Where is China's mobile sector heading and how will companies use SMS and WAP to monetize their services in the future? Joshua Maa is leading Madhouse to develop an advertising platform to address the needs of clients eyeing the mobile world in the Middle Kingdom.
Before founding Madhouse, one of China's largest intelligent mobile media agency and ad networks, Maa was EVP at TOM Online, where he grew the company to become China's largest MVAS firms by revenue. At TOM Online, he directed Wireless Business & Operations and International Business Development, leading 450 professionals and contributing to over 90% of total company revenue, which grew to well over US$16 million monthly in 2005.
Before TOM Online, he was the Founding CEO of Rock Mobile Corporation, Greater China's leading Mobile Music Entertainment Service Provider, where we raised US$8.5 million in 2 rounds of financing from first-tier VCs. At Rock Mobile, he built a team of 160 professionals and made RMC the leading Mobile Music Service Provider in Greater China.
Originally from Taiwan, and with over 14 years of managerial experience in Greater China's New Media, Entertainment, and Consumer Marketing industries, Maa is one of China's leading MVAS thought leaders and is currently the CEO at Madhouse.
How did Madhouse begin and why are its services necessary in the market?
David Ogilvy once said that 50% of advertising is wasted, but no one knows which 50%. Madhouse was established to challenge the current state of affairs in advertising, providing advertisers with the potential to target consumers with unprecedented levels of accuracy, immediacy, and interactivity.
Madhouse enables advertisers to take what are usually post-campaign analysis and KPIs for online campaigns and turn them into pre-campaign mobile targeting and media buying criteria.
MadServing has innovated intelligent mobile targeting that makes immediate use of user information (geo-city, carrier sub-brand, handset brand, model, and price segment) to ensure that only targeted users see relevant ads projected onto sites within the MadNetwork visited by those users. Such precision targeting is not possible in campaigns targeting traditional PC websites.
MadServing also enables advertisers to set limits on the number of times individuals view, click, and interact with ads.
Via MadServing, advertisers choose from the full array of flexible charging models: CPM, CPC, CPA, and time-based pricing.
To further boost the effectiveness of ad campaigns, MadServing includes an optimization feature, whereby different ad versions (design, creative, and context) of the same ad campaign are ?°served?± in various ad positions, evaluated hourly, and then top performing creatives are rotated into the various ad positions.
What sort of financing does your company have and what type of additional finacing are you looking for?
In March 2006, Madhouse completed first-round funding of US$3.6 million led by Gobi Partners and JAFCO Asia. Madhouse will raise second-round funding in the first half of 2007.
Why can't a traditional online ad serving technology or software deal with serving ads on mobile devices?
First, the mobile environment, particularly in China, is very complex. China has well over 450 million users carrying over 1,000 different handset models, from the highest of the high end to the lowest of the low end. In constructing MadServing, we had to take into account the huge variety of mobile phone operating systems, screen sizes, and continuous advances in technology. We developed MadServing to ensure optimized and standardized ad serving and reporting across this fragmented landscape.
Second, mobile ad serving includes intelligent targeting and reporting not possible over the traditional Internet. The increased functionality enabled by MadServing gives the mobile media an edge over traditional and online media, providing advertisers with better targeting and increased ROI.
What sort of growth do you see in your business in 2007-2008 and what type of benchmarks do you plan?
We see 2006 as the birth year for mobile media advertising in China. SMS ad broadcasting, a precursor to mobile Internet advertising and much of it considered spam, has been something nearly everyone in China has experienced, and this more primitive method has basically run its course.
We forecast that mobile media advertising will see a huge lift off in 2007, as carriers launch and promote 3G services, and brands come to realize the effectiveness of mobile media as a way to interact with consumers on an individual level, any time, any place. We see 2008 as a boom year, as the number of mobile Internet users comes to exceed the number of PC Internet users in China, and mobile media establishes itself as a major mainstream media in China.
In the first five months since launching the MadServing platform in July, Madhouse has served well over 84 million targeted mobile ad impressions. Considering our highly scalable business model, we expect to see exponential growth in impressions served over the coming months as more advertisers and publishers join and grow the Madhouse network (MadNetwork).
What sort of campaigns do you do for clients?
A global luxury spirits brand came to Madhouse to reach its target audience for the promotion its first ever global music event spanning New York to Shanghai. Via MadServing, the client projected promotional text and banner ads onto China's leading mobile Internet portals.
MadServing intelligent mobile ad serving enabled the client to specifically target the fashionable young China mobile Internet user base in Beijing, Shanghai, and Guangzhou.
The client targeted the home pages and entertainment channels of leading Free WAP portals with banner and text ads. Users that clicked on the ads were taken to a sophisticated campaign site built by Madhouse that presented full information on the event series, including detailed venue information, lists of stars scheduled to perform at the various parties, event-related wallpaper for download, and a chance for registered users to win event invitations. The site also featured a ?°refer to friends?± feature, enabling users to forward the site link, creating a viral effect.
How will the new consumer-friendly MVAS policies issued by MII affect your business going forward?
We fully support the recent policies instituted by the MII, particularly those meant to control SMS spam. The improved environment lays the groundwork for the larger and more responsible brands to move into the mobile media and interact with consumers in a win-win fashion.
