Our recent survey in the Philippines suggests that the early adopters of mobile money are unique in two important ways: the way that they use of voice and data services, and the frequency that they purchase load.
MM Users Send/Receive More SMSs and Phone Calls Than Non-Users
GSMA research conducted with CGAP in the Philippines suggests that early adopters of mobile money are more frequent users of voice and data services than typical mobile users. This conclusion is based on self reported data from a pool of 1,042 unbanked survey respondents. These individuals were asked to indicate how many phone calls and SMSs they place and receive each day. Here’s what they reported:
• SMS sent per day: 17 for MM users compared to 11 for non-users
• SMS received per day: 23 for MM users compared to 16 for non-users
• Calls made per day: 2.0 for MM users compared to 1.6 for non-users
• Calls received per day: 2.3 for MM users compared to 1.8 for non-users
Remember that this data comes from Philippines – the SMS capital of the world – so it’s not surprising that all survey respondents use SMS more frequently than voice. However, the distinction between mobile money users and non-users in terms of frequency of use is significant. Previously we noted that mobile money user ARPU is 74% higher than non-user ARPU. The data above supports our previous finding, confirming that mobile money users are indeed more frequent users of both voice and SMS. Note that this data doesn’t suggest that mobile money users will begin spending more on voice and SMS once they adopt the service. Instead, it confirms that the early adopters of mobile money are individuals who use their mobiles more frequently than average. This is intuitive in some ways. For someone to entrust their financial livelihood to a mobile operator, it’s reasonable to believe that they are highly comfortable using their mobile and have confidence in the network that it runs on.
Mobile Money Users Reload More Frequently Than Non-Users
Another way that mobile money users differ from non-users is in the number of times that they reload per week. This is an important metric – particularly for deployments whose business case relies on transaction fees from customers purchasing load on their handsets. Our survey revealed that mobile money users reload 3.4 times per week, compared to 2.7 per week for non-users. A number of explanations are typically offered to rationalize the high figures for both MM users and non-users. One is the fact that Filipinos are accustomed to buying in sachets. Indeed, low-income Filipinos (which represented a large portion of our sample) are able to use mobile services precisely because load is sold in such small increments and they don’t need to outlay large amounts of money to buy load. Sale of sachet-style load is possible because airtime is sold by retailers electronically in the Philippines. As a result, operators can cost-effectively reach base of pyramid customers and sell to them in tiny increments (i.e. P10, or US$0.20). Another explanation sometimes offered for the high reloading frequency is the fact that airtime has expiry dates which may contribute to purchase behaviour, though change could be coming here with recent changes from the National Telecommunciations Commission. While both mobile money users and non-users reload frequently, it’s important to note that users reload 26% more frequently than non-users.