Data Rewards makes mobile customers happy in their hour of need and more open to engage with the brand picking up the tab on those precious extra megabytes
The practice by smartphone users of deferring consumption of rich content until such a time they can get onto a WiFi network has become a commonly known and accepted practice. Savvy users do it to save the megabytes in their plan be it down to data hogging apps or content where the data consumption is unknown – that is no big secret. But what happens when a user has exhausted all avenues for data preservation and reaches their data cap? Traditionally there were two choices – you basically had to suck it up and wait until the start of the new data plan or you stumped up the cash for a top up. Neither proposition proved too popular.
Enter an unlikely saviour – the advertising industry.
Over the past decade, publishers have not only witnessed a significant drop in print advertising revenues, but also the rise of social media networks, a shift in news consumption to online and especially mobile, and recently a rising threat by adblockers. All these challenges call on publishers to rethink their monetizing and advertising strategies by adopting an innovative consumer-centric approach: Technology that reaches out to users and rewards them for their engagement. It’s a triple win solution for all parties involved: Publishers, advertisers, and consumers.
To test the premise, Telefonica took a close look at the mobile market landscape in Brazil – where almost 50% of the population has a smartphone – a number that is growing at breakneck speed with the rise and growth of a “middle class” and its status as a mobile first region. On closer inspection of that 50% of smartphone owners only 40% of these had proper mobile data plans and a third consumed all their data before the end of the month.
Telefonica’s global advertising team came up with Sponsored Data in response. A service that let’s an advertiser pay for a mobile customer’s extra data to get them to the end of the month (Data Rewards) or via toll-free/zero rated app deals. In exchange the advertiser can then expect a consumer to watch a video or take a survey for instance to claim extra data or enter a walled garden if the deal revolves around a toll free experience. It’s a win-win model where the user gets internet connectivity for free or access to a favourite app at their time of need while advertisers get a little closer to the customer in a consensual, non-intrusive way.
For carriers it represents an alternative way to monetize data consumption.
But does it really pay off for the advertiser? Staying in Brazil, Telefonica’s Vivo – its commercial mobile services provider for the region – worked with one such advertiser: Netshoes – one of Brazil’s most important players in e-commerce. Netshoes wanted to increase the number of purchases its customer made via mobile. Coinciding with Black Friday Netshoes launched offered access to its app using a toll-free agreement – meaning customers accessing the app would not see that data use come out of their monthly allowance.
The result: Sales grew 60% compared to the same period in the previous year. Visits to the app doubled and mobile visits specifically saw a 175% increase – out –pacing desktop accesses.
It is no surprise then that 2016 has been described as “the year of sponsored data” by many businesses while consumers are responding in ways advertisers have long dreamed of.