South Africa’s mobile telecoms industry has been a hotbed of innovation from its birth more than 15 years ago. Since then, it has put a cell phone in the hands of nearly every person in South Africa, with more than 40 million active SIM cards in the market.
In addition to driving the growth of telecoms penetration in South Africa, the industry has been a pioneer in areas as such as mobile commerce and mobile banking. One just has to look at the $110m deal that Visa recently signed to acquire local mobile payments company Fundamo for vindication of South African skill and talent in the mobile industry.
Today, we have an extremely well developed mobile market where subscribers are not just using their cell phones for text messaging and phone calls, but also for mobile banking, mobile commerce, instant messaging and other advanced applications.
One study from InMobi’s found that nearly 60% of South African users have now purchased at least one digital product through their mobile device. Another piece of research from World Wide Worx reveals that 44% of urban users make use of cell phone banking.
In other words, South Africa’s mobile infrastructure, penetration and technology all add up to a channel that should be highly attractive to marketers. Curiously, however, mobile marketing is the one area of the cellular industry where South Africa is not quite at the cutting edge compared to other parts of the world.
Most local organisations are using text messaging to communicate with and market to their customers, but we are not seeing South African marketers rush to embrace mobile display, search or app-based marketing and advertising. One reason for this is perhaps the fact that smartphone penetration in South Africa remains relatively low at around 16%, according to research from Gartner.
But it is time for South African marketers to start looking beyond the SMS if they don’t want to get left behind by the evolution of mobile marketing technology. With Gartner predicting that smartphone penetration will soar to 80% by 2014, there is a rapidly growing market for marketers to address with more advanced forms of marketing and advertising.
It needn’t be expensive to experiment with other forms of mobile marketing that enable one to interact with customers in more engaging and relevant ways than a plain text SMS allows. For example, a .mobi site that users with older WAP phones and newer smartphones can access can be put in place for a relatively small investment.
This sort of experimentation puts one on course for the more advanced technologies that may become more important down the line, such as native apps for tablets and smartphones.
Companies should also consider earmarking a little more budget for mobile marketing than they do, considering its massive reach into all segments of the population. The Nielsen Company found that total ad spending in South Africa for 2010 was R28.7 billion.
South African mobile marketing and advertising spend in 2010 was just R500 million, expected to rise to R1billion by 2012, according to stats from Vodacom, MXit and Google. This is a modest amount considering the size of the mobile market.
South Africa’s mobile marketing space, then, is full of unfulfilled promise.
The customers are there, as is the technology we need to use the mobile channel to interact with them in meaningful ways. South African companies should be looking at ways to take advantage of all of this potential if they want to keep abreast of the latest international trends.