In today’s telecom landscape, operators face growing pressure to balance growth with shifting advertising models. In this guest blog, Aleksandr Moskotin, Co-Founder of afina DMP, discusses the trends reshaping telecoms marketing and their approach to unlocking new opportunities.
In the competitive arena of telecom marketing, growth is the name of the game. But how do you scale your business within the constraints of the Cost Per Mille (CPM) model? Today, we’re dissecting the challenges and offering a data-driven solution that could revolutionize how telecom operators approach growth.
The Price Dilemma
Even if you haven’t hit the ceiling of advertisers’ budgets, another risk looms large — advertisers might shift their spend to other operators, and here’s why.
Historically, operators held a unique subscriber base accounting for about 80% of their audience. However, this figure has now dwindled to 50-60% and is likely to decrease further. The rise of eSIM technology, dual SIM capabilities, and affordable multiple-device ownership has fragmented the market. Consequently, advertisers can now reach your subscribers through different operators who might be more accommodating with their pricing.
Simply put, the competitive landscape is shifting. As an operator, it’s crucial to adapt and stay ahead — or risk losing valuable advertising revenue to those who are more flexible and innovative in their approach.
The CPA model isn’t just a fleeting trend; it’s the future of telecom marketing. With the shift towards data-driven decision-making, operators can ensure they’re not just part of the conversation but leading it. ”
In the saturated telecom market, raising prices might seem like a direct path to increased revenue. Yet, statistics paint a different picture. In markets like Nigeria, where it’s common for individuals to have 2-3 phones, the impact of price hikes could lead to a significant churn rate. Similarly, in Russia, the trend of dual SIM usage has surged, with recent data indicating that over 30% of users now opt for multi-SIM devices.
What does this mean for telecom operators? Price competitiveness is more crucial than ever. Current studies highlight that telecoms opting for a price increase in a multi-operator market could see an advertiser attrition rate of up to 40%.
The CPA Strategy
The Cost Per Action (CPA) model offers a compelling alternative, emphasizing not just reach but relevance. It’s a model where telecoms can indeed command a premium price point, but with a catch that advertisers find irresistible: targeted reach.
Affinity Is Key
Affinity becomes the cornerstone of the CPA model. By leveraging deep analytics, operators can identify which subscribers are likely to engage with specific advertisers. According to afina, campaigns based on affinity have a 70% higher conversion rate compared to traditional CPM campaigns.
The Strength of the CPA Model
The CPA (Cost Per Action) model thrives on precise, targeted advertising. Without accurate targeting, a CPA operator faces significant financial losses. This model demands that every ad hits the right audience at the optimal time, ensuring advertisers only pay for genuine engagements. A misstep in targeting not only reduces efficacy but can also lead to substantial financial repercussions, making precision and accuracy paramount in every campaign.
Enriching Subscriber Experiences
A focus on targeted actions doesn’t merely benefit the operator and advertiser; it also enhances the subscriber experience. When ads are relevant, engagement increases. afina’s insights reveal that subscribers are 53% more likely to engage with an ad that aligns with their behaviour and preferences.
The afina Edge
afina Data Monetization Platform is providing telecom operators with the analytics necessary to transition from CPM to CPA effectively. With afina’s platform, operators can analyze data with precision, resulting in an average increase of 30% in ad revenue for telecoms that make the switch to CPA-focused strategies.
The Future of Telecom Marketing
The CPA model isn’t just a fleeting trend; it’s the future of telecom marketing. With the shift towards data-driven decision-making, operators can ensure they’re not just part of the conversation but leading it.
In conclusion, where the CPM model poses challenges, the CPA model offers a sustainable path to growth and it’s a good effect for the CPM model. By focusing on affinity and leveraging platforms like afina, telecom operators can unlock new revenue streams, satisfy advertisers, and delight subscribers.
Stay ahead of the curve with us at www.afinadmp.com , as we continue to explore the dynamic world of telecom marketing, where data isn’t just digits — it’s the currency of growth.
