Octopus Adapts to a Fast-Changing Environment

Originally launched in September 1997 as a fare collection system for Hong Kong's mass transit systems, Octopus has expanded to become a widely used cashless payment system for convenience stores, supermarkets, fast-food shops, parking and other point-of-sale applications. It has become one of the world's most successful electronic cash systems, with more than 13 million Octopus cards in circulation and about 300 service providers. Using the card, Hong Kong residents have simplified the way they commute, dine, travel and shop.

Customer Success Video

Check out this video to learn more about Octopus Cards and its successes with SAS. 

View Video

• Windows Media Player
• Real Player

3 min. 25 sec.

---

Customer ViewPoint
You have questions; our customers have answers. Check out this video Q& A.

Eric Tai                   
CEO,                     
Octopus Cards

View Video

• Windows Media Player
• Real Player

---

(Requires Windows Media Player 6.4.7 or higher or RealPlayer 6 or higher)

Each Octopus card contains a built-in microchip that stores money electronically. The card's useful applications also include access control to residential and commercial properties, offices, or schools. Users simply wave their Octopus over a card reader, and the correct amount is automatically deducted from the card without any direct contact. Because the payment process doesn't require removing the card from one's wallet or purse, transactions require less than a second. It's convenient and fast, making everyday life easier for Hong Kong residents.

Octopus now processes over 9 million transactions everyday. With over 1 terabyte of data and growing, there was enormous potential for discovering valuable patterns in the data using SAS' advanced analytics.

"After being so successful on payments, we began to wonder how our information could be helpful to our partners and our customers," explains Eric Tai, CEO of Octopus Cards. "We noticed that for the small payment side of the business, most retailers didn't know who their customers were," continues Tai. "For fast food, at convenience stores or vending machines, you just pay and you go. So we thought this would be an opportunity for us. We can help retailers on an anonymous, segmented basis, rather than personalized basis.

"A fast-food operator might say to us, 'We want customers to come to us to have breakfast as soon as they get off public transportation in the morning on their way to work.' We can put the two together and communicate special offerings — some reward or some benefit — to those customers." For busy people exiting the subway, such offers ease the decision of where to eat or where to find a birthday gift, conserving those few spare moments between work and personal life.

"We can follow what the retailers' behaviours were previous to the campaign, during the campaign, after the campaign, so that our partners can actually work out the cost-effectiveness of the programs that we are collaborating on," says Tai.

SAS enabled Octopus to increase its business by gathering intelligence from its data and then marketing that intelligence to its retail customers.

"If we want to turn the data into valuable information so that you can actually provide added-value services for your customers, then you have to be a lot more sophisticated. That's what we've been doing with SAS over the last few years," explains Tai.

"I see this as a 'relationship business' between Octopus and our customers, but also between Octopus and our suppliers, the people who can actually build a relationship with us, understand us and also add value to our business rather than just add cost. These are important decision points for us," concludes Tai.

Copyright © SAS Institute Inc. All Rights Reserved.