Gogii Hires Ex-Myspace Exec to Make Group Texting Pay OffApril 05, 2011
All Things Digital
by Tricia Duryee
Gogii, a company that makes a popular group text messaging app called textPlus, has hired Chandra Hill to head up its monetization plans as it weighs paid vs. ad-supported features.
Text messaging applications, which offer the ability to send messages to a group of people via a single phone number, were in the spotlight at SXSW. Companies such as Gogii, KIK, Beluga, GroupMe and Fast Society were the talk of the town since they provided easy ways for large groups of people to socialize and get in touch quickly.
Following the event, GroupMe provided its first hint at what its business model would be when it opened up its mobile group chat to brands, which would be highlighted in a “Featured Groups” section.
Now, Gogii is beefing up its monetizing efforts.
Hill, who will have the title of VP of monetization and publishing, was most recently VP of mobile monetization at Myspace.
She will oversee all company revenue, which includes in-app purchases, advertising and a new publishing unit, said Gogii CEO Scott Lahman. “I can’t think of anyone better who can hit the ground running. She’s been doing this for years at Fox and at Myspace. This is almost the exact same role.”
Gogii’s textPlus application has 7.7 million monthly active users and recently set a record for sending 35 million messages in one day.
While Hill is just joining the Los Angeles-based startup, the company has been monetizing with advertising from the beginning. ”We hit seven-figure revenue-quarters last year, and that’s continued to grow. We are well past the testing stage. Advertising campaigns were up 300 percent in the first quarter compared to the same period last year.”
Mostly, the app relies on splash ads–which are like a homepage takeover–which the user sees immediately after opening the application. Lahman said users on average open the application 10 to 15 times a day, and that the ads have a click-through rate in the high single digits. There are also banner ads from within the applications, which are seen by its nearly eight million monthly active users.
Lahman said they made the decision to monetize with advertising because it allowed them to grow the business much faster than if they charged for it. A paid version of the application, which has no advertising, allows the user to pick the area code for the phone number they use. He said six to 10 percent of its users choose to upgrade. The app costs $4.99 and is available on iPhone and Android.
“The advertisers love it. We are the text client for a lot of our customers–that’s why they use it so much to send so many messages.”
Gogii uses a mix of its own direct sales force in addition to farming out some inventory to mobile ad networks, like Google’s AdMob, Jumptap and Greystripe. Returning advertisers include Disney, Fox, Target, Ford, Paramount, CBS, Unilever, JCPenney, MTV, Coca-Cola and Zynga.
The new publishing business, which Hill will oversee, will experiment with a sort of white-label service, which will allow a brand to completely take over the application for a specific brand or event.
Lahman said in March, 25 percent of the company’s revenues were coming from paid features inside the application. It’s his goal to hit 50 percent by the end of the year. “That will come against a growing advertising business–that’s not cannibalizing it,” he said.