Alastair Shortland is Founder and CEO of Textlocal, who provide SMS and mobile marketing services to a wide range of businesses including Dominos Pizza and Manchester United Football Club. We caught up with Alastair to discuss his business, his industry and his thoughts on the future of digital marketing.
Q: How did Textlocal start?
A: Six years ago, Alastair founded Textlocal as a bedroom start up and built "version 1." His driving vision was to introduce the power of mobile messaging to the mass market – simple, low cost instant communication for any business, service or community group. Alastair studied Computer Science in Nottingham before working for the Defence giant QinetiQ, and then on several projects for The Met Office and European Air Traffic Control. He chose to take a different path in 2005 after realising a gap in the market for a cost-effective mobile marketing provider, after opting-in to a text promotion for a local nightclub. He thought to himself, why shouldn’t all businesses communicate with their customers in this way?
He then joined forces with Darren Daws, whom he found on a website aimed at putting together investors and entrepreneurs, and now leads a team of technology experts at the Malvern Hills Science Park.
Darren runs our Chester office, spearheading the sales and marketing function. Darren graduated from Loughborough University, and spent the next 20 years working his way up the ladder in numerous marketing roles working for famous brands like B&Q, HBOS, AIG and Dixons Stores Group. Since 2005, he has used his skills to help bring the Textlocal service to market.
Q: What marketing trends do you think will emerge in the next couple of years?
A: 2012 will be the year of the mobile; and we will see more connected TV. Consumers are already wanting to do more things on the fly. Somebody even bought a house on their mobile this year. We will see more of this over the next few years, and the important purchases will become less constrained to consumers sitting in front of their PCs. TV will be more interactive, and advertising will have to complement this. We have seen product placement creep up within this space, and this will have more prominence over the coming years.
Anybody wanting to remain competitive will need to be digitally savvy, whether a large or small business. Mobile NFC payments will be developed and made easier for people, with more famous brands becoming involved. TV on demand will grow meaning that marketers will need to consider when audiences are consuming their media; it won’t always be when you think. Location-based targeting has been under question lately, as to whether people see it as opt-in, but this could grow over the next few years and see more people receiving targeted offers while they're out and about.
Q: Your company’s success suggests that in marketing, the medium can be more important than the message. Do you agree?
Make sure you look after your finances, and plan for making your budget work as hard as possible
A: I do agree to an extent. Response rates are significantly greater than traditional forms of advertising with the average SMS response rate typically ranging between 15 to 30 percent, compared to 5 percent for email and 2.61 percent for direct mail. No matter how important the message, it needs to catch the attention of the recipient first in order to be read and consumed. How it is delivered plays a huge part in this.
However, we do believe that they go hand in hand. We believe mobile marketing and communications is the best method to reach out to a targeted audience rapidly, however the message needs to make sense, have a clear call to action and mean something to the recipient who SHOULD have opted-in.
Q: You’ve brought quite a disruptive business model to a fast-moving industry. What challenges does this create?
A: Without any loans from the bank, or investment, the Textlocal start-up was difficult. However, we knew there was a demand, and so our business model was based around this demand. So we were able to move fast. With many start-ups I guess some challenges are based around location, rates and property. However we are an online business, so I worked in the early days from my bedroom. As we got bigger we faced some of the challenges just mentioned, but again we split ourselves into town prime locations (Chester, Malvern) and recruited the right talent to drive the business forward. We now have 14 people working for us. Of course there will be new entrants to the market, but we feel we offer added value for all our customers that is unbeatable.
Q: You’ve said before you didn’t have a lot of entrepreneurial experience when starting Textlocal. To what extent did this handicap you?
A: I truly believe that if you begin with a robust business model that works, entrepreneurial skill becomes second nature. As a technology expert, I was able to develop an online platform and use online marketing tools available to me relatively quickly. I was lucky as I was able to concentrate on what I knew best which was the online space, and then partner up with Darren who had expertise in marketing and finances. I think for entrepreneurs setting up shop alone, it’s very hard to be a jack of all trades and do everything yourself. There is a great deal of help nowadays for new start-ups, however you still need to be astute enough to know where to look.
Q: What tips would you give to entrepreneurs who don’t have a lot of experience when starting their first company?
A: I guess my only advice would be to make sure there is a clear demand for your business idea. You need to have a business model that will stand up in a busy marketplace. If the idea focuses on providing an expert service to the end user, and that service is in need, then you have the makings of a successful business, with or without the entrepreneurial skill normally associated with growing businesses. There is lots of advice and guidance available out there on how to market, finance and run your business, but it’s the idea behind the business that needs to be strong from the beginning.
Q: What three tips would you give to a start-up/SME looking to get the most bang for their marketing buck?
- Don’t ignore the power of mobile. Even a new company with no customer base can grow an opt-in list of potential customers to communicate with in as little as a day
- Be honest, transparent and inspiring in all your marketing communications; this will pay off in the long run
- Focus your marketing on the activities that will generate substantial return on investment
Q: What three pieces of advice would you give to an entrepreneur starting a company in your industry?
Q: To what extent will the increasing uptake of smartphones and mobile devices capable of processing interactive content have on the ability of text marketing to connect with its audience and yield a strong response rate?
- Have a clear vision, outline your objectives early, and know where you want to take the business and how you will go about getting there
- Make sure you look after your finances, and plan for making your budget work as hard as possible
- Understand your target audience, who you appeal to and get to know your customers
A: Text messages are simple, low in cost and have a readership of 97.5 percent; also the average text is read within four minutes of being sent. As the adoption of smartphones grows, the benefits of SMS becomes clear; campaigns need to capitalise on using SMS to support their overall marketing strategies and use messaging as the main force driving customers to the Internet. The combined effects of the recession and sweeping budget cuts in marketing spend; business owners and marketing agencies with a need to drive messages into more finely targeted campaigns with greater return on investment, every pound spent has to bring campaigns closer to the consumer.
No longer are you limited to 160 characters of text, the use of Smartphone technology and the public acceptance of tiny URLs on social media platforms, means that SMS can be used as tool to link to a bigger picture. SMS can now be used as the ‘hook’ needed to direct the reader to where they need to be online, faster than if they were left to their own devices. Links to apps, videos and web pages are easily incorporated into an SMS message, making SMS a vital tool working hand in hand with other mobile marketing tools to achieve greater ROI for every mobile campaign.
Q: Some people say that traditional forms of marketing – such as newspapers and TV – are ‘dead.’ As the owner of a cutting-edge, modern marketing company, do you agree with this statement?
Businesses need to learn to link everything together, and extend marketing campaigns to all mediums.
A: Marketers these days need to take an integrated approach. Digital is moving fast, with mobile leading this space, however this doesn’t mean that those who wish to consume information through more traditional methods should be ignored. Businesses would lose out by doing this. Rather, businesses need to learn to link everything together, and extend marketing campaigns to all mediums.
We are an online business, but we still have presence in print and other mediums. It’s also important to utilise different mediums as your route to the consumer. For example, you might place an advert in a newspaper, but use SMS or Twitter to alert the consumer to it by sending the correct URL. There are still certain demographics that prefer to still use traditional media, so we marketers still need to cover all bases. We need to evolve and embrace new technology, alongside, and almost to complement, what we might be doing elsewhere.