SMS 2.0 – What’s it all about?

We have a lot of buzz words flying around our industry at the moment – we’re seeing everything in 4K, everyone has their head in the Cloud, and OTT is going a bit OTT. There is however a new kid on the block, and that’s SMS 2.0. There has been a lot of talk recently about Subscriber Management Systems (SMS) and its progression from 1.0 to 2.0, but what does SMS 2.0 really mean? And is there really a need for it?

Traditionally, TV payment methods have always been confined to the living room. With only one screen in the home, subscriber management used to be fairly simple – families would watch TV together and pay for their content in the one place. For broadcasters and media organisations, this meant managing subscriber information on one screen, for effectively one audience. And this was SMS 1.0.

Now that there is consumer demand for multiscreen content, subscriber management isn’t so straight forward. Consumers want content on the move, and they want it on any device. We know that broadcasters are responding to these trends and delivering TV anywhere, but having different SMSs for multiple devices and relationships becomes problematic. It’s not simply a case of putting content onto different devices – there needs to be a ‘one SMS approach’ that combines payment processing, intelligent subscriber management technology and customer service operations in one place. And this is why SMS 2.0 was born.

The demand for content anytime on any device has changed the viewer relationship, and ‘the viewer’ has become ‘the consumer’. Viewers are now active and need to be engaged across a multitude of devices – which means broadcasters and media organisations need to develop complex relationships with their audiences if they are going to be successful. But building a relationship requires a sophisticated SMS – a system that provides a compelling consumer experience which is tailored to the viewer’s wants and needs, and is easy and enjoyable to use. A SMS needs to deliver a mix of companion apps, targeted advertising and marketing offers to create a mutually beneficial relationship between the viewer and the broadcaster. As video platforms become more sophisticated and integrated there will be a big opportunity for SMS to not only develop payment relationships with the viewer.

So we know there is a need for SMS 2.0 – but how do you monetise it? There are actually a few ways you can do this. The first is to use ‘actionable’ data – information that determines what is really relevant to the viewer. Data becomes actionable when you are able to create meaningful campaigns by applying functionality to data sets – so it could be as simple as selecting all accounts that purchased a family movie in the last 6 months, and offering them a 3 for 2 or a cut price subscription/season pass in December for family movies.

Another way is to use SMS to extract value from targeted advertising, and this is actually what broadcasters are doing at the moment. Targeted advertising makes it possible to understand consumer behaviour and get complete visibility across all devices. Broadcasters can use this value to their advantage, and diversify their offerings and create new experiences and routes to market to generate an increased return.

You can also use payment and SMS together, harnessing the power of data for monetisation. As VOD platforms become pay, there is a need for improved SMSs thus increasing the value of data. Applying data to a range of areas, for example, using personalisation and targeted adverts improves audience retention and in turn profitability.

For publishers, monetisation is a matter of collating data to deliver a more sophisticated SMS. Using data from print, online and apps allows for monetisation through content prioritisation, content targeting and churn reduction. With content prioritisation, it’s all about finding out which content viewers value, what premium content means for readers and then monetising this appropriately. Content targeting is about maximising the time spent consuming content, and prioritising certain types of content, and creating offers, vouchers or competitions for readers. Churn reduction focuses more on email marketing and targeting individuals, monitoring media consumption patterns, and effectively bundling and cross-promoting content.

SMS 2.0 is not only becoming a big talking point in the industry, but it’s becoming a big part of what we do here at PayWizard. Our solutions combine the latest technologies and modern techniques to provide the ‘one SMS approach’ broadcasters and media organisations are seeking. By offering comprehensive payment options across multiple devices, platforms and territories, and using real-time actionable data we are enabling broadcasters to make money from the content they produce, and enabling viewers to pay for the TV they want to watch whenever, wherever or however they choose, at the push of a button.

SMS is changing to meet the needs of a new type of viewer. Companies are all about monetising their content, and the changing consumer behaviour means companies need to diversify their offerings and create new routes to market in order to be successful. SMS 2.0 will be required by companies to stay ahead of their competitors, and provide relevant and personalised content to its viewers, when and where they want it.

Jamie Mackinlay, Commercial Director