Digital engagement on the rise, but user experience and payments still an issue

The launch last week at the CONNECTED SUMMIT in London of Payforit4 can be seen as the beginnings of the UK network operators starting to get mobile commerce. The Connected Summit demonstrated that media, TV, radio, retail and live events are all crying out for simple, small value mobile payments to generate revenue from interaction and engagement.

But there is still the issue of payouts. Undoubtedly, Payforit4 marks the start of much better – and lets face it more realistic – payouts, but to many in the media industry, the retail sector and other areas of entertainment who are increasingly becoming mobile centric, payouts are the single biggest stumbling block to using mobile payments to buy things.

And while all this rumbles on, other payment tools – preloaded services such as iTunes, mobile operator wallets, mobile offerings from card companies and banks, as well as third party payment tools are already starting to gain ground. They may not be consumers most convenient choice, but they work.

Of course, with the likes of iTunes, pay outs are as bad as the bad days of PRS, with Apple routinely taking 30%. But that will change. Also, PayPal, card companies, banks and mobile operator wallets offer payouts comparable to credit card companies, and so merchants, hungry for some sort of mobile payment mechanism, are starting to adopt.

Ed Boddington, in his opening keynote on day one stressed that already PayPal accounts for 64% of online micropayments while PRS, once the doyen of this space, is down to 20%.

Where does this leave Payforit4? Well, it certainly now looks better and has some backing from operators – though it still seems unclear as to how much they are actually going to push it marketing wise: with Voda and O2 rolling out stored value wallets one would think they have something of a conflict of interest or at the very least the prospect of a confusing marketing campaign if they do push PFI4.

Much of this was addressed in the seminars and workshops at Connected, but in the main streams of the conference, with input from media companies and service providers, it remains clear that they are not convinced.

With 65% of digitally active consumers using mobile, the connected media space offers huge potential to media companies and telemedia providers, but consumers are being let down by poor connectivity, badly designed user interfaces and a consuming payments landscape.

These were the key headlines from the CONNECTED SUMMIT in London on 15 and 16 March, as the media, marketing, retail and live events industries gathered to look at how to monetize the growing trend for digital interaction with brands and entertainment.

According to opening keynote speaker Darren Mark Noyce, founder of consumer and brand analysis company SKOPOS, the digitally active are increasingly becoming the general population and that this is driving interaction.

“News on the move: provides a number of needs,” he explained. ”Mobile and digital satisfies a range of human needs: its on the go, a quick fix, an enhancement, a substitute and provides catch up. Similarly at live events and sports, mobile is an enhancement –  a second screen when on tv or at the game – and a replacement when you can't watch it live or on tv, or both.”

In particular, mobile voice apps are doing well. “There has been a leap in interest in voice apps from 29 to 38% in our research,” Noyce says. “The Siri ads on TV have helped – despite reality not really living up to what is shown – but it shows potential and consumers actually accept it now. The industry isn’t having to push technology on to them.”

Within the media industries, digital interaction – particularly around TV shows – is again gaining ground as users start to adopt it through second screening and just simple familiarity. And some better press about doing it. As the second keynote speaker, Ed Boddington from Harvest Media and Chairman of industry body AIME, told delegates at CONNECTED: “TV voting is converging and we have managed to make it work and get over the scandals of the past. Now have a very strong industry. Revenues are increasing – slowly.”

As Bod points out, shows such as The voice and Britain’s Got Talent are now doing voice short codes that make mobile voting transparently priced. “This,” says Bod, “will bring more users and customers into the mix”.

According to Bod, there will be a lot more live play along apps as well as SMS votes coming back too. “But,” he says, “the greatest challenge is dealing with volume and with volume spikes. “

Social media is also playing a role, explains Bod, and is starting to skew the market, especially when it comes to payments and revenue generation.. “American Idol in the US offers free Facebook voting and here in the UK, Five’s Big Brother uses Facebook credits for votes,” he says. “Interestingly, about 10% of votes for the show came this way.”

In Puerto Rico, he expounds, they used Facebook credits to pay for votes. “Average votes per unique viewer was 30 (as opposed to 1.5 for non-Facebook voters and operator payouts were 25% higher – and it was a huge success,” says Bod. “So online voting has a huge role to play and revenue to generate.”

But while digital usage is on the rise among the population, there are issues, warns Noyce. “There are issues, both technical and experiential. Mobile is still, the worst customer experience of anything digital, but if you can make it a portable shortcut to what people want and is advantageous to use then its great. If it just cuts corners, it's a poor experience.”

But payments and poor UI aside, CONNECTED demonstrated that the power of mobile and media together is awesome (indeed it was described by Rich Holdsworth of Wapple as “F**KING HUGE” on an acid pink slide early on day one). Tapping into this huge market is well worth the candle. Increasingly, thanks to second screening – especially on tablets – consumers are interacting with TV shows and marketing, In the high street, shoppers are also increasingly looking at how to engage with retailers and brands. The potential here is phenomenal.

But again and again it is shown that mobile is viewed as being costly and bad payouts reinforce this for both consumers and merchants. And it is a shame as there is a definite hunger for mobile interaction with these things and a definite thirst amongst media, marketing and retail to use it. All we need is for – to coin a phrase from the early 90s – to get the ducks singing from the same hymn sheet, and this can be a really lucrative market for both telemedia and the media industries. Let’s hope that Connected Summit 2013 will be able to demonstrate some real progress on all these points.

FOR MORE DETAILS ON WHAT HAPPENED AT CONNECTED SUMMIT 2012, SEE THE NEXT ISSUE OF TELEMEDIA MONTH OUT ON 31 MAY.