Multimedia Intelligence dissects mobile content commerce and the biggest sources of revenue leaks in a free whitepaper, "Hidden Costs and the 3 Buckets of Revenue Leakage: The Anatomy of Mobile Content Commerce." The report identifies the success factors, risks and opportunities for various players in the mobile content value chain. Mobile operators and content providers not only need to manage the big three sources of revenue leakage to achieve profitability, they also need to consider them in their choice of mobile content platforms.
The first big bucket of revenue leakage comes from refunds, a cost of sales that can run as high as 5 percent. Causes are incomplete downloads, incorrect content delivery, specials or freebies that the customer didn’t realize are tied to a subscription, and complicated processing. Carriers often eat these costs to keep customers happy.
Solutions include accurate transaction processing through methods such as double opt-in, monthly or every-transaction subscription confirmation, and detailed transaction information on bills to remind customers of content or services they “ate” and have amnesia about. Even losses entailed in legitimate refunds can be minimized with transparency from the credit to the customer and timely removal of customer access or use rights.
The second bucket of revenue leakage fills when providers can't collect payment, either through fraud or careless account maintenance by the customer — for example, insufficient funds in prepaid accounts.
In this situation, payment processing should allow enough payment methods for consumer ease of use, to accommodate portal providers’ needs to conform to carriers’ payment rules or government regulation, and even to monitor the suitability of specific content for a particular customer. Bango, for example, stops offering certain payment methods to customers who have had difficulty with them in the past.
The third bucket is customer service calls that can produce costs as high as 5 percent of revenue. A CSR on the phone for 20 minutes about a 99 cent ringtone is hard to justify. The first answer here is automated customer self-care via the Web, which often can resolve routine problems. If it can't, the critical elements of the customer’s story are already there to prep the CSR.
For more information, visit www.MultiMediaIntelligence.com.