BILL DINAN: We’re seeing good growth year after year. Part of it is looking at the core foundation which we do from a quality perspective and then looking at technological solutions that we can bring to bear that help our partners utilize and get the most benefit out of our core products.
What’s your value-add to customers?
We’re probably the highest quality provider of local call-tracking lines that exist today in terms of breadth and availability and in terms of quality. Quality meaning the different types of things and tests that we do to make sure lines are operational. We’re held to a standard that’s higher than you hold your phone company to.
What specific things do you do that ensures quality?
Number one is local number availability. Number two, because the number of years we’ve been doing this, we bring to bear more of a partner-type approach, talking how our switches can be used. Because they’re a component of what our partners do to drive revenue for their advertisers.
Who are your main competitors?
From a pure call-tracking perspective, the only one that comes anywhere near a level of skill to what we do would be Marchex. But Marchex doesn’t do just call tracking. Part of the business is call-tracking analytics; part of it is their ad network.
What differentiates us from Marchex is we power ad networks. So at one point in time, years ago, Marchex existed as an ad network that was complemented by VoiceStar that was a call-tracking company and Marchex acquired them. So Marchex now has call tracking in-house to power its ad network.
Do you compete with ad networks?
We don’t compete with other ad networks. We’re about measuring, we’re about focusing on the quality of the measurement tool and how that can best be used for – whether it’s an ad network, whether it’s a media publisher that’s online, traditional media, broadcast media, mobile, depending wherever you’re going to be. In this world of a multimedia situation being able to measure across those platforms with a true independent view of what’s happened. I don’t care how things are performing, I want to be able to allow people to understand the performance of that media, whether they’re selling it, or for a national advertiser they might be buying it.
On revenues and growth, what have you seen in the past, what are you seeing now and what do you predict in the future?
I can’t really speak to revenues, the exact number – we’re a privately held company. We’ve been doing this for about 25 years and still private with no ambitions of going public. Growth, we’ve seen some significant growth over the last three to five years. We’re selling in the last year 160% growth in the digital search campaigns.
We’ve seen growth elsewhere but not as high as in those categories. So as a company we start off with traditional media, moved to online, from online into mobile, and as we moved to online get more involved in broadcast, we do a little bit in terms of electronic billboards and signage, that kind of stuff.
Where is most of your growth coming from?
Growth for us is more North America. Bigger numbers in North America than we’re seeing in Europe. We’re in about 12 countries in Europe, business is interesting there but it’s nowhere near the scale or adoption rate it has been. The only one that comes close to it is the United Kingdom.
I think the technology that exists within Europe is pretty significant – it’s similar to what is in the UK and then as we head into other countries there’s a lot of rules around – around regulation but there’s also different ways businesses transact, and how they think. So a lot of the growth we’re seeing right now continues to be in North America. UK comes close to it, and we’re seeing some interesting growth to Spain and France as well.
What’s driving that growth?
The growth we’re seeing has come in two pieces.
We’re seeing growth where traditional digital properties have expanded, shifted from measuring – using toll-free lines and ads to measuring local lines.
Why is there a focus on local lines?
Local numbers will on any given day outperform a toll-free line for hyperlocal search.
Whether you’re a local business or whether you’re a national franchise that’s appearing local. When I’m about to make a call, I’m looking for a local number. So what we’re finding is 3 ½ to 4 ½ times outperformance of local numbers vs. toll-free within the same ad creative.
So part of it is helping people understand the value of a local number versus a toll-free, and there are instances where you want a toll-free.
How about mobile?
If you look across our digital local search campaigns we’re running now, about 16% of them are true multiscreen campaigns. These aren’t necessarily the small businesses, but national agencies, media publishers, a variety of sources.
What do you mean by “media publisher?”
When I talk of “media publisher,” I consider a search engine a media publisher. I consider a vertical search engine a media publisher.
How do multiscreen campaigns affect your business?
So separate numbers in the PC, a separate number on the tablet, a separate number on the smartphone. For me, that’s a growth option for our business. As this becomes more complicated with more devices, there’s another need to look at the leads these devices might provide as well as the transparency required from the other businesses, being the small business or the national advertiser franchisee that’s looking to invest in it.
How do your clients approach their mobile investments?
There’s great potential that exists in mobile. Our call-measurement growth in mobile is outpacing advertising revenue growth in mobile right now. But I think it’s doing there is a leading indicator of people that are testing it. They’re trying to understand it. But in national advertisers they’re just looking at dollars. I’ve got to portion some of my dollars into online spend, they get that.
With mobile, they’re thinking about that [as well as] why should I take money out of broadcast right now? What’s the reason? How do I understand that? So as they’re trying to do this we’re starting to see the adoption of call tracking on mobile because now you’re seeing folks that adopted calls in traditional media, and when I say traditional, it’s funny, but I’ll call online search [traditional].
Why is that?
Print media was yesterday. Traditional is online. And new media [includes] the smartphones and tablets. So these folks now say, “What metric can I use that goes across all of this?” And the metrics are things like calls, they’re form-feeds, they’re reservations. Those are metrics that are helping national average. The lion’s shares of the dollars being spent today come across here.
Does Telmetrics plan to take on more funding?
The last time we had an investment in the company was back in the '90s. We haven’t taken on funding since, haven’t needed it for the growth options that we have, so it’s not a question where we’re out there looking for funding, no. We were investing our resources – we continue to invest our resources and profits in growing the business and growing it year over year. So, I don’t see there being a need for funding right now.
Who are you customers?
My customers are solution providers. They are media publishers, they are national agencies and they are national advertisers.
How many customers do you have now and how do you see that changing over time?
We segment customers by media type, so if you look at my business right now, about 75% right now are digital-based, with 25% being more of a print-based advertising. So we do print, but 75% of our business is in the digital space, be it online or mobile.
In the future, I think we’re going to get to the point where print will probably be about 5% of our business and not too far from the future. It’s not that print’s not growing, but the growth in the digital side of the business is so far outpacing what exists today, and also given the fact that we’ve dealt with print publishers for a long time and our penetration within them, the penetration of call-tracking numbers within that space is pretty heavy already.
What’s the size of the market you’re targeting right now?
If you’re looking at what we’re in, it’s really measuring direct-response media, or advertisers that fit into the direct-response model. If you look at whatever the size of that might be today, that’s the addressable market.