An unexploited marketing opportunity
Intro by Keith Dyer:
It's long been preplexing for me to understand why operators have had so little success with content and contacts back-up services. The automatic back-up of contacts, pictures, video and messages seems to me to be an obvious tool for aiding customer retention, even if it couldn't raise additional revenues (which I think it could, by the way). It could also be a crucial tool in placing the operator as a trusted online brand and help them build their presence to compete with the likes of the over the top providers that threaten to eat their services lunch. So why has there been so little customer uptake? Is it the way the services themselves have been offered, and what can be done about it? This article, whilst clearly expressing the opinion of an interested party, offers some answers.
The piece is written by Yossi Carmil and Ron Serber, co-CEO of Cellebrite.
As all of us know, losing a mobile phone or having it stolen is unfortunately a common occurrence, and as mobiles increasingly become the key repositories for personal information, the loss of this information can be quite traumatic. A survey we recently conducted amongst 1,000 mobile users in the UK found that only 18% of users back-up their mobile data, in spite of the fact that 47% of us have lost a mobile phone. Then comes the issue of trying to recompile all of the lost contacts and data such as photos, music, text messages and videos, which can often take users up to six months to recover, if at all. This is precisely why mobile marketers need to wake up to the opportunity that they are missing by failing to offer customers the ability to back up and upload their photos, videos, SMS and address book details at the point of sale.
Hang on, I hear you say, I'm sure there are services that I can download from my PC to back-up my mobile data. That's perfectly correct, but not all phone vendors supply such a tool. And more importantly, only a small percentage of users actually use them, even when available. This is partly due to complexity, partly due to laziness, and partly due to the fact that backup software from Handset Manufacturer A will not help you to restore the data to your new phone from Manufacturer B.
There are also some pure OTA applications that offer a similar service. But they require the user to proactively register for the service. Even then, the service usually will only back up a portion of the information types – typically only SIM content, excluding videos, photos and text messages. What's more, as most marketers know, as soon as you leave the emphasis on the user to take any action, you immediately reduce the likelihood of it happening.
The answer to all these impediments to adoption is to make mobile content back-up and migration a de-facto service offered at the point of sale and integrated with OTA back-up solutions that continue the service offering over time.
The ARPU effect
Backup is more than a convenience, and it impacts the operator's revenue just as much as it influences the customer. Those customers who buy new phones to replace lost or stolen ones and starting to build their contact details from scratch took six months to return to the same level of usage as before the loss, with 24% never fully regaining all of the lost data. Yet despite the back-up and synchronisation services being readily available, 47% of users were unaware of services offered by network operators in store. 48% of those expressed willingness to pay somewhere between £5 and £20 extra and wait up to 10 minutes to receive such a service, demonstrating the immediate impact on ARPU that a backup service can have.
Removing barriers to handset upgrades and improving loyalty
For 25% of users, a key barrier to upgrading their phone to a new model is the hassle of losing mobile data – in particular contact names and addresses, photos and videos. By offering a point of sale service to upgrade the customer's mobile content in the retail outlet, can be accomplished instantaneously, eliminating a key sales barrier whilst enhancing customer service. 27% of users would change their handset more frequently if they were able to transfer their mobile content onto the new device at the point of sale. This makes promoting the service equally appealing for the mobile operator as they have to ability to attract new users to their service by offering free data migration from their previous network, at the retail outlet.
Another increasingly sensitive issue for the user is that of data privacy, and the reluctance to leave any record of personal information such as photos or videos at the POS. (This issue has achieved much media coverage due to recent security breaches relating to celebrity mobile phones.) It is vital that POS solutions for backing up mobile content leave behind no vestige of user content.
Lessons from the computer data backup industry
In many ways, we stand today in a place similar to where the world of personal computer backup stood two years ago. For dozens of years, computer users knew the risks of data loss. Yet the adoption of regular backup solutions remained shockingly low, despite the existence of standalone software products. It wasn't until very recently that computer users have taken up backup at a more noticeable rate. What was it that triggered this change? A combination of automated internet backup plus pre-install activation on new PC deliveries.
Future Directions
The reality is that our mobile phones are becoming our main storage device and an extension of our own identity. Examples such as the mobile device being used as an e-Wallet confirms the direction that the mobile industry is set on for the future, where the mobile content itself will be equally or more important and valuable than the device itself. Operators should act now to realise the immense marketing benefits of offering a simple, effective means of migrating and backing up all mobile data. OTA-only solutions have proven to lack widespread accessibility, while PC-based solutions are unappealing to customers. It is clear that the future is an integrated POS and OTA solution that doesn't rely on the end-user to initiate, and delivers seamless, regular back-up of mobile data which means that – even if you mislay or lose your phone – the mobile content remains intact and can be easily restored.