April 13, 2010

ad:tech Presents Scott Kelliher's Experience at Virgin


By Wendy McHale

Madonna's got nothing on Virgin Mobile, except perhaps a ringtone!

With more than 15 years of experience in brand development, marketing and sales management, Scott Kelliher joined Virgin Mobile USA in June 2006. As the Director of Mobile Advertising for Virgin Mobile USA, Kelliher oversees the different programs available to Virgin Mobile's media partners, including Sugar Mama, Virgin Mobile USA's platform designed to allow customers to interact with different types of advertising creative in exchange for free airtime.

Needless to say, when I heard that Mr. Kelliher would be speaking at ad:tech I dialed in to see if we could chat. He'll be talking about "The Truth about Mobile Advertising and Branding" next week in San Francisco, Wednesday, April 16, 2008, at 5:15-6:15 PM. We recently got Scott on the line.

It's for you!


Wendy: How's it going?

Scott: It's going very well!

Wendy: Let's begin by talking about your career path. You came to marketing in a very non-traditional way.

Scott: Well, I graduated from college I moved to NY and got into a retail environment for a company called Blades. It sold snowboards, skateboards and in-line skates. Then I got into the music business; I played the bass. I began writing and producing music for TV commercials. From there I went to Virgin Mobile.

Wendy: That's an interesting progression. Given your musical background I would have guessed that you would have migrated in to the business. Were you always a composer?

Scott: No, I played bass in a lot of bands in New York, but we don't need to cover my music career in print!

Wendy: LOL! Got it!

Scott: That said, I think it helped that I started out on the business side. I saw what it takes to actually produce the music.


Wendy: That's interesting! Let's talk about mobile. Why do you think advertisers are embracing mobile advertising at this point since it seems just a short while ago it was still conceptual?

Scott: A number of things have come together. The awareness of mobile is now here and I think advertisers are looking for new and efficient ways to communicate with their customers at all times. Mobile has begun to yield some good and influential results.

Wendy: Why is that?

Scott: I think we've also made some good strides in developing metrics and reporting standards so that we're able to evaluate the performance of an ad campaign.

Wendy: Are there particular categories of business better suited to developing a successful mobile campaign?

Scott: Not certain types of businesses, but anyone wanting to reach out to our segment of the audience. Virgin Mobile targets young and "young-at-heart" with our service so advertisers will come to us if they want to reach that demographic. Together we can develop something that helps them get the word out with a message that's meaningful for them and our user.

Wendy: Give me an example.

Scott: Well, we've worked with a couple of studios where we've used combination of different platforms including Sugar Mama, some SMS work, some on-deck WAP banners ads and things of that nature. It's all worked to generate reach but also to deepen the relationship between our advertiser and our user.

Wendy: So the Virgin Mobile service is different than most other carriers and it really transforms the ability to sell advertising to your users. Tell me how and why it Sugar Mama works.

Scott: Most of the players in the space are a post-paid service. This means a consumer signs a contract and at the end of every month they are billed for the amount of time they used. A contract is usually 2 years long. If they want to cancel they have to pay their carrier and early termination fee.

Wendy: Right.

Scott: We're different. We're a 100% prepaid carrier which means we have no contract and no early termination fees. When we develop advertising platforms we have to develop them in a way that's user-centric because we don't have a cushion like the big contract carriers have. When they develop a program that really annoys their users the customers don't really have any recourse. They're not likely to leave because they're not going to want to pay the fees. Our users can leave at a moment's notice without having to pay any early termination fees.

Wendy: That's an interesting difference. Unlike a lot of companies that say they listen to their users, you really are bound by that. You walk the talk!

Scott: It's true. And that's a great place to be. Its makes Virgin Mobile more sensitive to our customers' needs.


Wendy: Tell me about your platform, Sugar Mama. It's a great name! was it developed in-house?

Scott: Thanks. The name's really made it stand out. Yes we did develop it in-house.

Wendy: Did you research Sugar Mama before you developed the program?

Scott: Yes. We knew going in that there was an interest from brands to reach our 5 million subscriber base, which gives us scale.

Wendy: Right.

Scott: Then we brought the idea to the user before doing anything else and asked them to help us shape it in a way that was going to be useful to them.

Wendy: Of course.

Scott: From there we shared our learnings with our brand partners wo when we rolled it out the users already knew what to expect.

Wendy: Sounds like it was well thought-out. Tell me how it works.

Scott: It's pretty simple. If a Virgin Mobile customer watches a commercial or interacts with an ad, they're entitled to free minutes.

Wendy: What is the demography of your user? How do know for sure who they are since it's a pre-paid service.

Scott: When you sign up for the Sugar Mama program, we ask users to give us some basic info, which is very helpful from an advertising sales perspective. The Sugar Mama program has a subscriber bass of customers ranging in age from13-30.

Wendy: How long has it been around?


Scott: About 2 years. As a matter of fact I started at Virgin Mobile the day it was born.

Wendy: Wow! Talk about an auspicious beginning.

Scott: It's been an incredible experience!

Wendy: Since you're been there from the beginning, you've really gotten to see it grow.

Scott: Absolutely! It's had a phenomenal growth story from the day it launched.

Wendy: Tell me about it.

Scott: When we launched it we figured we would have a strong up-take based on early user feedback. However, we achieved our 3 month customer goals over the first weekend!

Wendy: That's amazing!

Scott: It's not a typical story in this space. And it's been consistent. We sign up about 1,000 users a day. Every metric you can measure has been an unqualified success.

Wendy: Is everyone trying to copy it now?

Scott: I'm not sure but I think it will difficult since our service is different to begin with than the other carriers. I think it's a hard to copy or knock off.

Wendy: That puts you in an enviable position.

Scott: It does. In terms of advertiser response and metrics, the numbers have been phenomenal. We see an average click through rate of 5 to 6%.

Wendy: Fantastic. What's the magic formula?


Scott: LOL! It works because we choose ads that are relevant to our customers. When they go into the Sugar Mama area they know that they are going to watch ads. They've actively made that decision, so they end up being more receptive to the ads they see there.

Wendy: Do they comment on the ads?

Scott: Yes the whole program was designed to be a conversation. Everything we do is a two-way, transparent exchange of information. We are after all a mobile company!

Wendy: Yes, there's so much hype about the desire to have a conversation with ones' customer through social media and blogs. I sort of liken it to this whole "green" phenomenon.

Scott: I agree.

Wendy: Marketers are all scrambling to create a green message to capitalize on their customers are becoming much more aware of our environment and the need to sustain it.

Scott: It's no secret that Richard Branson has always been very committed to the environment. All Virgin companies are required to be as well.

Wendy: That leads to the next topic. Let's talk about the Virgin brand. Are there customers who come to use the service because they're big fans of the brand overall?

Scott: Without a doubt and it's just another point that sets Virgin Mobile apart.


Wendy: What's it like to work at Virgin?

Scott:It's great. It's a very progressive company in every way. We try to embody what we see in our customers

Wendy: Do you ever see Richard Branson?

Scott: Sure, He comes to our different events.

Wendy: Considering how familiar you are with what works for your users, when you develop a program for advertisers, do the studios you work get you involved in from the initial concept?

Scott: It varies by client but overall, very much so. When we're involved at an earlier stage we can help steer the advertiser to have the best chance of success with our user.

Wendy: You said Richard Branson attends your events. Give me an example.

Scott: We offer the Sugar Mama program on-line but we also have a number of off-line opportunities as well, like our Virgin Mobile music festival and other events like that.


Wendy: Tell me about it.

Scott: It's a 2-day rock concert where people come from all over.

Wendy: Do you play?

Scott: LOL! Not this year! This year our headliners are Foo Fighters, Jack Johnson, Kanye West, Nine Inch Nails, and Stone Temple Pilots!

Wendy: I assume you take the opportunity to evangelize the brand. Do people have chance to sign up for the service?

Scott: Definitely. It's an integrated opportunity. We want consumers to sign up there. To entice them since we are a Virgin company we plan things to surprise and delight.

Wendy: What's your role?

Scott: I'm the guy who receives the feedback from our users. I know right away if the program is working or not. We're not naïve enough to think we're going to get everything right every time. If it's not on target; it's certainly good to know so the client can make adjustments right away. It's interesting to creatively help brands gain access to our users.

Wendy: You must get a lot of marketers coming to you based on your success.

Scott: Yes, but like anyone else we have to do a tremendous amount of evangelizing. Once we have clients who have had a successful program, they tend to come back. We're always encouraging our clients to try new things.


Wendy: What kind of programs are the most successful?

Scott: The ones that require the most user interaction. Our users don't want to be spoken to; they want to be part of the process. Mobile gives advertisers a chance to use the handset in ways that other forms of media can't. The best programs are the ones that capitalized on that.

Wendy: Let's talk about ad:tech. Is this your first show or have you attended the conference before?

Scott: San Francisco will be my first one. I'm really looking forward to it.

Wendy: And you're on a mobile panel!

Scott: It will be a great chance to evangelize our brand.

Wendy: What do you hope the audience is going to learn?

Scott: I want to communicate that marketers have to know what it is they want to achieve in a mobile campaign and have an understanding of what works before they move forward. They shouldn't do it because everyone else is doing it. Besides being integrated, marketers should have specifics task where mobile fits into the larger program, but be sensitive that interaction is different than with other web platforms.

Wendy: Give me an example. For example we've found that ads on TV don't necessarily work well on the web. Do you find that web ads translate well to mobile?

Scott: It depends. Mobile isn't the web and that's something people tend to forget. It's a unique medium sort of a hybrid between out-of-home and the web.

Wendy: How about the privacy issues? What can be done now with behavioral targeting?

Scott: Everything we do is opt-in. We don't have to worry about the ads we serve because our users want the ads to gain the free minutes.


Wendy: That's interesting. Before we end, you said earlier that you began your career in the music business. Musician to musician, do you still compose tunes in your head?

Scott: Of course. Always have and always will. In fact, my wife often tells me to stop tapping on whatever surface that's in front of me. I do it unconsciously.

Wendy: But you play the bass. Are you a drummer at heart?

Scott: Well, it's difficult to play a bass guitar when you're driving!

Wendy: LOL! Scott, thanks for taking time out to chat with me. Good luck with your panel and enjoy ad:tech!

Scott: You're welcome, Wendy!

Scott Kelliher will be speaking at ad:tech I dialed in to see if we could chat. He'll be talking about "The Truth about Mobile Advertising and Branding" next week in San Francisco, Wednesday, April 16, 2008, at 5:15-6:15 PM.


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