Jonathan MacDonald, Blyk’s sales director, got in touch after my post a few weeks back questioning some numbers he’d presented at an event. Jonathan got in touch offering some clarification and further details about Blyk’s performance.
Blyk sends its members up to 6 communications a day. These can take the form of SMS or MMS, and can consist of a cast (a one-time message), or a dialogue (a set of messages back and forth with the member, at the advertiser’s expense). Blyk charges advertisers 5p per SMS, and 20p per MMS — so obviously the CPM is much, much higher than most online ads. But Blyk says its gets a much higher response rate than online ads (or most other types of advertising, for that matter). It cites a report saying that the average response rate for online ads are 0.02%; Blyk says its response/clickthrough rates from the first six weeks of its operation ranged from 12-43%. The tradeoff seems clear: fewer impressions, but a much better response, resulting in a lower cost per response. In addition, Blyk can offer advertisers a good bit of tracking and accountability to their advertising, as well as a deal of recipient targeting and profiling.
Those are pretty impressive clickthrough stats, and they were missing from from the original story. Also, if you work out the potential ARPU with six ad comms a day, it can rise pretty quickly if MMS can get worked into the mix. Of course, they’re only sending 1 or 2 per day at this point, though Jonathan says they’ll scale that up, along with their number of users.
The key for Blyk is maintaining that high response rate. It’s easy to chalk it up to users’ initial curiosity about this new ad format, but based the much higher CTR I get here on MobHappy from AdMob ads on the mobile version of the site than from the Google ads on the web version, I don’t think that’s solely the case. I think Blyk understands this, and realizes that they can’t be seen as spamming their users with poorly targeted and poorly constructed ads with little to offer users. They’re not selling ads solely on impressions, so the goal isn’t solely to gain as many subs as quickly as possible to create space for impressions.
Blyk does face a real challenge, particularly if operators leap in with more ad-supported services of their own and begin chasing the same market. But their numbers do look more promising than they seemed a few weeks back.
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