And we know there’s a lot more kind of juice that we can squeeze from these campaigns by pulling a couple of kind of easy levers to increase the performance of our current programs. So when we look at the future, we feel like Mobivity is in a really good position to grow both by bringing on new customers through the case studies that we’re now building with programs run at scale and optimize with our current customers such that the Connected Rewards business can overtake the legacy business. We’ll have a lot more tangible to discuss there on our Q1 call but everybody at Mobivity is feeling the excitement and we’re excited about what we can build in the long term.
Robert Berlacher: Well, you’ve — I think it was Kim mentioned that these programs just got really started in March and April time frame, perhaps maybe February, I don’t know but March and April. And if you’ve signed Chevron, Marathon, you said Circle K [ph]. Are they all — and you’ve got more in the pipeline. How soon — you said midyear, you think second quarter, you’re talking third quarter and that legacy business has a much lower gross margin, I assume then the Connected Rewards business. Can you give us any indication when you might also be seeing a shot at least cash flow positive or anything like that?
Kim Carlson: Maybe I’ll take the first part and Bryce [ph] can talk about the cash flow positive. But to quantify, I think we’re thinking about the second half of this year being the time where the Connected Rewards business eclipsed the legacy business on a monthly basis. So I think that’s as best as we can quantify when we say midway through 2024. Bryce [ph], do you want to talk about the being cash flow positive?
Unidentified Company Representative: Yes. I mean I think without getting too specific, it’s around the same time. You mentioned a couple of things. The gross margins are a lot better and the numbers you mentioned from a kind of a monthly basis are correct. And I think if we can overtake the legacy business with the gross margins that we’re seeing, it will be kind of in parallel with overtaking the legacy business that we can see the company becoming cash flow positive.
Robert Berlacher: Okay. And I think it was Kim that mentioned the return on spend goals for your partners. Can you comment at all on just — can you provide any metrics at all that demonstrate any kind of effectiveness of the platform and driving the user acquisition and retaining those customers at the same time? Is there — I mean you have to have some measurement that I would assume you’re looking at and that the clients are looking at as well. Everybody is going to have a different, I would assume, return on spend.
Kim Carlson: That’s right. So our gaming clients that are paying us on a per transaction basis measure their results on not only the install but how are people behaving in the game and they look at return on ad spend typically benchmark after 7 days. So if we deliver an install, we’re looking at how many people are watching ads or purchasing in-app purchases within the game. Now game to game, those targets can vary a little bit. But essentially, because we’ve been retaining our gaming clients pretty much 99% to 100%. That means we’re exceeding their metric of that day 7 return on ad spend, whether that is 8%, 10%, 12%, 15% as it varies by game developer. We are meeting or exceeding that. Therefore, those game developers are asking to spend more and are wanting to scale with us. So it is a very finite measurement in the game marketer world of what a measure of success looks like.
Robert Berlacher: So they set that return on spend contractually with you in order for you if you exceed to use example, 8% or 10% or 12%, then incentives kick in. Is that how you get your $3 to $7 per transaction? And then there is an incentive-based comp beyond that if you exceed the ROAS?
Kim Carlson: Not contractually. What they’re measuring us against is other networks. So if they’re buying installs from a mobile ad network or even Facebook or TikTok talk, how does Mobivity compare on a ROAS perspective. If we are beating that, they’re going to move budget from one of their other channels over to us. So it’s not a secondary commercial event. It’s really — it’s a path for us to really increase our transaction costs because we’re performing better than our competitors.
Robert Berlacher: So you’re not aware of what that is until they then reach out to you and say, look, you’re beating this competitor or that competitor so we’re going to throw more business at you?
Kim Carlson: We see it in pretty much real time because we have access to the game developers platform — performance platform. And we’ve also built our own internal tools to see events within the app that are getting essentially posted back to our system. So we’ll know in really short order, whether day 1, day 2, day 3 is on a trajectory to beat the game developers goals. That’s a nice thing about our platform is it’s very transparent.
Robert Berlacher: And then to move on with your competitors. Can you discuss that landscape in the Connected Rewards piece anyway? And just who are some of the other players and what are Mobivity’s advantages if there are some that the gaming companies are seeing?
Kim Carlson: Sure. So the mobile ad network is a massive industry. If you lump everybody together, we’re talking tens of billions of dollars a year that mobile marketers are spending on acquisition. Our key differentiators are really twofold. First, we operate outside of the device identifier and data tracking ecosystem which is what Apple has kind of turned upside down over the last 3 years by turning off the ability to really see a device ID in order to target that device for a particular ad. Because we’re living in a world of SMS marketing, e-mail marketing or in-app in a brand that is not our world or our concern. I think the other piece is the core technological differentiators are a bridge between the digital and the real world.
