[NMMC] Herman Heunis shares Mxit story

Company is located in Stellenbosch, and has a presence in Port Louis, Mauritius. There are 100 employees, with 40 positions open for developers.

Mxit launched in January 2005, with a paid application (R10 per month). There were 40 subscribers. That business model was scrapped, and in May 2005 launched with a FREE application.

Today there are 7million registered users, (6 million in SA), there is a presence in more than 120 countries, (500 000 in Indonesia), even 8 in Vatican City. Different language versions are available.

The membership base grows by 12 000 - 17 000 per day.

Naspers owns 30%.

Ultimately, Mxit is a lifestyle company with a disruptive technology.

What is it?

It is a free mobile and PC application that allows one to send messages for free. You can also send pictures, sound, voice for small amounts.

It offers content, entertainment, community building

It is expanding into music, social network, fashion, more …

It is a simple process to join. Shouldn’t take more than 2 minutes.

COMPONENTS

Phone client, 300 different phones

Connect to other Ims ICQ, Gtalk

Community building

(info bot, splash screen, forum (120K), online magazine)

Own economy, (moola) which are obtained by premium rated sms. Difficult to convert to different countries, but it is being done.

Tradepost,

Joebanker

Company broke even in Sept 2006. Revenue is currently evenly split: 50% advertising. 50% users.

STATS

• 12 millions logins per day
• 210 millions per day user messages sent & received
• 900 millions total packets sent and recd
• 120GB per day data traffic
• 4m offline messages received

In the beginning

• Marketing budget was less than 100K
• Technical issues severe
• Software complexities
• Internet bandwidth is expensive: They have data centres in Germany, Canada, Mauritius
• Dealing with humans: fickle, Mxit must change offering continually

Today:

• Ever changing landscape
• Innovation
• Competition
• Costs: servers are expensive

Success factors

• Neither sms or mms are true communication tools, because they don’t have presence. With Mxit you can see who is online.
• Users entered a phase of resistance to high telecommunication costs
• Technology
• Few competitors

• The FREE model and registration
• Community building
• Vviral marketing (no above line marketing)
• The PRESS
• Ccreated fanatasy, own world, characters and economy
• Consumer evolution

• Viral marketing
• Brand principles

BRAND PRINCIPLES

Join the evolution

innovate and keep on innovating

scrutinize traditional sacred cows and continue to do so

“We don’t compete, we create”

Communication is free, will stay free

Person to person communication will stay free

Charge for entertainment, but not too much

The software used is open source. If it had to be purchased, it would cost R100 million

VIRAL MARKETING

Created anti-establishement feel, which played a big role in success of viral marketing. They also invested in cellphone stickers, t shirts, Mxit Chat rooms

Other tools used to promote Mxit via viral marketing:

• the website itself,
• forum,
• creation of fantasy world,
• referral campaigns,
• use of INFO BOT,
• advertised own content,
• used the press, and more

INFO GATHERING

Data can be collected on country, region sex, age, phone type

25% of users above 16 are employed

Earn,on average, more than R7,000

3.5% of salaries is spent on mobile content

Launch new features every 8-12 weeks

ADVERTISING FORMATS

Splash Screen

5 second, full colour picture, while connecting to software

Non intrusive, not spam,

Used for advertising

Click through options to specific URL

No porn, liquor, tobacco ads are accepted

Inexpensive, targeted

Perceived as Mxit endorsing content

Able to deliver high volumes of images per day

High critetria for acceptance

An example of splash screen campaign was “Battlegames”. With 7 million impressions served in one week, the campaign raised revenue by 258% for that week.

Other formats of advertising include Skins, Bots, Tradepost (internal advertising), Sponsored Content, regular web advertising, sms advertising

FUTUTRE INITIATIVES

Interactive TV (idols, tv, user-genrated content)

Online Magazine (Galactic Times)

Mxit music, (60% of revenue goes to artist, 40% to MXit)

Mxit cafe (Social network, similar to facebook, will have proximity. will be portable.)

Mxit clothing (Used for branding)

Note: For photographs, videos and blog posts by Zoopy, the official social media sharing partner for the New Media Marketing conference, go to www.zoopy.com/newmedia.