Middle East & Africa Application to Person (A2P) Messaging Market Research Report: Forecast (2023-2028)

Market Definition

Application to Person (A2P) is a type of SMS service often utilized for notifications, reminders, and other communication between an application and a person. It provides two-way communication between the application and the consumer by allowing two-way communication with the application consumer while simultaneously allowing interactions with another consumer or user.

Market Insights & Analysis: The Middle East & Africa Application to Person (A2P) Messaging Market (2023-28)

The Middle East & Africa Application to Person (A2P) Messaging Market is projected to grow at a CAGR of around 4.2% during the forecast period, i.e., 2023-28. The market growth is favorably fostered by enterprises’ commercial and business requirements to connect with their consumers and bring in new consumers by propagating their business through messaging. Besides, as the region is expected to witness increasing urbanization & spreading development in numerous sectors, the demand for a direct connection between businesses & consumers through A2P messaging is bound to rise, moving the industrial ascension.

The rising number of cybersecurity incidents has also accelerated demand for a safe, secure, advanced customer communication management solution. With the flourishment of new businesses and enterprises in the Middle East & Africa with burgeoning modernization and fruitful business opportunities, the need for a digital medium to reach and promote one’s business is fueling the integration of A2P messaging services, enhancing the Middle East & Africa Application to Person (A2P) Messaging Market size. The prominent adoption of Customer Relationship Management (CRM) systems is further enhancing the market. For instance,

• In March 2023, Mitto, a leading omnichannel communications solution, announced integration with Shopify to enable A2P messaging for services such as abandoned cart reminders.

Market Dynamics

Key Driver: Spreading Digitalization & Increasing Mobile Subscriptions

The rapid adoption of digitalization resulting in an increasing number of mobile subscriptions, facilitates communication through A2P messaging systems driving the industry. With increased accessibility to smartphones, the availability of cheaper options, and the shift of consumers to communication through the Internet, the adoption of emerging technology is extending the enhancement of the market. Additionally, increasing mobile phone users facilitates communication between enterprises, businesses, application developers, and consumers, efficiently adding to the market value.

Moreover, the addition of improved features for consumers, such as notification of new offers, alerts, easy verifications, and promotional messages, further strengthens the dependency on such messaging and communication systems fueling the industrial expansion.

Possible Restraint: Lack of Compatible & Equipped Telecom Structure in Developing Regions

For the upgradation of the communication system and further integration of advanced messaging systems, there is a need for a compatible telecommunication infrastructure. The lack of such equipped and compatible telecom structure could hinder market expansion, especially in developing regions. Although some of the telecom operators are refurbishing the existing system, the delivery of it is relatively expensive and complicated, delaying the installation and arrival of advanced A2P services and creating obstacles in the path of market enhancement. Furthermore, since the reach of the modification of the infrastructure to the rural areas would rather be slower, thus the businesses and enterprises would face difficulty in reaching the potential consumer base in the respective region, hindering the market amplification.

Growth Opportunity: Scope for Business Promotions Through the Integration of RCS

RCS or Rich Communication Services are standard international protocols in telecommunication that enhance and improve the messaging experience for the receiver, just like over-the-top messaging platforms, including WhatsApp and Telegram, as RCS would garner extra attention from consumers towards businesses and have the potential to become a conventional digital channel by adding digitalization to Application to Person messaging, opening lucrative opportunities for the industry. Furthermore, the burgeoning penetration of smartphones and digitalization further supports the integration of RCS into the marketing strategies of numerous enterprises, especially commercial banks, opening new avenues for the market. For instance,

• In April 2023, Infobip announced their plans to work towards bringing Rich Communication Services (RCS) to enhance P2P and Application-to-Person (A2P) messaging space, hoping to get extra income to commercial banks and to provide a solution for mobile network operators (MNOs).

Key Trend: Elevated Adoption of A2P Services by Small & Medium Enterprises (SMEs)

The burgeoning adoption of numerous marketing strategies and services, including Application to People messaging services by a big pool of small and medium enterprises in the Middle East and African region to propagate their business and bring in new customers, is adding to the market value. Moreover, the requirement for instant and reliable communication among companies and especially between customers and SMEs to facilitate cost-effectiveness, broad reach, and easy integration with other applications is extending industrial amplification.

Furthermore, the extended adoption of A2P services for promoting businesses and handling customer relationship management (CRM), promotions, maintaining customer engagement, interaction, and other applications are positively impacting the industry.

Market Segmentation

Based on Application

• Authentication Services
• Promotional and Marketing Services
• Customer Relationship Management Services
• Pushed Content Services
• Interactive Messages
• Others

Among all the above, Customer Relationship Management Services (CRM) are projected to experience the fastest growth during the forecast period. It is attributed to the growing need for two-way communication between businesses or enterprises and their consumers for efficient customer services. Besides, with the spreading of digitalization, numerous countries in the region rely more on their digital devices like smartphones for maintaining relationships, purchasing, and checking businesses before interacting, thus opening lucrative growth avenues for the market.

Additionally, Promotional and Marketing Services are also expected to secure significant market share during the forecasting years, aided by the dire need to keep up with ever-advancing promotional strategies among businesses and intense competition between enterprises. Moreover, the profiting impact of successful promotional and marketing strategy in bringing more consumer and attention to the businesses further compel them to use Application to Person messaging to propagate their services.

Moreover, with the rising number of new applications and a surging number of consumers signing up for these varying apps, the Authentication Services segment is also projected to acquire considerable market share, aided by the high number of logging in and registering messages.

Based on End Users

• Banking, Financial Services, and Insurance
• Retail and eCommerce
• Hyperlocal Businesses
• Healthcare
• Travel and Hospitality
• Others

Here, the Banking, Financial Services, and Insurance segment is anticipated to experience the fastest market acceleration in the forecast period. It is aided by the growing economies experiencing a hike in disposable income with a rise in living standards leading to new subscriptions and applications to the banking industry. Furthermore, as A2P creates new marketing and interactive opportunities for the sector by propagating message exchange between the bank and the new consumers, it raises the demands for A2P messaging services for authentication, verification, and other related reasons. Moreover, the requirement for the BSFI segment to interact and engage more with their consumers is adding to the industrial acceleration.

Since the messaging applications allow the bank to send transaction details, consumer activities, warning about unethical trials of access to consumer accounts, and more, the service helps establish a trustful and fruitful strong bond between the service providers and the consumers, extending market ascension. Likewise, the surging use of online banking services and other options provided online adds to the requirement for authentications through SMS, increasing the industrial expansion.

Recent Developments in the Market

• In April 2023, Route Mobile, a top CPaaS provider for enterprises, OTT players, and mobile network operators, launched Route Guard. This Blockchain-based AI & ML solution aims to prevent spamming & phishing attacks.
• In March 2023, KORE Group Holdings announced the agreement to acquire Twilio’s IoT business unit to provide consumers with unified and seamless IoT solutions.

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