CLX Acquires Vehicle, a Personalized Mobile Video Technology Company, to Strengthen Its Product Offering

Stockholm, Sweden – CLX Communications AB (publ.) – XSTO:CLX

CLX Communications AB (publ.) (“CLX”) – a leading global CPaaS (Communication Platform as a Service) provider, has entered into a definitive agreement to acquire the personalized video and rich media messaging technology company Vehicle Agency LLC (”Vehicle”) for a cash consideration of USD 8 million on a cash and debt-free basis.

Vehicle’s dynamic video messaging platform enables enterprises to make more meaningful and personal one-to-one connections with their customers, directly on their mobile phones. From dynamic text and images to personalized videos, where all aspects of the audio and visual tracks can be tied to individual customer attributes, Vehicle delivers highly targeted communications to each unique consumer.

“We are thrilled to welcome the Vehicle team and their customers to the CLX family,” said Johan Hedberg, CEO of CLX Communications. “Dynamic personalized video is an exciting addition to our product portfolio that we intend to bring to the market, primarily through our service provider partners who typically target specific industry verticals. This innovative solution is also a stepping-stone towards an increasingly message dominated Enterprise to Consumer relationship, enhanced by the future of rich media communication including RCS (Rich Communication Services) messaging.”

“We have successfully proven that dynamic personalized videos enable enterprises to drive customer engagement to increase loyalty and sales, support on-boarding, and reduce churn,” stated Matt Ramerman, Vehicle’s co-founder and CEO. “I am excited to have our team join one of the global leaders in enterprise cloud communications. CLX’s vast network of partners and customers are an ideal channel for our innovative services and their people and mobile-first approach feel like home,” commented Jeff Gough, Vehicle’s co-founder and COO.

CLX is acquiring Vehicle Agency LLC for a cash consideration of USD 8 million at closing on a cash and debt-free basis with additional possible cash consideration of USD 4 million within the first year when EBITDA KPIs are met. Further cash consideration can be paid out over a period of 30 months after closing if additional KPIs are met. The EV/EBITDA multiple based on the cash consideration, at closing is 8,7 x EBITDA.

Inverness Advisors acted as the exclusive financial advisor to Vehicle in connection with the transaction.

For further information, please contact:
Thomas Ahlerup
Chief Investor Relations Officer – CLX Communications
Mobile: +46-768-66300
E-mail: thomas.ahlerup@clxcommunications.com

About CLX Communications

CLX Communications (CLX) is a leading global provider of CPaaS (Communication Platform as a Service) where CLX provides cloud-based communication services and solutions to enterprises and mobile operators. CLX’s mobile communication services enable companies to quickly, securely and cost-effectively communicate globally with customers and connected devices – Internet of Things (IoT). CLX’s solutions enable business-critical communications worldwide via mobile messaging, voice, video and mobile connectivity services for the IoT. CLX has grown profitably since the company was founded in 2008. The Group is headquartered in Stockholm, Sweden, and has a local presence in a further 20 countries.

CLX Communications’ shares are traded at NASDAQ Stockholm – XSTO:CLX.
To learn more please visit: www.clxcommunications.com

About Vehicle Agency LLC

Vehicle (www.vhcl.co) is a personalized mobile video and rich media technology company founded in 2010 in Seattle, Washington, USA. Vehicle drives customer engagement and brand loyalty with personal and dynamic video via mobile text messaging (MMS) and digital advertising. Vehicle has powered campaigns for brands such as AT&T, Macy’s, and Cricket Wireless. Vehicle complements its technology with media and advertising agency channel partnerships.

Vehicle Expands Analytics Practice with New Talent

We are expanding our talented team by hiring Rich Davis, Senior Manager of Insights and Analytics.  In this new role, Rich will be responsible for optimizing targeting strategies and delivering campaign insights to key Vehicle clients.  The hire significantly strengthens Vehicle’s capabilities in database management, analytics, and business intelligence.

Rich joins us from Foote, Cone & Belding’s HackerAgency, where he served leadership roles in data project management, technology enablement, and business intelligence.  He brings over 20 years of experience working in the wireless telecommunications, financial services, transportation, and retail industries.

Attributing ROI to marketing spend is critical to our clients’ success. Our ability to deliver personal, relevant, and engaging video to a consumer rests on insights gleaned from data. Our clients will benefit from Rich’s deep experience with campaign measurement, business intelligence, analytics, and client service.

Mobile: personal marketing and a look into the future

I suspect Mobile will be the nexus for many marketers in 2017, occupying a substantial share of the budget, planning, and technology investments.

As a recent Forrester report claimed, “Mobile is the face of digital”.  Mobile is the alpha channel, not just because of its projected growth and effectiveness, but also because of its influence across the entire marketing landscape. Savvy marketers should look to the present state of Mobile to foretell what’s next for all marketing in all channels.

Consider Mobile as the…

  • First truly personal marketing channel

Mobile leads other channels with respect to immediacy, proximity, and intimacy.  Such a personal medium demands personal content.  Brands that deliver personal experiences will outperform brands that expect consumers to sift through extraneous, irrelevant information.  McKinsey & Company calls this “Proactive Personalization”.  Brands that don’t personalize will be punished.  For example, Vehicle observes customers who receive non-personalized messages opt-out at a rate three times higher than those who receive personalized content.

  • First mainstream, cellular IoT device

Mobile phones are paving the way for a more complex ecosystem of connected cellular devices – the Internet of Things (IoT). According to Ericsson’s 2016 Mobile Report, cellular IoT is expected to have the highest growth rate of connected devices at 27% CAGR, reaching 1.5 billion connections in 2021.  Brands pondering IoT use cases and compelling user experiences should look first to what’s already possible on a mobile phone.

  • Data aggregator for the online (and offline) customer journey

Marketers are desperately trying to understand the customer journey. Mobile provides insight into how consumers engage online on their phone and across other connected devices.  What’s also exciting is how Mobile can inform offline patterns and decision making. Mobile data on location and dwell time can map customer journeys through the physical world too.  This is important because even though eMarketer data show mCommerce growing rapidly over the next 3 years, 92.3% of retail sales still take place in brick and mortar stores (according to Harvard Business Review and the Census Bureau.)

  • Bar-raiser for user experience

Customers want easier navigation, enhanced security, increased speed, and simplicity.  They want easy contact options for support.  They want Mobile apps that are useful or focused on their needs.  After experiencing this on a mobile device, why would consumers expect anything less from other marketing channels?

Mobile continues to be the epicenter of consumer behavior and a catalyst for marketing present and future.

(A version of this article originally appeared in the Data & Marketing Association’s 2017 Statistical Factbook.  This is an invaluable resource for fact-based decision making for any marketer.  Vehicle is a member of the Data & Marketing Association )

Personal Marketing: 2016 In Review

2016 has been a productive year in Tangletown. Vehicle has experienced growth and stronger client relationships.  We have expanded our advertising technology and added new talent.

We have learned a lot this year too.

Here are insights gleaned from our world of personalized video, mobile messaging, and dynamic advertising:

 

Stat:  Opt-out rates are 3X higher for static content versus personalized content.

So what?  You have to make marketing content relevant and considerate or consumers will ignore it.  Even worse, customers might rescind the privilege of speaking with them.

 

Stat:  MMS campaigns continue to exceed 98% deliverability with click through rates averaging 14%.

So what?  Our clients tell us that no other medium in their arsenal– not email or app push notifications – delivers the same reach as text messaging.

 

Stat:  Hyper-targeted, dynamic video ads deliver a 50% lift in engagement over static banners in a treated vs control scenario.

So what?  You will invest more on a CPM basis, but our experience says the ROI is there.

 

Stat:  At the local convenience store beverage aisle, more Vehicle employees prefer Rockstar energy drink over the other brands.

So what?  Make your own conclusion.

 

As we look to 2017, we expect personalization and mobile marketing will continue to be primary for many marketers, occupying a substantial share of the budget, planning, and technology investments.

 

Mobile Users Prefer Personalized Video MMS As Channel To Communicate Personalized Information

Customers prefer to receive communication about services or special offers via MMS (multi-media messaging), using personalized video, according to a study commissioned by Vehicle.

Nearly 4 in 10 (38%) said that their top choice to receive individualized content was through mobile video delivered through MMS. Another 50% said that MMS was a viable method among many to get communications from the mobile operator.

Further, a majority of responses (55%) indicated that the personalized content was “much easier to understand” when it came via a mobile video MMS message.

The survey was conducted with 2,700 mobile users.

The positive reception to MMS is consistent with business results seen by a major wireless carrier.

Working with Vehicle, the major wireless carrier uses personalized video pushed over MMS to support many key strategies, including a welcome video that is the very first point of communication with a new customer.

As a result, the company has seen:

  • Significant reduction in churn
  • A decrease in calls to customer support
  • The highest recall of any other company touch with the customer (more than 50% measured at 90 days post-video delivery)
  • Significant increase in revenue (ARPU, or average revenue per user and lifetime value)

The wireless carrier has also seen success via MMS in communication of service enhancements.

As individual neighborhoods receive network upgrades, the company pushes personalized video to all affected subscribers, alerting them to those enhancements.

As a result, the operator has seen a significant increase in Net Promoter Score, a key tool to measure loyalty.

The MMS channel picks up where SMS (text messaging) leaves off. It is highly scalable and can include a long text message (greater than 160 characters), images, audio files and video.

Viewers of MMS retain 95% of a message in video compared to 10% in text, according to Forrester. The 98% open rate is similar to text messaging and far exceeds the open rate of email.

MMS combines ubiquity and rich media. Vehicle clients have seen conversions between 30% and 50% greater than text.

Personalization has become a must for brands. 75% of consumers like it when brands personalize offers and messages, according to the Aberdeen Group.

“Relevancy is the perfect alignment between ‘who’ sees your communications and ‘what’ it says,” said Matt Ramerman, Managing Director and Co-Founder of Vehicle.
“Video with relevancy is the present and future of mobile. It is show, don’t tell, and combines emotion and simplicity.”

Mobile Video Captivates Shoppers In-Store

Despite all the attention given e-commerce, the vast majority of consumer spending this holiday season will be made in-store.

Aisles everywhere will have endcaps with product information. There will be “shelf-talkers” conveying particulars about some of what will be before shoppers.

At least theoretically there will be salespersons around to answer questions.

But the smart marketers like Macy’s know that there is more to be done, especially given the fact that there will be a mobile phone in the hands of virtually every customer.

Enter high-resolution video, viewed in greater numbers each month by consumers more rapidly adopting smartphones. Mobile now accounts for 22% of overall digital video consumption, according to KPCB analyst Mary Meeker’s 2014 Internet Trends report. And that number continues to grow.

Macy’s has used video and Vehicle’s platform as critical support to the retail experience.

In one program, shoppers respond to “Backstage Pass” calls to action in more than 30 departments. The customer is asked to text the keyword of a product designer or brand to Macy’s short code. A video is then immediately delivered back to the user’s phone, pushing the shopper closer to a purchase.

A mixture of entertainment and fashion, the 30-second films provide fashion inspiration, advice and tips. Following the initial feature, users have the option to select longer-length content that take them further backstage with each designer or brand. Featured designers and experts have included Bobbi Brown, Sean “Diddy” Combs, Tommy Hilfiger, Michael Kors, Greg Norman for Tasso Elba, Rachel Roy, Irina Shabayeva for I.N.C., and others.

With Vehicle, Macy’s additionally gathers point of interest information for each participating customer as well as the location where the response to the call to action is made. The brand uses this data to push targeted offers back to users.

Macy’s sees the initiative as helping it fulfill its mission of getting closer to the customer and his or her interests.

And it has done it in a way that both differentiates Macy’s from other retailers and caters to the increasing expectations of shoppers who want a unique in-store moment.

This trend is likely to continue. By 2016, 89% of companies expect to compete mostly on the basis of customer experience, versus 36% four years ago, according to Gartner.

The Importance of Treating The Customer As Someone Special

Something interesting often happens when a consumer is treated with real service.

We can think about the flight attendant who goes row by row, seat by seat, to thank passengers for their business. Smiles appear on people’s faces.

Or the employees of the tire retailer who run to greet a customer when they drive into the parking lot. Doesn’t that make an impression and create shopper loyalty?

AT&T Wireless gets the importance of personalized service. Every single day, the mobile operator decreases churn—the rate at which customers leave a business behind—and increases customer satisfaction through programs powered by Vehicle.

One way is through a custom welcome video that is the very first point of communication with a new customer. This personalized welcome video acknowledges and thanks the subscriber for his or her business and summarizes the details of the account and what to expect when the first bill arrives.

As a result, AT&T has seen:

  • Significant reduction in churn (customers leaving AT&T in the first 30 days)
  • A decrease in calls to customer support
  • The highest recall of any other AT&T touch with the customer (over 50% measured at 90 days post-video delivery)
  • Significant increase in revenue (ARPU or average revenue per user and lifetime value)

Take a look at the successful businesses and you are sure to see an extraordinary level of customer service. It’s that important to the bottom line.

Says Amazon founder Jeff Bezos: “We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.”

Just think of the times when you were called by name. Those experiences are memorable, don’t you think?

More and more brands are making memories by working with Vehicle to create and strengthen personal, one-to-one connections through dynamic, high-resolution video delivered by messaging channels.

Personalization Needed To Meet Consumer Expectations

The biggest change in marketing to consumers in the mobile age? Brands need to talk to them rather than at them.

Personalization is the new marketing buzzword, eclipsing such terms as cross-channel and synergy. It is driven in large part by the mobile user, who has raised the bar in terms of relationships with brands. This dynamic is discussed in a new study conducted by Forrester Research and Salesforce/ExactTarget. http://www.exacttarget.com/company/newsroom/2014/08/independent-research-reveals-personalizing-customer-journeys-impacts

Quoting from the study:

“The ability to deliver personalized customer experiences and contextual, unique offers is essential to retaining and converting customers to brand advocates. But the expectations of empowered, connected consumers make this easier said than done. They have instantaneous access to information across multiple devices and want to interact with brands on their terms—across channels and whenever they want.”

The entities found that 48% of marketers queried reported that they face challenges in personalizing each customer interaction, and 42% of marketers reported they face challenges with analyzing customer interaction data. Nothing short of business results is at stake.

Said Woodson Martin, CMO of ExactTarget, in a statement, “Today’s hyper-connected consumer requires companies to create personalized experiences and deliver value at each touch point to increase brand loyalty and drive sales.”

Another study fell in line with the Forrester Salesforce/ExactTarget findings, concluding that many marketers are ill-equipped to deal with the new realities around personalization backed by the use of Big Data. Approximately, 63% of marketers plan to improve strategies through customer segmentation and targeting, but only 6% see themselves as leaders in Big Data management compared with 62% who view themselves as keeping pace or lagging behind competitors, according to the CMO Council’s annual State of Marketing global benchmark study http://www.cmocouncil.org/current_program_details.php?pid=116 released recently.

There is hope, however. Wisely, nearly 44% of marketers will be investing in customer retention and monetization, which is more cost efficient than spending on new customer acquisition.