Normally when one hears the phrase “over the top,” the first thing that comes to mind is William Shatner’s acting. But retailers should start learning what that phrase means to tech folk, because it may soon be quite pertinent to how they interact with their customers, especially their younger shoppers.
Over the top, better known in telecommunications circles as OTT, means a system is using the Internet as the infrastructure to enable two-way communication instead of a technology normally associated with that style of communication.
So, for example, free mobile messaging services like Kik, WeChat, WhatsApp and Viber precisely mimic text messaging, except they use the Internet to connect users instead of the wireless voice connections that text messages traverse. Consumers who use these free services no longer have to pay for text messages, and the businesses that run these services get to display ads or in other ways monetize the mobile apps that enable the communication connections. The mega-popular Skype is another example: Instead of making a voice call, which costs money, millions of consumers connect via the free Skype app.
“OTT has been a global phenomenon during the last two years,” says Jay Sheth, CEO of mGage, a mobile marketing and technology company with more than 1,000 clients in 200 countries. “Downloads of messaging apps like WhatsApp, Facebook Messenger, WeChat, Viber and Kik have skyrocketed, and use by consumers has soared. This now represents an entirely different way for brands to engage with customers because many customers are saying this is my preferred way of getting information.”
In fact, many of these OTT messaging apps have, in a sense, become bigger than the wireless carriers that provide the wireless data connections to consumers over which OTT messages travel. In a new report titled “The OTT Opportunity,” mGage has compiled figures from mobile app messaging companies, telecommunications companies and other sources to compare the reach of these varied mobile communications vehicles. Following are the top 12 carriers and mobile messaging companies worldwide and their total subscribers or users, according to the report:
- China Mobile, carrier, 763 million.
- WeChat, app, 600 million.
- WhatsApp, app, 500 million.
- Airtel, carrier (India), 485 million.
- Vodafone, carrier (multinational), 453 million.
- Line, app, 400 million.
- Viber, app, 300 million.
- China Unicom, carrier, 276 million.
- TangoTxt, app, 200 million.
- Kik, app, 145 million.
- Verizon, carrier (U.S.), 115 million.
- AT&T, carrier (U.S.), 107 million.
Consumers in different countries have gravitated to particular mobile messaging apps—one catches on, goes viral in a region, and becomes something of a de facto standard. For instance, TangoTxt reaches about 100 million consumers in the U.S. and 100 million consumers in Europe and the Middle East, according to the mGage report. And Kik reaches more than 80 million consumers in the U.S. and Canada and about 60 million in Europe, the report finds.
MTV, the tastemaker cable TV giant, just opened an official Kik account last week. Music and pop culture fans can communicate with the automated account through various keywords—including WEIRD, which this morning returned a video of a “thug” Koala bear throwing another Koala out of a tree. Of course, that video is on MTV.com, so the Kik user is linked to MTV’s site via the Kik mobile web browser within the Kik app. Hence, increased brand engagement.
E-retailer Skullcandy, which sells headphones and related accessories, has been promoting itself in the Kik mobile messaging app, achieving message read rates of 75% and click-through rates ranging from 6-20%, the retailer reports. It took Skullcandy two years to get to 108,000 followers on Twitter—and only two months to get to 230,000 chatters on Kik, Skullcandy says.
Mobile firm mGage just released new marketing technology it has dubbed the mGage OTT Hub, an OTT marketing communications aggregation platform that enables brands to efficiently reach consumers on multiple mobile messaging apps, the vendor says. Because so many consumers are leaving their SMS (text-only) and MMS (multimedia) text messages behind in favor of free mobile messaging apps, brands need an easy way to connect with and deliver relevant information to their customers who frequently use these apps, Sheth of mGage says.
The mGage OTT Hub can help brands create personalized, in-app experiences with user authentication and secure, two-way communication, enabling companies and consumers to exchange rich messages—text, pictures, video and voice, Sheth says.
“With the emergence of OTT, we’re seeing a shift in consumer demand for accessibility in a single app versus relying on a plethora of separate mobile apps,” he says. “With OTT traffic outpacing SMS growth in several countries around the world, brands can now capitalize on the massive opportunity to reach their mobile customers with rich experiences and personalized one-to-one messaging.”
The vendor says ultimately it will charge retailers and other brands for mGage OTT Hub on a per communication transaction basis. But as it rolls out this technology that is very new to marketers, it’s experimenting with fixed prices per campaign with the idea of easing wary marketers into this new mobile realm.
“We are very conscious that especially in the early stage of a new technology, brands often work on fixed budgets until they become familiar with the technology and its benefits,” Sheth says. “In a 90-day pilot we did with a very large brand, we did a full-scale integration for a flat fee of $60,000. Normally it takes a couple months to get project approval with a brand this large, but they came back to us in 48 hours with approval. We’re seeing a high level of excitement around these messaging apps.” Sheth declines to reveal the brand because of a non-disclosure agreement.
Follow Bill Siwicki, editor of the Internet Retailer 2015 Mobile 500 and editor, mobile, of Internet Retailer, on Twitter at @IRmcommerce and @MobileStrat360B.
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