January 14, 2014
Eight years ago, Martin Kristiseter founded mSnap, a company built on the concept of mobile marketing and advertising - which at the time, wasn't even on the radar of most radio operators. Since then, mSnap was snapped up by Marketron, which provided Kristiseter the resources and client base to ride the growing wave of mobile business. Now, with more people spending more time viewing their world through a smartphone, Marketron has become an essential portal for radio to mine advertising revenue. Here, Kristiseter explains how it works now - and how it can work even better in the future.
What were you doing before you joined Marketron?
I came to Marketron in 2010 when it bought the company I founded, mSnap. mSnap was the leading provider of mobile marketing and advertising solutions to the media industry; Marketron retained our team and it's been a great marriage. We're all very fortunate to be working with such talented colleagues and leadership team.
How was the digital mobile world when you started at mSnap? I imagine it was tough sledding at first.
It was painfully early to be a mobile marketing and advertising vendor. We founded the company in 2005; those were the early days of mobile marketing, when advertisers had just started to see some traction on how people could utilize mobile phones to better engage with marketers and publishers. Before that, there were interoptibility issues between carriers as well as high data costs for consumers for all things data. We were tracking the mobile adoption in Europe closely and it was just a matter of time before the U.S. would experience aggressive growth as well. We raised a round of financing from a couple of VCs (Partech International and First Round Capital) and built the platform that would allow publishers like Radio and TV to better engage and monetize their audiences through the mobile platform.
When you started at Marketron, were you already convinced of the growing importance of mobile?
I've always been bullish on mobile and what the new platform could do for consumers, marketers and publishers. The metrics weren't as obvious in 2005 when we founded mSnap as they are now, but you didn't have to be all that smart to see where things were heading. Handsets were getting more and more powerful and costs were coming down rapidly with the increase in competition.
Today, I think mobile is still incredibly under-hyped. Look at the transition we've made in the last 3three to four years in mobile. It's so radical and revolutionary -- and we will continue to see rapid growth. Give tablets another two to three years to get additional power and we'll see the laptop being phased out both at home and at work for all of us that aren't programmers or doing heavy design. I, personally, can't wait for that day so I can stop schlepping my heavy laptop around with a charger close by!
At Marketron, things changed for the better for us. The company enabled us to better grab the opportunity at hand. Marketron offers a much bigger platform and we have a great team and financial backers to continue to grow our business. We had 750 stations when we joined; today we're just shy of 3,000 stations, which is a scale that I didn't dream of when we started out. I'm fortunate to be working with so many brilliant colleagues - it's what sets us apart.
What are the major challenges currently facing successful mobile campaigns?
There are a few things that are critical in any mobile campaign. First off, deliver value. Customers assess the value of the campaign or ad by determining its usefulness and how much time it will take them along with how much they'll enjoy the experience, making the entertainment factor important. Before launching any campaign, companies must make sure they can identify the value they're delivering to consumers within the campaign or ad.
If you look at mobile advertising campaigns, you see the clients running advertisements that are very similar to campaigns in other media - because you've got to cover the basic goals. But our objective with any campaign is to look at the targets and figure out what's the best way to reach them strictly through mobile. That makes the campaign more effective; with mobile you can personalize your approach and take advantage of the high engagement levels that are critical - and readily available.
You have to look at the mobile platform as having its own set of functionality. For example, an audio spot on a radio station -- as well as the same one that's streaming -- reaches a lot more people at once, but the spot on mobile allows you to better target a specific audience. Say you really want to target women 25-30 in Los Angeles who are married, with kids, at a certain income level. Not only can you do that on mobile, but you can go after that target audience who live or are currently in specific locations. You even have the opportunity to use specifics that can pinpoint a person who lives or works within 100 feet of a specific location in the downtown area of a city. You can do lot more targeting than you can on traditional radio and TV outlets. That's why mobile is a great companion platform to traditional media campaigns.
Each medium has its strengths. A normal radio campaign usually gets a good ROI as it's relatively cheap for the scale you receive. Mobile can get at audiences of scale both locally and nationally, and although costs have dropped significantly, they're higher than radio. So in turn, advertisers are spending more cross-platform - not just radio and TV, but video and mobile -- to get their message to the right people on as many platforms as they frequent.
What kind of online games are popular on mobile campaigns?
Mobile games can be very effective for both the station and the user. Compare an SMS text-to-win campaign with a typical radio contest; with the latter, you have to be caller number so-and-so to win front-row tickets to an upcoming concert. So you go on-air with that and several listeners will call in at once - and many of them will either get busy signals or be put on hold for a long time. That's a crappy user experience. However if you offer those tickets to some lucky caller who texts "Jazz to 77000" ... that enables everyone to engage in the contest and be heard. They can easily and successfully engage once or 10 times a day -- if that's what you want -- and every single interaction becomes an opportunity to serve the advertising community of a specific station. The technology we now have definitely makes it a whole lot better for listeners to engage with a radio station than it was just a few years ago.
When you're looking at specific games, a mobile "scratch-and-win" instant win game is a way for radio stations to bring listeners a richer experience that can be sponsored by an advertiser. It's designed to look like you're scratching a ticket to win and for those who don't win, every single one of them gets a consolation prize at the advertiser's store. That drives traffic and revenue into that store. That's part of the reason why those kind of games appeal both to listeners and advertisers.
Have you created enough games and campaigns to ascertain what makes one game or campaign more successful than the others?
Looking at our metrics, we're doing over 20,000 mobile campaigns a month, so there isn't just one type of successful campaign or game. Almost 3,000 stations do an average of seven campaigns a month -- and some do significantly more than that. We offer industry leading experience to guide our clients to a successful mobile campaign, whether they do text-to-win, increase their mobile communities, drive traffic to their mobile website or to a specific location. Marketron provides ongoing communication and the technology to make a richer experience for stations and their listeners. All clients get access to our Idea Vault that stores successful mobile promotions to better share best practices and wins across our client roster.
How many promotions a month do you recommend your client stations do?
That's not up to us; it's up to the stations and what they feel is right for their audience and team. All we are doing is providing the technology to enable the stations to engage with their audiences through mobile.
Do your stations do multiple mobile contests at once, or is there a danger of burnout and/or the games losing their uniqueness?
Our stations do an average of two text-to-win campaigns per week. Including text SMS as a way to engage with the station will not cannibalize other entry points, whether it's online or call-in, but it will significantly increase the engagement levels and make it easier for the audience to interact
One key to making the contests successful, no matter how many you do, is to give the mobile community the first chance at the prize - for example, the concert tickets. I see stations doing very successful campaigns that way.
Is there a danger of the advertising on a mobile campaign being so pervasive that it would hamper listener engagement?
I'm not sure I have a great answer to that question. Remember, the listener originates all participation in contests. We're not pushing the advertising on them. So if a station is doing a text-to-win for backstage access at an upcoming concert, the sponsor is the same one sponsoring it with on-air commercials. Mobile is part of the leverage; not only does the client buy airtime, but they're also buying mobile impressions. The ability for listeners to interact with the mobile game is free; I don't see tagging a sponsor to the game as being an issue.
Even today, when it comes to online/digital, not all radio operators are convinced that there's enough ROI to justify the investment in online and mobile. How do you persuade them otherwise?
There will always be laggards in technology. Some of the larger broadcasters had the resources to get in early, while smaller operators were later to the game because they didn't have the funds to invest. But if you look at mobile today, you're going to have a very hard time convincing me or anyone that the mobile platform is a fad. Consumers are spending about 23% of their daily time on mobile phones. If you look at spending, we're currently doing about $7 billion in mobile ad revenue in the U.S. in 2013. What radio took 100 years to generate, mobile advertising will make within its first 10 years. So the money continues to flow into the mobile sector as we all are spending more and more time on our devices.
Take a look at the adoption of smartphones; we're already at 65% today. That number also has a lot to do with the fact that about 50% of the hits on local station websites are coming from mobile devices. The question shouldn't be "Why do it?" - rather, "How do we do it better?"
Do you feel you're just scratching the surface with Marketron's mobile's potential, or do you feel you have a pretty good overview of where the business will go and what potential it has?
As I mentioned earlier, we will continue to see a rapid migration from desktop and laptops to mobile devices. It's a dramatic change and we're only scratching the surface of the mobile opportunity. At Marketron, we continue to build a simple, easy-to-use web-based platform that makes it easier for our clients to run their business and drive revenue. Such solutions are platform agnostic and will be optimized to the device you are using, whether you're on a tablet, smartphone or desktop. It sounds simple, but it's not easy to do ... and our engineers, with Tony Gaughan in charge, are making this a reality for our clients.
For the audience engagement products that we offer, we continue to invest to provide best-in-class solutions that meet or exceed the needs of our clients. We expect messaging or SMS to continue to grow across our stations. We also expect the web-based traffic from mobile devices to grow rapidly, so offering a CMS that can provide an optimized environment for mobile devices is not a nice-to-have, it's a must-have that we provide to our clients. With all the increase in engagement across multiple platforms, we believe that reporting and analytics tools will become more important for our clients to better understand and monetize their audiences.
Lastly, what of the future? What kind of mobile projects - which haven't been tried yet -- do you see potentially happening in the future?
One of the major shifts I see is how media buying is being automated. It's a huge shift that we're already seeing for mobile, desktop and video inventory. I recently read an IPG report that predicted that 50% of all ad buys will be automated by 2016, not just in mobile and online, but across all media including TV and radio. Very few broadcasters are ready to take advantage of this shift in media buying today.