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UTalkMarketing featured an article by Jouko Ahvenainen of Xtract. In this article, Ahvenainen looks at word of mouth marketing in a pragmatic manner. Here is a quick peek with some of the requirements for starting a positive word-of-mouth effect:

• Identifying who within the social ecosystem of your customers is influential. In this way, any company can consider its customer base as a social network; we aren’t talking just about Facebook users

• Targeting these influential people (what can be called ‘Alphas’) with campaigns that are most relevant to them, which they are likely to want to share with their network

• Making real-time marketing decisions based upon actual data and the way it’s analysed.

A full version of the article can be found from: UTalkMarketing

Several leading research organisations including the IAB (Internet Advertising Bureau) and Juniper Research have recently released reports on the current mobile advertising market and its future.

This year represents the first time truly quantitative research has become available on mobile advertising, and the numbers indicate conflicting trends in this nascent market, points out Xtract, providers of social intelligence software.

For example,
• The first expenditure study on mobile advertising in the UK, taken by the IAB and PWC, showed that the mobile ads market is growing 99.2% year on year, even when advertising in other forms of media dramatically decreased in the same period
• The huge growth in mobile advertising has been attributed to its exceptional targeting, immediacy and return on investment, says the IAB
• It also showed an impressive 44% of 16 – 24 year olds have checked social networking profiles on their mobile phones, suggesting younger generations are at the ready for mobile web and advertising
• Source: [http://www.iabuk.net/en/1/mobileadvertisingexpenditure120509.html]
However,
• Juniper Research’s study released in June indicates that by 2014, mobile advertising would still only account for up to 1.5% of total global adspend, despite mobile advertising offering ’substantially higher’ response rates than advertising in other media

“There is clearly a conflicting trend at present,” said Jouko Ahvenainen, co-founder and VP at Xtract. “Mobile ads are the most interactive, compelling forms of advertising for many brands, and offer far better response and click through rates when they are done well. And usage of the mobile web is growing rapidly. Other forms of media are struggling to sell advertising, in particular newspapers, and are shutting down. Yet even in five years time, leading industry bodies predict that mobile advertising will remain a mere drop in the ocean in terms of overall global ad spend.”

“This is leaving the industry scratching its head about how to cash in on the promise of mobile advertising. One thing that we constantly hear from advertisers and marketers, who hold the purse strings, is that they need far more intricate levels of targeting than are generally available today; measurability; accountability; and clearly defined ROI, in order to choose mobile over other media platforms. Clearly, highly-targeted forms of advertising that can be measured back are the way to continue the upwards trend in mobile ads. If marketers can’t see exactly who they are targeting, and understand the likely behaviours of these customers socially, they can’t trust the most personal advertising channel available today, and mobile will continue to be insignificant in the overall global ads picture.”

More information about Xtract’s social intelligence approach, on the frontiers of targeting in the mobile advertising market, can be found at www.xtract.com.

Press contact:
Emily McDaid (emily(at)hatch-pr.com | +44 7748 6333 55)

Yesterday, the second floor of Molly Malones offered a nice and friendly environment for mobile people from all industries to connect with each others in the event organized by Mobile Monday (MoMo). The topic of the evening was Earning models in Mobile Entertainment, which is also an important question to many of our customers.

Our board member Alan Moore gave interesting insights into the big opportunity in utilizing the players with different roles in social networks. This topic is closely related to what we do here at Xtract for mobile operators and other customers.

Other speakers gave also fascinating presentations. Dr. Josef Noll from Norway spoke about privacy issues in entertainment business. He forecasted that privacy matters will be huge business in the future. Dr. Madanmohan Rao pointed out that in India, where Bollywood and cricket are the most popular forms of entertainment, the ones who will understand how to make money from mobile entertainment will earn a lot of money.

The place of yesterday’s event, Molly Malones in Helsinki, was also the place where the idea of MobileMonday was invented. The original founders of MoMo were present at the event and told about how no-one could believe at the beginning (Sep 2000) that eight years later MobileMonday events would be organized in tens of cities all over the world. It is exciting how a good concept, such as that of MobileMonday, has the power to spread all over the world, thanks to world-of-mouth and people networking with each other.

The latest Technology Review has an interesting article about social network business and how social networks still have a lot of challenges to monetize their communities. New models, but also new solutions, are needed. And a key issue is to get advertising work properly in the social media.

Technology Review summarizes the new technologies to get advertising work in social media: “Startups that help advertisers and marketers better target the users of social-networking sites are fashionable investments for venture capitalists in North America and Europe. Such startups hope to sell advertisers detailed information about individual social networkers. They include the brand-new 33Across (which we profile in our list of 10 notable startups, which begins on page 50) and the more established Finnish company Xtract, which counts Vodafone, T-Mobile, and Blyk among its customers and has begun selling its software to advertising agencies and online marketers and publishers. ”

Jason Pontin, Editor in Chief and Publisher of Technology Review, commented in the Millenium Prize event that our solution is the most complete solution he has seen for solving “the multi-billion dollar problem.” It is nice to see that we have really found a way to build solutions to monetize digital communities.

Yesterday we had the privilege to listen to Dr. Andrew J. Viterbi give an interesting presentation on the Science, Technology and Business of Digital Communications. He has been working in the middle of the mobile communications revolution and has left his mark in the field in many ways. Does the Viterbi algorithm sound familiar?

Dr. Viterbi is one of the Millennium Technology Prize Laureates for 2008. His lecture was a part of the Finalist Symposium that was held at the Helsinki University of Technology in Espoo, Finland. This year, the main Millennium Technology Prize, the largest technology prize in the world, was presented to Robert Langer from MIT for developing innovative biomaterials for controlled drug release.

The organizers of the symposium had also invited three promising Finnish companies to introduce themselves. All three companies combine science and technology with communication and are making solid business that aims “to someday repeat the success of Qualcomm”, as the organizers put it. One of these companies was Xtract and Jouko Ahvenainen gave the presentation that you can see below.

The presentation was about how to monetize digital communications and to deliver more relevant advertisements to end users at the same time guaranteeing more returns for the advertisers. In the audience was also Jason Pontin, Editor in Chief and Publisher of MIT Technology Review. He commented that our solution is the most complete solution he has seen for solving “the multi-billion dollar problem.” Afterwards we had some good conversations around the subject over some coffee and other refreshments.

Xtract was the runner up of a public voting to select Finland’s Most Promising Growth Company. View a 2 minutes elevator pitch for the jury by founders Kimmo Kiviluoto and Jouko Ahvenainen at the Helsingin Sanomat event yesterday. In Finnish only.

New Business Week (December 3, 2007) has an interesting article about big changes in the advertising business. The article focuses especially on Saatchi & Saatchi’s challenges to keep their revenue and find a new growth. They have won new customers (like J. C. Penney) and marketing professionals love many of their campaigns. But their clients have not got concrete commercial results from the campaigns. As Business Week says: “Yes, most clients still believe in creating an emotional bond with consumers. But Roberts had come to the conclusion that many companies are desperate for an über-consultant-a ‘brand navigator’-who, in a fragmented media universe, can help them to make that connection across multiple media.”

Business Week continues: (more…)

I was with the engagement marketing guru Alan Moore in Library House’s Media Tech event in London this week. Alan presented Xtract and Social Marketing Intelligence to the audience, which included many people from the leading media and investment companies. Advertising and social networks were the main topics in most of presentations this year. Antti Örling from Blyk (Xtract’s customer) especially emphasized the value of targeting and relevance in mobile advertising. He mentioned that Blyk achieved 12% to 43% response rate in their mobile campaigns, compared to the norm of 3% to 6% in mobile and 0.2% in the internet.

People still have a lot of questions, e.g. “how will social network, mobile advertising and business models be like in the future?”. But people see the value of targeting and relevance in digital advertising, and understand the “hot media” needs social marketing intelligence.

You can also read more from Alan’s blog.