Carrier billing company Fortumo has launched a new platform designed to make it easier for merchants and mobile carriers to form “bundling” partnerships.
With the advent of online subscription offerings like Spotify and Netflix, we’ve seen a number of tie-ups with mobile networks to encourage consumers to sign up — for example, joining a specific carrier may come with free access to a music- or video-streaming service, or mobile data may be “zero-rated” for a specific service.
The problem is that setting up such deals can be time-consuming and resource-heavy. The nature of commercial discussions and technical integrations makes such tie-ups difficult for merchants to scale across more than a few carriers.
Founded out of Estonia in 2007, Fortumo is one of a number of companies that enable carrier billing for online games and other digital content services. Rather than asking consumers to enter long credit card numbers when making payments, the charge is applied to the users’s mobile phone bill instead. It’s particularly useful in emerging markets or countries where credit cards aren’t the norm.
Fortumo works with a number of big-brand companies, such as Google, Rovio, Sony, and Spotify, across more than 90 markets. With its new Bundling Platform, Fortumo is now letting any online merchant, including streaming services and cloud-hosting apps, plug directly into Fortumo’s platform, which is already connected to hundreds of carriers globally. It basically makes it easier and quicker for digital merchants to introduce new bundles with carriers and negates the need to integrate with each mobile network’s API for every bundle. It includes zero-rated data promotions or free / discounted access to a service for a set period of time.
“User acquisition — especially in emerging markets — is one of the most burning questions for digital content merchants today,” said Fortumo cofounder and CEO Martin Koppel. “Carriers are a great partner with whom to solve this challenge, as their marketing reach is unmatched. However, making individual bundle deals with dozens of carriers is time-consuming and inefficient. Fortumo’s Bundling Platform helps merchants manage their user lifecycle in a scalable manner so they can focus on converting acquired users into paying customers.”
It’s well understood that many consumers elect not to continue with a subscription once a promotional deal has expired, particularly where prepaid SIM cards are commonplace — such as in emerging markets where Fortumo operates. And this is why Fortumo is using its core payments and messaging APIs to sell its bundling platform. A single integration with Fortumo serves up access not just to bundling, but to the full shebang, meaning it can be used to try to shoehorn consumers into becoming full paid customers.
“Bundle deals alone are not enough to build a paying user base in markets where prepaid SIM cards are predominant,” added Koppel. “Most users simply opt out of the service after the bundle deal is over, leaving merchants and carriers with empty hands. By helping the customer in each step to becoming a paying user, we can substantially grow the benefits from bundle deals for everyone.”
The bundling platform is rolling out initially in Eastern Europe and Southeast Asia, with the first fruits of the integrations expected go live over the next few months.