América Móvil’s Mobile Advertising Service
América Móvil (AM) has the largest mobile subscriber base in
Latin America. Their subscriber base represents a massive potential
target base for mobile advertising. AM has partnered with MyScreen
to explore the opportunity.
In launching mobile advertising, América Móvil is faced with
following challenges:
● As with most mobile advertising initiatives, the challenge
is not to repulse customers with intrusive ads. AM and
MyScreen have implemented an opt-in system so as to avoid
customer backlash for the service. This approach will help
AM not to undermine the good relation that it already has
with its customers.
● Although MyScreen claims to have a patented technology for the service, this fact will not confer a
superlative advantage to the AM. The service is not designed to bring in new customers for the operator.
Rather, it is designed to exploit the operator’s existing large customer base, a key enticement for
advertisers.
● MyScreen could offer the service to other operators around the world. For now, MyScreen claims to have
confirmed deals with operators serving over 200 million mobile customers. These deals would include AM’s
markets in Argentina, Brazil, and Mexico. Also, MyScreen has already signed a deal with Turkcell in
Turkey.
© 2012 Cisco and/or its affiliates. All rights reserved. This document is Cisco Public Information. Page 2 of 5
However, this service has also provided a number of opportunities to América Móvil listed below.
● The clearest opportunity for AM is to generate more revenue from its vast customer base. With 225 million
subscribers, AM’s customer base is a valuable resource for advertisers. Given that mobile phones have
penetrated deeply into all facets of the society, the medium has added attraction to advertisers that want
to use mobile phones to target a more diverse audience.
● Although basic voice and data services are still the most lucrative revenue sources for AM, mobile
advertising will help diversify its revenue base and generate incremental revenue. AM has also embraced
other new products/services in mobile messaging, social networks, and app stores.
● A successful mobile ads push will further expand the reach of the AM brand. Presently its brands in the
region, Claro and Telcel, are very well known. By diversifying into services such as mobile advertising,
AM will be able to spread its brand into other areas of society, diversify the brand beyond mobile voice,
and increase the worth of its brand goodwill.
● For an operator that already commands market leadership in many of its Latin American markets, this
strategy will provide AM an opportunity to lead in the development of mobile advertising in the region. This
move will show AM as an innovator, a pace setter, and a company that is prepared to break new ground
to bring new products and services to Latin America.
Alliances/Partnerships
AM has taken the route to buy in mobile advertising expertise from outside rather than develop it internally as
some other operators do. This approach gives AM the opportunity to access best-in-class solutions with the
flexibility of choosing any supplier that it wants. The choice of outsourcing also reduces AM’s risk. Mobile
advertising is still in its infancy and has not yet lived up to many people’s lofty expectations. By avoiding internal
investments, AM is freer to walk away from the service of its chosen partner with few worries about investment
losses.
“MyScreen is proud of our partnership with Claro and América Móvil
and looks forward to meeting the Argentinean consumer demand for
better access and closer interaction with their favorite brands. Claro is
among many companies recognizing the value of the new advertising
channel that MyScreen is creating, and we are very pleased with the
overwhelming positive reception we are receiving from advertisers and
consumers in Mexico and Brazil, where we have already launched and
are generating revenue.”
—Maurizio Angelone, CEO, MyScreen
AM has partnered with MyScreen to implement mobile advertising solution. Originally the service is
targeted to launch in Argentina, Brazil, and Mexico, and there are plans for expansion. In partnering with
MyScreen, AM has opted to collaborate with a partner that will provide a complete solution for mobile
advertising. This arrangement frees AM from the day-to-day provisioning of ads and allows it to focus on its
core business of winning new mobile customers. MyScreen has developed a patent-pending technology
that delivers full-screen, incentive-based ads directly to the mobile phones of subscribers. It manages the
whole process, focusing on bringing together advertisers and operators. It does this by playing the role of
the industry advocate, forming relationships with advertisers and operators. MyScreen also runs a mobile
marketing consultancy, the MyScreen Agency, which collaborates with traditional ad agencies and brand
advertisers.
● AM has a good number of advertising partners. Confirmed partners for the launch in Argentina include:
Samsung Electronics, Easy, Hoytos Cinema, Unilever, Yellow Pages, General Motors, DIA%, Citibank,
and MacStation.
Strategy
● Collaborative innovation at play. Much of the functionality of the mobile ad solution comes from
MyScreen. The company developed the proprietary technology behind the solution and is fully committed
to its development. Together with AM’s resources, the two players are able to demonstrate innovation to
their customers and the market.
● Full-screen visual graphics. Ads are delivered on a full screen and are visually captivating. This capability
enables the advertiser to convey a brand’s image eloquently (see Figure 1 below).
Figure 1. Mocked-up BlackBerry and Unilever Mobile Phone Coupon
● Individually targeted. Each subscriber opting in is asked to complete a demographic and psychographic
profile. The results are then used to serve up ads relevant to the subscriber’s interests and lifestyle. This
approach also enhances the uniqueness of the channel, providing exclusivity to the brands.
● Incentive based. This is where AM comes in. Subscribers accumulate reward points for each ad that they
view. Subscribers can then redeem rewards such as free voice and Short Message Service (SMS) services
from AM. This rewards program incentivizes customers to continue using the service and acts as a kind of
promotional bonus for AM. Thus AM offers what it could simply have offered as a customer bonus, but in
return, has the chance to earn incremental revenue.
“Mobile advertising has tremendous potential, as the penetration
and individuality of the cellular phone allows us to reach a significant
and highly segmented public. MyScreen’s solution joins other mobile
advertising solutions already offered by América Móvil. This launch
reflects our commitment to stay in the forefront of the mobile
communications industry, offering our subscribers and shareholders
greater value.”
—Marco Quatorze, Director of Value Added Services, América Móvil
Success Factors/Metrics/Monetization
● AM has a sizeable incremental revenue opportunity from sharing the revenue that comes from advertisers.
So far, neither AM nor MyScreen has confirmed the revenue-sharing percentages. However, MyScreen
says that it has secured about US$1.5 million of advertising commitment.
● At a CTR of 20 percent and above, MyScreen’s solution should appeal to advertisers and brand managers.
Other ad platforms, such as Google AdWords, have an average CTR of 2 percent. Therefore, if the initial
phase proves successful and the CTR rate remains high, the solution is likely to become a sought-after
advertising platform in Latin America and possibly beyond.
● For AM, the partnership adds robustness to MyScreen’s solution. Other non-operators, such as Blyk, have
tried to set up similar mobile ad platforms independently. However, these platforms have not been very
successful. If AM can bring its clout, expertise, reach, and efficiencies to MyScreen’s mobile ad solution,
it is sure to be a win-win for both AM and MyScreen.
Company Background
● Read América Móvil overview
Case Study Source: Cisco sponsored research developed by Ovum