One of the most interesting new business models to be announced at the MMA Forum this week was OutThere Media’s Tomato Plus, launched in conjunction with mobile operator, Vip Croatia.
OutThere is run by my pals Alexandra Deutsch and Kerstin Trikalitis and it’s great to see women leading the way in mobile. The core of their business is a mobile advertising platform that enables marketing for mobile operators, mainly in South-East Europe, so far. Currently the platform serves 100 million subscribers across 9 markets, which is a real achievement.
One of the features the platform delivers is an off-the-shelf Blyk - in other words, an ad-funded sub-brand for operators. The first operator is Vip Croatia, with their Tomato Plus tariff, offers 50 voice mins and 50 texts a month free, in return for getting (up to) 10 ads per day. They did say though that they felt the maximum tolerance for receiving ads was 5 or 6 per day and even this seems high to me if pushed via sms. In fairness though, if the ad is genuinely adding value in some way, and thus appreciated by the recipient, 10 seems a very reasonable limit.
Like Blyk, Tomato Plus is targeted to younger subscriber base and has pretty impressive first results.
I think a lot of carriers will be looking to explore a Blyk type model, especially as the economy has crashed, so this is a nice business potentially. While Blyk have a huge amount of learning to add value to their product, on the face of it, OutThere do offer operators a very easy way of defending their market if they feel vulnerable to a new threat. Moreover, operators have the advantage of being able to cross-sell to their existing subscriber base, who they feel might be tempted away. Blyk, on the other hand, have to build a subscriber base from the ground-up against a local competitor who almost certainly has more cash too.
The one issue that both Blyk and YABROs (Yet Another Blyk Rip Off) have though is market education of potential advertisers. This type of marketing calls for a radical rethink in the standard way of marketing, meaning prioritising targeting over reach and replacing preaching with dialogue. This may well be visionary and the right way to go long term, but in my opinion the industry really isn’t ready to make this step. It’s hard enough to get them to use mobile marketing in the first place, let alone use it in a way that’s new, uncomfortable and unproven.
It’s great to be a visionary. But the trick is to visioneer just as the market is ready to be persuaded. Tf you’re too early with your message, you’ll be wandering for years in the wilderness, only to see some Johnny Come Lately eventually run away with the congregation.
Anyway, good luck to Blyk and Out There Media. We’re all going to need some luck in these turbulent times, because it’s going to get very bad out there, my friends.
Luck will most certainly be needed - especially when mobile is seen to be an engagement based, fully accountable, permission enhanced dialogue medium as opposed to a reach and frequency, impression based version of the online world.
Matching vision to market readiness will purely create vision that matches the market.
Innovation and disruption fly in the face of this and the wilderness can be your friend if the status quo is less than ideal.
Blyk is an intriguing model. But a new start-up, launched in the U.S. just a few days ago, puts a fresh twist on the compensate-the-consumer-for-receiving-ads model — one that puts even more control in the hand of the consumer.
It’s called Sayso — the world’s first mobile marketing marketplace.
Instead of paying mobile phone owners with minutes, Sayso pays them cash. And because everyone places a different value on their time and attention, Sayso lets subscribers decide how much they’re paid for each message received.
Subscribers complete a short profile and set the price they need to be paid. Then marketers build a targeted list based on demographics, geography and the maximum price they’re will to pay to deliver a message to an individual. Messages are then delivered to everyone who is a match.
Learn more at >> http://www.saysomobile.com
Drew
Sayso.
3 points.
1. What do you say to an advertiser when they ask you whether or not people are engaging in a campaign to earn money or because they love the campaign? After a year of conversations with advertisers about this, I concluded that this question instantly de-values the relationship and advertisers feel like people are simply putting up with campaigns to get paid.
2. As rewards depend on your price and your profile desirability, I expect people to soon figure out the optimum price and the optimum preferences to ensure highest revenue - notably which cannot exceed $49.99
3. Some will be paying to receive the messages from advertisers as their contract may be set like that. The advice that Sayso will give is that you should then counteract this with an increase in your price. However, in accordance to point 2, this may push above what the subscribers work out to be the optimum price so those who are paying for receiving ads will essentially lose out.
—
I am honored to have been part of what has set all this off as frankly I prefer business models that place the power into the hands of citizens.
Believe me though - setting up something that WORKS took such a considerable amount of research and testing that I am not sure many copy-cats realise the finely tuned aligorithms behind what appears to be a simple service.
Its like these companies are ‘live testing’ what will work…..which is great…..but it also means that almost as many that open will close.
I hope the collateral damage on user experience doesn’t blow trust in these services.
I hope that competition will build the market and eventually, FINALLY, bigger networks will realise whats going on.
Or not…
Well Drew, good luck with YOUR NEW COMPANY (it’s normal to declare an interest in these circumstances, but it looks like I’m going to have to do this for you).
This model has been tried many times online, as well as in mobile (first time in 2000) and every time it’s failed. What makes you think SaySo is going to be different? It’s a serious question.
Russell
As a point of interest - Verizon Wireless this week told companies that send out text messages that starting Nov. 1 it will impose a fee of 3 cents for each message it delivers to the phones of its subscribers. The plan prompted waves of protest among many of companies that use text messages.
jmac — Thank you for your thoughts and questions. Let me address your three points.
1. You’re absolutely right. Some value is lost when you compare a Sayso subscriber to someone that is on an advertiser’s “house list.” What Sayso, and other companies who follow some form of this model, are offering is a way to rent a targeted, permission-ready list. We feel that both house-list and purchased-list models will eventually take hold (just as they have in other areas of direct marketing). However, these are the advantages that a Sayso-style model offers…
First, advertisers can be up and running with a significant list quickly and without investing dollars and time in building a list. Second, house lists are made up of loyal customers — individuals the advertiser already has a relationship with. A very valuable audience, to be sure. But that model will never allow advertisers to directly target new customers because without an existing relationship those customers won’t opt-in. Third, our model allows for targeting — something that is vital to effective direct marketing. On the other hand, most advertisers who have built “house lists” know little about the individuals who have opted-in.
2. We expect, in fact we even plan to help, our subscribers set an “optimum price” based on past data. However, we don’t expect profile fraud to be a significant issue. That will so hurt the relevancy of the messages subscribers receive (and the value proposition is relevant ads + payment) that we believe most subscribers will avoid it.
3. Obviously subscribers paying to receive texts is an issue. And you’re right, adjusting your price is the only way to deal with it right now. However, we expect unlimited text plans (or even unlimited everything plans) to become commonplace in the near future.
Thanks for your thoughts. Hope I was able to address them.
Well Drew - as someone who was in the original team that built Blyk, I hope you did your research with real people.
Thanks also for pointing out the benefit of targeting in direct marketing
From painful experience I can attest to seeing ideas that seem perfectly reasonable being taken in an entirely different direction when in public.
Without wanting to speculate any further I would just say that if the cash benefit is directly based on profile type, it is feasible that profile type will be adjusted to maximise cash benefit.
I hope it all works out for you and I will join many others who will watch with anticipation.
Russell — Thank for the well wishes. My sincere apologies if I didn’t make it clear that I’m a partner in Sayso.
In response to your question, we believe the thing that sets Sayso apart is that we allow subscribers to say, “this is how much my time and attention are worth.” And then we turn around and allow advertisers to say, “This is how much I’m willing to spend to push my message out.” (This is similar to what Ad Brite is doing successfully in the online ad space.)
We believe the marketplace concept, rather than dictating to both the subscriber and the advertiser what their time/message is worth, represents a fundamental difference between Sayso and other “paidvertising” models.
We believe that advertising has value to marketers and consumers when done right and with consideration for the audience’s time and attention. We hope that Sayso will restore that ideal in a way that benefits everyone.
[...] Obviously I cannot comment on calling a mobile network such a weird name (ha!) but click here for Mr Buckley’s post about the ‘Blyk-like’ network. [...]
Thanks, jMac! I’m certain it will be a wild, interesting, educational and occasionally-bumpy ride. But that’s what makes it so worthwhile.
[...] is also an interesting debate around the Tomato Plus concept over at [...]
Hi gang.
Great original posting, Russell, thanks. I blogged about it and posted at Forum Oxford.
But even more interesting discussion here at the thread, thank JMac and Drew.
Drew - from my point as well, my gut says, this has been tried a million times to lack of success. But also - in full honesty - I said so of Blyk at its first announcement as well (along the lines of “what in the world are these famous Finns doing now in this hopeless swamp, as in Pekka Ala-Pietila former President of Nokia, Antti Ohrling the famed advertising man of Finland and Marko Ahtisaari the famed son of Martti - who just now won the Nobel Peace prize a few days ago). And look how wrong I was when people like Jonathan got involved with the Blyk concept and made it work.
We will watch Sayso and I wish it the very best of luck. If you do find it makes a success out of its business model, do come hop over also to my blog at http://www.communities-dominate.com and I’ll happily blog about it. We do need successful innovation in our industry.
But I’ll be honest with you, I am a bit skeptical; you might want to tweak your model into something that is more likely to succeed in the mobile data space, we do have a 200 billion dollar industry on our hands this year, there are tons of business ideas that are making oodles of cash to their owners ha-ha..
Tomi Ahonen
http://www.tomiahonen.com
[...] In the meantime, you may want to check out this related discussion at MobHappy. [...]