RCS could be finally justifying its existence

Much-maligned Rich Communication Services (RCS) are said to be proving their worth to advertisers.

This is according to mobile marketing specialist Upstream, which published statistics on Thursday that show click-through rates (CTRs) as high as 22.2 percent for adverts delivered via RCS. That compares to around 2 percent for a typical online ad. Then there is the conversion rate, which means the advert successfully convinces the recipient to do what the ad intended, such as sign up to a newsletter or place an online order. Here, RCS also performs well, offering a 37 percent improvement over traditional SMS marketing in some cases.

The reason for this efficacy, says Upstream, is thanks to the ‘R’ in RCS, which allows advertisers to send media-rich messages to their intended audience. And because the identity of recipients can be verified via their mobile number, ads can be accurately targeted and personalised.

“Audiences today are very fragmented and have come to expect personalised communication. There is currently no single communication channel that fulfils all of these needs effectively, so marketers have had to adapt to using a blend of different channels to maximise engagement,” said Kostas Kastanis, deputy CEO of Upstream, in a statement. “RCS brings unique value to any multi-channel mix, combining the rich media capabilities of digital channels with the hyper-personalised engagement of the SMS world.”

This will come as music to Google’s ears. In 2019, the search giant announced plans to upgrade the default messaging app on Android from plain old SMS to RCS. That move came less than a month after AT&T, Verizon and T-Mobile US unveiled their joint RCS project, the Cross Carrier Messaging Initiative (CCMI). Google completed its global RCS rollout in late 2020, and by summer 2021, the big three US telcos had pulled the plug on CCMI and adopted Android Messages as their default RCS bearer.

That doesn’t leave operators completely out in the cold though. While Google controls the app experience, operators, with their millions of subscribers, still own the channel through which advertisers can reach millions of end users. Upstream cited figures from Juniper Research that predict MNO revenues from RCS will reach $4.6 billion by 2026, compared to $230 million in 2022. And according to Mobilesquared stats from back in 2020, the overall RCS market will turn over $50 billion by 2028. In addition, with the number of mobile subscribers with RCS on their devices expected to grow from 1.2 billion this year to 3.8 billion by 2026, 40 percent of global mobile subscribers will be reachable by RCS.

“It is time for mobile operators to capitalise on the developments in the digital advertising ecosystem and take a leading role in it. They are uniquely positioned to do so through their millions-strong subscriber-base and ‘owned’ channels such as RCS and SMS,” Kastanis said. “Using technology platforms that allow them to run multichannel campaigns effectively – and by the numbers – is a step towards this goal, and will help revenues soar in the coming years.”

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