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RCS evolving into next-generation marketing channel for MNOs and advertisers, study reveals

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RCS messaging is expected to account for a growing proportion of global mobile operator revenue and become a vital channel for advertisers as they seek to enhance direct-to-consumer interactions and grow their first-party databases.

That’s according to a new white paper, “Unlocking multi-channel marketing with RCS”, published by mobile marketing automation experts, Upstream, which explores rich mobile messaging’s emergence as a vital part of the digital marketing mix.

RCS messaging allows MNOs and advertisers to create highly targeted media-rich messages that can be heavily personalized to engage and convert users. Performance metrics, including open-rates and message interactions, can also be used to help advertisers optimize their content for maximum impact.

“Audiences today are very fragmented and have come to expect personalized communication. There is currently no single communication channel that fulfils all of these needs effectively, so marketers have had to adapt to using a blend of different channels to maximize engagement. RCS brings unique value to any multi-channel mix, combining the rich media capabilities of digital channels with the hyper-personalized engagement of the SMS world. The marketing use cases for the channel can only be limited by imagination,” says Kostas Kastanis, Upstream’s Deputy CEO.

Upstream’s data suggests that RCS is already becoming a vital tool in helping advertisers connect with users on a personal level, showcasing click-through rates (CTR) as high as 22.2%[1] and a 37% rise in conversion rates[2] over traditional SMS in a series of campaigns run across industries.

Since 2020[3] and its global roll-out from the Google Messages app, RCS has been gaining significant traction and the number of RCS-capable subscribers is expected to reach 3.8 billion by 2026[4].

This emerging trend toward rich mobile messaging comes as third-party cookies, once the cornerstone of digital marketing, are to be retired permanently. Advertisers that can no longer tap into third-party cookies as a means of reaching wide audiences with broad but often superficial marketing campaigns will instead turn their attention to creating engaging and highly personalized experiences to grow their first-party customer base.

Being compatible with the MSISDN (Mobile Subscriber Integrated Services Digital Number), the unique mobile number of each user, RCS allows mobile operators to verify the identity of the subscribers, making it easier to provide targeted and personalized messaging. Global MNO revenue from RCS is expected to reach $4.6 billion in 2026[5].

Kastanis, concludes: “It is time for mobile operators to capitalize on the developments in the digital advertising ecosystem and take a leading role in it. They are uniquely positioned to do so through their millions-strong subscriber-base and “owned” channels such as RCS and SMS. Using technology platforms that allow them to run multichannel campaigns effectively – and by the numbers – is a step towards this goal, and will help revenues soar in the coming years”.

Upstream is one of Google’s official messaging partners enabling RCS, and is recognized as one of the key players in the RCS ecosystem by the GSMA[6]. In Brazil, one of the leading RCS markets globally, Upstream is the biggest RCS sender.

[1] Upstream martech platform data. Grow, Campaign for Food retailer, Web traffic increase
[2]Upstream martech platform data. Grow, Campaign for MNO, Pay plan migrations/upgrades
[3] Techradar, “Google releases RCS messaging globally”, November 2020
[4] Juniper, “RCS vs OTT: why 2022 is a crucial year”, February 2022
[5] Juniper, “RCS vs OTT: why 2022 is a crucial year”, February 2022
[6] GSMA Future Networks, “The RCS Ecosystem”, Accessed 20.4.2022
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