Delivering the marketing message via text
START-UP NATION: ZinmobiZinmobi aims to help businesses get ahead of the curve on direct SMS-based marketing
With mobile growth occurring at a quicker rate than expected, serial entrepreneurs Conor McAleavey and Brian Stephenson decided to harness the power of mobile technology to increase sales and lower the marketing costs of companies.
Their latest start-up, Zinmobi, develops mobile marketing software for multi-location retailers, food service chains and hospitality groups.
The Musgrave Group, Four Star Pizza, Kilkenny, Müller, Soundstore and Papa John’s are among the companies that use Zinmobi’s software to deliver promotions and coupons via text message.
Stephenson had previously been head of risk and operations in the online division of Paddy Power and knew what could be accomplished when decisions were being driven by data.
McAleavey had worked as a business analyst for various companies including Mercer and AIG, where he saw the importance of using data to drive marketing decisions.
“We saw an opportunity to combine data with mobile technology for marketing purposes. It’s all about harnessing data to make decisions. We use data that already exists in a company such as customer purchase history, their last transaction and where they made their purchase to do targeted promotions.”
The duo got early-stage investment from current and former Paddy Power executives and launched the company in 2010.
“Our original app wasn’t very beautiful but it had very solid foundations. We picked out clients we knew we could be most useful to and contacted them. They tended to be companies specialising in fast-moving consumer goods. It’s all about drip-feeding regular customers to keep them purchasing often.”
The company employs five staff, a number it intends to increase in the near future, by stepping up its UK presence. Last year, the company was accepted on to the Internet Growth Acceleration Programme (IGAP).
“The programme is for high growth potential internet-based companies. There is a one-day session every month where international speakers such as Sean Ellis of Dropbox speak about pricing strategies and global partnering,” McAleavey says.
The duo’s start-up is a more advanced version of Text Republic, a mobile marketing solution they launched for smaller businesses and clubs in 2009. McAleavey believes mobile marketing is still in the development stage overall, and has not reached saturation point.
“In every new marketing medium, there is a curve. First there is spam because there is no regulation, then regulation comes in and a best practice comes about. Once that happens, the marketing medium is a success.”
McAleavey says the power of SMS-based marketing is often underestimated. “Every single text message in the world is opened. The same cannot be said for e-mails.
“We track the lifecycle of each text promotion, from the sending of the coupon to its redemption. We then report back to the client on the percentage redemption rate so they can see the success of each campaign.”
Thus far, the feedback has been good from client companies.
Four Star Pizza reported a 20 per cent jump in sales in some stores since they started targeting customers based on their purchase history. Four Star had been running a mobile marketing programme for years but they felt it could be smarter and more effective.
“They wanted a system in place that would allow them to track at head office what was happening at each individual franchise. Head office now has complete visibility of the mobile marketing programmes being run at each store along with a clear picture of the return on investment.”
As for the future? The company is in negotiations for a second-round of funding to finance expansion in the UK, take on more staff and increase a marketing campaign to get more clients.
“Many of our clients come through word of mouth, but we’d like to increase the promotion of our company to get more.
“We have an office in London, so we’d also like to increase our presence there. The UK is our testing ground for the rest of the world.”