Adoption cycle for a sustainable innovation in mobile and Internet business ecosystem in Indonesia

1. Indonesia 2.0
The Adoption of Mobile & Internet
Andi S. Boediman
Strategic Innovation Consultant
andisboediman@gmail.com
www.ideonomics.com

2. Ritual
Creation
Mass
Adoption
Habit
Forming
Behaviour
Change
Behaviour
Introduction
Innovative
Solution
Innovation Adoption Lifecycle

3. morning ritual
82% brush teeth
74% take shower/bath
74% have something to eat
54% talk to family members
53% males shave
47% females put on makeup
Source: BBDO worldwide study
Ritual Creation for Consumer Market
The long way creation of
ritual will commoditize
innovation to become
consumer market.

4. Mobile & Internet Adoption
Mobile and Internet will become a ubiquitous
infrastructure for communication, content
distribution, community and commerce

5. voice & sms
becomes commodity,
drives pulsa become
kind of “money”
the potential of value added services
online shopping
video streaming
online gaming
music downloading
social networking
chatting
emailing
browsing

6. D = 82%
Rp 500 - 700 rb
C = 65%
Rp 700 rb - 1.5 jt
A = 86%
> Rp 2 jt
advertising
model
subscription
model
Mobile & Internet Adoption in Indonesia
innovator early
adopter
early majority late majority laggards
50 % 20 %20 %8 %2 %
mobile adoption
internet adoption
content
distribution
commerce communication
payment
platform
E = 86%
< Rp 500 rb
B = 82%
Rp 1.5 - 2 jt
mobile adoption

7. Warnet Office
Home Mobile
School Hotspot
online shopping
7%
video streaming
16%
online gaming
17%
music downloading
45%
social networking
50%
chatting
65%
emailing
82%
communication
content
community
commerce
Internet Usage
Source: Synovate
browsing
86%
key usage

8. Kaskus
Detik
Kompas Kapanlagi
information
Friendster Facebook
community
Ticket
Retail Book
goods &
merchandising
Advertising as
Business Model
Games
Classified
Images,
Music
digital content
Ecommerce as
Business Modelepayment
platform
US $10
million

9. Mobile Internet Adoption
Case Study
Learning from iMode, a mobile internet
ecosystem

10. • Low PC penetration in Japan
• High charges for PSTN dial-up access in Japan
Internet Problem in Japan
Solution
• Young women doesn’t really care about technology,
they care about connection and content.
• Connecting to Internet should as easy as
making a call.

11. • Launched by DoCoMo in 1999
• Within 3 years, it had over 35 M
subscribers and 40,000 iMode Web sites
• Low fees: 300 Yen/month plus 2.4 Yen/
KB downloaded
• It is an application environment for
subscribers for application providers
-> On Device Portal
• Open its billing system
• DoCoMo use a subset of HTML (cHTML)
• Manufactured a new breed of application
friendly handsets.
iMode Facts

12. When you focus on the number of Internet users for private
use, it is far from ’critical mass’ for major IP in Japan.
However, if you count on all cellular phone users of DoCoMo,
IP can easily reach economies of scale for its own service.
Cellular Phone User
47 million
Internet User
around 17 million
Personal PC User
3 - 4 million
Internet
Information
Provider
Information
Provider
DoCoMo User
27 million
ISP
Private LAN
DoCoMo
Gateway Server
iMode Adoption

13. iMode Adoption Strategy
Portal Link
Web access
Intranet
Intranet
Packages
Java
IMT‐2000
Feb 1999 Fall1999 Fall 2000 Spring 2001
i-mode
launch
Success of iMode lead to smooth introduction of
IMT-2000 which enable high speed access from
mobile devices (64k-384k bps). They enhance
iMode platform by introducing Intranet package
solutions in 1999, then Java technology in 2000.
Homepage
Email
Groupware
・Schedule Management
・Work flow Management
・Electronic Bulletin Board System
・Electronic Conference
・File Sharing
・Video
・Game
・Music
・Agent function ・Mobile TV
・Interactive TV
・TV Telephone
・TV Conference
・Security function
Rich (Visual,
High Speed)
Colored LCD

14. iMode & Content
Application
Content/Application Case Study
Movie Navigator, Mobile Banking, Character Download

15. MENU
1.Movie Guide
2.Ranking
3.Latest News
Latest Films
1. Deep Impact
2. Saving Ryan
3. SHITSURAKUEN
4. Kiseki no Umi
5. Romeo & Juliet
6. 007
7. Mr. Bean
Choose 1 Choose 1 Choose 5
Romeo & Juliet
1. Profile
2. Story
3. Special Features
4. Theaters
Choose 1（charged）
2 Theaters Found
in Your Area
1. Nihon Theater
2. Cine-Chante
Choose 4
NOW SHOWING
(9/26∼10/12)
Yurakucho
Nihon Theater
Marion Bldg. 11F
11:00/1:40/4:20
7:00/9:10
Adult 1,800Yen
Student 1,500Yen
Rsvd. 3,000Yen
Child. 1,000Yen
1. PHONE TO!
2. Return
PROFILE
USA/1996
Director, Hes Laman/
Film, Donald M.
Mclevin/Actor,
Leonard de Caprio
1.Return
Choose 1
STORY
Remake of the
Shakespeare`s
work with modern
spice.
1.Return
Choose 2
Call to the
theater and
make a
reservation
Choose 1 Choose 1
Content Example/Movie Navigator
Movie Navigator
Welcome to the
Latest Road Show
Information
1. ENTER
DETAIL INFO.
Guidance to this
Movie
Info Charge $0.10
per view
1. OK
2. Return

16. <Account Selection>
◎ Tokyo Brunch
Savings ***1234
○ Yokohama Br.
Checking ****234
Check Balance
Today’s Transaction
Past Transaction
<Sumitomo Bank>
1.Mobile Banking
2.Telephone Banking
Center
3.ATM Maps
4.Service Info
5.Sample
6.Application Form
Request
7.Customer Support
Content Example Mobile Banking; Sumitomo Bank
<Service Menu>
Balance Check
Money Transfer
Change PIN
Quit
MY MENU
1. Weathernews
2. ZAGAT Tokyo
3. Nikkei News
4. Sumitomo Bank
Mobile Banking
1.Start
2.Quit
3.Help Desk(Tokyo)
4.Help Desk(Osaka)
5.My Menu
<Input ACCT# and First
PIN>
ACCT#
＊＊＊＊＊＊＊
1st PIN
＊＊＊＊＊＊
Submit
Cancel
0354738111
Calling
<Balance>
11/3 10:30
#Account Balance
Y123,456
Back to Menu
Quit
<Account Selection>
◎ Tokyo Brunch
Savings ***1234
○ Yokohama Br.
Checking ****234
Money Transfer
Acct Transfer
Back to Menu
<Registered Acct>
○ Sumitomo Bank
Osaka Brunch
Savings ***4321
Paul Smith
◎ CITIBANK
Tennoz Brunch
Savings ****135
Takeshi Natsuno
Transfer Amount
1000000
Transfer
Back to Menu
<Confirmation>
FROM;
Sumitomo Bank
Tokyo Brunch
Savings ***4321
TO;
CITIBANK
Tennoz Brunch
Savings ****135
Takeshi Natsuno
Amount Y100,000
Fee
Y315
→Input 2nd PIN
＊＊＊＊＊＊
Confirm
Cancel
<Order Completed>
Executed 11/3
Order # 1103-001
Back to Menu
Quit
Balance Check
Money Transfer
Below

17. Case Study; Bandai Corporation
Chara-Pa! Service
Character Delivery Web by Bandai Corporation
Simple GIF downloading can generate money !
• You can download
GIF everyday by
enrolling membership
for 100 Yen/month.
• Acquired more than
450,000 subscribers
at mid November.

18. Mobile & Internet
Advertising Adoption
Mobile and Internet advertising growth potential
and understanding the consumer goods as the
biggest potential for advertising

19. Mobile marketing in Global Perspective
Mobile Advertising
market will grow
from US$900M to
US$1.1B by 2011
Source: Mobile - Jupiter
Research 2005 and PC
Internet - eMarketer, 2007
Cars
800 million
Phones
1.3 billion
Television
1.5 billion
Credit Card
1.4 billion
PC
850 million
Internet
1.1 billion
Mobile Phones
3.3 billion
(nov 2007)

20. Indonesia mobile advertising metrics
adMob serves ads for more than 6000 web sites and applications around the
world. It stores and analyzes the data from every ad request, impression, and
click and uses this to optimize ad matching in the network. This report is a
snapshot of the data to provide insight into trends in the mobile ecosystem.
Source:
Admob.com

21. Indonesia mobile advertising growth
Source:
Admob.com

22. Mobile Web Drawing Diverse Advertisers
Most advertiser is still IT and lifestyle related, consumer goods not yet
adopt mobile as advertising medium

23. eyeball loyal customers
purchaseconsideration favorabilityawareness loyalty
advertising
to mass
market
information/
user review
consumer
lead
purchase
intent
marketing funnel
customer

24. eCommerce Adoption
eCommerce adoption shows variety degree
of success depend on consumer ease of use
and trust

25. Global eCommerce

26. • Total credit card from 20 banks: 9 million
• The Big 4: Citibank, BCA, BNI and Mandiri.
• Potential market growth: 20-30% per year.
Credit Card Adoption
• How many credit card do you have? Why?
• Is credit card replacing money? Why?
A few question
The success of credit card is because
it offers a credit/financing/discount
solution, not only payment solution.

27. Yehey’s PayPlus+ has been
servicing local merchants for
about 3 years already but up to
now, but there seems to be too
little penetration amongst local
merchants.
Poor awareness in the general
population and lack of
infrastructure to support mobile
commerce may hamper
adoption of his innovative
business models.
In a survey conducted, there is
still poor awareness in terms of
people's attitude towards m-
commerce. A lot didn't
understand it despite the
advertisements on television and
in billboards.
On the aspect of infrastructure,
it is still difficult to "cash-in and
cash-out" using micropayment.
Both SKT and KTF have mobile wallet
offerings (SKT offers MONETA and KTF
offers K-Merce). These services came
out around December 2004. Neither of
these services has taken off. There
appears to be little or no marketing,
and the press is silent on these
services. You can still see an
occasional dongle in a store, but you
rarely if ever see anyone use them.
mCommerce Case Study

28. Todito.com the low- and middle-income Mexican
market through ePAID. It provides a cash-based
payment platform that supports e-commerce and
remittance services. ePAID facilitates low-cost
money transfers between workers in the United
States and family in Mexico. By allowing people
to ship goods to friends and family in Mexico,
ePAID eliminates the need for hard cash transfers.
For those who do wish to transfer cash, there are
small, affordable fees. For their ePAID venture,
eCatalystOne partnered with Mexican banks to
ensure that their customers can withdraw cash
funds from their ePAID accounts at ATMs.
Because ePAID is not credit-based, there is no
risk involved for the company or the consumer.
Opening an ePAID account does not require the
divulgence of any financial information and. More
importantly, consumers without access to credit
can open accounts using cash.
ePaid Case Study

29. desirable
hardware
ease of use
content
common
payment
internet/mobile
Apple Model
1
2 3

30. Online Purchase
Adoption is still low due to payment solution

31. innovator early
adopter
early majority late majority laggards
50 % 20 %20 %8 %2 %
Transition to eCommerce Adoption
Mobile
Adoption
Mobile
Internet
Adoption
ePayment
Adoption
eCommerce
Adoption

32. Key Takeaway
Understand and apply the
adoption cycle for creating a
sustainable innovation in mobile
and Internet ecosystem

33. Thank You
Andi S. Boediman
Strategic Innovation Consultant
andisboediman@gmail.com
www.ideonomics.com