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The South African Mobile Landscape

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The South African Mobile Landscape

Mobile (or Mobility) is a term that is being considered by more and more companies. Even Facebook, the one billion user company, has finally managed to get back to (and beyond) its original IPO value based on the latest returns from their users’ mobile usage and the advertising revenues that have flowed from that. It’s now generally accepted that, for most medium-to-large companies, a mobile strategy is a clear business necessity and no longer an afterthought.

However, while many are considering “going mobile”, many companies recognise that they don’t fully understand what that means, nor how to approach the challenge. Several are rushing ahead and planning, or actively developing apps for various smartphone or tablet devices in order to strengthen their engagement with customers. A cool looking app on one of these devices can certainly be inviting and convenient for users, and hopefully ‘sticky’, so the customer is more likely to remain loyal to the brand.

The problem with this leap to smart devices and associated apps is that it is focussed on a fairly small percentage of the South African population. A fairly recent report from Deloitte indicates a smartphone penetration in South Africa in the region of 25% of mobile users. Vodacom’s annual report (March 2013) indicates a 20% smartphone penetration. It’s hard to tell whether tablets are included in these figures, but it is very likely that anyone with a tablet also has a smartphone.

So unless companies are solely targeting the country’s higher income groups, a mobile strategy that relies only (or mostly) on smartphone apps is very limiting.

Going mobile in South Africa is about understanding the overall mobile landscape and how people practically make use of their phones or tablets locally. Mobile use in South Africa is simply not the same as in the USA, Europe or Asia – it’s very different. Anyone creating a mobile strategy needs to have an in-depth knowledge of the whole mobile ecosystem and where different channels or services are consumed. From there, one can take their company objectives and start assigning different initiatives to appropriate target groups – not only customers, but other key role-players such as staff, suppliers and other stakeholders as well.

The mobile eco-system is large and contains several mobile channels including:

  • Voice
  • SMS
  • MMS
  • USSD (Using strings like *120*1234# for services like airtime top-up)
  • Instant messaging
  • Mobile Internet (mobi sites)
  • Native applications (typically for Smartphone and tablet)
  • Webapps or Hybrid applications that combine Mobile Internet and native applications
  • Location-based services
  • Mobile payments

On top of these, you have services becoming more important in mobile including:

  • Email (older but still critical)
  • Mobile advertising
  • Personal Information Managers (PIMs)
  • Extension of companies systems (e.g. ERP clients)
  • Social media (Twitter, Facebook etc)
  • Maps
  • Augmented reality

Of course there are many more, but this should give one the idea that the more you investigate the mobile space, the more options there are. For example, I have deliberately left out Java-based applications which are available on both smartphones and the medium-end feature phones. While these are indeed applications, the effort to support all the different Java builds on the various phones out there make it non-viable as a useful channel for most companies to reach their users. To their credit, some have succeeded, such as Mxit in this field, but the result looks dreadful.

I have a personal aversion to MMS. It is a dreadful technology that has the absolute ability to do more damage to your brand than help it. This is largely because both mobile operators, but especially phone manufacturers, have added MMS as an afterthought, and often it simply doesn’t work. So I would never advocate the use of MMS.

This leaves many confused as what to do, what will provide a measurable return, and where do you even start?

A useful place to begin is to understand which services are available to different South African economic segments.

table

The takeaway from this table is that to reach every mobile user in South Africa, you need to offer a service that is either voice, SMS or USSD based, with SMS and USSD being the most practical channels for service offerings. From there, the next best option is Mobile Internet, or mobi sites. Some 72% of SA mobile users can access them, and as long as one develops the site carefully, those users can gain an excellent branding and user-experience as a result.

If you’re after the more affluent, LSM 8+ in the SA market, then by all means look at developing apps for smart devices. Even once you’ve made that decision, you’ll next be faced with which smart devices? Is it iPhone/iPad (iOS), Samsung/Acer etc. (Android), Blackberry (declining rapidly worldwide but still strong in SA thanks to their BIS service) or maybe Windows Mobile? Then comes the decision of which versions of those operating systems do you support? Next you’ll have to decide whether to go “native” i.e. the built-in language of the system, or use a cross-platform approach? And so on.

By now you’ll be getting a sense that the mobile landscape is large and complex. Applying it in the South African market adds an additional dimension to the challenge. That said, mobile is the most direct, personal channel to your customers and other role-players. Therefore it is highly recommend that you start your mobile strategy planning sooner rather than later.

As a practical rule-of-thumb for the SA market, you can make use of the following:

To reach every mobile user in SA for notifications – use SMS
To reach every mobile user in SA for applications or services – use USSD
To reach most (~72%) users in SA for richer services – use Mobile Internet
To reach the affluent SA market segment – use apps (iOS, Android, Blackberry, Windows) – in that order

With each of these options, only experience can really help you ensure smooth operation in their rollout so that people actually want to use them, and their experience is pleasant enough such that they’ll happily use them again.

With careful implementation, “going mobile” can directly contribute to a sustainable improvement in your company’s bottom line – by driving new revenue streams, lowering costs of business and improving customer stickiness with better customer care services.

September 2nd, 2013|