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In-store mobile transactions boom for SA

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In-store mobile transacting is booming in SA, says Bevan Ducasse, CEO of wiGroup.
In-store mobile transacting is booming in SA, says Bevan Ducasse, CEO of wiGroup.

South African consumers are driving a mobile transacting revolution enabled by a slew of innovative home-grown technology companies.

So says Bevan Ducasse, CEO of wiGroup, following the release of the company's white paper on in-store mobile transacting.

In the paper, wiGroup says for in-store mobile transacting, consumers use their mobile phones for all sorts of transactions, from checking balances, buying airtime and redeeming coupons, through to paying for goods and services and transferring money.

It also notes that in-store mobile transacting is booming in SA and the value of transactions to date through wiGroup's platform alone is over R2 billion.

"We're not just talking about smartphones here. Africa's feature phone users are active, smart and sophisticated. MTN's SMS and USSD-based Mobile Money service, to name just one, had over 13 million users by the end of September 2013, around 1.3 million of them in South Africa," Ducasse says.

He explains that local retailers, brands and agencies are leveraging the power of mobile transactions in clever ways to unlock new revenue streams and boost customer retention.

According to the 2013 GSM African Mobile Observatory report, SA has just under 60 million mobile phones in use today.

"In a population of only 50 million people, it's reasonably safe to assume that the overwhelming majority of South Africans own a mobile phone," says Ducasse.

"With the explosion of mobile transaction services and apps, and the increasing affordability of smartphones, the challenge today is how retailers can tap into the vast potential for additional revenue, customer retention and innovative marketing campaigns offered by mobile transactions."

Ducasse says recent success in mobile payment adoption in other markets has been encouraging. "US coffee chain Starbucks developed a mobile payment app that processed $1 billion in transactions in 2013 alone.

"In China, the value of all mobile payments in 2013 came to $1.6 trillion, a more than 200% increase on the year before. While Africa has traditionally led the adoption of mobile payments and mobile money transfer, clearly the more developed markets are catching on."

A key challenge of driving adoption of in-store mobile transacting has been a lack of uniformity, Ducasse observes.

"There's currently no one wallet or application that can do it all, and we don't expect there to really ever be one. The reality is a complex and ever-evolving ecosystem that includes customers, retailers, brands, agencies, banks, mobile networks, and local and international app developers. It's this interplay between these disparate groups that is producing some exciting possibilities for the mobile transacting space in South Africa."

Ducasse warns that the success of any in-store mobile transacting campaign is not only reliant on the technology.

"Retailers must ensure that the operations team - including individual store managers - are fully briefed and on board, and that till staff understand how the technology and campaign mechanics work. As we've seen with some of our brands and agency clients, customer education also plays a vital role; for this, in-store education campaigns work best. Whatever you do, make it as simple as possible for consumers: if you confuse them, chances are your campaign will fail to achieve its objectives."

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