Direct Carrier Billing Drives App Transactions Customer Conversion Rates
OTT (Over The Top) storefronts such as Google Play and Windows Phone Store that have implemented Direct Carrier Billing solutions have experienced a sharp increase in transaction volumes, average transactions values and conversion rates, a new White Paper from Juniper Research and Amdocs has found.
The White Paper found that while operator storefronts and portals now account for less than 7% of the 55.9 billion app downloads in 2012, the introduction of Direct Carrier Billing solutions on third-party storefronts enabled operators to substantially increase their content revenues.
According to the White Paper, Direct Carrier Billing allows storefronts to enable payment amongst a far wider and diverse user base, both in developed and developing markets. In the latter case, bank account and credit card ownership is often extremely low; in the former, it provides a billing option to the prepaid sector and younger demographics. Furthermore, it enables few-click purchases, thereby making it a particularly attractive option for impulse purchases.
As White Paper author Dr Windsor Holden observed, "For the operator, the storefront and the developer, Direct Carrier Billing is an increasingly attractive option. Storefronts and developers can monetise demographics which either do not possess credit cards or are unwilling to give out card details online; the operator can retain and enhance its role in the content value chain."
In addition, with storefronts such as Google Play and Windows Phone Store both expected significantly to increase their share of app downloads over the next five years, the scale of the opportunity for app monetisation through this mechanism will grow. According to Rebecca Prudhomme, vice president of product and solutions marketing at Amdocs, "Direct Carrier Billing helps operators grow new revenue streams by leveraging their key asset: the billing relationship with consumers. In 2012, we processed on behalf of our operator customers three times more Google Play purchases over Direct Carrier Billing than in the year before. This reflects operators' important role in app store monetization and consumers' preference for charging their mobile accounts. In the future, beyond payments, we expect operators to leverage their big data to enable personalization of various m-commerce use cases, from content discovery to coupon redemption."
Other key findings from the report include:
- There is significant opportunity for Direct Carrier Billing to be utilised for 'real world' purchases in the lower value, higher volume area, both in terms of ad-hoc purchases (e.g. books, flowers) and more regular purchases (e.g. petrol).
- By adding ticketing applications and services to a mobile phone a customer could be less likely to replace their mobile operator with a new one; customer loyalty should increase as a result of mobile payments.
- With the addition of analytics of the BSS (Business Support Systems) Big Data, the operator can add far more value to mobile commerce. This is beneficial both from the perspective of the MNO - allowing it to personalise content discovery based on analysis of on-going individual consumer behaviour patterns - and for third parties such as advertisers and retailers.