Supa Pesa opens up advertising business model revenues for mobile operators – South Africa now, Nigeria and Zambia next

9 December 2016

Top Story

With a slow but steady shift away from SMS, mobile operators need to be able to offer brand advertisers a wider and richer media offer. South Africa’s Supa Pesa has just launched a product with Cell C that will do this. Russell Southwood spoke to Supa Pesa’s CMO about what the product does and its plans to roll it out elsewhere in Africa.

According to Pashley, the new product is “an evolution of the mobile ad units that mobile companies have for text ads”. The advantage of the new product is that “if you have the right device you can render rich media advertising. For example, the ad could have an animated GIF and be on the landing page of a handset. KFC or Macdonalds might show you a picture of their burgers or chicken. It’s a credible means for advertisers to reach out to audiences. It will sense the device type and render correctly”

The ability to offer rich changes the financial equation:”It opens up a much higher yield on that real estate than before.” In South Africa, ads can also be placed alongside key customer transaction screens like Balance Check and Voicemail Notifications:”It’s not just Call Me messages and it works across both post post paid and pre-paid.”

The product has a campaign management tool that runs in the background. The operator can use this to specify what time the ads are flighted. So for example, ads for toothpaste and cereal might go out before breakfast and things like fast food over the lunch break.

One of the factors that has seen SMS ad messaging decline is that customers have been turned off by the constant bombardment of SMS ads they get. This product allows you to impose frequency capping. So for example, you can set the cap so that the consumer only sees the ad twice and there is no over exposure of the ad.

The overall approach allows the advertiser to get something that approximates to LSM targeting:”Over time you will build up a demographic profile of the user. Average Revenue Per User is not an LSM but it is a good guide.” Also in markets like South Africa, where there are more developed formal retail channels, it can do geo-location:”This won’t be available at the launch but will be shortly thereafter.” It will also be able to customize sales vouchers for customers if the mobile operator has an existing database with socio-demographic details.

The launch took place on 7 December with Cell C in South Africa and it will be rolled out in Nigeria in Q1 2017 and in Zambia in Q2 2017:”You need key continental advertisers to be in the markets. Ghana, Tanzania and Uganda are on our radar and we’ve had expressions of interest from operators in Brazil and Mexico.”

“We sell the ads and they are either turnkey or integrated ads. Most telcos don’t have experience in the ad sales areas. We do a revenue share with them and invest in the integration. The subscriber pays nothing to view the ads. Agency fees are a deduction but the revenue share is close to the 50/50 mark which relative to VAS is quite good. For telcos, the question is how much more value can they get from the same subscriber? We’re bringing in new money for them.”

It offers R45 per CPM in South Africa. Outside of South Africa “there will be a premium (on this rate) but it will not be massive. Obviously it will vary somewhat by category and inventory level. When we kick off, we’ll have 1 million Please Call Me messages and in January next year we’ll have 4 million Voice Mail notifications and they’ll be a substantial number of Balance Check transactions.”

What’s been the reaction of advertising agencies?:”We’ve been to a couple of them (to show the product) and the reaction has been positive.” The first brands to come on board have been Edgars Active and Old Mutual.

The next development is video”Mobile video is technically feasible and would be a new frontier for advertisers. We’ve got it as an option and they could air a TV commercial or a You Tube

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