Projections from the GSMA indicate that the value of business messaging will reach the $124 billion mark in 2030. This figure, coupled with a study outlining that messaging which employs Rich Communication Services (RCS) technology would be worth more than $52.2 billion by 2028, makes the RCS opportunity one that operators can no longer ignore.
The truth is, everyone wins when it comes to operator-based RCS messaging. With it, brands have the potential to reach anyone who owns a smartphone via a one-stop, easy-to-use feature-rich mobile messaging platform that makes use of chatbots, artificial intelligence (AI) and other technologies. Mobile device users have direct access to their favorite brands and services from a single RCS-based app, eliminating the need for multiple messaging tools to communicate with different businesses. And, just as importantly, operators have access to a new revenue driver that takes advantage of changing business paradigms.
If operators are to capitalize on the multi-billion dollar burgeoning business messaging opportunity, they should focus on four key areas where RCS business messaging is best poised to do double duty: drive both revenue and operational cost savings.
New brand revenue
Being able to position themselves to brands as a single, go-to platform for all business messaging, provides operators with a unique differentiator when it comes to attracting brand marketing dollars.
As it currently stands, brands face a broad range of complications from a disjointed OTT messaging ecosystem that requires them to use numerous OTT apps and different interfaces to effectively reach all their customers. Operator business messaging using RCS, on the other hand, offers brands a single, feature-rich, direct sales and commerce communications channel that can reach almost anyone with a smartphone.
The appeal of a one-stop RCS-based business messaging shop is bolstered by the operator’s ability to offer brands a privacy-by-design, entirely permission-based platform that gives brands levels of security and control that OTT providers simply can’t match. This creates an opportunity for operators to offer brands entirely new levels of differentiation, resulting in more relevant and more impactful campaigns to better engage customers.
Conversational commerce revenue
RCS-based business messaging also opens the door to a lucrative revenue share opportunity. Consumers increasingly prefer their brand interactions to take place via real-time customer service chats and chatbots, all of which can be integrated into an operator’s business messaging application. When these in-app “conversations” transition into the immediate purchase and payment through the app for physical goods or even services such as food delivery, the operator may be able to receive a percentage of that purchase.
Consider this example: Before I buy a new pair of shoes online, I likely want to know how true-to-size the shoe fits before I place an order. One way to get an answer could well be through a quick chat with the seller via my RCS-based messaging app. Once I’ve determined the correct size, a savvy seller could then offer me the opportunity to purchase those shoes immediately and directly via the messaging app rather than letting me stray to other purchasing platforms. If I execute my purchase within the app and there’s a revenue share agreement in place between the brand and the operator, it’s a win-win for both. The brand makes a sale, and the operator gets a cut of the transaction purchase price.
Upsell and cross-sell operator revenue
It’s not just brand relationships that make RCS messaging a valuable revenue generator. RCS business messaging can also be used by the operators themselves as an effective avenue for upselling and cross-selling their own services and products. Making one-time purchases of data or modifying subscriber plans, for instance, can be handled with “one-tap” options from within the app. Cross-selling other value-added services related to customer usage and purchase behavior (e.g., premium personal cloud services, adding device insurance) is another sales opening made simple via an operator-owned business messaging app.
And keep in mind that the benefits of operator-subscriber app-based interactions extend beyond growing revenue. Giving customers the opportunity to easily add efficient and personalized services to their accounts strengthens customer loyalty and increases customer lifetime value.
Self-service cost savings
Customer care represents a huge part of an operator’s budget. Data from Mobilesquared, for example, reveals that live customer service calls cost operators in the United States an average cost of $4.48 per call. However, with RCS-driven messaging chats or bots, customer care interactions can drop to about $1 per chat - a 78% reduction and significant operational cost savings when compared to a live call with a customer service representative.
What’s more, customers increasingly prefer the chat or chatbot experience when it comes to customer service. In Japan, where RCS messaging users recently passed the 20 million mark, one carrier reported that about 70% of subscribers using its customer care chat functionality had never made a customer care voice call before.
Between actual operational cost savings and customer experience improvements, an RCS-powered app clearly makes RCS business messaging-based customer service a smart move for operators.
An unmissable opportunity
Focusing on and ensuring the highest level of service in four key areas that RCS-driven business messaging can impact - new brand partnerships, conversational commerce, the upselling and cross-selling of operator services, and self-service cost savings - delivers to operators a massive opportunity to drive new revenue and realize significant operational cost savings. With the value of RCS business messaging expected to skyrocket in the coming years, now is the time for operators to act if they want to claim their share of the business messaging opportunity that is up for grabs.
