The 7 Message Trick

French company Key2Cell is preparing to launch its integrated technology platform in Europe in the autumn. The platform will enable advertisers to execute viable advertising campaigns using the mobile channel. The company says the platform can send hundreds of thousands of messages in one hit and can dynamically handle the needs of different devices among the recipient base, serving different ad formats, from SMS at one extreme, to streaming video at the other. David Murphy caught up with CEO Bruno Saint-Cast to find out more

DM: So Bruno, tell us about Key2Cell

BSC: The history of the company is that the technology was brought to me two years ago by Dominique Chouchana and Eva Benhamou. They took a thesis from the University of Tel Aviv relating to the profiling of a mobile handset or number in terms of its ability to receive different types of message, and turned this into hard code. It can vary depending on the network you’re on, the technology and the operating systems on the cellphone and various other factors.
We spent some money bringing the technology to a point where we have patent pending, due by early September. We have to be a little elusive about the core technology, but using the technology, we know, with a minimum accuracy of 70%, what the best message a phone number can receive is at any given moment.
So we stepped back and looked at the market and at various studies, including one from Cap Gemini which concludes that the market for advertising on mobile phones is huge, somewhere between $5-10 billion (£2.4 - £4.8 billion), in terms of how much money companies are ready to spend on it. But when you look at what is spent today, it’s only $250 million, and the gap is explained by a technology blocker. This is the fact that there are a lot of different formats and standards which are exclusive from one another. If your handset can only receive basic MMS, for example, there’s no way you can receive a video message, so you have to make a choice between sending a rich message that can only be opened by 30% max of the installed base, or sending an SMS which will be readable by everybody. And of course advertisers want to deliver the richest content they can to any given handset. 
Now the analysts say that advertising on mobile phones will not be feasible until 3G represents 70% of the installed base, which is not due to happen before 2010 in France and the end of 2009 in the UK. We do not believe 3G will solve all the problems, because companies like Motorola and Nokia will always bring new formats to market to differentiate themselves. The mobile industry is very competitive, so operators and handset makers will always develop new formats and ways to deliver messages. In any event, we offer an opportunity to successfully push messages out to mobiles right now, because we can identify the message which can be received by every handset and we can do this on vast numbers of phones.

DM: What percentage of phones can you handle?

BSC: All of them. Our technology is totally handset agnostic.

DM: So how does the technology platform work?

BSC: When we are creating a campaign, we have seven “launch fields” and in each one we put a different message format which we designed into the studio, and then we profile the database and in front of every number we say which of the seven message formats is the best fit. It takes just a few minutes to profile hundreds of thousands of handsets, and identify the message format that each should receive. These message types range from SMS at one end of the spectrum to what we call ‘MMS4’ which is a long video, at the other.

DM: So talk us through how a campaign would run in terms of the message format selection for each handset and the accuracy of the profiling.

BSC: So there are seven different messages. Each handset receives the one that corresponds to the richest message format that a particular handset can receive. So let’s assume a worst case scenario where we only achieve a 70% success rate. That means that 30% of the handsets do not receive the most appropriate message format for that handset on that network etc.
Now if you look at this 30%, half represents messages that could have been richer. The other 15% represents people who get a video but who can only receive SMS. This is obviously not ideal, but this is only for the first send. Once we get the error message we can send another message, because the interpretation of the error message increases our ability to profile the handset and so do a secondary send, which then reduces the percentage of errors to below 10%.
We have also decided to pool the information we have on numbers, because the more we profile a number the more accurate we are, so we decided to pool the numbers, so that if the same number receives a marketing message from two companies, each one will benefit from the profiling that has been done before. But we do not keep personal customer profiles on our database, nor do we have any means to obtain this. We retain only details that pertain specifically to the capabilities of the phone. 

DM: And where do the mobile numbers come from in the first place?

BSC: These are opted-in mobile numbers. Most large companies have an opted-in database where the customer has given their email address and mobile phone number, and their permission for it to be used for marketing.

DM: Really? I was under the impression that companies don’t have as many opted-in email addresses as they would like and are even further behind on mobile numbers?

BSC: Yes, some of them might be missing but a lot of large companies do have decent mobile databases, even if they are not as large as the email databases in existence. So as a means to protect these assets and to protect the end-user, we decided to add ethical or quality level controls to our technology. We ask client companies to provide proof that the number provided to us for the campaign has been obtained via a proper opt-in process. We also bring the guarantee of the optout, so that if the customer receives an MMS and says that he does not want to receive any further messages and they opt out, we do not leave it to the publisher to action this. We take care of it.
The third point is that we only deal in respectable content; there’s nothing shocking for the kids or anyone else. The fourth thing, which I believe is the most important, is the idea of adding value. We want the message to create value for  the person who receives it. It’s not about copying and pasting a TV ad on to the cellphone, we would refuse to do that. We want real value to be brought to the customer so that they will want to receive these messages.
For example, PMU is a French bookmaker that takes bets on horse-racing. Their first idea was that they have a nice TV ad that they could send to the phone, but we came up with the idea of sending video of the finish of a horse race to consumers who place bets on their phone. Combine this with an invitation to bet on the next race, we believe that we are delivering something of value to the customer. 
With a company like Renault, the idea would be to give the customer a video of the start or finish of a Formula 1 Grand Prix on their phone, because again, that brings value. You need to create something for the mobile phone which is consistent with what it represents for the owner of the number and the handset. It’s a totally different relationship than email, much more personal. It cannot be intrusive. We not only want the receiver to tolerate marketing messages, we are creating an environment where consumers will look forward to receiving them and feel privileged to be on a given distribution list.

DM: So are these trial campaigns that you have run?

BSC: No, just ideas. We decided when we set up the company to have discussions with some of the big players with no commercial agenda, just to listen to their opinions and find out the right way to do things. We believe it is likely to come to something, but it hasn’t yet.

DM: So when are you launching?

BSC: We launched in the UK on 12 July when our website went live .We can also demonstrate the technology under NDA until patents are registered. The information on our website is aimed at our community, at whoever would be interested to see how it works. From the beginning of September, we will offer online training on the global system, but our profiling engine will not be fully operational until mid-October, because we need to do more fine-tuning. So that’s when we will be fully operational and able to run broadcast campaigns. But before that, the studio will be available to design campaigns, to test against the seven different formats, to provide quotations, and simulate the broadcasts of ads as part of the campaign management system. We are projecting to handle 60 campaigns between October 2007 and December 2008, and we believe we will send at least 12 million messages in these first 15 months.

DM: And which countries are you launching in?

BSC: We plan to go live in the UK and France to start with, but nothing prevents us from launching in any GSM environment, so we are looking at the whole of Europe in due course, and we will launch in the US in January or February 2008.

DM: And how much does it all cost for advertisers?

BSC: The training, online support and the use of our studio to design campaigns and do simulations and get quotes is all free. The client only pays the cost per message sent which after profiling and optimisation will be roughly double the normal market price.  But of course it’s the effectiveness of the messages that are delivered that is the real take-away for advertisers.

DM: So how does a campaign work in practice?

BSC: After we have scanned and profiled the database, we tell the client the total number of handsets that correspond to each message type so you get the total cost to send it to everyone. But before you press the button to go live with the campaign, you can make a decision to say that maybe you don’t want to include the most basic SMS messages. Or maybe it’s that video streaming would cost you too much, so you will just send a video SMS. It’s a decision tool and it can be recalculated at any time, so you always get a number you are going to broadcast to, and we can then give an evaluation of our commitment in terms of our success in delivering the right message format to each of those numbers. The only thing you cannot do is send messages that are too rich to a handset with lesser capabilities.
So we tell the client that if we drop this format or that format, we will achieve a success rate of around 76% in the delivery of the messages. Then when the client has made their decision and pressed the launch button, we get the money, send the messages and then we can measure the success of the campaign, and if the success rate is lower than we quoted for, we pay the difference.

DM: And from the conversations you have had with prospective clients, what do you expect will be the typical size of a campaign?

BSC: It doesn’t just come down to our own experience. The analysts say that the average campaign will be 400,000 numbers. We disagree slightly with this. We agree that the initial database you work with will be roughly half a million, but after profiling, we believe that a lot of our customers will say they don’t want to send it to all the database. They will put the cut-off above MMS1 or MMS2, because these formats do not carry the right image for their brand or whatever, so on average we believe the average campaign will be around 250-300,000 numbers.

DM: And what about those consumers who gave their mobile number to a company and opted in to receive marketing messages from them some time ago, but have since forgotten they ever consented to it? How do you deal with that scenario?

BSC: On a purely legal point, there are more companies who have a real opted-in database on mobile than realise it. So legally, they can send this information to these people. But this is why we want to bring quality, we want consumers to be pleased to receive these advertising messages. But also, as part of our service, we make it compulsory for consumers to be able to opt out. When the first advertising message arrives on their phone, it could be a surprise, but we want it to be a good one. One of the companies we have spoken to is Warner Bros. Now imagine as a consumer you gave them your mobile number and that you are a big fan of Bruce Willis and they send you a preview of a future Bruce Willis movie. You will be very happy to receive that and share it with friends.

Comments

[Bruno Saint-Cast CEO of Key2Cell]

This piece is one of the most accurate piece of editorial discribing our technology. From the time of this interview, we had to postpone our official launch to the end of september as our patent advisors were 100% busy at defending a huge case at Bruxelles for one of their customers.
They strongly forbid us to put our technology on line before proper patenting.
The main difference for the end user will be that the first generation platform will be much more mature than the one which was rady, back in July.
Key2Cell apologizes to those in the advertizing community who had planned to take advantage of the summer break to get trained on this exciting new technology.