Ad funded Mobile Virtual Network Operator Blyk has made a promising start. UK sales director Jonathan McDonald announced that customer click-through rates on the network ranged between 12 and 43 per cent, which is far superior to what is being seen for other operators or on other media.
Blyk’s business plan is based on mobile display advertising. This ad supported system targets youngsters aged 16-24 in the UK. Subscribers of the Blyk network get free mobile call minutes and messaging in return for viewing six advertisements that they receive daily. The ads are highly targeted, based on selections made by the user at the time of subscription. Users of the Blyk network therefore only receive ads that they have opted-in for and are likely to be interested in.
This kind of advertising works because the users know what they are opting in for. Moreover, all the ads are sent according to individual preferences, which means the subscriber is more likely to be interested in finding out more about the products and services being advertised. The novelty factor and the fact that subscribers are compelled to view the ads in order to receive their free mobile minutes probably helps improve click through rates as well.
Do the privacy pundits approve?
The advertising system employed by Blyk should not ordinarily be perceived as obtrusive advertising because all the subscribers know what they are getting into. The choice is theirs, whether or not to opt in to use the operator, in the first place, and also to choose the products and services they would like to see ads about.
The future for ad-funded MVNOs
Early results seem to show that the concept of an ad-funded MVNO has is backed by a viable business plan. Advertisers will definitely be interested in purchasing ad inventory if these high click through rates can be sustained. The 16-24 mobile market is also notriously fickle, and an operator that can tie these subscribers down will definitely be able to attract top advertising budgets.
The next challenge lies in convincing not only youngsters to sign up but also professionals and middle-aged users who have higher spending power. If the service can be marketed well, then Blyk could could be a trendsetter and spell a bright future for ad-funded mobile networks as well as mobile advertising.