For years, American adult companies have eyed the European adult mobile market with a certain degree of envy, flowing from the relative ease of billing for adult transactions through European carriers, including the ability to support SMS-based purchases — an ability that no expert or market analyst believes American carriers will offer any time soon in connection with adult mobile sites, services or apps.
In recent months, however, there have been some subtle but important shifts in the way that many European adult mobile transactions are handled, a fact that some European operators attribute to a rapid increase in the number of adult mobile transactions, which has resulted in greater scrutiny on the part of some carriers and service providers.
In recent months, however, there have been some subtle but important shifts in the way that many European adult mobile transactions are handled.
“Direct carrier billing has been the cash cow during the last four years and the carriers have been regulating the market establishing higher control in signup flows as much as in recurrent rebills,” noted Karel de Beule, co-founder of Kimia Solutions. “For example, before, in many markets, the signup of a recurrent subscription was a single-click transaction, but now most carriers have implemented a double-click signup, with higher transparency in prices and conditions for the user.”
Not surprisingly, the additional click has negatively impacted conversion rates for such transactions, but de Beule also sees a silver lining in this particular cloud, observing that while the new approach has reduced conversions, it has also had a stabilizing effect on the mobile market, in part by reducing the number of contested transactions and reducing the number of purchases made in error by consumers.
While the relatively minor billing change might strike a lot of American adult mobile operators as the sort of problem they’d like to have (after all, even a reduced number of SMS sales is preferable to no SMS sales at all), another trend affecting the European mobile market will likely have a frustratingly familiar ring to it, from an American mobile content distributor’s perspective. Cherry Media founder and CEO Julia Dimambro summed it up for XBIZ as “the over-saturation of available porn in the more advanced European territories.”
‘Many countries in Europe actually support adult mobile billing — anything from topless to hardcore — which means that customers can purchase services with one-click billing and have the purchase charged to their mobile bill, instead of having to enter credit card details, much more impulsive and suited to the subject matter,” Dimambro explained. “Of course, this has led to a massive influx of adult services being launched very quickly, so if you are launching sites and services, you really do need to come up with something a bit different, and definitely focus on niche market segments in Europe.”
More alarming to Dimambro than the shifts in the European mobile market is that so many adult companies have never moved to effectively monetize mobile traffic, or done much of anything else to take advantage of the opportunities presented by the mobile market in the first place.
“Where the adult entertainment industry has been so innovative in monetizing new media platforms (such as web, e-commerce, digital marketing, etc.), it’s hard to understand how it’s been so slow on the uptake of the biggest commercial opportunity since
the adoption of www,” Dimambro said. “I’m amazed that when speaking to successful and innovative online adult services providers, I’m having to convince them in 2013 of the commercial merits to expand, create and offer mobile services, particularly when reports claim that a lack of mobile strategy could be a serious detriment to online businesses within the next 12 months, and web developers can create and maintain mobile portals with very little additional work.”
What drives the reticence to commit to the mobile market, particularly on the part of American porn producers and distributors? According to Dimambro, it’s what you might call the ‘pain in the ass factor.’
“According to my understanding, this [hesitance] is because of some of the barriers imposed on selling adult services on mobile,” Dimambro said. “Localized billing restrictions, bikini and topless grading levels only being allowed in many big mobile markets, dealing with different platforms, etc.”
Of course, companies can mitigate such challenges by working through firms like Cherry, who have already mastered the learning curve, and can deal with the niggling details of various geographically diverse mobile markets, allowing content producers to continue to focus on what they do best.
“We have 10 years’ experience in creating, launching and supporting adult mobile services, so we can assess businesses from a global mobile perspective, find out where the opportunities are best suited to individual businesses and offer all the infrastructure to run and maintain direct-to-consumer services,” Dimambro said, noting that this approach allows Cherry’s partners to “keep a much bigger chunk of the pie” than if they merely refer their mobile traffic to a third party site or affiliate program.
For some American companies and entrepreneurs, however, there’s no real opportunity to monetize content directly, because they simply don’t produce or distribute content. Monetizing traffic is the name of the game for such entities, and in that context, pushing European mobile traffic to a third party is clearly a far more viable means of entering the European mobile market.
Situated in such a position, what should people look for in the mobile affiliate programs they are considering for promotion, particularly ones that serve markets and consumers that the traffic-sender is not familiar with?
Bitter Strawberry’s Gian Carlo told XBIZ that affiliates should start by focusing their own mobile traffic optimization and “the complexity of the services that the mobile companies integrate, so that they can maximize their profit on the same amount of mobile traffic first, then push more volume in the right direction.”
“Affiliates should choose companies that offer a wider range of solutions and that have the power to deal better CPMs, acting as a wholesaler, and not spread their traffic between many affiliate programs with just a few good converting campaigns,” Carlo added. “Also, support in their native language is very important due to the ever-changing market and the abundance of new offers on a daily basis.”
Kimia’s de Beule advised paying special attention to three specific areas of concern; market coverage, long term vision and references.
“First, the company that you work with should be specialized in the market you’re targeting,” de Beule said, adding that even though vetting programs across multiple markets can be a lot of work, it’s well worth the effort. “Second, the affiliate program is your partner, and in this way it represents your brand. There are a lot of programs out there that go for a quick buck, and do not care about your audience; avoid them. You should work with established companies that have good references, ideally including recommendations from affiliates who target, or even live in, the same markets you are targeting.”
Looking ahead, Dimambro, de Beule and Carlo all anticipate that technological developments will define trends in mobile content delivery and the continued migration to mobile (as opposed to ‘fixed’) browsing as the web surfing method of choice on the part of consumers, in the European market and beyond.
“In the near future, services will go beyond video on demand, which is now the dominant use,” de Beule predicted. “Dating and live cams will emerge more on Android and HTML5 web-app platforms, but we see this as a global trend, and not something confined to Europe.”
The most important thing to realize, Carlo opined, is that the trend toward increased mobile use is not about to slow down, and all relevant sales and usage metrics support the claim that mobile browsing is steadily supplanting fixed web use over time.
“Although on the market for just three years, tablets are expected to outsell PCs this year and laptops next year, while Smartphones are already dominating the phones market,” Carlo observed. “So, one thing is clear: mobile is evolving into the primary screen for consumers. The challenge for different products and services is that they need to start distinguishing and stop lumping together tablets and smartphones. They have different uses, demographics and usage patterns, so for a better conversion rate the services/products provider needs to take this into consideration.”
