Economy is going bundle, so now what?

We know you’ve noticed it: Customers don’t pay for VAS services from their airtime like they used to. Billing and chargeability rates are going lower and lower while churn is skyrocketing. Yes, the economy has gone bundle but is it the end of subscription services as we knew them? Not necessarily.
The past 4 years were rough for companies and users alike: the pandemic of COVID has redefined how and where users spend their money, the war in Ukraine has caused mayhem on the global economy and now the price of fuel has gone up almost everywhere. A new recession is upon us, friends. VAS services are increasingly becoming a commodity, in the same basket with Netflix and gym subscriptions.
All over Africa, in other to accommodate customers whose disposable income has drastically reduced and remain relevant in a highly competitive market, MNOs are creating new bundles every day. Now, you can pay for packs of data, voice, SMS all at once, at a discount price, for longer periods of time, without cash ever hitting your phone. All from your Mobile Money or your bank account.
So how do we keep monetizing VAS services in a bundle economy? Think about these five solutions:

Integrate subscription services into bundles
That’s the most obvious solution. We need to follow customers wherever they go, be where they are, adapt to their habits and create more value. It is easier and infinitely more practical for every party involved. Moreover, it’s a great way to make user discover your service, a marketing strategy on its own.

Integrate Mobile Money into user flows
We can also go the other way around and ask “Hey user, you don’t have enough airtime to pay for this service but do you allow us to bill you from your Mobile Money account?” That’s nicely asked, eh?
MNOs have already gone that route for their bundles, now it is VAS’ turn to evolve. The advantage of billing users from their Mobile Money account is that they become more aware of why and when they spend their money, leading to higher usage rate and better product quality overtime.

Develop one-off and on-demand services
Sounds counter-productive but think about it: if the service is great, and content design is awesome, customers will follow you wherever you go. When you are bringing value, customers want whatever you offer and they will gladly pay whatever price you ask.
Think flexible billing
Why pay daily if you can pay for a whole month and why not a whole year? Your favorite softwares and platforms have long used that model. They provide more value if the customer is willing to stay longer in the service. VAS could take a page out of their book and learn from those proven practices.

Offer free services…
…And have someone else pay for it. Airtime has long been the only way to pay for VAS services but as digital is evolving, VAS providers have access to a plethora of new opportunities and may seize them to innovate, especially when it comes to payment. Users don’t have to be the ones cashing out. VAS services are essentially platforms and one side effect of it is that they capture the attention of users. Companies and marketers are ready to pay for that attention. Now, do you connect?

For more information on how YellowDot can help you monetize your VAS service and growth your revenue, contact us at YellowDot.


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