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            VALUE CHAIN
                    Course Faculty: Mrs Yasmin Malik

               Venue: IBA City/Main Campus, Karachi

               Course Start Date: Spring 2011 (Feb 1)

MIS553: Mobile Marketing Strategies
What is the Mobile Marketing Value
   There are 6 main links that make up the path that has to be crossed during
    the serving of a mobile ad to the end consumer

   Together these 6 links make up the Mobile Marketing/Advertising Value

   Also known as the “Business-to-Technology Fit” view of mobile marketing

   Depending on whether you have designed the ad, are placing the ad, are
    delivering the ad etc. you must be clear as to where you are in the chain
                    The Mobile Marketing Value Chain
                       A view of the Business-to-Technology “Fit”

                                 Content               Handset OEM

  The                                             Telecom operators          The
 Brand                                          and their infrastructure   Consumer
                                  Creative                                  Market
                                 Aggregator     The most “contentious”

Source: Adapted from Informa Telecoms & Media
Link 1: The Brand

   An established brand (as compared to less well known ones) is mainly focused on
    maintaining brand value and building brand loyalty
   Do you know what a given brand’s “Brand Value” is?
   Brand Value =
       a measure of the financial performance of a given brand as scrutinized by
         markets and shareholders
       It includes a measure of the historical and future financial strength of the brand
         taking into account publicly listed financial data from stock exchanges and
         company financial reports
       Usually quoted in US $ and ranked yearly according to value by brand
         consultancy firms such as Interbrand, Brand Finance etc. as well as leading
         business magazines such as Business Week/Newsweek
   Building brand value and brand loyalty can be done very effectively with mobile
   Many international car manufacturers such as BMW have made a good entrance
    into a good number of mobile marketing projects
   Other include Starbucks which have made use of mobile marketing
    coupons/barcodes used in a Mexico based customer loyalty campaign
Link 2: The Creative Agency/Media
    The Creative Agency will usually design and oversee the layout and
     features of the ad although not necessarily in-house
    The Agency can be a specialized mobile marketing agency or a
     mainstream media creative agency
    A Media Aggregator (aka the Media Agency) has links with different
     media entities including TV, print, radio, Internet and mobile channels
     (including telecom operators) for the buying and selling of ad space on
     various media
    In some cases, a company can be both a creative agency and a media
     aggregator depending on its marketing position and the demands/terms of
     the campaign
Link 3: Content/Technology Application
   In countries such as the US and UK where mobile marketing is a more established
    marketing media, this link has carved a very definitive place for itself
   Its strength lies in volume and diversity of applications/content
   Example of volumes: In Sept 2009, Apple announced that 85,000 applications had
    been developed for their App Store by over 125,000 developers
   Blackberry, Android, Nokia and Microsoft (as of Feb 2011) all have app stores that
    deliver mobile applications for RIM OS, Android OS and Windows 7&8
   Conversely, this link is very weak in the Pakistan environment due to the small
    number of companies that fall in this area and the relatively small number of
    apps/content made available in the market
   Can you name some of them….?
   (Vectracom, Rockville, ARPU+ and AKN Mtech/M3 Technologies)
   Companies in this link can provide a platform for mobile marketing (e.g. Admob),
    applications for mobile phones, design and deliver mobile banner ads, or design
    and deliver mobile portals/websites
   Some of the content/technology providers have very strong links with the telecom
    operators in their local or international environment
Link 3: Local Content/Technology
Application Providers
   Essentially a digital marketing company               Jazz Bananas is “Pakistan's first ever
    covering Internet and social media but also            operator powered mobile app store that
    the mobile platform                                    offers thousands of free and paid apps
   They source content from e.g.                          along with other content for Symbian, Java
    HungamaMobile, IndiaFM                                 and Android operating systems.”
   Significantly, they also create local content         Service is exclusively for Jazz, Jazba and
    for Internet and mobile                                Indigo customers
   SMS/IVR campaigns include: Lux                        Ref: Aurora article on Jazz Bananas
    Bodywash, Sunsilk                                     With Jazz Bananas, you get:
   Other significant mobile marketing                        instant access to thousands of your favorite
    campaigns:                                                 games
        Text “SURF” to short code to win credit              social networking
         balance (over 1.6 million participants)              download your favorite music
        Text to short code on Cornetto wrapper to            get on-the-go news from around the world
         enter competition to record a song with Jal
         the band                                             weather updates
        SMS riddles with Lipton to win credit                sports news & travel info
         balance which multiplies if passed on to
    Link 4: OEM

   In the West, OEMs (Original Equipment Manufacturers) play a very significant role in
    the telecom industry and associated telecom/mobile delivery platform
   For example, many mobile connections/contracts cannot be acquired unless you also
    select an associated handset
   “Handset-to-Network” exclusive deals such as the iPhone may or may not hamper a
    mobile marketing campaign
   In many instances, “The Brand” may be Nokia, Apple, Blackberry, Samsung or HTC
   OEMs may place mobile ads for their own brand or control the type and number of
    ads that are placed on their handsets
   Example: In April 2010 Apple announced the launch of “iAd” which is a mobile
    advertising platform to allow the iPhone to run ads on applications made by third
   Similarly, now that Google owns Admob this opens up immense opportunity and devices
    for the placement of mobile ads on Android handsets such as the Droid and the HTC
   If this is not the case, the OEM may still exercise its muscle by being the handset of
    choice for targeted mobile ads either in banner form or other form
   Do not lose sight of the fact that coupled with the handset, the OS (Operating System)
    is equally important (see Worldwide OS Impact Chart iCrossing)
   Impact on Mobile Marketing: Devices & Metrics OS Share

    Link 4: OEM – The Local Scenario...

   What is the correlation to Pakistan’s handset market?
   What are the recent changes that have taken place in our local market re Operator-
    OEM partnerships….?
   New launch campaigns that incorporate OEM/mobile connection include:
   Ufone launched the Nokia N8
    Exclusive points of sale for the N8 for first 6 months
     Mobile internet data bundles for 6 months

   Mobilink launches HTC with Windows Mobile 7 + HTC Radar
       First Windows 7 phone in the Pakistan market – similarities to Mobilink’s introduction of the
        Blackberry range....?
       3 months free GPRS (mobile internet)

   Zong introduces IDEOS with Android
       Target market....?
       8MB free GPRS access/month for first 6 month

       IMPACT ON VALUE CHAIN.....??
    Link 4: OEM – Local Consumer Preferences

   Imports of mobile phones rose 76% from 2009 to 2010 and were recorded at Rs. 26
    billion approx (Source: Federal Bureau of Statistics)
   Handset imports for approx Rs. 45 billion for 2010-2010 (Source: Federal Bureau of
   In 2010: Nokia leads the market with 500,000 units/month imported (Source: Karachi
    Electronics Dealers Association) despite headway made by other brands such as
    Samsung, LG, HTC and Q-mobile (Chinese brand)
   Q-mobile and other Chinese handsets: 100,000 units/month imported
   Samsung handsets: 100,000 units/month imported
   LG: 50,000 units/month imported

   Informal survey of Karachi’s Saddar mobile market (Source: Express Tribune, Feb 18,
    2011) shows that:
       56% of mobiles sold here are Nokia handsets
       29% are Chinese
       Samsung handsets account for approx 11%

    Link 5: The Telecom Operator/Infrastructure
   I believe this is the most “contentious” link!!

   As operators provide the physical network through which mobile ads can be both served and
    viewed, the dynamics of the Value Chain often centers around this link

   Operators can hold three main positions in the mobile multimedia market:

       Bit-pipe approach: focus on providing access only – this is their home turf

       Enabler/smart-pipe approach: an intermediate position providing access plus wholesale
        services to 3rd party players who wish to sell mobile multi media services

       Integrated/full fledged competitor: the other extreme in order to try and compete on the
        services and content fronts (in addition to access)

    Which is the best approach?

    .....We have seen a glimpse of this in the “Local Telco as Media Company” Example and we will
         look at these three main positions in more detail later on in the course...
                                    LOCAL TELCO AS A “MEDIA COMPANY”

                                  Publisher                     Property Provider             Carrier

 1. Person to Person                                                                                    1. Customer base access
 2. Alerts                                                                                              2. Leads
 3. Bulk Messages                                                    SMS                                3. Profiling capability
 4. Info Services (news, music,                                                                         4. Tracking Info
        sports)                                 Handset
      rd Party Services                                                              MMS
 5. 3                                          Applications

                                                              Mobile Advertising
                                              USSD                                     Call


SMS – Short Message Service
MMS – Multimedia Message Service
IVR – Interactive Voice Response
USSD – Unstructured Service Supplementary Data
    Link 6: The Consumer/Target Audience
   This certainly should not be a case of a “blind SMS” campaign in huge numbers without
    any idea of who will be receiving your ad – care should be taken to avoid a “spam”

   In mobile marketing, the consumer should never be seen as part of a “numbers”

   “Opt-in” campaigns are much better as they help you to build up a good database of
    participants and can help in profiling them for future, more targeted mobile marketing

   At times, targeting will need to be very specific

   Working together with companies that can provide demographic and psychographic
    data is in many case advantageous if not essential

   It is essential to not only target the consumer but also to track the consumer
    All 6 Links

   It is important to realize that in a practical working environment, you may represent any
    of the 6 links that we have discussed in the Value Chain
   Mobile marketing should hence not be viewed as an exercise that is undertaken purely
    by “marketing agencies”
   At any given time, market forces will impact and change the dynamics of the Value

   Your mobile marketing strategies – whether they are marketing or technology based –
    must be adapted accordingly

   The success or failure of your strategy is dependent on how you interpret the dynamics
    of the Value Chain


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