Marco Veremis Issue: Africa and the Middle East 2015
Article no.: 14
Topic: There is a thirst for content in high-growth markets
Author: Marco Veremis
Title: CEO
Organisation: Upstream
PDF size: 359KB

About author

Marco Veremis is CEO and co-founder of Upstream – a mobile monetisation platform. In 2013, Marco was named EY’s Greek entrepreneur of the year.

Marco sets Upstream’s strategic direction and spearheads business development as it continues its expansion into new geographical and product areas and has been Chairman of the Board since 2002. As an experienced marketing strategist at leading advertising agencies Grey Advertising, McCann-Ericsson and DDB in London, Marco developed global and Pan-European communications strategies for brands such as Nestlé, Coca-Cola, Sony and SmithKline Beecham. Marco is a mentor for Endeavor and Openfund, Vice President of the board of HAMAC and an angel investor and board advisor in Workable HR.

Marco holds a Bachelor of Arts in Politics and International Studies from Warwick University and a Masters of Philosophy in European Studies from Oxford University.

Article abstract

Research from Ericsson found that in Sub-Saharan Africa, 70% of mobile users access the internet on their mobiles, in comparison to 6% who use desktop computers. The mobile handset is of critical importance to growth-market users, and it is therefore the device which content developers will be targeting. 

Full Article

Driven by the prospect of market saturation in the west, digital brands like Facebook, Twitter and Google are increasingly looking to high-growth countries to provide a new wave of customers. The ‘next billion’ mobile phone users are expected to come from Africa, Latin America and India, and over the next few years, consumers in these markets will become better connected to the internet, developing into increasingly proficient and avid users of digital content.

For a number of large digital brands, future success will depend upon their effectively capturing and maintaining the loyalty of these customers. High-growth markets have their own nuances however, and brands will need to think carefully about how to develop and deploy engaging content.

Mobile-first, mobile-only
In the west, the mobile phone is one of many devices we use to connect to the internet and access digital content. Within high-growth markets, users tend to rely solely on mobile phones for this connectivity. Research from Ericsson found that in Sub-Saharan Africa, 70% of mobile users access the internet on their mobiles, in comparison to 6% who use desktop computers . The mobile handset is of critical importance to growth-market users, and it is therefore the device which content developers will be targeting. Given the range of mobile devices being used – from cheap feature phones to low-end smartphones, it’s important for brands to take a ‘device-agnostic’ approach to developing digital services and content. By creating content which can be deployed across a number of different handsets, brands will maximise customer engagement, and he visibility of their own content.

Smartphone growth
We have seen low-cost smartphones prosper in emerging markets, acting as a catalyst for the development of diversified mobile content. GfK has forecast that in 2015, the top ten smartphone markets for ‘growth by value’ will be entirely dominated by emerging market countries, including India, South Africa, Brazil and Nigeria. The emerging market smartphone growth can be attributed to pricing; manufacturers like Xiaomi have been quick to develop and distribute low-cost smartphones to emerging markets, making them attainable for consumers who were previously priced out.

From a content development point of view, we are seeing an explosion in the numbers of smartphone apps entering the market, across a range of areas such as entertainment, education, communication and utility.

New business models have been opened up by the internet, and we have seen a surge in the number of value-added apps and services for smartphones. In Kenya, Nigeria and Mozambique, TV and media services are frequently accessed via smartphone apps, and this is giving rise to the development of content which is specific to particular regions.

The smartphone app ‘Peek’ for example is currently being trialled in Kenya; it uses the camera lens to scan the eye for cataracts, and emails the test results back to doctors. If a cataract is detected, treatment can then be offered – minimising the chances of the patient going blind. Apps like this which drive social wellbeing within areas are invaluable, further cementing the value of mobile in developing regions.

Feature phones are still the bread and butter
Smartphones are still very much the minority handset within African, Latin American and Indian markets. Instead, feature phones – simple devices which can still access the internet but don’t have touch-screens – are the staple. The hardware is cheap, but they are more difficult to develop for, and they cannot access apps and digital content from the likes of the Google Play store. Unlike the west, in which the market is dominated by iOS and Android, the mobile OS landscape in growth markets is far more disparate, with a number of ‘unknown OSs’ to be catered for.

As a result, operators have the opportunity to embed themselves as trusted content providers, and offer services across a range of basic handsets – effectively catering to the needs of all their subscribers. Brands need to develop content which is device-agnostic, thereby maximising the number of customers being targeted. This approach is particularly effective when combined with localised content, tailored specifically to particular geographic regions or sets of users.

Limited access to the internet
The limited telecoms infrastructure in emerging markets can make internet access both a scarce and expensive resource. According to Ericsson’s research, “47% of Sub-Saharan mobile users believe that data is still too expensive”.

When it comes to content development, careful thought needs to be given to the amount of data an app will use, and whether the level is sustainable for the future. A number of popular games – such as Clash of Clans – would never feasibly take off in emerging markets, simply because they require speedy internet connection, with a large data resource.

A number of brands are clued into the requirements of high-growth markets however, and have tweaked their digital offering so as to work with local conditions. In June this year, Facebook Lite was launched, an Android app which uses less than one-half of a megabyte of data, and designed to run in areas with patchy internet connections. The app is designed for customers using 2g networks, which are much slower and less developed than the 4g networks we use in the west.

Going beyond ‘lite apps’ an even more powerful approach lies in taking both a device-agnostic and multi-channel stance when it comes to content development. By creating digital content which can be consumed on a number of devices, and across a number of channels (SMS, mobisite, apps), brands further increase accessibility, and help promote growth of customers.
Payments methods – pre-paid mobiles
Payment methods are a huge consideration when it comes to emerging markets. Many of the regions are ‘unbanked’, with consumers having no access to a bank account or debit/credit cards. 90% of all financial transactions in Africa are made in cash, and this means that traditional app-store models of payment are off the cards. The success of schemes like M-Pesa in Kenya, in which users send money to each other by transferring their mobile airtime, have shown the value in network operator billing methods. Consumers trust network operators, and given the latter have systems in place to take payments for call plans, they are ideally positioned to facilitate payments for digital content sent to mobile devices. Leveraging this position of trust, operators have the chance to package and distribute content on a subscription-basis. Many consumers will not be able to afford one-off app purchases, but they will be more likely to take-up subscription-based bundles, in which they pay a small monthly fee in exchange for access to a range of apps and digital services. A subscription-based model promotes longer-term loyalty amongst customers, and allows them to access content they’d otherwise be priced out of.

Operators are already providing consumers in rapidly developing economies with connectivity, so it makes complete sense for them to start enabling widespread access to a world of content too, engaging their customers in a new way. This will need to be a key priority for operators in the next few years, as they will need to capitalise before the likes of Google come in and eat their lunch.

We are seeing swift and significant change within the growth markets, and the area has significant potential in terms of bringing the next billion digital customers online. There is clearly a thirst for content amongst consumers, and the development of hardware and infrastructure is increasingly allowing this appetite to be met. One particular area of opportunity lies with developing and enabling digital content via network operators, and it will be interesting to see if they can capitalise on their position, and avoid the fate of operators in the west.