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- 1. Accessing the most effective and efficient business model for M- Commerce to boost revenue generation Naveed Ahmed Choudhury Head of M-Commerce, Citycell (a JV of SingTel & Pacific Telecom Bangladesh) March 06,2013
- 2. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Outline • New technologies • Effective business model • Different business models • Bangladesh overview & M-Commerce • Citycell in M-Commerce • M-Commerce Service & VAS • Different approaches of M-Commerce • Revenue growth
- 3. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved New Technologies •USSD, SMS, IVR or combination •Contactless technology e.g. NFC •Other initiatives e.g. Google wallet, ISIS etc. •following are technology wise break down for M-Commerce in Asia Pacific in 2015* : •Transaction: US$ 3.6 billion •SMS: 67%, NFC: 23%, Others: 10% *As per Frost & Sullivan
- 4. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Business models •What is an effective business model •Different business models •Varies as per roles of different actors in value chains. Need to incentivize based on who provides what. •For Mobile Commerce, business models vary based on Bank-led, Telecom led or hybrid model. In a Bank-led model, a Telecom provides connectivity for SMS/IVR/USSD and also POS network.
- 5. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Outline •Bangladesh overview •M-Commerce industry •Citycell in M-Commerce •Mobile payments •Current technologies •Segment without mobile •Way forward
- 6. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Bangladesh: country overview •Population>160 million. •GDP : US $ 282 billion (PPP) •Growth rate: 6%(approx.) •GDP/capita: US$1970 (PPP) •Bank access: only 13%. But mobile subscribers>90 mln* So there is a huge opportunity to provide access to banking services through Mobile phones.
- 7. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Remittance Source: worldbank 0 2,000 4,000 6,000 8,000 10,000 12,000 2005 2006 2007 2008 2009 2010 Migrant remittance inflows to Bangladesh Migrant remittance Inflows (US$ million) – International remittance accounts for 10% of national GDP. – Channels: • Formal: Banks, Money transfer organizations, Postal services etc. • Informal: Hundi or hawala, hand delivery, travel agencies etc. – Existing channels are • Costly • Time consuming • Bureaucratic etc. M-Commerce can simplify remittance receiving.
- 8. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved M-Commerce landscapeM-Commerce landscape • Bank-driven model: 22 Banks given approval. • Only 14 banks able to launch service. • DBBL, partnering with Citycell first to launch M-Commerce in March 2011. • Citycell as an MNO provides retailer footprint and network connectivity.
- 9. • Citycell pioneered launch of Mobile Banking partnering with a local Bank. • As per regulatory frame work, Banks have ownership of product, pricing, campaigns etc. MNO provides retailers and network. • Citycell has introduced innovative uses of M- Commerce e.g. retailer commission payment(partnering with DBBL).
- 10. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved A growing market • Main players:Bkash(2.2) & DBBL(1) million accounts. Total 3.3 million(approx.) accounts. • Total number of M-Banking accounts was 0.7 million(approx.) in May 2012. • So > 400% growth in eight months. • New Banks entering landscape. • New services e.g. international remittance, deposit schemes to be introduced soon.
- 11. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved M-Commerce & VAS Maturing and upgrading the Telecom customer Mobile voice SMS Various VAS e.g. SMS based, IVR based, USSD based VAS Internet access & services The next step in this evolution should be M- Commerce services.
- 12. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Different approaches •Treat M-Commerce as a separate stream OR •Leverage on VAS for growth of M-Commerce & vice versa. •Make M-Commerce part of Telecom loyalty & rewards programs.
- 13. www.citycell.com c2008. Pacific Bangladesh Telecom Limited. All Rights Reserved Which approach to take •In context of VAS, Telecom operator should be at least an enabler(subject to local regulation) to reap following benefits: •Better customer experience •Create stickiness •Strengthen customer relationship •New revenue stream