Risk brings dream to life

2009-12-12 13:30

A GAMBLE by two entrepreneurs to ditch their cushy executive jobs

and venture into a barely developed mobile advertising business is ­paying

off.


Patrick Kuwana and Ncaba Hlophe are the founders and directors of a

mobile multimedia company, Livemobile, which supplies football data content to

cellphone users.


The 18-month-old multinational specialises in providing fixtures,

live commentary, video footage and results of soccer matches across the world to

its 220?000 subscribers.


Users log on to the company’s website via their cellphones and

download the content.


Kuwana says the mobile digital portal company was started after

they realised that traditional media firms were lax in taking advantage of the

mobile gadgets as a marketing vehicle.


“Our vision was based on the ­belief that cellphones are used by

­almost everyone in the world and we needed a business that will generate

revenue by marketing and advertising products and services to cellphone users,”

he says.


The entrepreneurs, late in 2005, left their jobs as executive

managers at retail companies to start Umliba Investment Corporation, an

investment holding company.


In January 2006 Kuwana and Hlophe took all their savings and bought

a 30% stake in international data-providing company, PA Sport. Last year they

set up Livemobile as Umliba’s subsidiary.


The partnership with PA Sport has proven to be strategic, as it

gives Livemobile permission to offer live video footage of the English

Premiership matches.


Livemobile, however, does not have rights to offer video footage of

local soccer games.


“Soccer is the biggest sport in the world and we thought the

business would be successful if it specialised in providing football

content.”


It was emotionally daunting to start the business as the industry

was still new, Kuwana says.


“It was a scary move. We used all our savings and pension money to

start the business. The industry was still new and we did not have any company

to learn from.”


But they banked on research showing that 70% of the country’s 27

million individual cellphone ­users were interested in soccer.


“The company is successful and we are proud that we have not gone

to any financial institution to apply for funding,” he says.


Livemobile generates its ­income only by selling advertising space

on their web page.


The service is supplied to football fanatics for free. However

their cellphone network operators charge them for content downloaded.


On average the website is visited by 220 000 users a month, half of

whom are registered regular users.

Kuwana says users spend approximately five minutes on the

website.


The firm is growing and has managed to tap into markets in other

­African countries.


“About 54% of users are South Africans, 23% are Kenyans and 17% are

Nigerians,” he says. The balance is made up of other countries.


He says most local users prefer to consume content on the Premier

Soccer League, while the rest of the market is largely attracted to

international football matches.


Kuwana says it was easier to venture into the business because it

did not require millions of rands in ­capital investment, as traditional media

does.


“The only thing you need to start this business is access to the

mobile technology and an innovative and unique product that will keep on

­attracting your target market.


“But the challenges include the lack of awareness of the product

and the reluctance of advertising ­agencies to set aside money in their budgets

that will cater for mobile ­advertising.”


Kuwana views traditional media firms as Livemobile’s

competitors.


Media companies such as City Press’s sister publication, Kick Off

magazine, and some local football teams are slowly starting to give Livemobile a

run for its money as they are offering a similar product.

T
he major advantage of cellphone marketing is its ability to give

swift feedback on the number of people who have viewed an advert.


Kuwana says since the company started they have been focusing on

growing it.


“But we are now finished with building the foundation phase and we

are now focusing on generating more revenue.”


He says the company will push an aggressive marketing

campaign.


“After five years we want to be one of the biggest advertising

mobile media platforms in the world.”


The company recently won an award at the Mobile Marketing

­Association in the display category for the Europe, Middle East and ­Africa

region.


Now it is setting its sights on ­opportunities that will be brought

about by the Soccer World Cup.

 

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