It's all fun and games until someone trips over 5 million subscribers

If MobiThinking's "Insider's Guide to mobile Web marketing in India" is accurate, 90% of the country's mobile subscribers have voted for a reality show-based contest via SMS. Half of them subscribe to regular SMS jokes, and nearly as many use their phones to get astrology or sports information. This is pretty remarkable in a country where many development organizations are struggling to achieve scale for their mobile-based health, agriculture, and education programs.

Writing for the GSMA recently, Kristen Roggeman pointed out that there is an obvious demand for entertainment among mobile users in both rural and urban India. She describes an innovative marketing effort by Hindustan Unilever (HUL), whereby mobile phone users make a missed call and receive an automatic call-back with 15 minutes of radio programming. The service now has 5 million subscribers and sends out 25,000 hours of programming every day. HUL has now dropped traditional radio marketing from its advertising mix. The hunger for entertainment is not unique to India. In Brazil, The most popular apps are for music, entertainment and navigation, followed by photo, video and social networking. In Nigeria, the national brewery ran a spectacularly successful SMS marketing campaign inviting 18- to 25-year-old men to attend music concerts. The ads had a response rate of more than 30% and a click-through rate of almost 9%. And in the US, drug makers and insurance companies are developing game-like apps that give points and gifts for sticking to drug regimens. (Failing to follow drug prescriptions is estimated to cost US employers, insurance companies and health providers around $200 billion a year.)

Development organizations might take note: even for the poor, entertainment is a central aspect of mobile phone usage. Mobile devices are quickly supplanting radio and television as the main conduit for personal entertainment in developing countries. Integrating entertainment - music, games, sports, movies, and contests - into dry but useful information campaigns is a viable way of extending the reach and impact of programs. Also, strategic partnerships (e.g., with sports, music, or media groups) could help defray the cost of promotion and generate buzz. Development organizations hoping to capitalize on soaring mobile penetration rates frequently devise SMS-based outreach programs. Making them more fun will require a little "outside the box" thinking, but it could be rewarded by increased awareness, adoption, and effectiveness. 

A Case for Strengthening CSR in Emerging Markets

The nongovernmental group World Growth recently released a report entitled "Corporate Social Responsibility: How Global Business is Getting it Wrong in Emerging Markets." The report examines the corporate social responsibility (CSR) policies of nine major international corporations including Nestle, P&G and Unilever. According to the report, the CSR policies of these corporations are disproportionately influenced by developed-world NGOs, such as the World Wide Fund for Nature (WWF). As a result, their policies often hurt low-income producers, are misaligned with emerging market national development objectives, and promote causes of little value to local people in emerging markets. 

CSR may have once been understood as philanthropy. However, many firms are realizing that giving away a product or service to communities that need them is often a short-term solution to a long-term problem and are examining other models for social and economic development. Companies like Novartis have encouraged supply chain innovation to create profitable new business models that better serve emerging markets in a sustainable manner. Pharmaceutical giant Novo Nordisk recognized how epidemic diseases strain national health systems in markets where it operates. Together with Oxford University, the World Health Organization and Yale University, the pharmaceutical firm spearheaded an international healthcare campaign focused on improving diets and encouraging exercise to fight chronic diseases that it stands to profit from. Rather than giving drugs away, GlaxoSmithKline cut the cost of its products in its poorest markets by providing regulatory and technical support to establish production facilities with local third-party contractors. 

As the above cases demonstrate, CSR efforts in emerging markets can be executed in a profitable and sustainable manner. Firms seeking to improve their CSR programs in emerging markets can focus on improving the delivery of their products or services to make them more accessible, affordable and usable. In addition to discovering new business models, firms seeking to address local problems can engage in partnerships with experts who understand these environments and the needs of customers within them. Mutually beneficial strategic partnerships can also help multinational firms leverage partner core competencies to help gain access to local markets and support operations. When firms consider the impact of their activities from the vantage point of potential emerging market customers and governments, they are better positioned to discover new business models and capture new sources of revenues. 

Quantifiable Business Value required for Social Development in Emerging Markets

Increasingly, multinational corporations are required to justify business investments in developing countries as having benefits for local populations, and likewise, philanthropy departments are asked to demonstrate the business rationale for philanthropic programs. IDG news recently discussed how some corporations are managing to achieve this delicate balance better than others. Recognizing and quantifying a blended value for these types of investments is necessary as technology companies search for near- and long-term growth opportunities in lower-income markets around the world where infrastructure is weak and educational programs are limited. For years, technology companies have addressed these issues through philanthropic or corporate social responsibility projects. As developing countries become increasingly attractive consumer markets, however, social development initiatives married to the company’s core products and services are proving to be sound strategic business investments.

The shift from philanthropy to sustainable business investments, or “social innovation,” may be here to stay, according to Unilever’s Chief Executive Patrick Cescau. Recently, Cescau even suggests that corporate social responsibility (CSR) may, in fact, be dying out. By addressing socio-economic conditions with their products and services, companies are both identifying next-generation consumers and discovering novel, low-cost ways of using technology.

Business managers sometimes find resistance to focusing company resources on emerging-market business growth due to the challenge of quantifying the opportunities and benefits. Managers responsible for growth in emerging markets will gain greater traction internally by demonstrating the business value of social development initiatives. These investments must be measured on the basis of market size, financial opportunity and alignment with current business systems and goals. By applying business rigor to social development initiatives, companies can ensure their sustainability and ultimately maximize the benefit to the target markets.

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