IAMAI MVAS Talk: Creating Magic with Mobile

Here is the text of the speech. The presentation to go with it is here.

What’s been the biggest revolution in retail in India?

It has NOT been hundreds of malls across India. The real revolution is what is in the hands of everyone – the interactive device. Every customer of every enterprise now has a mobile phone that CAN change how marketing is done.

[SLIDE 2]

There lies an opportunity – an opportunity to leverage the power of mobile phones to serve customers. Customers are, after all, the bedrock for an enterprise’s existence.

Let’s talk about how enterprises can leverage this power in two key areas – retaining their most important customers, and acquiring newer ones.

We did precisely that at Netcore. How did we build a successful platform, MyToday?

[SLIDE 3]

Since its inception, Netcore has been focused entirely around the potential of communications – via email and mobile. In the past two years, we have given SMS a second life – moving beyond P2P SMS, A2P SMS and Spam.

We used the power of PUSH and PERMISSION to build MyToday.

[SLIDE 4]

Here are some figures that will speak to how HUGE the potential is.

  • Our free SMS subscription service, MyToday Dailies, has grown to 3.7 million subscribers in less than 2 years – all via word-of-mouth.
  • We send 12 million SMS daily – accounting for 4% of India’s SMS traffic.
  • We continue to add thousands of new subscribers daily.

The daily SMS we send has become a habit for MILLIONS of people. The right-of-way we have because of that habit we created can now be monetised in various ways: from ads to leads, from paid channels to transactions.

How easy is it to subscribe to one of our 50 content-rich channels? Just send an SMS. It could not be easier.

What about on the enterprise side?

Great news: more than 120 companies have advertised on MyToday in the past year, with 40% of them running repeat campaigns. More than 100 enterprises use Netcore’s Enterprise Mobility services. Over a dozen use Invertising.

[SLIDE 5]

Let’s start with Customer Retention. Customers want to stay connected with the brands they like, the shops they visit, and the companies whose products they buy.

  • Imagine the mobile handset company sending an SMS a day for the first 30 days after you buy a phone telling you about a new feature on the phone you just bought.
  • Imagine your favourite bookstore telling you about the new titles that have come in and the special offers they have this weekend.
  • Imagine the multiplex you visit telling you about the availability of tickets for the weekend’s movies.
  • Imagine the toy store providing weekly customised recommendations after you’ve SMSed in the gender and date of your birth of your kid.

Are there companies that do that already? Yes of course!

[SLIDE 6]

  • FabIndia sends out multiple SMS every month to its subscriber base telling them about what’s new.
  • TimesNow uses Invertising to pull in people to their TV channel when news breaks – like when Abhinav Bindra won the Gold at the Olympics or when Benazir Bhutto was assassinated.
  • Meri Saheli, a women’s magazine publisher, complements its print cycle with daily messages on a variety of topics to a subset of the subscriber base that has opted in.
  • Western Railway is now publishing regular updates on its services and new trains and facilities they are coming up with.

How do they do that? Invertising.

What IS invertising?

[SLIDE 7]

Invertising is invited advertising. It is communication from a business or advertiser that is invited, instant and perceived as useful information for customers. It is built around PUSH and PERMISSION. The customer is in control and therefore happy to be given information that helps in their decisions.

There is no better channel to send this information than on SMS. There is no better way to do it than to give your customers the right to opt-in and opt-out. There is no better frequency than daily.

If you can take 20% of your customer base – the most profitable ones, who are also most vulnerable to competition — and you build a daily relationship with them for just Rs 2 per customer per month, doesn’t this change the dynamics and economics of your business?

That is how the magic of SMS can make a difference to a business.

Let’s move on to Customer Acquisition. How can we create and leverage Media on Mobile?

[SLIDE 8]

We had Nielsen survey 2,500 subscribers of MyToday. Here are some amazing statistics. The average age of the subscriber base is 25 years. 75% of the 3.7 million subscriber base is less than 30 years. 80% belong to SEC A and B.

Three-quarters of the subscribers read every SMS that they receive. For the vast majority, MyToday has become the primary source of receiving news and information.

[SLIDE 9]

40% of subscribers read all ads, and 30% of them have taken action on the ads that they have seen. No other medium comes close to generating awareness or response as SMS ads tagged to targeted content that subscribers want to read.

In short, MyToday has created Media on Mobile in India. And we have worked with over 120 advertisers in the past year to showcase what’s possible and deliver results.

[SLIDE 10]

SMS Ads can be branding ads, click-to-action ads (where the action can be an SMS, call or clicking on a URL), or sequenced to tell a continuing story over multiple days because of the predictability of message delivery on the SMS channel.

In an interesting ad format innovation, HUL’s PureIt and Colgate’s MaxFresh ran campaigns which invited people to subscribe to short SMS channels which reinforced the message they were communicating.

[SLIDE 11-12-13]

So, whether it is awareness (reaching millions) or generating responses (leads), I believe that there is no other medium which can have the same impact that SMS is going to have in the coming years in a mobile-centric market like India.

[SLIDE 14]

To summarise, whether it is helping enterprises build deep, lasting relationships with their existing customers via Invertising or helping them to acquire new customers cost-effectively by reinforcing their message and generating responses, SMS is the channel that today holds the greatest promise for enterprises. It can also be used to foster greater interaction among employees and provide the power of push mail on even the lowest-end handsets.

[SLIDE 15]

Mobile VAS companies should focus on this market to create new opportunities for themselves and make India the leader in mobile marketing and communications globally.

Invertising

I had written this note sometime ago as a backgrounder on Invertising (invited advertising). I think it is as relevant today as when I had written it. It is one of the anchor services in mobile marketing.

The fundamental paradigm shift that we see in the next few years is from ‘customer relationship management’ (CRM) being engaged by companies to ‘seller relationship management’ (SRM) being practiced by customers. Or, to put it in other words, it will be less about advertising, and more about invertising (invited advertising). The reason for this shift? Every customer will have with them (and its almost true even today) a two-way interactive device with access to any information needed at their fingertips. In India, this device will be the hand-held networked mobile computer (what we call the cellphone today) – and it will radically redefine the equation between vendors and customers. This note discusses how to start building for tomorrow’s world – which is in fact visible even today!

Let us think about marketing today. Companies advertise across multiple media to reach their target audience. Every time they have something new to tell their target segment, they re-advertise. Advertising is thus a continuous process. Media companies love this because they make money every time companies need to reach their audience. Some companies try and get past this by creating loyalty programmes and newsletters which they then send out regularly. Now, with an increasing number of users having mobiles, sending SMSes is another extension of the marketing campaign.

What is wrong with this picture?

First, the whole process of discovery and re-discovery. Existing media companies have little or no incentive to enable the creation of a relationship between the customer and the vendor – because that threatens their role as an intermediary. They want the customer to be ‘discovered’ via their media vehicle – each time.

Second, the lack of knowledge of what marketing works. In today’s media campaigns, it is not easy to track the actual impact on sales (or even customer footfall in the store). Internet-based campaigns do enable tracking – but that only works for online stores.

Third, the lack of an emotional connection. It has been said that marketing is a conversation with the customer. But hardly anyone seems to be doing this. There is no bond being created. The question a brand must ask: how can I become a daily utility in the life of my customers?

Fourth, there is no easy way for the customer to convert advertising that is seen into information that he wants. There are many occasions when customers want to stay updated on specific things, but businesses have no easy of providing them that info. Newsletters can be done, but they are not personalised – and do not necessarily guarantee anonymity from the customer’s viewpoint.

Fifth, it does not take into account that pretty much everyone capable of buying has a mobile phone. Our estimate is that 80-90% of customers today are likely to carry a mobile phone. The mobile is a two-way interaction device, but companies are not using this appropriately.

Finally, the customer can be a champion, and facilitate viral marketing. The customer can be a connector – sharing things that are useful with others in the social network. This is because all of a customer’s contacts are accessible near instantly via the mobile phone’s contact book.

It is clear that marketing and business-to-customer interactions are likely to undergo a sea change in the coming years. In the developed world, perhaps the most important change in the past few years has been brought about by the Internet and pay-per-click (pay for performance) advertising. This advertising is contextual – either linked to search or the content on a page. In the UK, 12% of advertising spend is now being done online (the PC Web). In India, the same is unlikely to happen for two primary reasons: the computer penetration is still quite low (coupled with limited connectivity options), and the rapidity of innovation is making the mobile as the primary access device for people. Thus in India, the levers for shifts in marketing are likely to be centred around the mobile.

As we look ahead and address the limitations of today’s marketing methods, the mobile will emerge as the fulcrum for the new options. Companies which recognise and adopt mobile marketing are likely to see significant early benefits – and lock their competitors out in the customer attention game. Tomorrow’s world of mobile marketing is going to be built around three tenets:

  • Publish-Subscribe: Companies will publish and continuously update various information streams (think of them as ‘feeds’). Customers can subscribe to any of these streams and then receive updates as soon as new items are published on the feeds. Customers can also stop subscriptions to the feeds anytime. Publish-subscribe ensures a spam-free world for customers.
  • Multi-Modal Viewing: Customers can chose to view the content in any manner – via SMS, email, voice, desktop browser or mobile browser. The experience is seamless.
  • Instant Sharing: Customers can themselves become publishers, choosing to share what they have received with their social networks.

Taken together, the three will create the platform for seller  relationship management (SRM) and invertising. As Doc Searls, who calls it VRM (for vendor relationship management), puts it: “It’s something new. Rather than advertise, we notify. We assert. We express…VRM isn’t just about conversation. It’s about relationships. And transactions.” Invertising is how this happens. Invertising is advertising customers invite into their lives. It is how customers advertise their intent. It is what customers get instantly. Here is an excerpt from an article in MediaPost:

THE LATIN ROOT OF “ADVERTISE”–ADVERTERE–LITERALLY means “to turn towards.” It is the same root for the word “adversary.” This sense of confrontation at the essence of advertising may be what undergoes the most radical change in the next decade of marketing sponsorship. Contrary to popular wisdom, consumers do not hate advertising per se. People continue to buy through catalogs that arrive in their mailboxes; search advertising is booming because people click ads targeted to their queries; and we can all hum a dozen favorite TV jingles.

Yet, in this world of hyper-fragmented media and too many marketing messages, consumers are acting to avoid the overload, paying for the unadulterated media they want, and investing in technology to strip out unwanted ads. With the skyrocketing popularity of blogging and TiVo, iPods, NetFlix, and peer-to-peer networks, consumers are starting to expect more control over their entire media experience, a phenomenon at odds with interruptive advertising.

Procter & Gamble Chief Marketing Officer Jim Stengel told the audience at the American Association of Advertising Agencies’ media conference last year: “All marketing should be permission marketing. All marketing should be so appealing that consumers want us in their lives.”

“Permission marketing” may not be the best phrase to describe the new era of marketing that is already beginning to take shape. “Service marketing” may be closer to the idea.

With mobiles now and using a publish-subscribe platform, there is a simple way to bring this new world of SRM and Invertising to life – now.