Brief:
- Direct-to-consumer ad network Moolah Mobile partnered with SurgePhone Wireless to offer free mobile service to consumers in exchange for watching ads on their smartphone home-screens. The service is aimed at an estimated 1 million low-income consumers in the United States, starting with a rollout in Florida, Virginia, Georgia and Texas, per an announcement.
- The service provides free talk, text and data by subsidizing wireless bills with income generated by Moolah Mobile. The company aims to generate passive income for Android users by serving native advertisements on their home screens and letting them opt in to take surveys.
- Moolah Mobile aims to add 3,000 to 5,000 locations a month to reach 40,000 by the end of 2019 and a possible user base of more than 800,000 subscribers. Subscribers can use the income to pay phone and utility bills, make purchases on Amazon, or convert into gift cards, per its announcement.
Insight:
Moolah Mobile and Surge's service may help marketers to reach low-income consumers who are difficult to target through other media channels. Subsidizing the cost of owning a smartphone by serving users with ads helps to ensure that targeted marketing messages get seen. Surge is offering the service on its Volt Android devices, which have Moolah install kits, and in SIM starter kits for customers who want to use their own smartphones.
Several companies have experimented with ad-supported mobile service to mixed success. Blyk more than 10 years ago started an ad-supported mobile service in the United Kingdom that ran more than 2,000 campaigns for brands such as Coca-Cola, Colgate and L'Oreal. The service was aimed at young audiences and posted strong metrics, although it didn't reach the massive scale that had been expected, Ad Age reported. France Telecom's Orange network bought Blyk in 2009. Similarly, Amazon introduced an ad-supported smartphone in 2016 after failing to gain traction with its Fire Phone. Moolah Mobile's plan to target highly focused groups of users may help to reach benchmarks without building massive scale.
Ad-supported mobile service may help to get around ad-blocking software that has become more popular on mobile devices. The portion of mobile sessions among U.S. users of ad-blocking software rose to 5% last year from 2% percent in 2016, according to researcher AudienceProject. While that percentage is still a small slice of the mobile ad market, it could become a more significant problem if the user experience deteriorates.
