helping them qualify for larger loans and build credit history. LendwithCare (video) connects lenders and borrowers through microfinance institutes vetted by CARE International.
  • 77. Bitcoin
  • 78. 79 What is Bitcoin? Bitcoin is a digital crypto-currency that enables people to make near-instant peer- to-peer transactions and purchases via the web and mobile. Bitcoin is maintained and regulated by a global network of enthusiasts and is being used by people, businesses and even investors. DKSDan commented on the appeal of the new currency: “Bitcoin is not only a unit of account, it is an entire exchange protocol designed to allow the secure, simple, inexpensive, and irreversible transfer of value between potentially anonymous parties without the restriction of borders, interference from governments, or exposure to counter party risk. This is where Bitcoin’s intrinsic value lies.” Source: Source: Source: This map of Bitcoin Meetup Groups provides a glimpse at the global nature of the network: Introduced four years ago, Bitcoin now sees $45 million of activity per day. There are currently 11 million Bitcoins in circulation, i.e., $1 billion worth of Bitcoin. At time of writing, one Bitcoin is currently worth an average of $96. How do people use Bitcoin? People purchase Bitcoins using their local currency at exchanges like Mt. Gox. In essence, each Bitcoin is made of a string of codes. With each transaction, a new code is attached. This makes it possible to trace all the exchanges of each Bitcoin in circulation and prevents the same Bitcoin from double- use. People store their Bitcoins in wallets on their computer or mobile or on the web. Or, they store their private key on paper. People make payments by entering the peer or vendors’ public key, similar to how we send emails by entering an email address. Blogger Ashutosh wrote: “Bitcoins are kept in a digital wallet which you can keep in your computer, or on a website online,which will manage and secure your wallet for you. You can have as many wallets and bitcoin addresses (where you receive money from others) as you like.”
  • 79. Volume 2, Issue 2 Future of Money Source: Since data about every Bitcoin transaction is freely available online, experts encourage people to create and use new Bitcoin addresses for each transaction. This also prevents hackers from seeing how many Bitcoins are stored in each wallet. This infographic explains how people buy, store and spend Bitcoins. View the full infographic at: Below is a screenshot of what someone’s mobile wallet could look like. Crowdsourcing Bitcoin
  • 80. 81 Source: Source: Where do Bitcoins come from? There are currently 11 million Bitcoins in circulations, and more Bitcoins are “mined” every 10 minutes to ensure a steady stream of fresh circulation. TechHive’s Leah Yamshon explains: “In order to buy, trade, or use Bitcoins, the units of currency have to first be introduced to the market... Bitcoin mining software runs the Nakamoto algorithm, searching for a specific chain of code. When that code is found, a block of Bitcoins is rewarded to whoever found it. Current blocks contain 25 Bitcoins, but the block size goes down by half every four years, making mining harder and less profitable as time goes on.” “Currently, there are roughly 11.4 million Bitcoins in circulation--that number will cap at 21 million in 2140, according to the algorithm’s limitations.” Because of the rewards involved - 25 Bitcoins equals $2,400 - there is an active community of programmers who work part-time and full-time to mine new Bitcoins. There is also a universe of vendors that caters to these programmers with more efficient computer hardware. Maintaining and regulating Bitcoins The process of mining new Bitcoins is actually what keeps the network running. In the hunt for rewards, miners compute all the Bitcoin transactions and create up-to-date logs that trace each Bitcoin’s activity. The Economist explains: “The entire network is used to monitor and verify both the creation of new Bitcoins through mining, and the transfer of Bitcoins between users. A log is collectively maintained of all transactions, with every new transaction broadcast across the Bitcoin network. Participating machines communicate to create and agree on updates to the official log.” “This process, which is computationally intensive, is in fact the process used to mine Bitcoins: roughly every 10 minutes, a user whose updates to the log have been approved by the network is awarded a fixed number (currently 25) of new Bitcoins” CNN’s Stacy Cowley draws an interesting comparison to highlight the current scale of the Bitcoin mining network: “The power of all the computers networked together to maintain the digital currency’s system far exceeds the combined processing strength of the top 500 most powerful supercomputers.” The Verge’s Adrianne Jeffries explains the crux of this open source P2P network and how they regulate the currency: “The fundamentals were strong: transparency created trust; a network of users substituted for a central authority; and built-in deflation canceled out any circumstantial inflation that might devalue the currency. Whenever a problem arose, members of the community worked together to fix it.”
  • 81. Volume 2, Issue 2 Future of Money Source: Source: For instance, there was a recent fork in the system and two different logs were created which allowed for double spends. The network immediately spotted the bug and within a few hours agreed on a solution and resumed operations. Why do people use Bitcoin? Some people are excited about Bitcoin because it is a decentralized currency that cannot be affected by any one government’s actions. Some use it because it is a more effective form of exchange in a global and digital era. The Economist pointed out one of the top reasons: “Bitcoins (or fractions of Bitcoins known as satoshis) can be bought and sold in return for traditional currency on several exchanges, and can also be directly transferred across the internet from one user to another using appropriate software. This makes Bitcoin a potentially attractive currency in which to settle international transactions, without messing around with bank charges or exchange rates.” Writer and Bitcoin enthusiast Kashmir Hill listed four reasons why people and merchants would opt to use Bitcoin “(1) It lets you make digital purchases in stores without revealing your identity (by using a credit card with your name and number on it). It would let you do the same thing online.” “(2 )Merchants can avoid paying high transaction fees and don’t have to worry about fraudulent purchases that result in charge- backs. “When a transaction is done, it’s done.” If merchants were to offer discounts to Bitcoin shoppers, that would make the currency more appealing.” “(3) For spending internationally or while abroad, you don’t have to worry about converting your money to the local currency, and the conversion fees that go along with that.” “(4) It allows people to make purchases when they are banned by other traditional payment providers.” Several people are also showing interest in investing in Bitcoin, much like they would in say, gold. This interest is part responsible for the fluctuations of Bitcoin, which at its highest traded at $230 per Bitcoin. Many people believe that Bitcoin allows ‘anonymous’ transactions, but this isn’t necessarily true. Blogger Colin Neagle pointed out: “Some simple research on Bitcoin shows that although transactions are conducted anonymously, they can be traced. The Block Chain logs and displays all Bitcoin transactions. Starting there, anyone interested enough to see where the Bitcoins used to make one transaction could follow its trajectory from its origins.” Many people also believe that Bitcoin allows people to engage in criminal activities like purchase of illegal items (e.g. drugs) or tax evasion. Governments are now beginning to introduce legislature that applies to Bitcoin exchanges and vendors that use Bitcoin. The U.S. government has also used Bitcoin to trace illegal activity and conduct a raid on the online drug haven Silk Route. Crowdsourcing Bitcoin
  • 82. 83 Source: Source: Source: The Pros & Cons of Bitcoin - LeWeb London 2013 Why do businesses use Bitcoin? Thousands of merchants, including OkCupid, Foodler and even Wikileaks, now accept Bitcoin. Bitcoin business solutions provider BitPay itself reports a clientele of 7,500 merchants. Merchants are accepting Bitcoin for a first mover advantage, to cater to tech savvy people or to capitalize on the opportunity to create new services. Several entrepreneurs have created services that enable Bitcoin enthusiasts to spend their Bitcoins to buy things like Zara clothing. Source: Here are some reasons why merchants should accept Bitcoin, according to Bitcoin. org: “Bitcoin is an emerging market of new customers who are searching for ways to spend their coins. Accepting them is a good way to get new customers and give your business some new visibility. Accepting a new payment method has always shown to be a clever practice for online businesses.” What people are saying about Bitcoin Thinkers, bloggers, the media and Bitcoin enthusiasts all have a point of view on the new currency, which range from the extreme ‘Bitcoin is a scam’ to ‘Bitcoin is the future of money.’ Several of these points of view are discussed in this LeWeb panel of Bitcoin. Some thinkers question the ‘true value’ of Bitcoin and speculate that it may be the next Ponzi Scheme, or the newest bubble. Vanity Fair’s Kurt Eichenwald wrote: “In essence, the market is a fantasy. Once the hoarders stop buying, what buyers will step up to the plate to take their place? My bet? No one. There will be, at some point, a time when some hoarder decides to unload. Prices will drop. Other hoarders will get scared and start to sell. Prices will drop further. Before long, there will be a mass rush to the exits. And at that point, the illiquidity of the Bitcoin market will be apparent.” Several thinkers believe that Bitcoin is a natural evolution of money, in keeping with the digital and global world of today. Salon’s Kyle Chayka pointed out the need for this evolution: “Cold, hard cash has inherent inefficiencies. It’s bulky and difficult to transfer between owners (wheelbarrows notwithstanding). These days, money is barely even paper bills—it’s just a number stored on a computer signifying credit or debit. Digital currencies take that idea one step further, creating self-regulating mediums of exchange through peer-to-peer networks.”
  • 83. Volume 2, Issue 2 Future of Money Tom Simonite, IT editor of MIT Technology Review, speculated: “Bitcoin could hit the big time as less an idealistic reinvention of currency and more a technology to move payments more efficiently than today’s systems.” Source: Source: Meanwhile, Gavin Andresen, a lead developer on the Bitcoin project, cautions: “Bitcoin is an experiment. Treat it like you would a promising Internet start up company: Maybe it will change the world, but recognize that investing your money or time in new ideas is always risky.” Impact on brands and organizations? It’s still too early to speculate on how Bitcoin could impact brands and organizations. The currency may have more of an impact on financial institutions as early adopters use Bitcoin as a way to avoid transaction fees, to make quicker international payments to cut costs associated with currency exchange. Financial institutions should also note investor interest in the currency – especially as entrepreneurs propose the creation of a Bitcoin fund. Crowdsourcing Bitcoin
  • 84. 85 Pledgeit
  • 85. Volume 2, Issue 2 Future of Money What is Pledgeit? Pledgeit is a crowdfunding platform that invites people to seek pledges or donations in exchange for performing various challenges. Source: While most charity crowdfunding platforms have been launched by entrepreneurs to connect people with worthy causes and non- profits, Pledgeit was launched by the charity Leukemia & Lymphoma Research itself to ensure the most effective use of donations. How it works Fundraising events typically focus on a specific challenge or activity. Pledgeit broadens its reach by inviting people to set their own challenge – resulting in a mix of serious, quirky and fun challenges. Blogger Nick Clayton noted: “Instead of somebody deciding to take part in an activity then looking for sponsors, the new Pledgeit platform enables people to challenge their friends to complete task in return for donations.” Rosie Baker wrote: “Challenges can be anything from eating as many crackers as possible in a minute, doing standup comedy or running a marathon.” Source: Crowdsourcing Pledgeit
  • 86. 87 Source: Source: People can choose their own challenge, or nominate a friend to carry out a specific challenge. Blogger Emma Klues explains how Pledgeit works: “In a nutshell, you can dare your friends to do any challenge you’d like, back it up with pledges, and then leverage your social networks to make your goal and control your pals, all while donating to charity.” Rosie Baker reported: “People can also remove challenges set for them if they do not want to participate.” Money is deducted from the pledgers only after a participant successfully completes a challenge, as confirmed by the challenge’s referee. The website explains: “The challenge referee is the sole and infallible judge of whether they deem the challenge complete. That’s either the person who created the challenge (if they were challenging a friend) or the elected referee (if the person was challenging themselves.) When they decide it’s complete, your pledges will be cashed. Their decision is final.”
  • 87. Volume 2, Issue 2 Future of Money Source: Source: Source: ‘Hall de la Pledgends’ Pledgeit uses gamification to create a sense of competition, peer pressure and reward. People who successfully complete challenges are crowned ‘pledgends’ and featured on a special page called “Hall de la Pledgends.” Christina Foulger commented: “I think this is a great idea, its fun its engaging and it has an element of competition and self worth about it.” Reaching potential donors Bloggers, marketers and the people behind Pledgeit note that the fun approach to fundraising excites potential donors and energizes those affected by “donor fatigue.” Cathy Gilman, chief executive of Leukemia & Lymphoma Research shared the reason they chose a creative approach: “The financial environment for fundraising has never been more challenging. Our response at Leukemia & Lymphoma Research is to focus even more resource on creativity and innovation to inspire and engage people to in raising the money we need in ways that are relevant and enjoyable for them.” Blogger Emma Klues noted that the approach helps reach a larger audience base, beyond the charity’s core community: “People will be doing this because “it gives back” and they can make their friends do stuff, not because they are wildly passionate advocates of L&L Research. This opens up their audience far beyond just their dedicated fans, but keeping the social good option ever-present makes it far more powerful than just a site to call out your friends.” Cause marketer Paul Jones wrote Pledgeit “puts the fun back in crowdfunding for causes.” M&C Saatchi’s Fortnightly tech bulletin pointed out that the approach helps combat ‘donation fatigue’: “This potentially massive fun factor helps overcome the growing problem for charities of donation fatigue.” Increasing effectiveness Leukemia & Lymphoma Research opted to build its own platform to bypass the standard 5% processing fee charged by charity crowdfunding platforms like GoFundMe and Razoo. This approach also lets Leukemia & Lymphoma Research control and access all the data collected on the platform. Leukemia & Lymphoma Research’s Ellie Dawes explains: “Another benefit is that Pledgeit is ours now. We do not pay any percentage fee, as we would to any external platform. We also have full access to the data. Many crowd-funding platforms release very little amounts of data, Crowdsourcing Pledgeit
  • 88. 89 Source: Source: Source: Source: Source: and by analysing trends on Pledgeit, we could gain insight that can help us plan and tailor our fundraising planning activities across Leukemia & Lymphoma Research.” Howard Lake reported: “The platform has cost around £20,000 so far, but the charity is confident in can recoup that within six months if 12 or so challenges are completed that raise a similar amount to that achieved by a London Marathon runner.” Inspiring doers – and talkers Bloggers and thinkers also commended the relevance of the platform, both for people who already do things and don’t mind associating with a charity, and also for people who’s friends constantly talk about doing things but need an extra push. Wade commented: “What a great way to encourage people to take things they are already doing and raise awareness to non-profits and funds for them.” Other approaches to raising funds Not all charities build their own platform from scratch. Many partner with pre-existing crowdfunding platforms, like GoFundMe and Razoo, which have the resources to maintain state-of-the-art platforms and large communities of donors and influencers. Some charity crowdfunding platforms focus on specific topics. For instance, Start A Cure focuses on cancer research projects. A new charity crowdfunding platform, Philippines-based Social Project, is experimenting with ways to increase the effectiveness of crowdfunding campaigns, and breaks down a large funding goal into smaller milestones. Some charities seek to change people’s behaviors. UK-based The DoNation encourages people to ‘replace cash with actions’ to contribute to a more sustainable world. Some charities encourage people to spend for good. UK-based Easy Fund Raising partners with e-tailers to ensure a percentage of all online sales go to charity.
  • 89. Volume 2, Issue 2 Future of Money People’s Lab is MSLGROUP’s proprietary crowdsourcing platform and approach that helps organizations tap into people’s insights for innovation, storytelling and change. The People’s Lab crowdsourcing platform helps organizations build and nurture public or private, web or mobile, hosted or white label communities around four pre-configured application areas: Expertise Request Network, Innovation Challenge Network, Research & Insights Network and Contest & Activation Network. Our community and gaming features encourage people to share rich content, vote/ Innovation Challenge Network: Chicco Artsana - Nataieri In 2012, Chicco Artsana & MSLITALIA used the People’s Lab platform to create a, an open digital community with moderated access where 100+ parents discuss issues in bringing up children and sharing their experiences. Research & Insights Network: P&G Asia - Thank You Mom In 2012, P&G Asia and MSL Singapore used the People’s Lab platform to create a Social Media Regional Center, a secure, private community where 100+ P&G stakeholders and agency partners shared content and best practices for the “Thank You, Mom” campaign at the London 2012 Olympics. comment on other people’s content and collaborate to find innovative solutions. The People’s Lab crowdsourcing platform and approach forms the core of our distinctive insights and foresight approach, which consists of four elements: organic conversation analysis, MSLGROUP’s own insight communities, client- specific insights communities, and ethnographic deep dives into these communities. The People’s Insights Quarterly Magazines showcase our capability in crowdsourcing and analyzing insights from conversations and communities. People’s Lab: Crowdsourcing Innovation & Insights Learn more about us at: |
  • 90. 91 Write to us to start a conversation on how we can help you distill actionable insights and foresights from conversations and communities: Pascal Beucler, SVP & Chief Strategy Officer ( Nidhi Makhija, Senior Manager - Insights ( | | MSLGROUP is Publicis Groupe's strategic communications and engagement group, advisors in all aspects of communication strategy: from consumer PR to financial communications, from public affairs to reputation management and from crisis communications to event management. With more than 3,700 people, its offices span 22 DesignedbyMSLGROUPCREATIVE+ countries. Adding affiliates and partners into the equation, MSLGROUP's reach increases to 4,000 employees in 83 countries. Today the largest 'PR and Engagement' network in Europe, Greater China and India, the group offers strategic planning and counsel, insight- guided thinking and big, compelling ideas – followed by thorough execution.