Mobile Point View by Paul Ruppert

Interview: Lisa Gersh, President Strategic Initiatives NBC Universal & Managing Director, The Weather Channel

 
Recently I had the opportunity to attend the Conference Board's Corporate Development Conference sponsored by Ernst & Young's Transaction Advisory group. The conference was attended by leading Corporate Development Officers from 3M, P&G, SAP, Microsoft, Colgate-Palmolive, Sun and others, covering such topics as Organizing Corporate Development, Repurposing Corporate Development for Challenging Times and Valuations of Multinational Acquisitions and Divestitures--my favorite panel of the day, which I stumped with my question regarding US vs ROW style M&A.

While there I had the chance to sit down and interview Lisa Gersh, President of NBC Universal's Strategic  Initiatives Group and the Managing Director of The Weather Channel.
Gersh joined NBCU in November of 2007 after the company acquired Oxygen Media, which she co-founded and served as its President & COO. Upon joining NBCU she led the multi-billion dollar acquisition of The Weather Channel Companies and is currently the executive in charge of the investment, aka, the CEO. Thanks to Lisa for spending a few minutes with me there.

With advertising revenues getting hammered in this contracting economy, is NBC Uni's Corporate Development looking to expand aggressively into different modes of media, especially the mobile platform, for future growth?

"Our acquisition of the Weather Channel is a great example of our strategy--looking at how we can leverage content regardless of platform, then swiftly positioning it to take advantage of its benefits such as its power via mobile. Weather information and related imperative content effectively applies itself across all our platforms--mobile, internet and  TV--which is why we have integrated the Weather Channel content from MSNBC to the Today Show to mobile applications. It is a great standard of defining a multiple platform strategy for NBC Universal."

How has Corporate Development and the M&A environment changed as a result of the current period of contraction?  From where you sit in the media conglomerate world, what do you see as tangible significant changes?

"One of the biggest changes is a broader consideration of what is going into the mix. While with Oxygen Media we had a strong sense of where a property might sit, what would be accomplished in its first year, all the metrics and projections worked out, very traditional financial analysis of the stakes involved.  A year later with the Weather Channel, which occurred at the first stage of the economy's troubles, we and GE were quite concerned with the human impact of a change in control in a private company, with the reality of people loosing their livelihoods in a very difficult time. The conditions made us think very differently as a company and the HR impact of the deal and the impact of integrating the Weather Channel into the GE family of companies"

"As a result, the responsibilities of communicating the value of the deal have shifted. Communicating up and down the corporate ladder has a higher scrutiny now, especially for the CDO. Essentially the more things have changed the more they have stayed the same. It comes down to the foundation, the management expectations, the synergies attained, and how effectlvely it is communicated."

On the topic of gaining synergies, do you think the weighing of deal prices and valuations, combined with the flat economy has escalated the importance of capturing deal synergies faster, slower or the same as in the past?

"I think timing is everything. Let's call this "pre-Lehman" and "post-Lehman" considerations.  Post Lehman, capturing quick synergies are critical. We're looking to bring the value of an acquisition much closer. In the past, we might have targeted 18 months for identifiable returns, now those are moving to 9 months, with a greater focus on integration needs to gain control of the business operationally and financially. This is especially true in the media business where it is critical to move quickly, as we did with The Weather Channel acquistion.  Also I think the understanding of the friction and obstacles are more candid now post-Lehman. People expect bad news and challenges in these times--no more glossy deals. In fact that makes it an improvement since now there's a more real sense of expectations and friction than pre-Lehman."

How are corporate development initiatives such as M&A opportunities managed within NBC Universal?

"Smaller, digital technologies such as mobile centric ones, or properties of that sort, are led and identified by a business unit's GM or leadership that might be utilizing it or are more closely aware of technical applications or the strategic advantages of content.  If it is cross fucntional, impacting multiple aspects of NBC Universal, than it is up to my group to identify and source the advantages and challenges of the opportunity. Plus we have an on going process analyzing a number of potential deals regularly as part of our functional responsibilities."

This was a great conference--at roughly 100 elite participants, small enough to meet everyone, many of whom both served as great panelists who then stayed for the conference, like Lisa--a true measure of its value and importance if the panelists stay on to sit in the audience. Check it out for next year.

AKQA Mobile: Advertising for the Digital Mobile Age

AKQA is a global digital advertising agency that is at the top of the mobile advertising game, having won AdAge's Digital Agency of the Year for 2008, and being named the 48th most innovative company in the world by Fast Company. Mobile is a key component to their digital advertising practice is a key component to their strength, but their mobile  initiatives are their reals bench strength.

AKQA brought in Dan Rozen about a year ago, a long standing mobile marketing veteran in the UK, and since then they have grown to a dedicated mobile team of 20 with campaigns for Coca Cola, Visa, ESPN, Orange, Nike and most mobiley noteworthy Smirnoff vodka.

Listen to my interview with Dan Rozen, GM of AKQA Mobile here:

Smirnoff made its first stab at mobile with a WAP site built by AKQA. Rather than simply re-creating the Web experience on the phone, AKQA opted for an on-the-go cocktails and nightlife guide. In the U.K., the mobile site reaped about one-third the traffic of the Web site, reports Michelle Klein, Smirnoff's global digital marketing director, who calls AKQA "at the bleeding edge. They know what's happening in the technology space and they bring those ideas to us. They have their fingers on the pulse. They came with a big idea and then blew the idea out."

In other words, while mere ad mortals struggle to understand the social MOBILE web, Dan Rozen and his trailblazers are already deep into the next big thing.

Coca Cola & Mobile Marketing: Reach & Refreshment

Within Arm's reach of Desire
The Coca Cola Company, aka Coke, has been a leader in mobile advertising for some time. Going back to 2005 when they launched a bottle top short code campaign in Turkey and the UK, Coke has been forward leaning into the potential of mobile. BTW, I led the carrier connectivity supporting that project while I was at Mobile 365; we delivered the SMS payload for Coke to mobile subscribers in both countries, hence I've had a long standing interest in their leadership in mobile marketing.

Coke's view of the mobile world is that every person on earth should have a Coke product "within arm's reach of desire."  Good mobile advertising looks to capitalize on a first mobile impulse and Coke is effectively executing in both areas. Coke provides 1.4 billion servings a day, and there are 3.4 billion mobile phone users in the world. Hence they are slightly behind and need to fill a 2 billion gap by driving arm's reach demand, naturally through the mobile phone.

The Language of Refreshment
Does anyone actually want to view ads on a mobile phone, let alone interact with them?  Silly question, of course they do. Coke actively recognizes the singular opportunity to interface with the world's most intimate electronic device, a mobile phone. Moving well beyond the simple messaging which I was involved in, The Coca Cola Company is into viral advertising enabling shared content via your social graph enabled via your mobile device, as well as providing idle entertainment through limited reach bluetooth zones--for more, listen below. No mobile frontier will be left unexplored for the most recognized brand on earth.

Listen to my conversation with Tom Daly of Coca Cola who heads up their global mobile marketing efforts 13 mins

Recently at the Mobile Marketing Association Forum in San Diego, I had the chance to talk to Tom Daly, Group Manager--Strategy & Planning for Global Interactive Marketing at The Coca Cola Company. Tom's the key guy--globally--at the forefront of their digital marketing and mobile is a key component to their strategy--not surprising.

Refreshment is a language everyone understands. No one speaks it better than Coca Cola.

Mobile Advertising: Snap, Send, Get.

There's much buzz about the ever increasing impact of short code applications in mobile advertising and marketing. Sending simple texts messages when you see an advertisement in the world of old media such as magazines and newspapers, and engaging the brand through new media mobile. Look at ShopText as a great example of this and their campaigns with Cosmopolitan and other Hearst magazine properties. An emerging leader in the mobile short code marketing category.

Yet, short codes may be too early and too late. Now emerging mobile technology surrounding QR codes and dot matrix codes are starting to demonstrate their technological innovation. Instead of six to 10 key punches, now you can easily take a picture of a code and have the same functionality.

While at CTIA IT in San Francisco three weeks ago, I saw the next iteration of image recognition, Snaptell. The Snaptell solution doesn't even need the code. You just snap a photo of the advertisement and you're off. One touch functionality.

Listen to my interview with G.D. Ramkumar, the CEO of Snaptel ( 9 mins)

Interactive Media in Magazines
You can see how Snaptell works in the real world in the September 9, 2008 issue of ESPN Magazine. They've partnered with Snaptell with all their advertisers for this issue. The reader snaps a picture of an ad their interested in. Their phone is directed to a mobile web landing page, and they get more information about the product/service plus cool rewards, like ring tones, screen savers, games, ring back tones,  free-miums! 

In the background, the brand is able to easily access detailed information about the user, such as type of handset, network subscription, and other data which the reader might be interested in sharing, essentially all the actionable metrics which make these mobile advertising offerings of such great contextual value.   Snaptell provides an end to end solution for mobile marketing that includes campaign management, carrier gateway integration, content delivery, and an intuitive, easy to use interface for the advertising agency to set up a campaign.  Essentially the "snap on" Snaptell solution puts simple short codes to shame. 

How'd they do that?
The technology behind mobile image recognition is quite intriguing. Interlaced into the advertising image are feature points which are picked up by the phone, and compared against a data base, with over a billion components of images. Within a second it identifies and recognizes the feature points and activates an interactive instruction application. You don't even need to have the full image or even a majority of the image in picture, you can crop it, capture just a corner, and it still works. The payload is through an MMS message being sent of the image.  The coolest part is that it doesn't need to be still images such as a magazine or print ad.

It works with video, too!  Just watch a tv commercial, click an image, et voila, and actionable event is being requested of you. Pretty slick technology. 

Look for Snaptell in Men's Health, ESPN Magazine, Wired, and other magazines in the future.

Mobile Advertising: Bango Measures Exposure, Pursuasion and Transactions

Understanding how analytic metrics illuminate and profile users, with a measure of customer acquisition costs is a key performance indicator for advertising whether it is traditional print, fixed billboard or media such as TV and radio. The same now applies with the emerging mobile advertising channel.

If the real value exchange between mobile and advertising is to be fully capitalized, new data sets need to be developed for the advertising and brand industries that drive this space.

An on-going interest of mine has been how the mobile segment is moving to solve core questions like: a) how many people have been exposed to an advertisement? And (b) how effective is the advertising?  (c) what do my buyers look like across a score of indicies?  These are cornerstone questions to advertising, and nothing has changed now that it mobile is increasingly part of the advertising mix. 

As part of my quest I had the opportunity sit down recently with Bango's Anhil Malhotra. Bango is paving the way in mobile advertising metrics, working with the Media Rating Council and Mobile Marketing Association, moving beyond simple CPM (cost per 1k exposures), PPC (pay per click), CPC (cost per call) and CPA (cost per action) metrics to establish new audience verification metrics for mobile. 

Listen here [8.5 min]

         to my podcast with Anil Malhotra, SVP of Marketing with Bango (recorded at the Harvard Club of New York) as we explore the future of mobile advertising metrics, and how there is no end to the appetite of what people want when it comes precise and concise audience verifiability.

The reality is that mobile provides much more power in the battle from exposure to persuasion to transactions. Listen and find out how. 

Paul Ruppert chosen as Managing Editor for Mobile Messaging 2.0

I've been a contributor to Mobile Messaging 2.0, a corporate sponsored blog covering the mobile industry since September 2007. Last month Beeline Communications and the blog's sponsor, Airwide Solutions, chose me to be the new Managing Editor of the blog which has 12 paid contributing analysts of the mobile industry.  Click here for my most recent post at MM2, "China's Black Market iPhones surpass 1 million.

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Velti Invests in CASEE & Chinese Mobile Marketing

Velti Maneuvers into China's Mobile Marketing

Chinese mobile advertising startup CASEE has closed an investment from London-based mobile marketing company Velti plc. The investment was worth up to $6 million, according to the announcement from Velti. CASEE operates an on line mobile advertising marketplace at CASEE.cn  Riding on the success of AdMob neutral off-deck posture, some have characterized CASEE as the AdMob of China. Here's the value proposition: Wireless application protocol (WAP) site operators go to CASEE and sign up to run ads on their sites, while advertisers can bid for ad space through CASEE. So within the vernacular they provide inventory to those interested in mobile marketing campaigns. 

This caught my interest for all the obvious reasons--a Chinese company again leading a mobile initiative and gaining western attention, a mobile marketing play, international M&A--but mostly since I know Velti, the company which invested in CASEE.

Velti is run by CEO Alex Moukas who I had the chance to interview at CTIA in April. Velti is the leading mobile marketing company with over US$60 million in revenues--not the start up AdMob; a listing on the London AIM exchange makes it a far more robust public company. How many other mobile marketing companies are public?  None other that I know of. The company's been around for 8 years, starting out in the mobile messaging space and migrated up as the market has evolved. Mobile advertising is one of the most effective ways of driving fuller branding efforts especially within emerging markets such as China, where most access the Internet via a mobile WAP page. Good play for Velti.

Listen to my interview here with Velti CEO Alex Moukas: (x1, 10:30)

Mutual Utility
Velti's investment is a good play for them to enter into the fastest growing Chinese mobile market. CASEE is serving over 500 million ads a month on over 3,000 WAP sites in China. The company currently has 25 employees, but expects to reach 45 by the end of 2008. The company's publishing partners include Sina, Sohu and QQ.  The announcement said that Velti will be able to extend CASEE's mobile advertising technology outside of China and that the two companies will cooperate on product offerings and development. CASEE's founder and CEO is Xin Ye, former CTO of Linktone (NASDAQ: LTON).

GOOD BONES  & SMEs

CASEE was founded in 2006 by a local Chinese team headquartered in Beijing. Advertising clients span MNCs such as Kodak and General Motors to local, small and medium-sized enterprises. These Chinese SMEs are the real value here since that will be the primary source of advertising growth via the mobile channel in China for the future. Using their special sauce, it matches bids for advertising space against inventory offerings through targeting to maximise the price received by over 2000 content publishers from their WAP sites from advertisers. In short, the basic mobile marketing advertising model currently employed across the globe.  The real value here is the access the CASEE founders have in the Chinese market, including it's CEO, Xin Ye, who was the CTO of  Sohu. The founders and board have extensive experience in the local market, having held senior executive positions at US-listed Chinese companies like Sohu, Baidu and Linktone. CASEE serves more than 500 million ads every month to mobile phones in China and receives its revenues from advertisers.

I think both companies will fare well from the linking investment. Clearly it provides both a complimentary and substantial leg up, into mutually interested markets: one to go outside of China, the other the chance to get into China. Looks like a: win-win. Watch both.

Interview with Laura Marriott, Mobile Marketing Association

Here's a an audio (scroll down) primer on the Mobile Marketing Association from its President, Laura Marriott. I had the distinct pleasure--and fun--of meeting and interviewing the President of the Mobile Marketing Association at CTIA which you can listen to here.

Laura's s view of CTIA

...not much emerged at the show from the mobile advertising segment. Although there was increased interest and attendance from the agency and advertising arena reflecting a growing understanding and recognition of the importance of mobile in the marketing mix. Meaning: good things to come in mobile marketing.

What is the MMA?

Good question--a laurel which Laura tossed my way twice in the interview. MMA is a global trade association across the entire mobile marketing ecosystem with regional representation in the US, Europe, Asia and Latin America reflected by 600 companies in the business drawn from across the world. The Mobile Marketing Association is the premier trade association that strives to stimulate the growth of mobile marketing and its associated technologies. It's membership is comprised of drawn from the worlds of advertising agencies, advertisers, hand held device manufacturers, carriers and operators, retailers, software providers and service providers, as well as any company focused on the potential of marketing via mobile devices.

Listen here to Laura describe the differentiating aspects of innovation and creativity development across the world.  (1x, 11:51 min)

Is the MMA important?

Yes. As consumers increasingly use their handsets to browse the Web, it's no wonder that advertisers see mobile screens as valuable turf. In the US, cell phones haven't yet proved to be the same kind of advertising bonanza as the Internet, mostly because of the wireless industry's more controlled nature and the slower adoption of text messaging and mobile Web services. But momentum is gradually building, especially behind text-based marketing campaigns, which are more prevalent in Asia and Europe.

According to research firm eMarketer, worldwide spending on mobile advertising totaled $2.7 billion last year and is expected to hit $4.6 billion in 2008, rising to $19.1 billion by 2012. In contrast, eMarketer projects that Internet advertising in the U.S. alone will reach $25.9 billion this year. Global brands drive much of it since the advertising business is driven by global brands, while the types of marketing varies region to region. More text based in other parts of the world than the US, with use of sponsored Peer to Peer messaging for example in places such as India and Africa.

MMA Boards in each region set the regional focus while following global advertising guidelines and policies. Overall goal of the MMA is to provide ease of use of for global brands to enter the market on a global basis, not a carrier to carrier, country to country basis. Part of this is promoted through 8 events across the globe sharing as a best practice identification and inspiration process source. For those who are interested in pursuing the MMA best practices, there are also lots of white papers and other free downloads at their website.

The Elephant's Legs

MMA dances between the legs of two industry elephants, advertising and mobile. Through the deft leadership of Ms. Marriott she's been able to wrangle these beasts and have them cooperate successfully. Challenges exist such as extending reach and fully using the feature rich phones for advertising, but through education of brands as well as consumers on leveraging the technical sophistication of mobile phones the conversation around mobile advertising has made great strides.  As Laura rightly concludes: "Mobile advertising is going to be hot this year!"

SMS Dangers: Send, Bump, Bruise

Walk & Text Wounds may be the next front in the attack on texting by the powers that be within the Nanny state? Just wait until state legislators get wind of an investigation by the Star Newspaper, one of those cheeky London Fleet Street papers known for their bodacious page 3 girls, that's the front page on the right>>>>>>>>>oh, you already noticed?

According to the Star's crack investigative efforts, over 6 million Brits were injured in some way because they were so immersed in the experience of sending an SMS text message they failed to look up! Most seemed to be situationally unaware of such things as lamp posts and other immovable objects including garbage cans (trash bins in Brit speak), car barriers (bollards), or stepping off the curb (pavement).

Broken Bones & Fractured Skulls, oh my!

These were not simple "slip and falls" or Text Messenger's Thumb which I've written about before, but ranged from broken noses to fractured skulls. The survey was sponsored by the British information (directory) service provider 118118, which is quite adept at driving awareness with their off beat marketing. BONG!

According to the Daily Star, there are now plans to set up "mobile lanes" akin to bicycle lanes for text addicts to skirt around dangerous spots.' Now that's a good mix, speeding bikes and wandering pedestrians looking down at their iPhone. Layer in all those who are  listening to their "life soundtrack" with iPod ear buds, and CRASH!

According to an interviewed activist from a group called Living Streets, who warned: “Our pavements are increasingly becoming obstacle courses.” Huh, what's changed here in regards to sidewalk topography?

Aha, here's the culprit--commerce. To protect and serve the texting public 118118 has launched a pilot project protecting such lame texters by installing texting bumper guards on offending lamp posts and other obstacles in London's Brick Lane starting yesterday. 118118 spokesman William Ostrom said: “Hopefully this scheme will reduce the risk of embarrassing injury.” Scheme indeed.

Very clever way for 118118 to get their brand "close" to their consuming public and very consistent with their intruiging brand positioning!

So what do you think of 118118's innovative way to bring attention to their brand, slick advertising or sorry excuse?

Super Mobile Communicators

Duh! Teens are “Super Communicators”
Research from the Pew Internet & American Life Project finds that that 93% of teens use the internet, essentially using the web as their social palate—the place where they can interact, share their creativity, and tell stories. 64% of online teens ages 12-17 have participated in one or more among a wide range of content-creating activities on the internet, up from 57% of online teens in a similar survey at the end of 2004.

28% of the entire teen population are super-communicators. These are teens who employ multiple communications options for dealing with family and friends, including wireline phones, cell phones, texting, social network sites, instant messaging, and email, and surprisingly they are more likely to be older girls. This breaks with the past “3 Gs” marketing perspective of the mobile industry, i.e., “Games, Girls & Gadgets” targeted at teenage boys.

The reality of the mobile business is that sub-twenties consume more sophisticated communications tools than a 40 year old corporate executive who is completely price elastic when it comes to communication costs. This is quite a disruptive influence which goes well beyond the mere “teen texting” phenomenon which is most often reflected in the media mobile advertising culture.

Result of the Bedroom Culture
Face it, kids drive the world.  If you want to understand the future of technology, look to why and how technology enters into the lives of tomorrow’s customers. If you really want to see the future, examine how childhood has changed rather than how technology has changed.

Children and young people’s engagement and experience of “the world” has radically changed. The difference from children of the past is now their “world” isn’t the real world which most of mankind has experienced; it is the “virtual world.” New media and technology have clearly shaped their social life, but it hasn’t been the cause of this. It in fact is the result of something very different.

Consider how perceived risk has changed childhood. The rising concern of anything remotely or horribly risky befalling children has lead to the decline of kid’s street culture. When I was growing up in the 60s, the ringing pronouncement of my mother whether we were either in the US or France during my summers was “GO OUTSIDE AND PLAY!” I’m sure that even in cave man days, kids were either lashed to their mothers while gathering, or following their fathers while hunting. But today’s industrialized developed child socializes from the confines of his/her bedroom, which has made technology critically important to their cultural connections. Technology isn’t the cause, it is the effect.

As a result, most kids are fairly isolated. Digital technologies such as the mobile phone and easy access to the internet have enabled adolescents to overcome their experience of isolation through connected communication with their peers. Parents look as though mobile communications is a technology tool, while the children use it to gain freedom from parents/adult supervision and reach out. Kids engage in tribal behavior using a separate language as a code such as shortened SMS, thus avoiding any adult interpretation. Naturally these connection technologies make them passionate about the technology. It connects them with peers, enables them to be entertained. It gives them ways of interaction, experiment, to progress, to grow up.

Lagging Mobile Marketing Message
The rise and commercial attention on social networking services is a reflection of the reality that kid’s self expression is the biggest problem they have. The reflected results of the problem are the “confluent” use of technology and solutions to express themselves such as You Tube, My Space, Facebook, Flicker, IM, SMS, etc. They have created their space to do what they want, which is what we did when we played kick the can, sandlot baseball or spin the bottle. Mobile phone personalization through ring tones and skins expresses who they are. Kid social hierarchy is now through who you relate to and reflected in a buddy list, which is a new social status marker.

In order to broader capitalize and harvest this opportunity the mobile industry needs to be more responsive and reactive to this new evolution of consumers. It is a reflection that marketing to the mobile consumer is not effective to the young, male football viewers (from either side of the Atlantic), nor enterprise based aging baby boomers. It needs to be more engaged on these creative communicators, these Super Communicators which will shape the business in a few short years.

OK. Now its your turn. What do you think of the comfort of today's risk free kids? Do you think technology has enabled this or is a demand response to it? Is marketing of mobile communcations lagging this cohort? Comments are very welcome (please!) with the objective of building a community who engages in a conversation. And if you liked the post, please dig, delicous, or stumble to spread the word! Thanks for your readership.