Will Rich Communications Services Rise As A Serious Channel?

William Dudley

The world of mobile messaging is buzzing about the potential that rich communications services (RCS) will bring to the ecosystem.

Businesses and brands that have already invested in messaging channels to reach their consumers are also anticipating the benefits that RCS will bring. But there are some realities versus hype to consider about RCS in its current state.

First off, I won’t be attacking RCS as a channel, as I believe it still has a very high potential to provide needed changes to how those of us providing messaging solutions deliver capabilities to our enterprise and brand customers. Second, the current iteration of RCS, based on the GSMA standard called Universal Profile, has just gotten started (over the last two-plus years) and continues to gain momentum as a messaging channel. Finally, it’s the promise that RCS, especially “business RCS messaging,” brings to the consumer engagement world that could be a game-changer.

Mobile messaging today is not all SMS anymore. There are a variety of messaging channels – many of them very regional – that consumers are using. For most, these non-SMS messaging channels are strictly person-to-person (P2P) and based on various social networking platforms. We typically call them social/chat apps. For example, WhatsApp and its 1.5 billion subscribers have all but taken over P2P messaging in many markets, notably parts of the EU, India, and Latin America. WeChat is heavily used in China, Line in Japan, and so forth. There are also strong communities for Telegram, Viber, Line, Facebook Messenger, Snapchat, Kik, and many others. The point is that social/chat apps are a fact of life that marketers can’t ignore. But there is one major problem: they are fragmented. Not everyone has them or uses them, and in many cases, such as with WhatsApp as of this writing, they are not suitable for notifications and alerts.

Notwithstanding WhatsApp’s current “beta” state for business messaging involving a handful of providers, enterprises and brands are basically relegated to interacting with consumers in a P2P style via WhatsApp’s Business app. There is no API support for alerts, notifications, or conversational engagement that businesses can leverage. Of course, that may be starting to change.

Conversational engagement has been gaining in popularity over the last 18 months or so. This means the consumer interacts through the messaging channel with a brand in a conversational manner. This may be a live human, but in many cases, people are conversing with an automated bot (or chatbot). Bots range from simple to sophisticated, powered by AI engines and machine learning to handle various types of input. Most are purpose-driven and built around social/chat apps. Facebook Messenger, for one, has an environment that is conducive to bot interaction, although things like bot discovery and truly useful bots have been a challenge.

In RCS, the concept of conversational engagement really sets the tone coupled with its secure, rich media. And best of all, it’s operational on default messaging clients on most Android devices. Furthermore, if implemented correctly, the messages can fall back to SMS, if the end user’s device (or operator) does not support RCS. And yes, most bots can work on SMS almost as well as they can on RCS.

SMS messages from businesses have over a 90% open rate, according to Mobilesquared‘s research. That’s an amazing statistic that is key to the current and predicted growth of business SMS – or A2P: Application to Person, as it’s called in the industry – and frankly, this is a major component of the allure of SMS engagement. But can RCS offer similar allure and benefits?

Mobilesquared noted in a July 2018 blog post that “nearly 50% of mobile users would be active RCS users, i.e., they would engage and interact with a brand. This figure smashes interaction levels on other channels, and RCS is only getting started.” So, what does RCS do that other social/chat apps don’t do?

RCS – specifically A2P RCS – can provide a practical alternative to the requirement and expense of deploying a mobile app. Mobile apps are quite expensive to design and build. Furthermore, there is the ongoing problem of user retention and user abandonment – if you can get the user to download the app in the first place. According to Localytics, 21% of users now abandon an app after one use. Furthermore, the percentage of users who launch an app more than 11 times is only 38%. Those statistics don’t seem that impressive to me.

If the functionality of the app can be embodied within an intelligent, RCS conversation, with fallbacks to SMS and even other social/chat apps, where applicable, there is no need to maintain an app. The same functionality, richness, security, and engagement are available to the user through their default messaging client on their device.

That, to me, is part of the huge promise that RCS can bring to the new world of mobile consumer engagement. I would much rather have several brand/enterprise-specific entries in my messaging client than individual apps for each one – especially if they are ones that I only need from time to time. With RCS, I can remain anonymous if I want and interact with a bot to provide rich content, answer questions, even make purchases.

So, what about RCS vs. a mobile website? That is a compelling question that we should examine. Mobile websites can provide brand visibility and audience reach and are cost-effective. They can take advantage of SEO to enhance their overall brand visibility. Mobile-optimized sites – especially those with responsive design – can work on many different displays and can support multiple types of rich media and content and location-based mapping.

I would argue that the best solution is a combination of a mobile website for brand visibility plus an RCS engagement for further interaction with features such as click-to-call, live chat, direct notifications; leverage device features such as the camera or GPS; and provide a compelling list of features – all from the device’s default messaging client.

The reality of RCS functionality and desirability depends on the business’ objectives and use cases – and the case for RCS is strong in most of them. Think about what is being done with SMS today, then imagine what could be done with RCS and how the channel could be improved. Think about how incorporating conversational interaction could further engage and benefit the user.

Here’s a simple example: SMS delivery of two-factor authentication codes. This is a popular method of delivering verification codes to a person’s mobile phone. The user simply provides a code delivered in an SMS message to an app or website as part of two-step verification. The scheme is the most widely used method of two-step (or two-factor) authentication; however, there have been some security issues with this methodology. With RCS, a rich message could be securely sent – fully encrypted, end-to-end – to the user’s device with a request to validate a login or transaction with a simple Allow or Deny option. Further validation could be done through the RCS session, which would overcome many, if not all of the security holes of SMS methods, even SIM-swaps.

RCS has the potential to change the way the consumers interact with brands in the coming years. While many messaging service providers offer solutions around SMS, a smaller subset offer true multi-channel solutions that include social/chat apps along with SMS. What is compelling is that a significant number of these messaging service providers are now talking about RCS, with many showing demos and new solutions for business. Brands are getting on board as well.

While the number of operators supporting A2P RCS may not yet be what we would like it to be, I think that in the next 12–24 months, we’ll see a new wave of mobile operator support along with some real enterprise and brand launches. There’s still a lot of work to do and quite a few unknowns, but it still looks as if business (A2P RCS) is poised to become a significant channel for consumers to to interact with businesses.

Explore the highlights of the 2018 mobile market and messaging trends including SMS, A2P, intelligent multichannel, RCS, and chatbot services and their impact on the digital economy and customer engagements. 

This article originally appeared on SAP News Center.

About William Dudley

William Dudley is group director, mobile evangelist, and strategist of the Industry & LoB Products at SAP Digital Interconnect (formerly known as SAP Mobile Services). He has many years of experience building and managing telecommunications network infrastructures. He defines global strategy and solutions for SAP Digital Interconnect, a business unit of SAP, within the mobile ecosystem, focusing on solutions for messaging, mobile-enabled online security, next-generation networks (5G, LTE, IPX), and consumer engagement through mobile channels. As mobile evangelist, Mr. Dudley communicates through both internal and external publications, social media and is active in industry groups. You may follow him on Twitter at @wdudley2009. His primary blog site is https://blogs.sap.com/author/william.dudley/.