Text marketing enters the fray

An online company believes paying people to receive ads is the key to marketing by text message without irritating consumers or phone companies.

Mobile phone users registered with HooHaa list their name age, location and buying interests on a database and allow themselves to be reached by advertisers by text.

In return, they get a 10 cent credit for each advertiser text which is accumulated into lots of $2.50 and deducted from their mobile accounts.

The scheme started in January after chief executive Brian Hawker and his partners - Jason King and Kerry Emerson - happened on the idea.

Hawker - who has a background in sales and marketing at FMCG company Masterfoods - says it is early days yet.

But HooHaa signed up 43,000 people and last month began its move into the Australian market. "We've been surprised by the swift uptake and to be honest there is an element of our touching wood," he said.

"But we think that we might have happened on a business model for marketers to reach mobile customers with tailored messages."

Mobile phones are enticing for marketers because it gives them direct one-to-one access to consumers.

HooHaa answers a problem that has ensured mobile marketing is heavily self-regulated by the phone companies.

"Quite frankly, people just really hate it, says Michael Carney, the media strategist at ad agency G2.

But permission-based marketing is allowed by phone companies and HooHaa says it lets advertisers reach mobile users without becoming a nuisance.

HooHaa advertised through mainstream media and registered people in an online survey giving their interests and buying habits. As a result they got approaches only on things they wanted to hear about.

"I don't want to get messages from a fashion store like Max, but I do want to know there is a special deal for golf club members at a local golf store or if my favourite beer was selling at $15 a dozen at a local supermarket," he said.

Hawker said traditional direct marketing would see companies sending out 100,000 pamphlets or messages trying to reach 1000 customers.

Direct marketing executive Robert Limb, of Rapp Collins Limb Walker, said the type of service offered by HooHaa was more likely to be attractive for promotional advertising than for discounting.

He said the appeal of mobile marketing was based on the close relationship that could be forged and had to be built on permission to communicate.

Consumers had to be in control of the messages they were receiving.

Hawker confirmed the HooHaa had "some challenges" with one of the phone companies but declined to give details of this, the allocation of ad revenue or profitability.

He said the HooHaa database had a broad cross-section of consumers, but was strongest in the demographic for people aged 18-30.

Source: New Zealand Herald

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