I made an analysis of Blyk numbers at Forum Oxford last week. We had some good discussion around Blyk there and my numbers did not generate much argument. We had many other intersting comments about Blyk overall, though, not all good..
So for those who don't know, Blyk is the UK based free mobile calls and free messages provider, which requires that users receive up to 6 messages per day to get a modest allowance of SMS text messages and voice minutes for free. After 18 months Blyk reports 200,000 subscribers in the UK - all between ages 16 - 24 (Blyk enforces rigidly these age limits). For a start-up new mobile service provider (on a business concept called MVNO Mobile Virtual Network Operator) to get 200,000 subscribers in 18 months in a very saturated mobile market such as the UK, is very commendable. Obviously out of the 75 million mobile phone subscription in the UK, their market share is only 0.3% so it is not really seen as a threat to the major mobile operators (carriers).
But in the specific age bracket of 16-24 year olds the story is quite differnet. There are about 6.4 million youth in the UK aged 16-24. Out of those, 3% have a Blyk subscription. That is significant certainly. And as the numbers doubled in the past 9 months, if we assume only half as strong growth for this year, Blyk would have nearly 5% of the UK subscriber base in this age segment by the end of this year. Even if the 16-24 year old segment was not the most attractive segment to most in marketing (and obviously it is), these numbers become very "real" very fast. The biggest UK mobile operator, O2/Telefonica has only a 28% national market share (alll ages). The UK market is quite competitive...
AVERAGE CAMPAIGN AND AVERAGE BRAND
The new Netsize Guide 2009 has an interview with Blyk COO Leif Fagelstedt where they quote several Blyk numbers. Based on those I did an analysis of the advertising on Blyk so far. Note that of the 200,000 subscribers I used the halfway point (100,000 subscribers) as the reference number for the averages (as this is a growing service that started at zero 18 months earlier).
There are 200 advertising brands on Blyk like L'Oreal, Coca Cola, Mastercard etc. They have run a total of 2,000 campaigns so the average advertising brand has been so satisfied with their mobile marketing with Blyk, that they have run 10 separate campaigns during the past 18 months. For anyone who doubts the business viability of Blyk, this one statistic should answer doubters. Over the past 18 months that works out to more than one new campaign every other month on average across all advertisers.
I made some estimates based on anecdotal evidence that Blyk does not actually send out 6 ads to every Blyk user every day and assumed the total advertising traffic is 5 messages per day. This includes any response messages from the Blyk users. So as Blyk now reports a sustained average response rate of 25%, that means 4 outbound messages from the brand to the user, and 1 inbound response messages per user per day.
Lets do some math. By the above assumptions, Blyk has served at the average user level (some math fudging) 216 million advertisements over 540 days and also handled 54 million response messages. The average consumer who started on Day 1 would have seen 2,160 ads and sent out 540 responses.
The average Blyk campaign delivered 108,000 ads and obviously the average brand ran 10 campaigns and delivered 1.08 milllion ads in total on Blyk and received over 250,000 replies. Thats a lot of engagement marketing...
AN AVERAGE CAMPAIGN
It is not possible to exactly measure the size of a campaign because we don't have further information. But I ran some scenarios at Forum Oxford and came up with a likely scenario which did not draw any dissent. I honestly do not know how close these numbers are, but am confident the margin of error is not 50% or more, rather perhaps 20% or less. So we can safely use these numbers as illustrative examples of a typcal Blyk campaign and certainly there will be many which fit this exact profile.
My analysis suggests a likely campaign target size of 8,000 Blyk members (8%) and if one brand engaged with that size of Blyk customers 9 months ago then it would send 13.5 messages over a 2 month period. Practically thinking if we round it up to 14 it means for example running a one-ad-per-day campaign for two weeks and then being "silent" for the next six weeks. Or having one week-long campaign this month as the first half and a follow-up week-long campaign next month, to complete the 2 month long campaign cycle.
But yes average segment size 8,000 Blyk members and then you need to design a campaign that sends out 13.5 messages per user in a 2 month span. (and you'd expect to get 3.5 messages in reply on average per each such campaign from each average user).
That is radically different from desiging a national TV campaign or a web banner ads campaign or a search words campaign. You have to write the "script" for a dialogue that runs 14 outbound messages, receives 4 separate personalized replies, in probably a one month total campaign span. That is what a typical Blyk campaign looks like. Yes, we are re-inventing advertising like Alan tells in his new book Social Media Marketing (which has a foreword by Blyk co-founder Antti Ohrling)
WHY ARE REPLIES OF NO ALSO COUNTED?
We also had some lively discussion at Forum Oxford about Blyk today. It has some unhappy customers - who doesn't - and has recently changed its free offer to arguably less value etc. That is to be expected, they are still learning and experimenting in this space.
But an interesting observation was about how Blyk counts its "response rate". Note first, that a "response rate" is a stronger level of involvement than the internet metric of click-through. You can be invited to click through or be sometimes unwittingly caused to click through to a site which you did not intend, or which you find not appealing and you click out of (usually using the BACK link on the browser). A response on Blyk is a active intentional reaction by a user, even if the question was a "yes/no" question and you replied No. It is an active, deliberate, considered response every time. Never an accident
Remember the Blyk users get 4 ads every day (up to 6). They don't have to respond. And obviously as the advertiser brand is charged the cost of also the return reply messaging traffic from the users, obviously Blyk has a reason to measure and bill for this traffic..
So yes, if you had an unintentional click-through on the web, that is certainly a wasted effort, the person is definitely not buying your product. It distorts the number. What of the "no" response on Blyk (as distinct from not responding at all ie ignoring a question)? It is not the same as a false positive on a click-through. Because Blyk is premised upon the concept of "engagement marketing". It is not one single advertising message. It is a dialogue. A process. And most crucially, on Blyk the advertiser can have up to 200,000 parallel individual dialogues. Not one mass market shout to all. But thousands of individual discussions. All of course managed and automated, not individual emails to them all..
So where is the value of No. Its not no in one reply. It is the occurance of No in the context of multiple discussions among identified prospective customers. The occurance of no. What do I mean.
PIZZA HUT BURGERS, UK
So lets say Pizza Hut wants to trial a new product in their restaurants in the UK. Lets say they test market hamburgers. With Blyk they can measure a lot. First, before they launch, they run a survey among all Blyk members, on whether they would buy burgers (at x price) at Pizza Hut. They'll get yes replies and no replies.
Obviously Pizza Hut can follow up with the yes replies later by offering them sample discount coupons etc. Thats not the point. Lets examine the power of knowing no. Now Pizza Hut does its big jazzy national ad blitz on all media except mobile. They run TV ads and billboards and radio spots and magazine ads and coupons and posters at the Pizzxa Hut restaurants. They do the big movie tie-in with James Bond ordering a Quantum of Lettuce etc. Fine. Regardless of the merits of the idea, this will generate some business, so say all marketing textbooks. You advertise to generate sales. But how much did it work? Maybe it is only a few burger-fanatics who go eat all the burgers or maybe its a wide ranging success. Here Blyk comes in. Now Blyk asks the SAME question to the same people who responded the first time two weeks ago, just before the campaign.
We want to know how many who previously said no, now say yes (and vice versa). Because we know each user individually by their Blyk phone number and we know what they responded two weeks ago before this big ad campaign - we can measure the change. Because of measuring the replies that said no.
Even further, I said leave mobile out of the test. Why? Because after that legacy media based campaign, next week Pizza Hut can do a mobile-only viral campaign (across all networks if they want) And then measure how that changed opinions. Compare how the mobile campaign did compared to the older mass media. There is power in knowng no, Dr No.
So yes, Blyk also counts the replies of "no" and that is relevant, because in an engagement marketing process, also the "no" replies have value. They help us refine our targeting. And that is what Blyk is all about: targeting. How tight? a typical campaign wll target to 8,000 Blyk users and send then 14 messages over a month and receive 4 replies from the same person in that time. This is NOT rocket science of some deranged futurologist with impractical concepts. 200 giant brands do this with 2,000 campaigns across 200,000 youth customers who love it so much they deliver 25% response rates. Anyone who doubts the viability of Blyk to its target customers needs to understand this number. Blyk will not go away. Soon every market will have a player like Blyk to deliver this kind of targeted engagement marketing.
A new way to do marketing communications is being born. Blyk is showing us the way. (PS Blyk is a case study in my book Mobile as 7th of the Mass Media with the foreword by Pekka Ala-Pietila co-founder of Blyk and its chairman as well as past President of Nokia). and if you want case study examples of engagement marketing o mobile, I have 50 cases of recent successes in mobile advertising in my eBook Pearls Vol 1. Not all engagement marketing obviously but many of the recent examples are. Take a look at this page for Pearls Vol 1 Mobile Advertising