Africa: Advertising Revenues Will Become a New Source of Digital Revenues for African Mobile Co V2.0

London — The transition to digital revenues among Africa's mobile operators is already under way. Online content and services (like streaming), mobile money and data revenues are all contributing to African Mobile Co V2. Advertising revenues should play a much bigger part in this transformation but the mobile operators are up against the global social media networks. Russell Southwood talks to Donald Mokgale, CEO, Out There Media (OTM) Africa about how it can help mobile operators connect with brands.

In September last year, Donald Mokgale left leading ad agency, Carat South Africa, to become the CEO of OTM Africa. OTM started working in Africa in 2019, seeing the mobile first continent as fertile ground for expansion.

OTM started in European markets based on seeking to answer a simple question:"Why don't telcos get the same ad spend as Facebook or Google? There was no seamless marketplace to buy ad inventory." OTM Africa sees telcos as having 2-3 times the number of users in each market:"We'll fill that gap." For example, MTN has 25 million customers in Ghana, three times the number of Facebook users."

The platform OTM Africa provides, Mobucks:"essentially pulls anonymized subscriber data into various buckets." These 'buckets' include: gender, age, location, ARPU level, device type, OS type and pre and post paid:"That's what we use but we can entertain meta data requests. We can dig out the data that will help a particular campaign. For example, Spotify was able to target those that had accessed a Spotify link to carry out a campaign to increase its number of users."

In terms of revenues, the brands pay OTM for the campaigns and then it pays the mobile operator:"They take the lion's share." Brand campaigns so far have involved international names like Procter and Gamble, Coke, Unilever, skin care company Beiersdorf and banks and ad agencies:"We are working closely with agencies to understand demand... .It's a new platform for most brands and they want to trial it. It's especially difficult with agencies as the default setting is to go with what you know."

Currently, it is live in Ghana, Nigeria and South Africa. It is working with MTN to expand into the rest of its markets by 2022. In South Africa it is live across both MTN and Vodacom and in Nigeria MTN and 9Mobile:"The MNOs are relaxed about serving ads across more than one operator."

It is in discussions that are in various stages with other mobile operators including MTN. To widen the use value of the platform, it will be launching a Mobucks for SMEs on a self-service platform similar to Facebook or Instagram.

The ads can be delivered in several different formats: targeted SMS messaging to an opted-in database, a rich content service ("MMS on steroids") delivering video, a payment gateway and chat bots, an ad alongside the Please call me message and display banners. It claims good conversion rates. First Bank Nigeria used it to promote lead generation for an insurance product, getting a 12% Click-Through-Rate.

I asked Mokgale to estimate the share of digital as a percentage of total ad spend. He estimated 10-12% in DRC and perhaps as much as 15% in Nigeria. Overall, he estimated that across Africa there was around US$1 billion of digital ad spend: "The biggest markets - like Nigeria and South Africa- are the lion's share of that number." Mobile companies only need to acquire a portion of that pie to make a difference to their bottom line.

In Brief

Poultry company Ross Breeders Zambia has recently chosen Cellulant's integrated digital payment solution Tingg to make payments for goods and services using locally relevant payment options.

MDXi, a MainOne company has launched a data centre in Appolonia City, Ghana.

YahClick and its partner Hughes Network Systems have signed a strategic partnership with Global Communications Extension Services Limited (GCES) to provide satellite connectivity for Nigerian wireless operator 9mobile. In signing the agreement, YahClick and GCES will work to support 9mobile in providing its secure and affordable services to individuals across Nigeria. YahClick's partnership with GCES will bring satellite connectivity to hundreds of cellular backhauling sites, delivering 9mobile with a reliable and robust means of rural connectivity.

Ethiopia has formally announced that it will launch the process to award a second new mobile licence later this month, including a permit to offer financial services. But despite the removal of what has been widely seen as a key stumbling block in the liberalisation of the country's telecoms market, African telco giant MTN is reportedly no longer interested. MTN is unlikely to bid for the licence, an outcome that could only been seen as a setback for the liberalisation process, Bloomberg reported on Thursday, citing unnamed sources familiar with the situation.

South Africa: On Thurs, 5th August 2021, President Ramaphosa announced new ministerial positions and a restructured national executive. Ms Khumbudzo Ntshavheni was appointed as the new Minister of Communications and Digital Technologies. Previously she was acting Minister in The Presidency. Mr Philly Mapulane was appointed as Deputy Minister. Previously he was Chairperson of Portfolio Committee on Higher Education, Science and Technology.

The International Finance Corporation (IFC), a member of the World Bank Group, announced a partnership with Microsoft's 4Afrika initiative to make digital tools and training resources more accessible to small-scale farmers and agriculture-linked small businesses.

Cheer on your favourite English Premier League (EPL) team safely from the comfort of your home as newly launched Vodacom Sports Radio brings all the action of the 2021/22 season live to mobile phone users in South Africa. EPL is one of the most widely followed soccer leagues in the world, and through Vodacom Sports Radio, Vodacom customers can conveniently use their mobile phones and tablets to keep up with the latest news, listen to live matches and follow their favourite teams.

MTN Group has confirmed the renewal of its operating licence in Rwanda with effect from 1 July 2021. MTN Rwanda has paid 70% of the RWF91 billion (USD89.4 million) renewal fee, equivalent to around RWF64 billion, with the remaining 30% due by July 2022. The new concession is valid for ten years.

Business communications services provider Infobip has announced that it will provide WhatsApp customer communication services and its Conversations CPaaS-based contact center solution to leading Senegal mobile operator Expresso.

AllAfrica publishes around 800 reports a day from more than 100 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.

X