|Issue:||Latin America 2010|
|Topic:||Crack the short code – send a message to consumers|
|Author:||Alfred de Cárdenas|
|Organisation:||Syniverse (Manufacturer) Telecommunications technology|
Alfred de Cárdenas is the Executive Vice President, Americas at Syniverse Technologies; he is responsible for the North America, and Caribbean and Latin America regions. Before joining Syniverse, Mr. de Cárdenas was with Nortel Networks, most recently as general manager of converged multimedia networks. He also held a number of other key leadership roles at Nortel, including vice president positions in carrier support and operations, sales, marketing, customer care, and network operations as well as assignments in Colombia and Brazil. Alfred de Cárdenas earned his MBA from Nova Southeastern University and his bachelor degree in industrial and systems engineering from Florida International University.
Latin America’s current mobile penetration is 88 per cent, far surpassing fixed penetration and SMS texting can reach nearly every mobile user. Better yet, since SMS is so inexpensive any mobile user, even low-income pre-paid subscribers, can afford to respond to messages. It is also an inexpensive way for companies to exactly target consumers of interest and, by using the new Latin America common short code (CSC), let these consumers opt-in, respond and bond with brands that appeal to them.
Connectedness is an essential component of any enterprise’s relationship with consumers. These audiences value the brands with which they feel truly engaged, which means enterprises must go beyond simply capturing attention and find ways to further foster relationships. Finding a way for organizations to build brand connections with consumers in Latin America can be particularly challenging because of the region’s size and inherent diversity. Each country has its own unique demographic, cultural, governmental and historic climates, all of which affect overall consumer preferences and behaviours. To overcome these challenges and grow, each enterprise, whether based within or outside this dynamic region, must find a way to provide its Latin American consumers with useful, relevant information specifically tailored to individual needs and interests. And when it comes to connecting with these target audiences, brand owners must ask one key question: “What’s the most effective way to reach and build bonds with my customers?” The answer to that question is simple: mobile. With the region’s mobile penetration at 88 per cent – and more than 100 per cent in many major cities – it’s clear that consumers in Latin America have truly embraced mobile as a way of life. The go-anywhere capabilities of mobile make it the preferred communication method in many areas, largely surpassing traditional fixed connectivity. For example, in Argentina, there are 115 mobile subscriptions for every 100 persons, compared to the 25 fixed-line telephones per 100 persons, according to the CIA World Factbook. Connecting the dots 160 characters at a time Considering the region’s cultural and socioeconomic diversity, it’s no surprise that the ways Latin American consumers use their mobile devices vary greatly as well. From the small percentage that uses smart phones to access the mobile Internet, to the many consumers who purchase a SIM card to use in a basic device, and everything in between, the use cases are vastly different. There is, however, a single medium with the ability to reach nearly every mobile user in the area, regardless of the device in use or how a subscriber uses it: SMS texting. From the most basic feature phone to a next-generation smart phone, almost any mobile device can send and receive SMS text messages and, with the penetration of smart phones currently in the single digits in the region, it’s clear that there is a significant addressable market that can only be accessed via SMS. Because of SMS’s ubiquitous, affordable nature, it’s easy to understand why subscribers in Latin America have adopted text messaging as their go-to form of communication. According to Portio Research, consumers in the region sent roughly 250 billion SMS messages in 2009, and that number is likely to increase to more than 400 billion by the end of 2014. One factor driving these figures is the fact that many prepaid subscribers are opting for SMS plans over voice because of how effective and affordable it is to communicate via text. Popularity aside, choosing SMS as a medium to connect with consumers also has the advantage of immediacy. For example, while a broadcast or print advertisement requires viewers to take action the next time they are in a store or at home on a computer, a mobile message allows brands to bond with consumers on the spot, so these users can respond anytime, anywhere. SMS brings a number of additional benefits for enterprise brands beyond reach and immediacy, including low cost, as well as high visibility that has been shown to result in improved consumer responsiveness. Achieving two-way connectedness Optimal connectedness and engagement between an enterprise brand and its consumers can only be achieved by facilitating two-way communications. In other words, brands must not only send messages, but they also must allow consumers to reach out to them, effectively joining the conversation with their brands of choice. Brands that allow mobile users to connect with them proactively are able to target their marketing resources directly to the consumers who are most interested in their messages. Moreover, communicating with users who have opted in allows enterprises to tailor communications to individuals based on their interests and preferences. When it comes to achieving a new level of connectedness, short codes – five- or six-digit numbers that serve to address SMS messages from consumers to enterprises – have emerged as ideal vehicles because of their simplicity. A mobile user can reach an enterprise or opt in to a promotional campaign simply by composing an SMS and sending it to the easy-to-remember short code belonging to that organization. Forging new connections through short code communications not only helps enterprises achieve marketing goals, but also gives consumers the on-demand services they desire. Already in Latin America, short codes provide a popular way for consumers to purchase mobile content, like ringtones for their phones. The truth is, the possible uses of short codes to create new bonds between consumers and brands are limited only by an enterprise’s imagination. Some examples include using short codes to allow consumers to enter contests, respond to surveys, or cast their votes for contestants on television shows, as was done with American Idol in the United States. Furthermore, short codes can be valuable tools for product or service promotions, putting information, such as a coupon or special offer, directly in an interested consumer’s hands on demand. What’s the catch? It’s clear that short codes are an excellent tool to connect enterprise brands with their target audiences, providing consumers with the engagement they desire. So what has prevented extensive rollouts of these types of campaigns across Latin America in the past? Until recently, fragmentation has stood in the way of widely deployed short code marketing campaigns in this region. If a brand wanted to incorporate a short code into its marketing efforts to reach audiences across Latin America, it would need to endure the extremely tedious and impractical process of seeking out and leasing a short code from each individual mobile operator in every country in the region. This situation traditionally has been a tremendous obstacle to the growth of mobile connectedness between brands and Latin American consumers. Fortunately, the different components of the short code ecosystem, including mobile operators, short code aggregators, content providers and application developers, have all lined up behind the recently announced Latin America common short code (CSC) initiative administered by the CTIA-The Wireless Association, which allows countries in this region to break down traditional messaging barriers. This new initiative allows enterprises to simply visit the CSC administrator website (www.codigoscortos.com) to register a single code that will work for a unified campaign across all participating operators in more than two dozen countries instead of having to register and purchase an individual code for each market. This streamlined process means a significant reduction in the amount of time and money enterprises have to invest, leaving them with more available resources to focus on developing content to build relationships with their high-value customers. Proven success Ample proof of the effectiveness of common short codes as tools for fostering connectedness already exists. Since CTIA launched a similar CSC initiative in the United States in 2003, organizations such as professional consumer brands, sports teams, television networks, movie ticket vendors, restaurants, non-profits and even political candidates have enjoyed more fruitful relationships with many of their target audiences as a result of launching comprehensive short code campaigns. These enterprises have found that consumers are much more likely to respond to a short code campaign than an email campaign, indicating a clear preference for communication through this medium. In 2010, CSCs helped connect U.S. mobile subscribers to the citizens of a country in need. When the devastating earthquake struck Haiti, several charitable organizations turned to CSCs to help raise funds for the millions of people affected by the tragedy. The American Red Cross alone raised more the US$30 million by encouraging Americans to text ’Haiti’ to its short code – an unparalleled amount in the world of mobile donations. The organization credits the campaign’s success to the short code’s ability to reach a wide audience immediately via mobile communication, rather than requiring potential donors to send in a check or enter their credit card numbers into a website. Stepping up to the plate With the growing pervasiveness of SMS and the recently launched pan-regional Latin American CSC initiative, there has never been a better opportunity for enterprises to connect with Latin American consumers. CSCs have a proven track record of success in the United Sates, and CTIA predicts rapid adoption of CSCs in Latin America as a result of its initiative. Looking forward, the growth of CSCs will help foster continued increases in engagement between consumers and brands across Latin America. SMS is only the beginning, as CSCs foster innovation to incorporate new alternative data sources and grow content streams. With this capability, brands can take connectedness with their consumers in Latin America to a whole new level.