I was waiting for bus at my designated stop and SMS came to my phone from the travel operator informing me that bus crossed the previous stop and will be there in next 10 minutes at your location.
I had ordered my food online and SMS flashed in my phone that delivery boy will be reaching soon at your doorstep. Bon Appetite.
In both above cases, no individual had sent me those messages rather I received those from an application which automatically sends SMS based on certain parameters. These Application to person (A2P) messages is being used extensively for customer engagement across different industry verticals. While there is a sharp decline in the usage of SMS in person to person (P2P) arena, A2P had a significant expansion in the past few years in terms of revenue & traffic.
Communication service providers (CSP) are entering into partnerships with many organizations from different business lines in providing the required connectivity(backbone network)to deliver the SMS to end user. This business use of A2P SMS is helping the Telco’s in generating more revenue than the regular p2p SMS.
Source: Ovum, Mobile Messaging Traffic and Revenue Forecasts: 2017-22
Challenge: On the flip side, managing these enterprise customers is becoming a challenge for CSPs with increased partnerships.With the rapid digitization on ground, rating models are becoming complex and CSPs are signing contracts with innovative pricing models. Gone are those days where there is a standard fixed price for SMS and bill the same to your customer.
As per the contracts and SLAs, different rating & pricing models are being applicable to different partners. In addition to this, enterprise customers lack the visibility of their usage and balance quota which is leading to dispute with CSP. There are some complex agreements with respect to A2P messages where CSP gives the 1st 1000 SMS for free and then a slab/tier-based rating will be applicable. Furthermore, certain agreements also involve discounts and additional mark up pricing based on specific parameters. A2P SMS market is dealing with higher volumes but with lower margins. Managing these enterprise partnerships with different A2P rating models and contract agreements is becoming complex and challenging.
Solution: A comprehensive solution for the above challenge should manage all the partners right from signing the contract to generating the bill for the A2P message usage to the respective customers. A convergent partner management solution using which the CSP can seamlessly manage all their enterprise customers. System should enable the operator to maintain and track different contract related information at one place. System should also have the provision of attaching the soft copy of SLA (Contract) to the module for future reference. There should be a reconciliation feature which compares the partner’s data with source data and eliminates the risk of over/under charging to the partners. Solution has to be capable of handling complex rating models with inclusions and exclusions. Furthermore, Tier/Slab based rating models should be easily configurable along with non-usage recurring charges associated with the same.
Several industries like e-commerce, banking, entertainment, healthcare and tourism are completely leveraging the advantages of these A2P SMSs` in reaching out to their customers. They are using this medium of messaging for providing multiple services like instant alerts, notifications, promotions etc to their end customers. While there is good chunk of revenue inflows associated with these A2P SMS, an effective partner management solution helps the CSP in integrating and managing their partners seamlessly.