According to Juniper Research, the global carrier billing market was worth around $4 billion in 2014 and it is predicted to rise to $13 billion by the end of 2017. ExoClick recently updated the mobile carrier targeting feature on its platform so advertisers can now target hundreds of more carriers worldwide, opening the door to mobile carrier billing. To demonstrate just how important this new feature can be, I’ve composed 10 carrier billing tips and facts to help you make the right mobile carrier targeting decisions.
Fact 1 — Mobile Operators Are Fighting Back
Although carrier billing is commonly used for transactions in emerging economies where much of the population may not have credit cards or bank accounts, it is unfairly painted as a payment method that’s mainly popular in less wealthy countries.
Carriers have been pushing their own billing systems for quite a while now. It was the only way for them to survive as technology took away many of the revenue making opportunities they once had. SMS messaging was replaced by WhatsApp, MMS was replaced by Instagram and Snapchat, calls have been replaced by Skype or Facetime. So carrier billing allows the mobile operators to fight back and to gain a slice of the revenue that’s already flowing over their networks.
Fact 2 — The Big Boys Are All Into It
While Apple has (for now) built its mobile ecosystem on credit/debit card sales, Android is all for carrier billing. Business Insider pointed out in April 2014, “Google has been cutting deals with wireless carriers everywhere.” At the end of 2014, carrier billing was also introduced on Amazon’s App store, Samsung is rolling out carrier billing for users of Samsung Galaxy Apps and the carriers themselves are developing products for use with their own traffic and consequently their own direct billing. Despite the hurdle of Apple and adult products, the regular mobile web still allows adult sellers to bill on Apple devices.
Fact 3 — Direct, SMS Or Voice?
There are three types of carrier billing — direct-carrier billing where a consumer is required to enter their phone number on a website and they are charged on their next phone bill, SMS billing where a consumer sends an SMS to an operator to receive a PIN code (the charge is in the SMS messages), and voice billing, which is still a popular payment method, especially in countries like Germany where there is only a 20 percent credit card penetration. Payouts tend to be higher with direct-carrier billing because the tech is easier to implement. Don’t just think these billing methods can be used only for mobile, there is a growth opportunity for using carrier billing for paying for desktop adult products also, like dating, cam sites, subscriptions for streaming either via a consumer entering their phone number on a website or by purchasing credits via SMS. Additionally many consumers purchase prepaid mobile cards to make adult purchases; this method also gives the consumer complete anonymity.
Fact 4 — Carrier SDKS For Developers
As app stores have pushed sales and downloads in the digital content market forward, so carrier billing has grown and increased its share of the overall market and one of the factors for this growth is that carriers have been providing their own SDKs to developers for in-app carrier billing. This allows advertisers to target cheaper Wi-Fi traffic and then charge with carrier billing via in-app purchases.
Fact 5 — Carrier Billing Isn’t Just For Less Wealthy Markets
Although carrier billing is commonly used for transactions in emerging economies where much of the population may not have credit cards or bank accounts, it is unfairly painted as a payment method that’s mainly popular in less wealthy countries. According to Business Insider, Google’s work with carriers has actually focused on wealthy economies, with thriving app stores, including in Japan, the U.S. and the U.K.
Fact 6 — Using Aggregators
Normally the product owner does not have the ability to integrate directly with a carrier; this is normally done through aggregators who have direct relationships with carriers and then billing is carried out through the aggregators' billing platform. The aggregator will take a small cut, but they will handle all the admin and the carrier relationship leaving you free to concentrate on creating great products and campaigns. Aggregators are specialists in products related to carrier billing so use them for your market research, they know what kind of product offerings convert the best and in which GEOs. They also handle operator policy changes, for example if an operator introduces a new regulation it is their job to ensure that all products aggregated through that operator are compliant so you don't have to keep tabs on it. Bear in mind though, that if you do use an aggregator you need to plan well in advance, as carrier approval for a new product can take up to two months.
Fact 7 — Impulse Shoppers
Think about your price point when selling in a product that uses carrier billing. For impulse purchases it needs to be cheap, on special offer or bundled with free extras — and who can resist a bargain? Also, bear in mind that some carriers accept transactions not just for digital products but also for hard goods as well as accepting higher price point transactions and not just micro billing.
Fact 8 — On The Upsell
Create your own product ecosystem by designing products that are part of a whole, in order to drive more sales from your targeted consumer. By retargeting you can upsell product add-ons, product upgrades, products in a series/collectables, etc. By getting consumers to buy into your product concept you could have similar success to products like Candy Crush Saga, whose in-app purchases and add-ons generate $3.7 million a day!
Fact 9 — Month In, Month Out
Subscriptions, where you receive regular monthly income from your customers, are the holy grail and this business model works especially well for membership content products, dating, music etc. The subscription value in Tier 1 countries is high, for example, in Austria the average subscription value per person is 70 euros a month. Tier 1 countries are also less likely to stop their subscriptions once they have joined. Statistics show that a one-time subscription payment is more likely to appeal to consumers, so offering 3-month, 6-month and 12-month subscriptions at discounted prices are also a route to conversions.
Fact 10 — Chargebacks
Chargebacks are rare in most GEOs. If the operator can prove that the log in process covers their guidelines then a consumer cannot claim their money back, however countries like Germany have strict policies on charge backs so be aware of the carriers rules on this subject.
Filipe Rodrigues is an advertising account manager at ExoClick.com.