If you have ever wondered what these are, or wanted to understand more about how they work and the right way to implement a RBT system, then take a look at this whitepaper from the Mobile Marketing Association.

One of the roles of the MMA is to encourage the spread of information and best practices about various forms of mobile marketing. In this whitepaper, they address the newly emerging RingBackTone format.

This type of advertising has been around since 2008, and has seen good success in certain markets. See MobiAd article, Turkcell – Putting Mobile Marketing At The Center Of The Business.

Even Google is apparently investigating RBT as well; Is “Ring Back Advertising” The Future For Google? And yet it is probably one of the least understood forms of mobile advertising.

The opportunity is huge: with over 3 billion phones worldwide, and an estimated 4 calls per subscriber per day, there are 12 billion potential daily impressions! In the US for example, there are about 1.2 billion calls per day, compared with about 240 million US Google searches.

The question of course is how will Google generate a profit from these activities. The recent publishing of a Google patent application titled “Ringback Advertising” may give a good indication.

Google Voice is a new Google service that is designed to help consumers manage their voice calls. The system provides a variety of features such as:

• a single phone number which can be used to consolidate all your incoming, outgoing and sms communications,
• a centralized Google Voicemail, which can also provide written transcripts (with Karaoke-like word highlighting!)
• a variety of other phone features such as conference calls, call forwarding, call blocking, call records, and discounted international call rates.

For more on the Google Voice system, take a look at the Google video at the bottom of the article.

Google also released Google Voice applications for Android and Blackberry in the past week, with a promise to release an iPhone version soon. These applications make the use of Google Voice very transparent on mobile devices. You can read more about this on the official Google Mobile Blog.

Clearly Google might be able to generate some revenue based on the international call charges, but the recent publication of a Google patent application gives an indication that they may be looking at advertising as a way to monetize their telephony business.

The patent (which can be viewed online here) discusses a full ringback advertising system.

Although Google has not made any statements about if or when or how they intend to implement ringback advertising, a look at the patent shows some interesting features:

• It would be an auction based ad selling system, as Google does for online ads.
• Advertisers can classify their ads according to product categories and a preferred location for caller. These are considered when the ad auction is taking place.
• The system will be able to take caller location into account when determining which ad to play.
• Callers can setup which category of ads they are interested in listening to.
• The system will be able to charge advertisers according to how long or how much of the audio message the caller actually heard.
• Metrics will be reported for optimization such as a “Listen Through Ratio”.
• There is a place for “third party publishers”, presumably other companies that would play audio ads from Google through their own PBX or other audio application.

Other companies have successfully implemented ringback advertising, for a good example read the MobiAD interview with mobile operator Turkcell. It will be very interesting to watch how Google decides to use this means of advertising to generate revenue from their new voice based services.

Here is a short Google-video about the Google Voice service.

This years winners came from a wide variety of countries, including America, Britain, Denmark, Finland, India, Norway, Russia and Turkey, highlighting the growing international flavor of the awards.

This year’s winners were drawn from over 180 submissions from over 60 countries, competing in 15 categories.

Two of the winners were mobile marketing services/campaigns.

In the category Best Mobile Ad Campaign, mobile operator Turkcell took home the award for their Tone & Win campaign (see MobiAD writeup).

In the Best Mobile Content category, the prize went to 20:20 London for their Thmbnls Interactive Mobile Drama (see MobiAD writeup).

The Full List Of 2009 Meffy Winners

Turkcell is the largest mobile operator in Turkey, with 37 million subs. They have been very innovative in the area of mobile advertising and marketing, with their “Tone and Win” service winning this year’s GSMA award for “Best Mobile Advertising Service“.

In this interview, Chief Value Added Services Officer Cenk Serdar talks about the Turkish market and why Turkcell has put mobile marketing at the center of their business.

The Turkish Market: Young and Tech Savvy

Turkey has the second largest population in Europe, and it is also a very young country. The average age is only 28, and over a quarter of the country is aged 14 or younger.

In general, the Turks love their mobile phones and new mobile services are rapidly adopted. However, although the population is generally tech savvy, many people do not have much disposable available. So in the past, Turkcell has found that it can be difficult to earn much money if they charge for a service.

… and Price Sensitive

As an example, Cenk talked about their experience with Microsoft Messenger service. The available target market in Turkey is the 4 million handsets that run Windows Mobile OS. Turkcell did a 3-month, free promotional launch of the service, and within the 3 months had signed up 1.5 million active users. This was cited by Microsoft as one of the fastest launches of messenger anywhere.

At the end of the 3 months, the promotion finished and the price went to 6 YTL (less than $5). Cenk described the situation, “People knew the service, they had downloaded it, they liked it, they had used it. You would think that someone would be willing to pay for this.”

However, when the promotion ended, Microsoft Messenger users fell from 1.5 million users to 25,000 – a drop of over 98%!

Cenk concludes, “Customers are so price sensitive, there is a huge difference between charging nothing and charging even a couple of dollars.”

Everything Will Be Data

Cenk believes there are some other fundamental long-term reasons why mobile advertising and marketing will have to become a major business for operators. He points out that the current trend is that everything mobile is moving to broadband, even voice services, and gives the example of the growth of Skype in the mobile space: it has been pre-installed on some 3-UK handsets for awhile, Nokia just announced a deal to include Skype on their handsets, and a Skype application for iPhone was recently released.

“In the long run, customers are not going to be paying for voice separately – it’s all going to be a data package and voice will be included. And actually, the next step beyond that will probably be that the data charges will also be paid by someone else (e.g. paid by a brand through advertising).”

So these are the underlying reasons that have driven Turkcell into mobile advertising: the need to offer free or low cost services, and the eventual erosion of other revenue streams.

“A year ago, we started putting mobile advertising and marketing very much at the center of our business. These are the reasons why we put a lot of our energy and resources behind it.”

“Tone and Win” (Tonla Kazan)

Turkcell’s plan is to launch a lot of innovative services, knowing that some will fly and some will not. You never know ahead of time, so it is important to experiment.

One new service is “Tone and Win“, which takes advantage of one of a mobile operator’s basic assets – a voice call.

Between when the call is placed and when the person picks up, there is a time period which is idle. Cenk says, “We can fill this time with a marketing service which is not intrusive, and in fact, if we do it right, it might be enjoyable for the customer who is calling.”

Basically a subscriber enrolls in the Tone and Win service, and then when someone calls them, the caller will hear a marketing message instead of a standard ringtone. The subscriber earns credits depending on how many callers they receive that listen to the messages. The credits can be used for voice minutes or to purchase other data services from Turkcell.

This service has been very successful, and Turkcell has great plans for it in the future. “Tone & Win” also recently won the GSMA’s “Best Mobile Advertising Service” award.

Benefits For Brands

The benefits to the subscriber are quite clear – free minutes and services. But Turkcell realizes that there also has to be a very compelling story to the brands if this service is to work well.

Cenk cites 5 main reasons why these services work well for brands.

• First, the caller is captive, there is no competing advertising. They are are making a phone call so they are actively listening to their phone at that moment.
• Second, the operator usually knows the demographic profile of the calling customer, and so can select the most relevant ad to play*.

  Clearly Turkcell would only know the caller’s profile if they are also a Turkcell customer. However Turkcell has found that over 90% of calls are “on net”, so usually they do know the caller’s profile (one of the benefits of a 56% market share!).

  The service is set up so that in fact the brand is only charged for the ad if the caller is also from Turkcell; if the caller is from some other network, the advertising message is still played, but the brand is not charged for it.

• Third, Turkcell knows not only the demographic profile of the customer, but over time is developing a profile of the caller’s propensity of interest, based on responses to this and other services.
• Fourth, this service is very measurable. Turkcell can provide full reports on how many people listened, how long, where they were from, actions taken, etc. All the data is available to the operator, and is very valuable to advertisers.
• Finally, the service can be used not only for branding and building awareness, but also for direct selling of products. For example, during the advertising message, the caller can be given the option to press a key to get additional information, be connected to a call center, etc.*

Cenk concludes, “You can see that everything works for the brands, so getting brands on board has actually been pretty easy”. In 2008 50 brands ran campaigns on the Tone and Win service, including Coke, Pepsi, P&G, Nestle, and most of Turkey’s biggest banks.

An example of a successful targeted advertising campaign created through Tone & Win was the November 2008 campaign by Warner Bros for the James Bond film Quantum Of Solace. Only Tone & Win members who were between the ages of 13-54, male, and living in the 26 Turkish cities where the movie launched could select this ringback tone, thus concentrating the advertising message on the preferred customers in the target markets.

Opt-In Mobile Marketing

Turkcell also runs several other mobile marketing services that have proved successful.

One of the best known is the “opt-in database” which now has over 7.5 million subscribers. Basically, customers agree to receive marketing messages, with the promise that the messages will be relevant and will offer good deals on interesting products.

Turkcell of course never shares individual information, but they will do profiling and targeting to setup a specific target group for a brand, sometimes as small as 5,000 to 10,000 people. And the returns are great, with response rates usually running from 5% up to 25%.

Turkcell has found that many brands, especially banks, are using this type of marketing because the results are very measurable rather than TV where you never really know if there are sales generated.

“The beauty is that we can target the customer and bring the right message to them. More and more brands are preferring this channel, because these days it’s not about generating awareness and excitement, it’s about generating real sales. And this is a perfect channel to generate sales,” say Cenk.

Selling Mobile Marketing

Turkcell sells mobile marketing services both directly and through partners.

There is a network of 22 mobile marketing agencies who are closely linked to the Turkcell mobile marketing team and who are paid on a performance based revenue-sharing model. Cenk say, “These companies are specialized in mobile marketing, so we have found they are more successful at selling than any other media agency.”

When Turkcell sells mobile marketing directly to its major accounts, the activity is integrated with other sales efforts – corporate account managers and mobile marketing account managers often visit the customers together. In fact, some of the mobile marketing agreements are worked out directly between the “C” level managers at the customers and Turkcell. So this is a subject that is getting a very high level of attention.

And mobile marketing is proving to be a good business for Turkcell. They now have a number of major Turkish corporate customers where the revenue from mobile marketing is greater than the revenue from all other Turkcell services combined: voice services, internet services, Blackberry services, etc.

Global Economic Slowdown

Cenk believes that the global economic problems have effected the mobile content business in Turkey, but not drastically. On the other hand, mobile marketing looks like it will be positively effected by the economic problems. “This is primarily because mobile is so much less expensive than TV, but with very good results.”

He cites the example of a real estate development firm that ran an outbound “targeted IVR” campaign (another service offered by Turkcell) and managed to sell 18 apartments worth a total of $5million. The campaign investment was less than $100,000, so it was a very successful effort.

The Future

Cenk concluded the interview with a few thoughts on the the future.

“When I look ahead, I see lots of opportunity. Instead of people complaining and talking about why mobile marketing doesn’t work, they should come to countries where it really works. There are so many ways to do this if you really understand the customers’ needs, and then combine it with your mobile assets.”

“From our perspective, we feel really great about mobile advertising, we think now the time has come. When you work mobile marketing at the C level – the CEOs and CMO’s – then you can get the budgets allocated. We see that brands are building mobile into their budgets at a very early stage, and we think our revenues in 2009 might double from 2008.”

* these 2 features are in the platform and will go live within a few months.

Since then, 200,000 subscribers have signed up, and 50 different brands have run campaigns using the service.

Turkcell is the largest GSM operator in Turkey with 36.3 million postpaid and prepaid customers (as of 9/2008*) with a market share of approximately 56% (as of 6/2008*).

In May 2008 the TonlaKazan service was launched. TonlaKazan subscribers can choose a branded message that people hear – instead of a standard ringtone – when they call that subscriber. The subscribers would then earn free airtime depending on how many people called and how long they listened to the advertisements. Turkcell also introduced a new advertising charging method called CPL, “charge per listening” (this MobiAD article explains the service in more detail.).

Since then, some fifty different brands have launched 72 campaigns using the Tone & Win platform including major brands like Akbank, Coca-Cola, Universal, Digiturk, Garanti Bankasi, Kraft, Nestle, Nivea, P&G, and Unilever. Each campaign had a minimum duration of two weeks, and at the end of each campaign Turkcell would provide the brands with a detailed report containing members’ demographics, socioeconomic status, total impressions and total branded RBT seconds listened to by callers.

Turkcell reports that on average, Tone & Win subscribers are awarded 20 minutes of airtime per month, although this number can reach up to 40 minutes for some subscribers who receive lots of incoming calls. Although it was only open to a limited amount of members during the beta period, the loyalty program has currently grown to over 200,000 members and has now been made available to all Turkcell subscribers.

Cenk Serdar, Turkcell Business Development CEO said, “The Tone & Win platform … has reached over 200,000 members since its launch, creating more than six million monthly impression in six months. Additionally, the platform is decreasing the churn rates of Turkcell subscribers who are Tone & Win members by giving free text and minutes in return for sending sms/mms ads daily. This new ad-funded business model shows great promise and the potential to surpass other models in mobile marketing.”

Tone & Win was developed with 4Play Digital Workshop, Turkcell’s business partner that provides innovative products and ideas.

Read the full Turkcell press release.

* Source: The Telecommunications Authority