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Why is USSD not Obsolete and What are Businesses Using It for?

Over the last few decades, USSD has been a popular technology that businesses use to connect and reach customers. With smartphone adoption and 5G implementation on the rise globally, many would view this older and simpler technology as obsolete. The truth is that this powerful technology is only now beginning to reach its potential in terms of what it can do for businesses. We examine how USSD can enhance customer experience, better target customer segments, and increase revenue below.

Overview of USSD

To understand the power that lies in USSD technology, we first need to understand what it is. USSD is short for “Unstructured Supplementary Service Data” and is a real-time interaction service that allows your business to display text on a user’s handset. It is a mobile communication technology used around the world to send text between a mobile phone and an application in the network. Consumers most commonly use USSD to check available mobile airtime and conduct data balance inquiries or mobile marketing competitions. This is just the tip of the iceberg for how USSD can be utilised.

The value of USSD within the Telco industry

With all the advances in the Telco industry related to smartphone adoption and the move to 5G, you may be asking why is USSD still relevant? The answer lies in the statistics.

According to GSMA’s 2022 Mobile Economy Report, 53% of the global population are connected, which means they have used internet services on a mobile device, 41% are within the footprint of mobile broadband but do not use it, and 6% do not live within the footprint of a mobile broadband network. Although 53% of the population are connected, 47% per cent are not, which translates into 3.6 billion people who are not connected. So how are these people utilising mobile and value-added services? The answer lies in USSD.

Even in the age of digital transformation, where new technologies are making headway, this technology remains steadfast. It can close the digital divide and offer services to those who do not have connectivity or the means to keep up with the latest smartphones etc., specifically those in emerging markets. For example, nine in 10 mobile money transactions in Sub-Saharan Africa still flow through USSD.

Those in emerging markets have gotten incredibly creative with how they are using this technology. For example, in the wake of the Covid-19 pandemic, USSD self-service solutions were being used by farmers across East Africa for fundraising, training, and knowledge sharing. In South Africa, WhatsApp and USSD were utilised by the government to set up a COVID-19 Connect service to help citizens locate coronavirus guidance.  Although WhatsApp is the most popular messaging platform in South Africa, the USSD COVID-19 Connect was the most accessed platform.

Why will USSD remain relevant for years to come?

Over the past three decades, USSD has segmented itself in the telecommunication industry as a simple, functional, and powerful technology. Its value lies in the fact that it is the perfect way to connect and reach customers no matter what phone they have, if they have data or not, or what network they are on. USSD offers complete inclusivity. Over and above this, USSD remains a popular mechanism for businesses because of its:

  • Low transaction costs.
  • Interactivity and fastness.
  • Simplicity and user-friendliness.
  • Ability to work without an internet connection.

In this way, businesses can reach broader audiences no matter their connectivity at an incredibly low cost. This opens a wide range of opportunities and possibilities for businesses and how they choose to use USSD technology.  

How Businesses are using USSD

One of the ways businesses are utilising USSD is to better target different audience segments. This technology allows businesses to effectively target the right customers with the right services, products, offerings, and promotions and interact directly with their end-users/customers. 

Businesses are looking for ways to connect and engage with their customers and use several different ways to do this. These include:

  • Customer self-management services – USSD offers customers self-help services that are fast, accessible, and efficient to use. They can transact, find out information and more. In this way, the USSD technology is used instead of a call centre.
  • Information services – Used with other advertising mediums, USSD can be used as a call to action. The user makes use of the USSD code and follows the appropriate prompts if they are genuinely interested. The result is no time wasted with unnecessary communication with people who are just curious but will not end up buying. In this way, customers can find out all the information necessary regarding the service or offering they are interested in directly from the business.
  • Surveys – Using USSD, businesses can message an invitation to participate in a survey, either to their entire user base or by using email marketing segmentation. Surveys can offer feedback from customers, or they can be used to obtain pertinent information for new products or services. USSD surveys effectively collect responses that enable businesses to make better decisions and more effective marketing campaigns.

Businesses are also looking for ways to enhance customer experience with USSD. USSD is being utilised to provide customers with value-added services and offerings that include:

  • Mobile Banking – mobile financial services are a popular service many customers are looking for, especially in emerging markets. Mobile Financial services like Mobile banking are the perfect option as they can be run off USSD, will work on any device, and is available at a very low cost.
  • Information updates (WASP services) – with USSD, businesses can provide customers with value-added services through Wireless Application Service Providers (WASP). This includes getting news, sports and currency updates or even purchasing tickets.

Over and above this, businesses are looking at ways to utilise USSD to enhance revenue and profitability and are doing this through:

  • Mobile advertising – Mobile advertising has shown to be very effective when used in medium combinations. USSD offers businesses superior reach related to advertising.
  • Please Call Me messages – Using a USSD code, users can send a “Please Call Me” message to another person or in a marketing campaign. In addition, the service can be monetised by using adverts after the message is sent. 
  • Coupons and vouchers – An excellent method of acquiring new customers is with coupons or vouchers that offer free services or discounts. Businesses can utilise USSD vouchers and special offers to provide potential customers with a voucher code or an opportunity to try the service they are selling/offering.
  • Competitions – Running competitions that work with USSD and social media has proven popular because USSD codes offer simplicity for potential customers to enter the competition. In this way, USSD enables you to reach potential customers you wouldn’t otherwise have engaged with.

Conclusion

From the above, it is clear that USSD technology still has a place in the current technology stack, even with digital transformation driving new advanced digital technologies. The power of USSD lies in its inclusivity and ability to reach customers across all segments at a low cost. Businesses can utilise this technology to improve customer experience, connect and engage with customers, and increase revenue. USSD is far from being obsolete and is only hitting its stride in terms of what is possible. This is still a technology to watch.

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