• by Shankar Gupta , January 12, 2005

In a move to harness the growing interest in cell phone text messaging, online marketing firm MessageCast, Inc. plans to begin inserting ads into its LiveMessage service, which sends alerts via cell phone text messages, e-mail and desktop, said company CEO Royal Farros.

Currently, LiveMessage sends messages via e-mail, cell phone, or desktop alert for clients such as FoxSports, which uses the LiveMessage service to deliver current sports scores, and L'Oreal, which sets up 10-day beauty programs for customers, and uses the service to deliver reminders about the steps. MSN and all its various vertical sites also subscribe to LiveMessage, and can send their subscribers LiveMessage Alerts.

The next step, said Farros, is to insert contextual ads into the messages -- which MessageCast dubs "alert engine marketing." One of the major concerns for MessageCast, however, is to keep the ads unobtrusive, so as not to annoy the consumer. "The ads will be in the background, not the foreground," Farros said. "It's there to help you, and if it's not helpful, it's not there to distract you either."

Advertising through mobile phone messaging technology is taking off as a way of reaching younger consumers. In September of 2004 the Pew Internet and American Life Project estimated that about 53 million people used instant messaging. Within the 18 to 27 year old demographic, 25 percent specified that they had used IM wirelessly, as compared to only 15 percent of the whole.

Many advertisers are positioning themselves to take advantage of the increase in mobile messaging. www.TextAlert.com is launching a new service that can send coupons and promotional offers directly to cellular phones. Third Screen Media, another text messaging marketing company, worked with Dunkin Donuts to send coupons to opt-in consumers in the Boston area. In China, Detroit-based Emage Media developed one to two minute video spots, titled "Crazy English," that Chinese students can download onto their cell phones. The spots are designed to teach English, and Emage Media is now planning to include product placement in them, hopefully tapping the Chinese youth market.

In October 2004, FCC rules went into effect that strictly regulated the messages that marketers could send to consumers' mobile phones and PDAs. The rules require marketers to gain consumers' permission before sending text messages - and that permission can't be granted in response to an unsolicited text message. The LiveMessage service is entirely opt-in, however, so those regulations will not be a problem for MessageCast, Farros said.

Faros added that MessageCast is compatible with RSS, or really simple syndication -- which is booming in popularity among the blogging community. Blog owners can publish RSS feeds on their sites, and RSS readers then pull the feeds off the site and translate them into headlines, so a user can aggregate all the blogs and news feeds they read into a single program. MessageCast uses those RSS feeds to check blogs for updates, and then can send out LiveMessage alerts via cell phone, e-mail, or desktop alert MessageCast plans to insert the contextual ads into the alerts its LiveMessage program sends out.

Blogs supporting LiveMessage can also send these alerts by e-mail, desktop alert and cell phone text message. Ads relevant to the blog's audience can be inserted into these messages, Farros said, targeting the very specific and very involved audiences of Web logs.

"What AEM is, is just another extension into relevancy," Farros said. "The next five years will be online relevancy's assault on traditional advertising."