Waterfall Guy

David Murphy talks to Matt Silk, Co-founder and Executive Vice President of Waterfall Mobile

DM: So tell us all about Waterfall, Matt.

MS: We founded the company in August 2005. Myself and my Co-founder Matt Sechrest, our CEO, were both at E*TRADE at the time we looked at the US mobile marketing and mobile content sales landscape and saw that it was an extremely complex market, much more so than Europe and Asia. The situation seemed to be that if you wanted to do things on mobile you went to an ipsh! or an Enpocket or a MindMatics and you paid them 25 or 50 or 100 grand and they would get you a shortcode solution and you would get your campaign up and running and three months later you would go back and do it all again.
And we thought there had to be a better way. I was at E*TRADE for five or six years, I rebuilt the site many times, and we just thought that we should be able to hide all the complexity behind mobile marketing and mobile content sales in the same way we had hidden the complexity between trading shares at E*TRADE via a simple, clean easy-to-use website.

DM: So what was it that attracted you to mobile?

MS: Thats actually hard to say. I think we just looked at the complexity and saw a great opportunity to make things simple.
That was the hypothesis and we have just been charging forward ever since. We have built a core technology platform to empower marketing managers, to build out mobile messaging and marketing campaigns so that they can do it themselves without spending 50 grand on the solution.

DM: So tell us about the platform.

MS: Msgme is our flagship platform for marketers in brands, agencies and publishers; any type of publisher or marketer who wants to grab mobile and treat it more like email marketing or any other set of tools to round out their 360-degree marketing activity and engage in a one-to-one relationship with their customers through the features, the functionality and the analytics that the platform offers.
We also have a second offering, AlertU, which is aimed at schools. This is a two-way emergency mobile communications system that we launched late last year.
It allows anyone to blast out a message using SMS technology to anyone who has subscribed to receive it.
We already have 15 schools configured for this and we are signing up more.

DM: How do they pay for it, either at the school or the student end?

MS: Theres no charge to the students, other than their standard text rates. We hope one day this might change with legislation but as of today, they have to pay for the texts. For the schools, we charge $1
(0.50) per head per year, or we have a corporate sponsorship model where a brand can associate itself with the service, mainly by getting involved in the initial PR around the announcement. Their name doesnt appear on the messages that go out or anything like that. But we have financial services and automotive brands who are very interested in this idea and we should have some deals signed very soon.

DM: So where Msgme is concerned, is it totally self-service or is there a managed service element to it?

MS: Msgme has been designed and built as a self-service platform. Some of our early accounts needed a little more hand-holding, so we can act in agency mode, but really, we want to enable and train marketing and brand managers and empower them to do this stuff for themselves. We want to teach you how to fish, rather than fish for you. Thats not to say that we wont add managed services down the line, but thats to be determined as it evolves.

DM: And how does Msgme work?

MS: You can log on and set up an account in 30 seconds. You get three free keywords and 1,000 messages. The keyword is the CTA you put on marketing materials and then you configure the campaign, with tools for polling, voting, ringtone and wallpaper sales, text-to-screen applications etc. These campaigns elements are all productized.
This is to get people started and trying their first campaign or two on a variable-cost model, so they buy a bucket of messages and pay for the traffic, or if theyre selling content, we do a revenue share with them, so there are no account management or start-up fees. We just get them up and running on the first few campaigns and then negotiate the message packages.
The upsell is when the publisher runs a few campaigns and then says: This is great, we want our own, so then well do a private label offering, and this is scheduled for mid-April. So in the current incarnation, its a shared shortcode model - 67463 is the current one - but the next version will include a shortcode selector, so a large agency can come in and manage all their different brands and shortcodes. So this will be aimed at large publishers and there will be a licensing fee on top of that. And with this version, there can be any number of publisher accounts, so one private label issue of Msgme could be enabling 5-20 accounts on the publisher side.

DM: So how long has Msgme been around and are there any deployments you can tell us about?

MS: Sure. It came to market in October 2006. Weve had a lot of activity on the music front. The Dave Matthews Band is one example. They launched with us last December and theyre using the tools to build a mobile fan community. They were already selling ringtones through carriers, but they wanted to build up the d2c side, so they promoted the mobile campaign on their website and their MySpace page and through email and they have really embraced the mobile channel, using it to sell ringtones and bring their existing fan base into the mobile community.

DM: And is there much competition? For instance, Flytxt, one of the original mobile marketing agencies, abandoned the agency model a while back and started selling their platform as a software solution.

MS: Most of the people we are competing with are the agencies; there are not many technology platforms out there. We see a couple of things that are starting to look and smell like a technology solution, but not much. Mainly, we are competing against the likes of ipsh! and MindMatics, who are selling an agency creative solution, so our counter to that is to be the technology enabler and we have now built a reseller channel with agencies that dont have a mobile offering, to enable them to sell a mobile offering.
But we are just a technology enabler for those agencies. I can give you a great example, in fact from a recent campaign with Toyota. They sponsor the South by South West (SXSW) Music Festival in Austin and they wanted a campaign to go after a young demographic, so they had an agency called Drillteam who built a site for them that allowed people to go in and pick the events they wanted to attend and build their itinerary, and then they could sign up for relevant blogs that would send picks and tips on whats going on to their phone, and they could also get reminders sent to their phone when they were at the event.

DM: So are you optimistic that US consumers actually want to engage with brands on their mobile?

MS: I am. I believe we have only scratched the surface with the number of people leveraging this channel. We are enabling marketers to do it themselves, and we are seeing incredible enthusiasm and progress from clients who are using the platform. They love it. In general, agencies and brands want to run mobile marketing campaigns, but people are  overwhelmed. They dont know what to do and how to do it, so when we show them that they can have a mobile campaign, they are ecstatic. Putting even the first campaign together is really easy, but its the first meeting that is sometimes the challenge because they have been over-hyped by the agencies, who have made mobile seem so difficult, so with Msgme, we hope to show that its not that hard to do.

DM: You dont seem to have much time for the mobile agencies, but some people would argue that when youre running your first campaign, thats exactly the time you do need advice from professionals who have run many campaigns in the past.

SM: There is definitely a place in the market for companies to service those clients who want and need hand-holding, but I see those mobile marketing agencies as our future clients. IconMobile, a mobile agency that is 40% owned by WPP, has just started using our technology. This is an agency with big clients like BMW and Microsoft, and they have just started using our technology. We dont want to get involved in the hand-holding, but being their technology enabler works really well for us.