Zero-rating key to customer acquisition - Airtel Africa
By Tom Jackson, South Africa
Making OTT services such as Facebook and WhatsApp available for free on mobile networks - or so-called “zero-rating” - is a key part of customer acquisition, according to Willie Ellis, head of products and innovation at Airtel Africa.
Ellis told the AfricaCom conference in Cape Town Airtel had seen the benefits of zero-rating and was keen to work with more providers other than Facebook in order to sign up more customers, as well as drive future revenues.
BizTechAfrica reported earlier this week Airtel had extended its partnership with Facebook to offer the Internet.org app to its customers in Kenya, having already rolled out the service in Zambia. The app provides a set of locally relevant basic internet services for free, with the aim of making it easier for people to access the internet.
Ellis said the strategy was proving very successful for Airtel, which he said like other operators is still in the customer acquisition phase, with the phases of selling value-added content to these customer still to come.
“For now in Africa it is acquiring data customers, it is the land grab,” he said. “We’ve still got a long way to go to get people onto the internet. By no means is Internet.org a destination, it is a journey that is progressing. There are ebbs and flows between operators and OTT players and we are getting to a good place where it must be win-win.
“The primary purpose of Internet.org was to move our customer acquisition in Zambia a lot faster. We have doubled our Facebook users in Zambia.”
He said Airtel was extending its relationships beyond Facebook.
“We have a lot of OTT friends. We are OTT-friendly, come and work with us,” Ellis said.
He said the next phase would be to look at opportunities to monetise, perhaps by using OTT services as sales front-ends for operators’ services. He said Airtel could be able to buy Airtel bundles on Facebook when they try to leave the free zone, rather than only on Airtel platforms.
Maria Pienaar, chief information officer (CIO) at Cell C, agreed with Ellis that zero-rating services was an excellent route to acquiring customers. Cell C recently zero-rated WhatsApp for its subscribers.
“It is very much part of customer acquisition and driving customer stickiness,” she said. “We have seen it has definitely helped with customer acquisition, though its still only three or four weeks now. There is the additional value add of things customers do like to do. You do see a trend where people do move to where value is.”
Nicola D’Elia, head of international growth and partnerships for Europe, Middle East and Africa (EMEA) at Facebook said zero-rating was the best way of making access more affordable, but agreed with Ellis that thoughts needed to also be on long-term sustainability.
“There are two main challenges, one is affordability, one is awareness. I think if you can address these two challenges you are on a good way to bringing people online,” he said.
“We have run hundreds of zero-rating campaigns, and it does prove it is extraordinary at gaining customers. But we do need to make it sustainable. This is the vision that we have. Once you address affordability and awareness, that it can be a sustainable concept.”