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Bundling and co-marketing with TV providers: white paper by Fortumo

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Fortumo's latest white paper looks at how digital service companies can work together with cable & satellite TV providers on bundling their services. The goal of such partnerships is to achieve user and revenue growth while creating loyalty among customers of both companies.

TV providers have similar capabilities in user acquisition to telcos and they also have established a billing relationship with their audience. In many cases, telecommunications companies provide subscribers with mobile services, television as well as a broadband connection which means the bundling effect can be multiplied across multiple channels.

In this white paper, you will find answers to the following questions:

Who are the biggest TV companies to seek out bundle partnerships with?
What models of partnership can be leveraged with TV companies?
How does the bundling experience look like from the consumer perspective?
How can Fortumo support your bundle launches through our Trident bundling platform?

Fortumo is a digital enablement platform for app stores and digital service providers for user acquisition, monetization and retention. The company connects service providers with more than 350 mobile operators across Asia, Europe, Latin America, the Middle East and Africa.

Service providers use Fortumo’s platform to manage the end-to-end customer lifecycle of mobile users on these networks through the company’s bundling, carrier billing and messaging solutions.

Fortumo’s platform is used by thousands of leading digital merchants including Google, Spotify, Electronic Arts and EasyPark. Founded in 2007, Fortumo has offices in San Francisco, Madrid, Beijing, Delhi, Singapore, Estonia and Hanoi. For more information, please visit https://fortumo.com.

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Bundling and co-marketing with TV providers: white paper by Fortumo

  1. 1. Bundling and co-marketing with TV providers This white paper looks at how digital service companies can work together with cable & satellite TV companies on bundling their services. The goal of such partnerships is to achieve user and revenue growth while creating loyalty among customers of both companies. White paper by Fortumo
  2. 2. Bundling in this context means grouping together several digital services into one package. This approach is very common in the telecommunications industry, where mobile operators charge a flat fee per month for multiple services: calls, messaging and mobile data. In the past few years, telcos have also started to bundle video, music and other digital services with their subscriber packages. Telcos do this in order to sell more of their own products (“upgrade to a more expensive monthly pack and get service X for free”) and create loyalty among their customers (“stay subscribed for 6 months, during which you’ll get service X for free”). For digital service providers whose products are incorporated into bundles, the main benefit is user and revenue growth: mobile operators have acquisition and monetization channels in place that can quickly bring a large amount of new customers to the digital service. Bundling thus helps resolve the challenge of product discovery and access to premium services for those without a bank card or account. Bundling and co-marketing with TV providers
  3. 3. Mattias Liivak Head of Marketing & PR Andrea Boetti VP of Global Business Development & Sales This is a significant challenge when entering new markets where traditional marketing channels and payment solutions may not work. In addition to telcos, digital services can also seek out partnership with cable and satellite TV companies who deliver television to their viewers. Through set-top boxes and broadband connec- tions, these companies do not just provide channels, but almost always complement it with a central hub which features additional services such as movie rental, replays etc. This means TV companies have similar capabilities in user acquisition to telcos and they also have established a billing relationship with their audience. In many cases, telecommunications companies provide subscribers with mobile services, television as well as a broadband connec- tion which means the bundling effect can be multiplied across multiple channels. TV companies face challenges such as cord cutters, similarly to mobile operators whose new subscriber growth and revenue per user has been in decline for the past few years. This means they are increasingly seeking out partnerships with digital merchants whose services can be bundled, in order to keep their customers loyal. Below, we take a look at who the biggest TV companies to bundle with are, how the different models of partnership with them differs, what the bundle experience means from a consumer perspective and how Fortumo supports digital merchants in launching bundle partnerships through the Trident bundling platform. If you have any questions about the white paper, please contact us at bd@fortumo.com. Bundling and co-marketing with TV providers
  4. 4. Fortumo coverage TV providers who are also telcos Cable and satellite TV landscape There are hundreds of international and local TV service providers delivering programming to their customers globally with the biggest growth coming from Asia and the Middle East. Below we have brought out an overview of providers whose markets overlap those where Fortumo is present and who also function as mobile operators. The reason for highlighting these companies is because bundle partnerships with them bring the biggest scale. Companies offering multiple telecommunications services have the ability to create cross-platform offerings, both at home (desktop, television) as well as on the go (mobile and tablets). Europe Latvia Macedonia Netherlands Norway Poland Portugal Romania Russia Lattelecom Vip/Boom UPC/Ziggo, Tele 2, KPN/Digitenne Telenor TP/Orange Meo/PT, NOS/Zon, Vodafone Telecom Romania, Orange TV MTS, Beeline/Vimpelcom Serbia Slovakia Slovenia Spain Sweden Switzerland UK Telekom Srbija Nova Digi/Slovak Telekom Telemach Ono/Vodafone, Canal Plus/Telefonica/Movistar Telia, Telenor Swisscom, Sunrise Virgin, BT, TalkTalk Austria Belarus Belgium Bosnia Bulgaria Croatia Cyprus Telekom Austria Velcom Telenet M:Tel Vivacom, M:Tel Max TV/T-HT, Vip Cytavision Czech Rep O2 Denmark Estonia Finland France Germany Greece Hungary Italy TDC Telia, Elisa Telia, Elisa, DNA Orange, SFR, Free Vodafone, DT/T-Home Cosmote T-Home Telecom Italia Bundling and co-marketing with TV providers
  5. 5. Middle East & North Africa Bahrain Egypt Israel Jordan Morocco Oman Qatar Senegal Turkey UAE Batelco Telecom Egypt Partner Orange Maroc Telecom Omantel Ooredoo Orange Turkcell, TTnet Du Asia & Pacific India Indonesia Malaysia New Zealand South Korea Singapore Sri Lanka Tata Sky, Videocon d2h, Airtel Digital Telkom Astro Vodafone KT Olleh, LG U+ StarHub, SingTel TV Dialog Taiwan Thailand Uzbekistan Vietnam CHT, TWM Truevisions Uztelecom VNPT, Viettel North & South America Bolivia Brazil Canada Tigo, Entel Claro, Telefonica, Oi Rogers, Videotron, Bell TV Chile Colombia Claro, Entel, Movistar Claro, Movistar Ecuador Guatemala Paraguay Peru Claro Claro, Tigo Telefonica, Claro Claro, Tigo Bundling and co-marketing with TV providersBundling and co-marketing with TV providers
  6. 6. Which digital merchants should seek out bundle partnerships with TV companies? TV company bundle partnerships are the best match for digital merchants whose services are already consumed partially or wholly through home entertainment devices. Bundling can thus be best leveraged by the following segments: Partnership models with TV companies Bundling For digital service merchants, there are three primary ways how to work together with TV companies to achieve user and revenue growth: bundling, reselling and payments. In case of bundle partnerships, the TV provider pays the digital merchant on behalf of their users for the accounts. In return, they promote the bundle offer to their users, usually with one of two goals: With bundling, the TV provider includes the merchant service into its own product that is being sold to consumers. The consumer pays for services (TV and the merchant service) once to the TV provider and gains access to all of them. In order to increase digital merchant service uptake, usually an incentivized offer is included with the bundle - either the service is free for X months to the user or they receive it at X% discount. Video streaming services: 60% of streaming happens on TV screens To acquire new customers (“Switch to us and get X service for free!”) To upsell existing ones (“Upgrade to Premium Package and get X for free!”) MERCHANT DISCOUNTED SERVICE BUNDLE CONSUMER CONSUMPTION CONSUMPTION FEE TV USER E-sports: desktop and TV are the primary devices where gaming content is streamed Music streaming services: between 15% and 70% of streaming happens on desktop & TV (highly dependent on age demographic) Console gaming: TVs are the primary device where gaming content is streamed Bundling and co-marketing with TV providers
  7. 7. Once the bundle offer expires, there are two options: the TV provider upgrades the user to a paid account (in case the bundle partnership also involves a payment mechanism, such as charging the user on their TV bill) or the merchant attempts to convert them on their own (e.g. by offering to continue usage through a credit card payment). Bundling and reselling do not mutually exclude each other and it’s commonplace to have both partnerships in place at once: for example, offering the bundle package to new customers, and selling the service at a regular price to existing ones. Reselling In case of a reseller partnership, the TV provider becomes a vendor for the digital merchants. The digital merchant sells their accounts or licenses to the TV company who then puts them on sale in their own channels (online store, TV hub etc). Providing such alternative payment methods is especially relevant in emerging markets, where access to bank-based payment methods is lacking. For example, in Latin America credit card penetration is below 30% and in countries like India, it can be as low as 2%. Leveraging a locally well-known brand - which both mobile operators as well as TV companies undoubtedly are - can add additional value during the checkout, as the consumer recognizes a familiar brand, thus also increasing confidence in the digital service provider. Payments In case of a payments partnership, the digital service merchant enables payments through partner’s payment mechanism in their own service. In case of TV companies, this would mean providing users the option to charge payment for the service to their cable or satellite TV bill. MERCHANT CONSUMPTION PAYMENT PAYMENT TV USER MERCHANT PRODUCT PRODUCT CONSUMPTION PAYMENT TV CONSUMER PAYMENT Bundling and co-marketing with TV providers
  8. 8. What is the TV bundling experience for consumers? Below, we have brought out a few examples of how the consumer journey looks like in case of different partnership models with TV companies: Example 1: User activates bundle from TV provider smart hub and gets access to the service also on other devices. Example 2: Push notification example. User watching TV, notified of new service available. Bundling Bundling and co-marketing with TV providers
  9. 9. Example: User purchases digital service from the TV provider smart hub and get access to it also on other devices. Reselling Example: User is browsing merchant app, chooses to pay through their cable TV bill, identity is detected automatically thanks to them being on home WiFi and charged to next month’s cable bill. Payments Bundling and co-marketing with TV providers
  10. 10. How can Fortumo support you in teaming up with TV providers? Fortumo develops and operates the Trident bundling platform, which digital merchants use to connect to TV companies, mobile operators, broadband companies and other merchants for user acquisition and monetization partnerships. The platform supports all three models of co-operation (bundling, reselling, payments) with one integration giving scale to co-marketing activities. Instead of individual integrations to each partner, digital merchants can integrate once with Trident and get connected to all other partners integrated into the platform. Key features of Trident include: User authentication and service provisioning: identifying users that are eligible for co-mar- keting campaigns and enabling (as well as terminating) service access to them, both through our back-end as well as the user interface Payment collection: collecting payments through the partners’ payment channel (carrier billing for mobile operators, TV bill for satellite and cable TV companies, broadband bill for broadband providers) Analytics: reporting and analytics on all active partnership deals and their performance, providing data on consumer behaviour and partner channel performance which otherwise would be fragmented Curious to learn more about how Trident can help you get connected to TV providers, mobile operators and other digital service providers for co-marketing? Reach out to us at bd@fortumo.com. TridentBUNDLING PLATFORM DIGITAL SERVICE PROVIDERS350 TELCOS GLOBALLY GAMES CLASSIFIEDSMOBILEVMNO CABLE TV DBSTVBROADBAND PUBLISHERS MUSIC VOD POTENTIAL USERSCOUNTRIES 4.5BTELCOS 350100 Upgrade to 5GB/month data pack Get 3 months of music sreaming free WEB SOCIAL MEDIA NEWSLETTERS RETAILPUSH SMS MOBILE + MUSIC Subscribe to Premium TV pack Free 12 month access to online newspaper CABLE TV + PUBLISHERS Upgrade to 50MB/s package Get 6 months of VOD service for -50% BROADBAND + VOD Programmatic, targeted o ers of your service to telco subscribers. Bundling and co-marketing with TV providers
  11. 11. Additional reading White paper: Carrier bundling for user acquisition and marketing Direct carrier billing in 2017: global market report by Fortumo Carrier billing for mobile commerce: Kinguin & Orange Poland case study Fortumo is a digital enablement platform for app stores and digital service providers for user acquisition, monetization and retention. The company connects service providers with more than 350 mobile operators across Asia, Europe, Latin America, the Middle East and Africa. Service providers use Fortumo’s platform to manage the end-to-end customer lifecycle of mobile users on these networks through the company’s bundling, carrier billing and messaging solutions. Fortumo’s platform is used by thousands of leading digital merchants including Google, Spotify and Electronic Arts. Founded in 2007, Fortumo has offices in San Francisco, Beijing, Delhi, Singapore, Estonia and Hanoi. For more information, please visit: https://fortumo.com https://facebook.com/fortumo https://twitter.com/fortumo https://www.linkedin.com/company/fortumo-ltd This document is for informational purposes only. Fortumo and the authors make no expressed or implied warranties in this document. Fortumo and the author(s) make no representation or warranty in relation to the accuracy, completeness or reliability of the information contained in this document. Any opinions expressed in this document are subject to change without notice. This document may be based on a number of assumptions and different assumptions could result in materially different results. This document should not be regarded by recipients as a substitute for obtaining independent advice and/or the exercise of their own judgement, and is not to be relied upon by recipients. Fortumo and the authors, and any of their members, directors, employees or agents do not accept any liability for any loss or damage arising out of the use of all or any part of this document. Copyright © 2018 Fortumo | All rights reserved. Read more Read more Read more

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