03 April 2017
By Eckart Zollner, Head of Business Development at Jasco Group
A recent emerging global trend that is disrupting traditional data payment responsibility, is that of businesses offering their consumers free online access to their websites or other online platforms. Usually, consumers who wish to access a business’s online services, particularly via mobile channels, need to have enough data to do so – or they simply don’t go online at all. This has incited many businesses and service providers in South Africa to begin offering free access to their sites regardless of whether the consumer has any data left or not – but who covers the data costs?
The concept of offering toll free access to customer service channels isn’t a new one. Toll-free numbers that enable consumers to call businesses, at no charge to themselves, are still in effect today for both customer care and the selling of services and products. Today’s consumer, however, is more likely to access a business’s services, products or customer care centre via the Internet than over the telephone, meaning that businesses have had to change the way they offer their toll-free services to their market, shifting the same concept to an online platform.
At what price?
Data charges for accessing these “toll-free” platforms are invariably covered by the businesses who own the platforms, or websites. A business wishing to provide their consumers with free access to their sites – data or not – strikes up an agreement with one or many network operators which allows them to cover the charges for anyone who accesses their online site or platform. The charges that the person accessing the site would usually incur simply gets redirected to the business site owner.
Businesses offering this service can end up with hefty data bills, particularly for high traffic sites, however the benefits more than make up for the costs. Although there is the risk of incurring data charges which don’t result in sales, offering free access to their online portals means that businesses are able to effectively remove almost any barrier for consumers – potential and existing – to access their products and services. This translates directly into more site visits which means more sales and, ultimately, increased profits.
The disruptor differentiator
Providing free access to online portals also enables a business to stand out from its competition. It differentiates the business from others of its kind, and consumers are more likely to visit their site, free of charge, than those sites which require that they use their own data. Consumers see the perceived value of this service and are able to immediately feel the tangible effects thereof. They can “window shop” at no cost to themselves, which increases the possibility of impulse buying and serves to heighten the reputation of the business in their eyes. It’s a definite brand activator.
Despite the incurred data charges, businesses offering this service could actually end up saving costs. Businesses could shift most of their operations online and do away with physical, brick-and-mortar premises. This means fewer physical shops or offices, fewer employees and less need for infrastructure, all of which drag heavily at the bottom line.
Finally, businesses are able to tap into heretofore untouched markets. Consumers who would ordinarily have to travel for kilometres can access products and services at their fingertips – for free! Consumers who tend to use up all of their data before their month is up can still access platforms without worrying about the data charges. Suddenly, a business’s customer base can expand radically.
Integration is key
Any business who wishes to offer toll-free access to their sites and online platforms firstly needs a mobile commerce platform which will enable this functionality. Their platform must be able to integrate with their current operational systems, software, billing platforms and even customer relationship management systems.
Integration is critical to this process, to ensure full functionality and service delivery. A business would also need to engage with one or more network providers to ensure the charges for accessing their site, or specific portions of their site, are redirected to themselves and not to their customers.
Paving the way
Toll-free online access is the tip of the iceberg for similar services aimed at making it easier for consumers to access and buy products and services online. There are many other disruptive services starting to emerge in South Africa to simplify the buying process and widen the customer base. For example, companies that offer cardless purchasing, where consumers who don’t have access to credit or debit cards are able to use a ‘middle man’ platform to pay for products and services – consumers “buy” credit from a third-party provider, such as a mobile money service provider, who then pays the supplier for them.
It’s a short hop and a skip to a world of Internet shopping in which consumers are unencumbered by traditional shopper problems such as lack of accessibility or lack of a bank account, and South African businesses are acting quickly to be a part of it.