In a perfect world, you can market only to who you know actually cares (albeit even a little) about your product and not waste time and money on the disinterested. You can try as hard as you want, but you’ll never be able to tailor your content perfectly. I’m not saying the world is perfect yet, but it just got a little closer. With Mira, you can check the type of people in a given space and tailor your ad space specifically to them.
Jon Frangakis and his brother, with different skill sets came together to create this new venture. Today, they stop in to answer some questions for us.
Tell us about the product or service.
Mira provides web analytics in physical spaces. There are dozens of incredible companies out there that are touching this online to offline space so I’ll offer a specific use case to help illustrate how we’re different. Mira retargets in real life by affecting something called Digital Out-of-Home media (think: Digital Signage, Taxi TV, etc) which, for our purposes, we define as all the screens in all the public spaces that have 2 things in common (1) they’re serving us advertising and (2) none of them know anything meaningful about the audience immediately present. Mira takes advantage of that by tailoring the content from those screens and basing it on the mobile devices nearby. More specifically, on interests and demographics of a physically present audience that we anonymously aggregate through an index that we call the Behavioral Genotype.
Here’s how it works; we incentivize mobile app developers to drop our SDK into their app. Once they do that, Mira starts to build anonymous profiles, the Behavioral Genotype, in the background of those devices. The Genotype is simply a numerical representation of behaviors, interests and traits. That string encoding can then be used in lieu of identification over a proximity protocol such as Bluetooth Low Energy.
So if you can picture it, these Genotypes are floating around in physical space and can characterize the audience that surround a physical point in the world. Imagine if the signage we walked past in the mall was changing seamlessly based on the shoppers that were immediately present.
How is it different?
Most companies bridging the gap between digital and physical are focused on pushing notifications to a device based on that user’s proximity to a particular retail store for example. We’re going the opposite direction by using anonymous behavioral profiles, our Genotypes, to inform the screens around that user, effectively taking that mobile impression off of the tiny mobile screen. The idea is that we’re using mobile devices for ad context instead of ad content.
We take this a step further too. One thing we say around here is that you don’t always have to show an ad. While changing consumer behavior is incredibly valuable, there is also a great deal of value in measuring it. Analyzing Genotypes for a given location in real time and pushing that to a dashboard can be game changing to a brick and mortar operator. For clarity, Mira aims to be to a brick and mortar retailer what Google Analytics is to an e-commerce business. We differ from companies in this space in that we can offer the interest based a demographic layer of data for a site similar to what a Nielsen Scarborough subscription would get you but it’s better data (behavioral vs survey answers), hyper-local (as opposed to DMA-based), less expensive (about 1/3 the cost) and a sample size several orders of magnitude larger. We also offer a way to monetize it immediately through our Digital Out-of-Home integration.
What market are you attacking and how big is it?
With the introduction of targeting and other technologies, Digital Out-of-home becomes a $20B sector of advertising by 2020. In its infancy, location analytics is a $12B industry.
What is the business model?
On the out-of-home side, Media Owners (the folks that put the screens in place) will pay for targeting information from mobile devices since they can charge a higher CPM on targeted impressions. We connect the two mediums and take a cut for making that happen. Same on the analytics side, it’s simply a rev share for a portion of the subscription contracts
What inspired the business?
I use to be a vertical market director at a technology company and was selling into property managers and real estate developers. I was given a small ad budget (~$300k) and was getting almost 0 conversions on digital but I knew that my exact target was riding around in cabs all day. Even in the early days of Taxi TV, I was priced out immediately. A 30-second spot running on half the cabs in NY for a week was about 1/3 of my total ad budget. It became apparent that I would pay a lot more on a CPM basis if there were a way to reduce the overall campaign cost but obviously targeting wasn’t available. Actually still isn’t but we’re hoping to change that here soon.
So lucky for me I knew an incredibly talented developer really well, he happened to be my brother. Proximity protocols like Bluetooth Low Energy and WiFi Direct were just becoming a thing and we figured we could build it so we did. Working together has been amazing and I would say that was a big reason for even trying in the first place. I’m older than Gabe, who was off in Afghanistan and Iraq as a Marine when he was still pretty much a kid. That led to this dynamic in which he sort of looked up to me but now, as co-founders, my respect for his ability to build things has made for a great juxtaposition.
Here is a statement: The app economy has gone from 10 people chasing a dollar to 1001 people chasing two dollars. What are you thoughts on this?
It’s obviously true. In fact, it’s one of the problems that we’re setting out to solve.
The number of developers building apps has skyrocketed. It’s clear that app developers understand that there is a huge amount of money to be made in the app stores. A popular app that’s monetized well can generate a solid return for the developer, 12% of app developers make over $10k a month and a little over 1% of all app developers make over $500k a month — that’s a serious incentive to build an app. But because so many developers understand the potential profit in the app market, we have millions of apps competing for attention. The trouble is that many quickly learn that building an app isn’t a gateway to riches: 47% of app developers make less than $100 a month.
Part of this is because some apps just aren’t that great. But others just struggle to get noticed. And some are great apps, with strong audience numbers but just poor monetization strategies.
Monetizing with in-app ads is tricky. Mobile is not the desktop, and just throwing ads into an app doesn’t always work. In fact, it usually doesn’t. With the compact screen, the connectivity issues, the portability of the device and the focused attention of mobile users, mobile has its own complex requirements, apart from the desktop, and we need to stop applying the same thing that worked on desktop screens to the mobile screen — and if we’re honest, ad overload wasn’t terribly successful on desktop anyway. Over 50% of desktop users employ ad blockers or actively block cookies. Now we’ve got this outcry for ad blockers in mobile. Ads that compete against the app, don’t work. We developers need to monetize our apps without hurting the app experience for the end users we depend on.
We think that developers who build an awesome app deserve to get adequately compensated — that’s a problem we are already solving for our developers. If they have the audience, we can help them realize above average CPMs — without running off their audience with an ad-cluttered app.
What are the milestones that you plan to achieve within six months?
I think we’re a very different company in 6 months. We have about 2 dozen pilots that will be wrapping up over that time period with major mall operators, fashion boutiques, NFL, NBA and MLB teams. It could really be a Cambrian moment for us. If these go well and we convert pilot customers into paying customers, not only are we approaching profitability but we’re proving a value in areas that have a lot of room to change the way business is done across many different channels. The bridge between digital and physical is talked about a lot but nothing intertwines the 2 quite like Mira does. Retargeting impressions from desktop to mobile is one thing, but imagine begin able to follow that up with targeted impressions in the screens that surround us all the time when we’re on-the-go. We call this retargeting in the real world, which truly wraps the consumer in a unified message while still respecting the user’s privacy.
If you could be put in touch with one investor in the New York community who would it be and why?
We just closed a seed round a couple of months ago but we’re hoping to work with Google Ventures for our Series A which will probably happen sometime in Q2 of 2016. So with that, Erik Nordlander would be great to sit down with and our connections to him are pretty weak. Beyond capital, talking to Erik would be great because of the complex machine learning systems he built, specifically in the ad serving space. So while our capital needs are a bit off into the future, I’d love to start a conversation with him now. Besides, I’ve found that relationships get off to a better start when one of the parties isn’t in desperate need of something; especially if that thing is money.
Why did you launch in New York?
We’re from here. I moved to NY after I got out of the Marine Corps and it’s hard to imagine living anywhere else. But why is this a great place for Mira specifically? There’s the obvious Madison Ave focus and access to capital but also, NY is the mecca of out-of-home in a lot of ways.
Where is your favorite place to visit in the area in the fall?
The GWB walkway is amazing this time of year. You can look up the Hudson Valley on one side and it’s like this picturesque autumn backdrop and then face the other direction and the NYC skyline impresses every time. Just makes this awesome contrast of nature’s beauty next to one of our most incredible creations.