Perspectives from BrazilMinutrade Case

Daniel R. Costa

Co-Founder

MobX / Minutrade

Corporate Sponsors

Media & Association Sponsors

Brazilian Economy

Population: 189 million – fifth largest in the world

Brazil: Investment Grade country (Stand and Poor’s and Fitch Ratings)

GDP growth - total 1,551 USD trillion / the eighth in the world / 5.4% growth over

2006 figures

Increase in M&A

Status of external debt (foreign currency credits outweigh foreign debt)

Stable economy (system of inflation targets, primary surpluses of public

accounts, and the floating exchange rate)

Consumer spending boom – growth of 6.5% over 2006, more than the GDP

growth

Class C growth (in the last two years, more than 20 million Brazilians migrated

from classes D and E to Class C)

About Mobile Market

About Mobile Market

Digital TV / Triple / Four play

Number portability

27 million SMS daily, against 28 million connections by Post

3x more mobile phone users than Internet users

1,656 new acquisitions per hour in Brazil

180% increase in web portals

access via mobile (August to December 2007)

About Mobile Market"Brazil and Mexico represent the largest

opportunities in the Latam mobile market"

"'BRIC' countries, will have an estimated 645m new

subscribers – 42% of the world total"

"A recent study of wireless subscribers across the

'BRIC' countries showed that Brazilians are the most

interest in using wireless data services"

BRIC – Brazil, Russia, India and China

Sources: Pyramid Research

Mobile Marketing and Media Market

Mobile Marketing and Media Market

Operator: provides and controls the Environment

Lack of a well-defined policy

Operators: different levels of understanding and priorities

Advertisers: planning to market via mobile phones

Media Market budget in 2007: USD 15.76 billion

Trend: money migrating to new media

Budget for Internet media in 2007 was 2 times as high as in 2006

Budget of billboard media fell 16.33%

Launch of MMA in LATAM, operators, agencies, and advertisers together

for sustainable growth of the market

Minutrade is a solution for the acquisition, management, and

distribution of mobile minutes and messages through

incentive and reward programs.

Every expenditure may generate mobile minutes;

Immediate value/discount perception

Easy opt-in generation; open channel for new relationship

with consumer;

Measurable results

Zero logistic costs compared to traditional loyalty programs

product rewards

Win-win situation for the entire value chain

Own platform, easy to be integrated using few operator

resources

Minutrade

Product Assumptions

Product Assumptions

127 million mobile phones

Low ARPU and large prepaid base

Average minimum salary is approximately USD 290/month

Class C reached more than a quarter of the consumption capacity in the

country (the largest share in the social pyramid)

Mobile spending exceeds 30% of a person’s expenditures (mainly classes C, D,

and youth)

Airline Company and Credit Card loyalty plans offer miles/free tickets….

Value perception of mobile minutes is huge (one prepaid minute can cost over

USD 60 cents!)

Minutrade promotional video

Inserir vídeo

E x a m p le : D r in k a n d W in ! P r o m o t io n

A n o t h e r e x a m p le : M in u t r a d e ’ C a r d ( s in g le a n d c o - b r a n d in g )

A n o t h e r e x a m p le : lo y a lt y p r o g r a m s p r o d u c t r e w a r d s

Rewarding the ENTIRE Value Chain

Consumer – Enhanced consumer experience,

instant and tangible discount perception, “Mobile

inclusion”;

Brand – Brand awareness; new media and

relationship channel;

Publicity Agency/Minutrade – New and

innovativing marketing tool, broker fees;

Operator – New revenue stream (access to

new budget sources, such as credit card

rewards – 2007 budget exceeded 200 MUSD)