Crowd Mobile (ASX:CM8) has just announced a record fourth quarter and is busy growing its new Digital Influencer Agency, which it sees as a key opportunity going forward.
Over the fourth quarter, Crowd Mobile achieved record revenue of $11.6 million and underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of $3.3 million.
This year, Crowd Mobile launched Crowd.Agency, a platform that connects brands with “digital influencers”- people who have a strong presence on social media. Crowd Mobile.Agency is currently executing over 200 influencer campaigns a month and has worked with over 4000 influencers over the past 3 years.
I spoke to CEO Domenic Carosa and asked him about Crowd Mobile’s strong year, Crowd.Agency and plans for the future.
- It’s been a great year for Crowd Mobile. What do you attribute your success to?
Laser Focus. We’ve had quite a number of integration pains with a company we bought called Track which now forms part of our subscription division.
We’re very much focused on our existing businesses’ organic growth as well as paying down our debt. By the end of June, our net debt was less than $3 million dollars, which is a far cry from the $15 million it was 18 months ago.
- Why is Crowd Mobile investing in digital influencers?
We see digital influencers as the new TV channel and TV commercial, particularly for the millennial market. Millennials are no longer watching traditional TV and online they’ve typically got adblockers installed. Hence, the best way to get marketing messages across these days is via influencers.
And the reason influencers work well is that their followers trust them much more than a traditional TVC or banner advertising. A large part of our Q&A divisional growth has occurred due to our increased use of digital influencer as a market channel.
- How can someone become a digital influencer?
In our experience, people want to become digital influencers for fame first and then fortune.
It terms of how it’s about trying to find a gap in the marketplace. They can start by simply recording video or starting an Instagram account and finding what people are interested in, all while conveying their unique personalities.
Traditionally, influencers might have had 50 or 100 thousand followers, but we are finding that a more important metric is engagement. You can have someone with 2 million followers with very low engagement, which isn’t as good as someone with 100,000 followers who has very high engagement.
- How does Crowd.Agency work from both the influencer and brand point of view?
We have a team of over a dozen people who find influencers and approach them to promote and market products. We’ve even built an Influencer CRM (Customer Relationship Management) platform that helps automate much of that particular process.
The influencers will either deal directly with us or through a talent manager. We then work on the creative and finding the best method and channel to promote a particular product. Following that, the influencer often creates the content in conjunction with us, and we’ll agree on a release schedule.
Brands on the other hand, will typically come to us and say they want to use influencers to market their products. Their core objective may be to increase email subscribers, get people to download an app or boost sales. We will then match the brand with the appropriate influencers and desired call to action.
- What has been your experience working with Viacom? Do you see personalisation as an important area going forward?
We have a very good relationship with Viacom International, a large global media company. We have released six apps with Viacom’s MTV, and we are in constant communication with them about what’s next. You can expect some further developments in this area very soon.
I think one of the reasons there has been so much growth in the emoji/sticker space is because people want to personalise their communication.
You don’t get an email or message these days without an emoji or sticker in it. And that’s just the trend towards personalization that’s taking place.
- What emerging technologies are you excited about?
AR and VR are certainly very interesting. We are experimenting with some AR, but it’s not mainstream yet. Since we are trying to tackle the mainstream market, we need to wait until AR sees more widespread adoption.
Another emerging technology we are excited about is 5G. It is definitely going to be important in the continuing shift to mobile that we are seeing around the world. We’ve passed the tipping point, and people are spending more time on their mobile devices than any other device.
- What are Crowd Mobile’s plans for the near future?
We will continue organically growing each division of the company and keep paying down our debt. That may sound a tad boring, but it’s the right thing to do from a business perspective. We do have a number of innovative new products that we are building for digital influencers and we’ll be announcing them over time.
We see digital influencers as the new TV commercial, particularly for millennials. The way influencers make money today is mainly through advertising. For example, they’ll hold up a can of Coke or use an Apple device and get paid to do that.
However, moving forward we see that there are opportunities for them to leverage their popularity to sell both physical and digital products. So we’re focusing on how we can help them monetize beyond advertising.
This is where our global mobile distribution network, which we have spent the last eight years building, comes in. As of today, we are connected to over 160 telcos around the world that allow us to bill our customers’ mobile phones. That’s a very powerful distribution network that we have in place.
About Crowd Mobile
Crowd Mobile is a mobile-first company with a world-leading ‘Q&A’ platform, providing personalised expert advice, and a subscription service giving users access to games, infotainment and security products.
It operates across 54 countries and 30 languages and have partnered with more than 160 mobile carriers, allowing users to pay for products and services through their mobile phone or with Google or Apple Pay.
Crowd Mobile has developed a diverse range of products in the m-payment, entertainment and infotainment space and is listed on Australian and German stock exchanges (ASX:CM8, FWB-XETRA:CM3).
