Mobile advertising is a niche space, where entrepreneurs are yet to take plunge due to several regulations and technology platform limitations.
Mobile spend in India are set to grow at 40 percent to touch Rs 250 crore this year. However with TRAI regulations beating down hard on unsolicited SMS as a medium for mobile advertising, mobile marketing agencies are making in app advertisements their new best friends.
In a matter of five short years the mobile landscape in India has transformed from voice and text based handsets to a market that’s talking applications and augmented reality. The Telecom Regulatory Authority of India (TRAI) has pegged active mobile connections at Rs 91.35 crore last year, a number that has marketers excited.
38 year old three time entrepreneur Anil Mathews has tapped into mobile advertising space of hyper local marketing to woo advertisers. Founded in 2008 his venture provides advertisers and publisher’s location based advertising.
When customers are sick and tired of their smart phones inbox being flooded with spam from property dealers and retailers offering deals, Adnear sends an ad only when customers using applications. The team of AdNear has driven around geographies and captured wireless information like Wi-Fi and cell tower signals and stored them against their locations in a data base.
AdNear checks which Wi-Fi signal or cell tower customer is connected to and then derives his location. The user then receives information regarding deals or discount coupons from retailers and other ventures in the vicinity. Having mapped over 800 cities and 4000 towns in India, this Bangalore based entrepreneur conceptualized AdNear in 2008. This hyper local advertising venture went live last year.
"We started building a platform that actually could use location on feature phones without operator dependence and across geographies. And when we built this we realised that this platform is so powerful that it could be used for various things like location based search or location based advertising and that was a starting point of AdNear," Anil Mathews, Founder & CEO, AdNear said.
"So in 2009 we finished out prototype and we started going and driving around various cities across the geography and capturing location information and data which we leverage today to target the users better. Initially it was intended for a different use but then we have grown today to be the largest location based advertising company in Asia Pacific," Mathews added.
The venture seems to have made quite an impression on investors too. Having received a seed round of funding from rediff.com in 2009 the real kicker came last year when the venture received USD 6.3 million from Sequoia Capital and Canaan Partners. Anil has allocated the money towards expanding AdNear’s international presence and strengthening his sales team. However AdNear’s technology does not clog customers mobiles with spasm.
"From a consumer point of view it is only a pull actually, we don't push an ad to them which means you won't get an ad when you are walking around or you are just near a store so here is an ad. It is always a pull which means you are using an app, you see the ad. There are no privacy issues or anything like that and when you click on it you get a lot of engagement options such as click to route or click to call or click to coupon. And it really works very well because actually as a consumer I am happy to actually get that ad because it is not just a spam ad, it is a useful information for me. I am actually seeing that okay here is an offer which is near me and here is a direction to reach there. So it is very valuable information that we are giving to them compared to just normal ad that is not making any sense for him," Mathews said.
In its attempt to be the largest AdNear now have offices in Bangalore, Mumbai, Delhi, Singapore and Australia. Working across operated networks and most OS like Symbian, Android, Blackberry as well as Windows, AdNear targets the in app advertisers as well as publishers like New apps or weather widgets and has roped in key clients like Toyota, Titan, Ford, Pizza Hut, Samsung, Nokia and Airtel. Having already reached 30 million unique users so far, Mathews explained how AdNear makes its money.
"Whenever we need to run a campaign for a specific brand, let us say we are getting X, we take a revenue share out of it, it is typically 60-40. So if you are taking like Rs 100 from the brand, we are giving away Rs 60 to the app owners and these app owners could be popular apps like chat apps, gaming apps, news apps and so on and we keep the 40 percent. That is the typical business model. Now the way we charge the brands is mostly on cost per mille (CPM) which means we charge them on 1000 impressions that it served," Mathews concludes.