Interview – Jonathan Bass

Managing Director, Incentivated

Incentivated managing director Jonathan Bass formed the company in 2001 along with James Hubbard and Craig Jamieson. Hubbards background  was PC infrastructure, Jamiesons, network infrastructure  – he was a senior member of the team that designed and deployed Vodafones 2.5G and 3G network while Bass himself has a grounding in media and marketing from his time at US media company, Clear Channel. Inspired by a seminar presented by Flytxt, Bass saw an opportunity to go for the mid-tier companies below the levels of the ones that Flytxt itself was targeting, and Incentivated was born.
Four years on, the company has several hundred customers, and runs campaigns across Europe, the US, New Zealand and Australia.
Mobile Marketing Magazine caught up with the youthful 32-year old to ask about the current state of the market.


MM: Youve been established for four years now. What are the biggest changes you have witnessed in that time?

JB: Well first of all, weve learned that convincing people to get involved with something new like mobile marketing is a long process. Theres a certain inertia among people who have to spend serious amounts of money doing something new. They dont want to lose their job, so persuading someone to do something new is a slow process. Weve enjoyed double-digit growth year on year, but things have been slower than we expected.
In terms of innovation, the big things in the last couple of years have been the use of the mobile direct response channel. By that I mean, traditional direct response, but carried out via mobile, and my view is that in a few years time there wont be a single poster on the streets, or print ad or TV ad, without a shortcode. I dont mean a shortcode replacing a URL or telephone number, but working in conjunction with them to give consumers the choice of how they will communicate with the brand. And the innovations are in providing a more detailed interactive response. So were not just saying to somebody: Text this keyword and well capture your mobile number. Were saying: Text your house number and postcode, and well send you printed material in the next couple of days, perhaps a printed brochure for the car youre interested in. Or Text your email address because youve read the ad in the newspaper on the way to work, and before you get to the office or before you get home that evening, there will be a full colour HTML email advertising the brand with a link to the campaign  microsite for the richer experience, the experience that we cant really at this stage deliver to the wider audience via mobile. But mobile as the direct response channel is the glue that connects the traditional media with the interactive, online media.
The second key innovation is in mobile customer services, which is enabling  consumers to do things that they would otherwise have to call the call centre to do. So when you come home and find a card behind the door saying the utility company has been round to read the electricity meter, you dont need to speak to a human being in a call centre. You just text it in. Because if youre a consumer and your PC is not turned on, the last thing you want to do is to turn it on, connect to the Internet, find the web page and enter the details.

MM: Youve given two examples there. In the first, you talk about prospecting for new customers using other channels, with mobile as the response channel, and in the second, using mobile to communicate with existing customers. But when you talk about prospecting, where does the industry stand with respect to the availability of lists of opted-in mobile numbers?

JB: We are working with large list owners to grow this part of the market. The volume of mobile numbers is about 15% of the number of opted-in mail addresses with socio-demographic information, so that is quite limiting, and it means that typically, we have to go to more than one supplier to find enough numbers to meet the socio-demographic criteria.
The situation has come about because list companies have only been asking for mobile numbers for the last three or four years, compared to the last 12 years for email, and also, people are still more comfortable about giving out their email address. The mobile number is a more personal thing. But the numbers will grow as the list owners keep collecting the data.
This, though, is only half the equation. The main problem the list owners have is in data cleansing, and this is an area where we doing a lot of work with the list companies. When you send a text to the opted-in number, you need to know if it was delivered, for which you need detailed delivery receipts. These do exist, but a lot of the mobile networks do not make them available unless they are specifically asked for them, and a lot of clients are not even aware they exist.
The other problem is that you dont initially get a clear indication from a text message receipt if the person has gone away. They might just be out of the country and have their phone switched off, in which case you get a false negative. So we are doing a Home Location Register Lookup with the networks databases to see which of three possible states a number is in. Is it a real number that has not been allocated yet? Or a live number? Or a number that has been given up?
The list companies are very excited by this, because it means that they can poll the database the day before they send the message and determine if the number is still live, and if not, remove it from the list. We are finding that between 40% and 45% of the mobile numbers on databases belonging to list owners and brands are mobile numbers that no longer exist. So the cost per response is virtually double what it should be and the return on investment is almost half what it should be.

MM: Which sectors and/or brands are impressing you with the way they are using mobile marketing?

JB: The car makers seem to have got it and worked out what is going on. There are three currently that are running TV ads with direct response shortcodes. I think its probably because the purchase decision is a complicated one and consumers want to see a lot of material. You want a printed set of materials that tells you about the wheel sizes, colour options etc., and if youre watching TV and the PC is not booted up, you can just reach for your mobile, text in your house number and postcode, and two days later, a full-colour brochure turns up, and then youre part way down the line of buying your next car.
Of course, its not relevant for everyone, but it could be applied to other high-value items. Like a house for example. Many estate agents now send a text message with details of the property, and if they use MMS, they can also include a picture and even a map, much more detail than they could previously have fit into 160 characters.
Theres also been a lot of activity in the public sector, which has been a boon for us. Its been driven largely by the Cabinet Offices e-government initiative to migrate as many central and local government services to the digital platform. This brings mobile into play for the 45% of the population that dont have Internet access. And we are involved in some trailblazing work from the Mayor of Londons office in this respect.
The deadline has slipped to Easter 06, but there is still an impetus, a reason for the people involved to do something. I think the problem in the commercial space is that everyone is just so busy, working 50-, 60-hour weeks. There are a lot of clients who are only just grasping online, who only recruited their dedicated online specialist 18 months ago, and who have been busy getting the online strategy right. So while we have done tests and trials and talked about mobile strategy with them, they just have not had the time to make it happen yet. The Internet revolution is not over yet, and you cant expect an Internet marketing specialist to handle two revolutions simultaneously, so we have to bide our time, but it will happen. Mid 2005 was the tipping point in terms of moving from early adopters to the mainstream. In 2003 and 2004, we could not get meetings with senior marketers to talk about mobile. In 2005, theres not a single client who does not want to know whats going on in terms of cost, legislation, technology, everything.
The other sector that is really taking mobile to heart now is the advertising agencies  – interactive, direct response, media planning and buying, whatever spots they are wearing, the ad agency community is desperate to take ownership of this. You have media planning and buying teams looking to own this space, creative people needing to understand it, interactive agencies who see it as their natural home, though 95% of what they do is online, and then also you have direct response agencies who see it as a medium that is particularly applicable to them. But while they are interested in it, they do not want to develop the technology themselves, they want to buy it as a complete solution, they want an Incentivated or a Flytxt to make it happen and be accountable for it.

MM: And apart from the obvious barrier you mentioned of the pressure on marketing peoples time, and the reluctance to be the one who tries something new, what other barriers are there to more widespread take-up of mobile marketing. What about the devices themselves, for example?

JB: I think people need to understand that if you are going to restrict yourself to a 3G audience, you will be pursuing a niche advertising agenda. If thats what you want, to reach a very niche audience, then go 3G and the experience will be tremendous, but it will only get you around 5-7% of the UK population.
If your remit is nationwide, then its a 2.5G world. You can still do 15-second video clips, the quality of which is beyond adequate, but you are talking 15, 20, 30 seconds not the first seven minutes of a film, so the advertiser has to think: Do I want to reach everybody, or just a narrowcast audience?
So the barrier is not technology, because you can get your message out via SMS, location-based services, the mobile Internet, but there is a barrier if you want the high-resolution 3G experience, because there are not many handsets out there.
Another key barrier is on the legislative side. 75% of customers we speak to do not realise that the Privacy laws cover mobile. And the 25% who do are very cautious, so many of them have thrown away their databases and started again from scratch, because they assumed the worst and decided to clean them to a greater degree than they probably needed to.

MM: So much for the barriers, what are the most interesting mobile marketing applications you are seeing currently?

JB: One of my favourites, because it is so unusual, is some work we have done for a couple of telcos, Primus and One.Tel, where we enable consumers to use their mobiles to top up an international calling card. As a consumer, if you pay a retailer 20 for a calling card, the telco gets about 7 of that, after everyone else has taken their cut, even though the telco provides 20 worth of calls. So with the system we have put in place, when the credit on the card runs out, if you have been using it with a mobile phone, you get an automatic text message asking if you want to top up the calling card. If you say Yes you get around 25% more credit than the price you pay because the telco doesnt have all the other intermediaries to compensate. If you say No then you are removed from the database. Its just one example of the innovation out there, and theres much more to come.

Jonathan Bass was interviewed by Mobile Marketing Editor, David Murphy