When someone needs a ride home in Kampala, Uganda, they have a few options, including using a ride-sharing app such as Uber. They know the app well enough through advertising, and also know that the fare would be similar or less than that of a taxi. Yet using the app requires data, and data is not free. The ride-sharing app could lose this customer, not for lack of awareness or demand, but for lack of data.
The digital economy thrives on people being connected, and thus depends on their ability to do so. Unlimited connectivity is out of reach for many, and this is what circumscribes the mobile online economy today: in emerging markets where data is expensive relative to the cost of life, mobile engagement is halted. Needless to say, the ability to tap into these billion-dollar markets remains very alluring.
Today, app developers are aware that the cost of data is having an increasingly important impact on their product’s growth. They are looking for ways to reduce friction to engagement, and have started doing so through sponsored data. This trend takes many forms, the better known of which is zero rating, where an app is made free of data charge for the consumer, as the mobile provider redirects the fee towards the brand.
Netshoes, an online fashion retail company based in Brazil, partnered up with Telefonica Brazil to do exactly that. Launching their brand-sponsored app on Black Friday 2016, Netshoes enabled their customers to shop from their mobile phones without having to worry about data costs. The results were stunning: three months later, sales vie the Netshoes app surpassed sales made from desktops for the first time in the company’s history.
The idea of using data as an incentive to download an app or as a reward within a loyalty program is a relatively new one, yet it feels as natural as accumulating points towards getting a free panini maker. It’s also more coherent: the need for data is much more salient for a consumer when navigating the mobile ecosystem. Offering data as an incentive to use an app, to fill out a survey or to share a product with friends is a way of increasing mobile engagement by responding to the consumer’s needs: truly a win-win scenario.
Opera News, Kenya’s top news app, chose to celebrate their 5 million download mark in June 2018 through a partnership with Safaricom, Kenya’s largest mobile distributor. For a limited time, this partnership offers 15 MB of free data for installing the app, 35 MB for successfully inviting a friend to download the app, and 5 MB every time this friend invites someone else to the app. By the end of the month, through brand-sponsored data and newly added football World Cup features, the app reached 10 million downloads.
With data sponsorship and rewards, mobile data distribution and availability is evolving: from being in the critical path to mobile connectivity, to becoming a solution, a powerful currency for engaging users. The rise of this new mobile data commerce ecosystems presents fresh solutions for brands, app developers and marketers, providing innovative engagement strategies for mobile growth.