CREATING
CONVERSATIONS
IN THE SMARTPHONE ERA
WHAT YOU NEED TO KNOW
ABOUT APPLICATION TO
The recent $19 billion acquisition of WhatsApp by Facebook put an exclamation point on the shift by consumers to over-the-top (OTT) messaging apps on smartphones, where consumers are communicating with each other (peer-to-peer) via internet-based messaging applications instead of traditional text messaging. In contrast, mobile messages sent by businesses—or application-to-person
However, the rise of smartphones has caused consumers to shift to new types of messaging platforms, often called over-the-top (OTT) messaging, in order to communicate with each other. OTT applications ride on top of existing internet service without a mobile operator’s involvement. WhatsApp—an application purchased by Facebook for $19 billion in February 2014—and Apple’s iMessage are two very high profile examples of OTT messaging.
The activity in OTT messaging is primarily centered on person-to-person (or P2P) messaging. P2P refers to messaging between the mobile devices of consumers, like texting a friend or family member. One of the reasons OTT messaging has gained such popularity is the cost savings consumers realize. While the US has popularized “all-you-can-eat” consumer messaging plans, mobile users in many other countries pay fees on a per text message basis, making the cost of regular communication with peers very high. In some countries a single text message might
TEXT MESSAGING CONTINUES
TO BE AN ENDURING DAILY
BEHAVIOR FOR ALMOST EVERY
CONSUMER IN ALL PARTS OF THE
WORLD. IN ITS 2014 TECHNOLOGY,
MEDIA & TELECOMMUNICATIONS
REPORT, DELOITTE & TOUCHE
FORECASTS THE CURRENT
GLOBAL MARKET SIZE FOR TEXT
MESSAGING TO BE $100 BILLION.
cost the consumer $0.25 or even $0.50. OTT apps such as iMessage and WhatsApp have provided free or very low cost alternatives for consumers. While cost savings and added functionality like avatars and multimedia capability have made OTT messaging alternatives popular for P2P messaging, the same conditions do not exist for application-to-person (A2P) messaging (or messages sent from an enterprise to a person). Consequently, the overall messaging market is a rapidly diverging pair of stories. The worldwide growth rate of 4% compounded that is projected by Portio Research through 2016 is comprised of P2P growing at 1.9% per year and A2P growing at 13.1% per year.
The main cause of this difference is that A2P messaging is the only platform that maintains a single, out-of-the-box community of users around the globe; if you have a mobile number you can participate in A2P messaging without being dependent upon the ability to access the internet, the type of mobile device you use, or the downloading of a mobile app.
UNDERSTANDING A2P
AND P2P MESSAGING
SOME FAMILIAR USE CASES OF A2P MESSAGING INCLUDE THE FOLLOWING:
EXTREME COST SAVINGS HAVE MADE
OTT MESSAGING ALTERNATIVES VERY
POPULAR FOR PERSON-TO-PERSON (P2P)
MESSAGING, BUT THE SAME CONDITIONS
DO NOT EXIST FOR
APPLICATION-TO-PERSON (A2P) MESSAGING.
The reach and ubiquity of SMS (short messaging service) has been critical to the rise of A2P messaging. A2P includes any SMS or MMS (multimedia messaging service) message transmitted from a software application to a mobile consumer and vice versa. The growing share of smartphones, initial mobile app fervor, and rapid adoption of P2P OTT messaging apps distorts the perception of A2P messaging. Given the urgency with which every enterprise must adopt mobileas a core part of a multi-channel communication strategy, A2P remains the most cost effective path to realizing an effective messaging strategy. A2P text messaging is a simple and direct way to engage mobile consumers in a two-way conversation. This type of messaging is omnipresent, operating across all carrier networks. It is not dependent on a mobile user having a smartphone, internet connection or mobile apps, and doesn’t require the enterprise to make significant investments in infrastructure beyond API integration or platform implementation. A2P messaging makes use of multilateral global carrier relationships to deliver real-time information over a medium that consumers trust and rely on.
• Mobile Marketing Campaigns • Alerts (Scores, Balances, Security) • Call Back Requests
• Mobile Ticketing
• Appointment Reminders
• Personal or Device Authentication • Surveys
• Database Queries • Content Delivery • Account Inquiries • Contesting
• In-Store Calls to Action
OTHER SOURCES CONTINUE TO VALIDATE THE UNIQUE VALUE AND
GROWTH OF A2P AS A CHANNEL. ACCORDING TO INFORMA, GLOBAL
REVENUES TO MOBILE OPERATORS FROM A2P MESSAGING WILL
GROW FROM $13 BILLION IN 2013 TO $15.8 BILLION IN 2016, A RATE
OF GROWTH NEARLY 700% FASTER THAN THAT REALIZED FROM P2P
MESSAGING IN THE SAME TIME PERIOD.
Jupiter Research
estimates an overall A2P
messaging market value
of a booming $70 billion
by 2016. This data signals
increasing interest on
the part of enterprises to
implement the simplest
and most effective ways
to communicate with
individual stakeholders.
THE REASONS FOR THE
GROWTH DIFFERENCE
BETWEEN A2P AND
P2P INCLUDE:
1. The need for ubiquity and reach is crucial to the enterprise. OTT messaging typically involves users on the same platform at the same time (such as iMessage or WhatsApp). In this circumstance, consumers are replacing the proven P2P infrastructure provided by carriers with an OTT message sent via an app on their phone. Consumers choose these apps based on a value proposition offered by the app provider. While consumers are willing to explore different ways to engage with friends and family, commercial enterprises can’t afford to rely on exploration and trial and error to communicate in a B2C relationship. There is no large enterprise or service provider who would be able to satisfy its messaging needs across all stakeholders with mobile apps or OTT solutions alone. In fact, it’s unlikely to meet even 20% of its messaging needs with such an approach. When it comes to mobile engagement, A2P messaging based on the mobile telephone number is the only way to engage nearly 100% of consumers via the mobile phone. Failing to provide a mobile option that works for the vast majority of consumers—or requiring the download of a special application or other action to participate—is not smart for the enterprise.
THE RISE IN A2P
MESSAGING
A2P MESSAGING BASED ON MOBILE TELEPHONE
NUMBERS IS THE ONLY WAY TO ENGAGE 100% OF THE
CONSUMERS VIA A MOBILE DEVICE
2. Existing infrastructure and clear ROI. Using simple APIs that connect into a messaging service provider, an enterprise is able to quickly connect to a global carrier network reaching billions of consumers. While it is critical to accommodate privacy, regulatory and mobile operator guidelines for any program, the fact that the infrastructure stands ready to go is a major benefit when compared with the development of a mobile application from scratch. Additionally, by relying on the use of a mobile number, there is a reduced need for investment in marketing or education programs to encourage the download of an app or keep up ongoing engagement—almost everyone knows how to text. Plus, many of the use cases for A2P messaging are accompanied by proven ROI with known costs associated with messaging volumes. For example, the cost associated with using A2P SMS in customer care can be measured against the cost of call center calls. The costs for A2P programs are virtually all variable, reducing the risk of a large up front investment in an app—software development, marketing, and deployment—that may only lead to adoption and use by a few.
SHOCKINGLY 80% OF THE
ENTERPRISE AND BRANDED
APPS ARE NOT ABLE TO SECURE
EVEN 1000 DOWNLOADS,
MAKING OTT MESSAGING
AN UNREALISTIC OPTION.
3.Business communication via OTT is more complicated and more demanding of consumers.
Spectacular events like the acquisition of WhatsApp result from the rapid viral growth of a P2P messaging application: users download the app and invite other users to communicate with them. When that process works, the numbers grow exponentially. While every brand or enterprise may dream of “going viral,” that model works only when the mobile app itself is the business. There is no “ubiquitous business communication app” to connect every consumer to every business. Brands delivering a message on their own behalf are not inclined to share an app with other brands who may dilute, or even compete with, their relationship with a particular consumer. Even when an enterprise is far down the path of implementing a smartphone strategy involving mobile apps (thereby making OTT messaging possible), they are faced with complex decisions involving their own app strategy.
While push messaging has become an increasingly important tool in an enterprise’s mobile strategy, it requires the consumer to download and install the enterprise app. With “app fatigue” (there are 700,000 apps in the Apple App Store), brands might be lucky to get 10% of their target audience engaged. Shockingly, 80% of enterprise and branded apps are not able to secure even 1,000 downloads, making OTT messaging an unrealistic option to drive serious engagement.
Over time, this will change. OTT messaging for business interaction will expand, but given the costs and the burden of effort placed on the consumer, it is not likely to become the staple that SMS has become in marketing or CRM use cases. At best, it will be a choice preferred by some, just as email and voice remain.
When thinking about the long-term viability of A2P SMS, one must remember an essential fact. Consumers like simplicity and choice.
“ PREFERENCES ARE THE NEW PATENTS. YOU CAN ANTICIPATE ALL YOU WANT, BUT IN TODAY’S WORLD, CONSUMERS WHO CAN EXPRESS THEIR PREFERENCES BY COMMUNICATING WITH YOU WILL ENJOY A BETTER EXPERIENCE.”
– SCOTT HOWE, CEO, AXCIOM
“ TO BE SUCCESSFUL WE HAVE TO PROVIDE CONSUMERS THAT ‘LEAN BACK’ EXPERIENCE, RATHER THAN THE ‘LEAN FORWARD’ EFFORT REQUIRED BY TOO MUCH TECHNOLOGY.”
– JAMES E. MEYER, CEO, SIRUIS XM RADIO
GIVEN THE NEED FOR SIMPLICITY AND CHOICE, IT IS CRITICAL THAT ENTERPRISES BALANCE THEIR APPROACH TO A2P MESSAGING WITH AN UNDERSTANDING OF SMARTPHONES AND ALTERNATIVE MESSAGING STRATEGIES.
A mobile app is required to be installed by the user to receive push notifications.
Consumers must agree to allow push messaging, meaning that control over the receipt of the notifications is provided by the mobile operating systems to the mobile device user. For example, the mobile device user can turn off, or opt out of, notifications at any time.
The enterprise or brand sending the push notifications does not know the mobile number of the recipient.
The app owner may be able to use the mobile device’s location to send targeted notifications. The mobile user is not able to initiate contact with the app owner using push notifications (although they may be able to use the mobile app to do that).
Pushing any messaging unrelated to the mobile app may confuse or discourage mobile users. Push notifications have become an important part of the overall communications mix when a brand or enterprise has an established mobile app with a large user base. Therefore, deciding between text and mobile app push notifications/ OTT solutions should not be an either-or-decision.
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Push notifications take advantage of the constantly open IP connection to a mobile device provided by the leading operating systems for mobile, namely Apple iOS and Android. Using the appropriate APIs and third-party software, enterprises are able to push messages from their in-house applications directly to users of their brand’s mobile phone app in real-time. Important elements of push messaging that can affect an enterprise’s messaging strategy include:
PUSH NOTIFICATIONS FROM MOBILE
APPLICATIONS VS. TEXT MESSAGING
SMS App Push Notifications Simple way to introduce consumers
to mobile strategy - maximizes participation and reach
Useful for intense applications where messages are being pushed in high frequency Extremely high open rates based
on active use of text messaging
A preferred channel for the consumer
Available to all consumers whether or not the app is downloaded - can help promote app downloads
Simple and effective based on verified mobile number
“AT THIS POINT, SMS REMAINS MORE USEFUL TO BRANDS AND ENTERPRISES THAN A MESSAGING APP, OF WHICH A MOBILE USER MIGHT HAVE SEVERAL, MAKING A TARGETED APPROACH DIFFICULT.” –PAMELA CLARK-DICKSON, INFORMA TELECOMS & MEDIA
Can be useful to incorporate as part of overall communications strategy, although notifications may be turned off by consumer
Works for loyal app users if app supports customer service strategy Apps are unlikely to be related to a specific marketing campaign, but can work in mass market use cases; can be location-triggered, increasing chance of engagement Not tied to mobile number in a way that can be used for verification
PUSH NOTIFICATIONS FROM MOBILE APPLICATIONS VS. TEXT MESSAGING
HERE ARE SOME FACTORS TO CONSIDER FOR A
SUBSET OF ENTERPRISE MESSAGING USE CASES:
INFORMATION ALERTS
Mobile apps will continue to be a critical part of a brand’s mobile strategy, and push messaging related to the mobile app can be highly relevant and engaging, especially when used in location-based campaigns. However, the difficulties brands face when seeking adoption of a mobile app limit its usefulness to brands who already rely heavily on their apps and are likely to continue a high level of investment in them.
A2P text messaging can play a role in supporting mobile app downloads as part of a marketing plan, or help augment the app strategy of a brand or enterprise by leveraging the right kind of SMS messages within an app. For example, Twitter announced in September 2013 that it would partner with several crisis management agencies to leverage SMS to provide two-way information during times of emergency. Other companies use their mobile apps to subscribe consumers via text message for REMINDERS & NOTICES
CUSTOMER SERVICE MOBILE MARKETING
TWO-FACTOR AUTHENTICATION
“AT THIS POINT, SMS REMAINS MORE USEFUL TO BRANDS AND ENTERPRISES THAN A MESSAGING APP, OF WHICH A MOBILE USER MIGHT HAVE SEVERAL, MAKING A
SIMPLICITY, CHOICE, AND
VARIABLE COSTS VERSUS LARGE
UP FRONT INVESTMENTS ARE
ALL FACTORS THAT MAKE A2P
TEXT MESSAGING A MUST-HAVE
FOR ENTERPRISES OR SERVICE
PROVIDERS IN AREAS AS DIVERSE
AS FINANCIAL SERVICES,
PAYMENTS AND SECURITY,
HUMAN RESOURCES, CUSTOMER
SERVICE AND B2C MARKETING.
ADOPTING A MESSAGING STRATEGY
IN THE SMARTPHONE ERA
ADOPTING A MESSAGING STRATEGY IN THE SMARTPHONE ERA
COMBINED WITH THE
BARRIERS TO MOBILE
APP ADOPTION FACED
BY ENTERPRISES, A
MESSAGING STRATEGY
MUST INCLUDE SMS
IN ORDER TO REALIZE
THE FULL EXTENT OF
POTENTIAL MOBILE
OPPORTUNITIES.
With a well-defined messaging strategy, enterprises and service providers can:
• Identify when it’s better to use text messaging vs. OTT push notifications. • Realize a strong ROI by reducing costs associated with communication inside and outside the enterprise
• Leverage existing investments in technology by taking advantage of simple web-based integration methods for messaging
• Dramatically simplify the consumer or employee user experience by making smarter decisions about messaging • Improve the quality and availability of information enterprise-wide or for your enterprise customers as a service provider
Forming a messaging strategy will begin with identifying the programs that can benefit from messaging and identifying the highest priority for your organization. Many organizations start with customer service as an area for mobile messaging implementation because of the extraordinary cost savings available.
For example, SMS can reduce call center volumes and shorten case resolution time as increasingly large numbers of consumers seek to communicate in their preferred channel. Just as consumers have seen more immediate resolution through social media, they will discover the same immediacy and response rates afforded by mobile devices.
• Banks and financial institutions rely on messaging to deliver real-time fraud alerts, balance notifications, and even enable account transfers.
• Travel companies inform travelers in time about changes in flight-status, weather alerts, and booking information.
• Large consumer websites use two-factor authentication to increase security and protect against user fraud.
• Healthcare providers make use of messaging for appointment reminders and prescription refill alerts.
• Brands are rapidly expanding mobile marketing and CRM database initiatives using messaging to drive loyalty programs and deliver targeted coupons, offers, contests and campaigns
• HR departments and job boards are using messaging to communicate job listings or employee alerts
In all cases it’s critical to define your audience and what type of information you’ll want to collect, disperse, or exchange over messaging.
“SMS REMAINS A SIMPLE AND EFFECTIVE MESSAGING SERVICE NOW IN THE HANDS OF ALMOST 6 BILLION HUMAN BEINGS. THAT DWARVES EVEN THE REACH OF MIGHTY FACEBOOK, AND FOR A LONG TIME, SMS WILL REMAIN A PROFITABLE, ESSENTIAL ELEMENT IN THE MESSAGING MIX.”
– KARL WHITFIELD, PORTIO RESEARCH
In every possible area of messaging, an enterprise can implement an SMS program more cheaply and efficiently before it even considers mobile app development. Where a mobile
OTHER AREAS OF A2P MESSAGING
SUCCESS DUE TO LOW RISKS AND
HIGH ROIS INCLUDE:
EXPECTATIONS FOR
IMPLEMENTING A MOBILE
STRATEGY QUICKLY ARE HIGH
FOR EVERY ENTERPRISE AND
SERVICE PROVIDER. A2P
TEXT MESSAGING PRESENTS
AN ATTRACTIVE PLACE TO
REALIZE FAST BENEFITS DUE
TO ITS LOW COST, EASE OF
IMPLEMENTATION AND THE
LEVERAGING OF EXISTING
INFRASTRUCTURE.
SURVEY USE CASES FOR MESSAGING As above, there are a wide variety of messaging use cases to consider depending on your business. These cases can work with internal or external constituents. It is wise to consult industry providers about what messaging programs and campaigns are successful in your market. Look for information documenting likely traction and benefits.
UNDERSTAND IMPLEMENTATION METHODS
A2P text messaging leverages the existing networks of mobile operators and third-party service providers to enable messaging to almost any mobile subscriber anywhere in the world. Enterprises and service providers are able to leverage straightforward APIs to connect to this existing network. Similarly, there may exist technology investments such as platforms, databases, or content sources that can be leveraged for instant success.
GETTING STARTED WITH
A2P TEXT MESSAGING
IN ORDER TO GET
STARTED WITH SMS,
YOU WILL WANT TO:
GETTING STARTED WITH A2P TEXT MESSAGING
GET FAMILIAR WITH THE COSTS OF A2P TEXT MESSAGING
The costs of your messaging program will extend to the internal costs of implementation through to per message fees associated with the volume of messaging you are doing. When a high volume of messages is at stake, fees can become very low. The cost to get a messaging program up and running can be as little as 5% of that of developing and managing a mobile app.
LEVERAGE AND/OR BUILD DATABASES AND CREATE EFFECTIVE CONTENT
Define your audience and determine and what type of information you’ll want to collect, disperse, or exchange over SMS. You can build your database by asking consumers to text you, leverage your websites or app properties and have them fill out a form. Text messages can include links to multimedia content like video and pictures or to product information and reviews.
EXECUTE FOLLOWING BEST PRACTICES
A2P SMS engagement is always permission based. You will need to be upfront about the nature of the content you’ll be sending and what information will be collected from mobile subscribers. Privacy continues to be an important issue related to all aspects of digital data collection. Work with the right partner who can assist you in making your programs comply with laws, regulations and mobile operator guidelines, as well as provide best practices for a range of use cases.
SELECT THE RIGHT PARTNER.
Seek a partner that can help address all aspects of your messaging programs and support you every step of the way. Look for partners that are dedicated to A2P messaging and won’t get distracted by other service offerings to your enterprise.
As the largest independent A2P (application-to-person) mobile messaging company in the world, Mblox helps brands, agencies and service providers create meaningful connections with their customers on mobile devices anytime, anywhere. Mblox’s network of more than 900 mobile operators around the world enables businesses to reach nearly 6 billion consumers. Mblox makes it easy for businesses to use text messages and push notifications to drive revenue, lifetime customer value and ROI. The company’s market longevity and experience give customers peace of mind that they’re sending the right message at the right time based on industry best practices, while an account management team of local experts provide ongoing support in a rapidly changing mobile environment.
Mblox offers mobile messaging solutions that drive positive engagement throughout the customer lifecycle, with a primary focus on mobile care. Today’s enterprises are relying more and more on mobile messaging, specifically SMS, as a critical tool in both acquiring and nurturing their customers. The ubiquity and handset agnostic nature of SMS make it the optimal channel for applications such as two-factor identity authentication, emergency alerts, airline schedule changes or delay communications, and shipping notifications, just to name a few.
ABOUT MBLOX
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