Onwards and appwards for platform
Good things, they say, come in threes.
They have for NZAX-listed VMob, which now has three big international brands using its mobile commerce platform.
One announced in June was a three-year contract with PT Metranet, a division of Indonesia Telkom, to make its cloud-based technology available to Telkom's 147 million subscribers through wi-fi hotspots across Indonesia.
The two others are with McDonald's in the Netherlands and Mobil Exxon in Norway for a mobile app making personalised offers to customers in those countries.
Founder and chief executive Scott Bradley said all three relationships resulted from its association with interactive marketing specialist Tribal DDB.
"We have built a Ferrari mobile marketing platform that can attract big brands. Our strategy now is to have case studies in multiple markets - Norway, Indonesia and the Netherlands - that will prove we can scale globally," he said.
VMob's technology combines social profiling, geo-location and transactions to help retailers and brands better understand their customers and to get the timing right on personalised promotions and rewards.
The deal with McDonald's in the Netherlands was initiated a year ago, building on an existing app that already had one million users. It was relaunched six weeks ago on the VMob platform with new features that include customer profiling, location awareness and loyalty functionality. Since then the app has become the No 1 lifestyle app in the app store and No 2 overall.
"The VMob platform has significantly increased guest visits to store, tray value and gross sales," Bradley said.
The Mobil Exxon case is similar - an existing app is being built into VMob's platform and is due to be relaunched in October. It will include weather information. So, for example, if the weather is hot consumers might be offered a cold drink and ice-cream, whereas if the weather turns frosty, they would be offered a hot chocolate.
VMob tested its technology in New Zealand and learnt more about the pain points for retailers and what pushes customers' buttons in a year-long pilot, under the name Vouchermob. About 100 retailers were involved including McDonald's, Dick Smith and Dominos in the discount voucher scheme.
It also did an eight-week pilot in June with Yellow for its menus.co.nz brand, letting people know about restaurants in their area and what sort of dining experience to expect.
"We knew our technology worked well but we needed to better understand what drives customers to retail stores," Bradley said.
The company has won a couple of Hi-Tech awards and made Red Herring's Asia Top 100 list last year.
If the international case studies pay off as expected, VMob's next move will be to raise more capital to help it expand faster. It has raised $4 million to date, including $1.5m in a private placement mainly aimed at Australian investors in June.
"Given the depressed resources sector there's a lot of money looking for a home in Australia and they like a technology story. It's easier to raise money there than here," Bradley said.
He has retained the biggest shareholding with about a 43 per cent stake.
VMob was the subject of a Stock Exchange inquiry this week on why its share price rose 20 per cent, from 1.5 cents on 25 June to 1.8 cents on 19 September. The trading volume on September 19 was nearly 12.5 million shares compared with the year's daily average of 568,444.
Bradley said the company took its continuous disclosure obligations seriously and had complied with the NZX listing rules.
He said gaining a higher profile meant more people were interested in the stock.
At the Morgo conference for entrepreneurs earlier this month, Bradley was upbeat about the company's prospects although having spent $5m to date, it will soon need more money to keep the momentum going as revenues will build slowly.
The company reported an annual loss of $1.7m on revenues of just $90,000 for the year to March, its first annual result following its back-door listing onto the alternative market.
Auditor Deloitte said the company ended the year with a working-capital deficit of $180,000 and cautioned that might cast significant doubt over VMob's ability to continue.
Bradley said the capital raising in June helped alleviate that problem but it would be some time before the company was profitable because it was in an expansion phase.
VMob chairman, Phil Norman, said the relationship with Tribal DDB was providing opportunities that were otherwise difficult for a small New Zealand company to obtain and they would look for similar partnerships with others.
"We have great technology, a great team, and a big market opportunity. It comes down to execution and having the right amount of capital available to do that and sufficient working capital to employ the right people."
Norman, who holds around a 5 per cent stake and was a former chairman of NZX-listed Xero, likes to take an active role in the young companies he invests in.
"When you're dealing with the SME sector boards need to be actively engaged and the chairman has a lot more to do than regular board meetings.
"You have to understand the business."
The VMob potential was "tremendous", he said, but it won't happen in five minutes - it's a long journey.
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