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Welcome to Episode 4 of The Story of You. Today, we have Milan Reinartz, the CEO of ad- tech company Postr, a New Zealand headquartered ad-tech startup.
In the age where the consumer’s attention and eyeballs have a price, Postr has created a value exchange model for individuals to get data for personalized lock screen ads. They offer consumers free data for opting in to view ads.
They have also just closed a round of $2.5 million in funding.
Here are some highlights from our conversation with the 29-year- old CEO of Postr
How did you come up with this? Why did you feel there was a need?
“I worked in advertising with Saatchi & Saatchi, BBDO and Ogilvy as a designer. As a creative, you create an advertisement for McDonald’s. On TV and a billboard, it looks great. But on a mobile, it’s on this tiny little banner, in between an article you are reading on the Straits Times, which is really not a good user experience. For me, this was frustrating.
“I was so into smart phones and to see that this was the best thing we could do on mobile with tiny little banners was frustrating.”
“I saw something similar in the U.S. but with different brands. I thought I wanted to try this with Fortune 500 companies and also through personalisation. We started with giving people points to cash out with or give to charity. Then, we gave people data, which turned out to make lots more sense.”
Why data over cash?
“The perceived value of getting 500MB or GB per month is much higher than getting $2-$3 per month– even though the value of data is intangible based on network capacity.”
Walk us through the process.
“You get an SMS asking, “Do you want to earn an extra 500MB or 1GB of data per month? Just download this app and get personalised ads on your lock screen. The amount you see depends on how much you use your phone and the demand we have in your personal demographic and location.
The reward is the same weather you see 20 or 100 ads a day– we base the reward on an average. Engagement with ads and excessive impression generation cannot be incentivised, otherwise the advertising loses its value because it is non-genuine.”
Let’s talk numbers. Tell us about the conversion rates.
“On average, people see about 30-40 ads per day. The point is that it’s undisruptive. We track two performance metrics. One is the click through rate and we generally have a rate that is 10 times higher than the industry average, which is fantastic for the advertiser.
“You don’t have an issue of competing with content. It’s a single minded proposition- it’s the only thing you
see. Here, you have positive bias into the advertising because you opted into the experience as it’s not been forced upon you and secondly it’s single minded, as it’s the only thing you see.”
How many users do you have ?
“We have 250,000 users. We got the first 100 through an app through advertising on FB for our app. Now, we have well over 1,000,000 registered users and 250,000 daily active users.”
What was your strategy to expand globally?
“We have always stayed lean and the B2B model always helps or the B2E2C- business tomenterprise to consumer model helps where we don’t need much money for marketing. We partner a lot with local sales agencies. We moved out of NZ because it’s not very saleable and I was lucky to find investors here in Singapore who are very supportive. We also identified SEA as a very attractive market based on our model.”
What is the big vision?
“It started with me wanting to make mobile advertising more attractive to the consumer. If it’s
more attractive to the consumer, it is more effective for the advertiser.”
How to get older people from non-tech industries to listen and take you seriously? How to deal
with other cultures?
“Big corporates generally embrace new digital technologies and try to find out what startups are
doing. Relationships are very important and you should be able to build a good rapport and relationship with key stake holders. It’s important to understand the market conditions and if your business model makes sense for this partner.”
The product market fit analysis stage is really important.”
What is the biggest lesson you have learnt in your startup journey so far?
“I am designer so I always try to get everything perfect. I learnt that you don’t have to get everything perfect. You just have to get one or two things perfect. The most important thing is that you get the business model right early and you prove you can generate revenues. Don’t be held back by idealism.”