Yesterday, we argued that one of the biggest reasons apps have the chance to monetize better than social networks themselves is the opportunity apps have to offer deeper and more aligned integration to brands. This week, Inside Facebook will be taking a look at the companies helping brands connect with users on the Facebook Platform.
To kick off our “Bringing Brands to the Facebook Platform” series, Inside Facebook first takes a look at New York-based Appssavvy. With a long background in digital ad sales, Appssavvy has built its business connecting Facebook application developers to brands by creating custom, integrated campaigns.
We sat down with Chris Cunningham, Founder of Appssavvy, to learn more about the company and how it’s connecting Facebook Platform developers with brands.
Chris, give us some background on Appssavvy and where you are today.
I come from a long career in digial ad sales, including MusicVision, Bolt, and Freewebs (which sput out SGN, which is now one of our partners). I was hired by Shervin Pishevar (currently CEO of SGN) at Freewebs to sell widgets in 2006. I was first person to sell a widget program – I sold it to Paramount Networks. I spent the next year educating agencies and brands about the value of widgets, and launched over 30 campaigns.
After Facebook opened up their API, many of the brands that we were selling widgets to called us up about applications and started asking about them. Companies like P&G did $100k buys. It was then that I realized that someone needs to connect Palo Alto and Madison Ave – connect developers and brands.
Today, we 9 people and have closed angel investment. Our team is not made up of typical Silicon Alley/Valley guys, they’re media guys. The problem is not inventory, the problem is money.
Are you building any technology in house?
We don’t have in house developers. We’re not technology focused – we don’t do anything except applications. We are a direct sales team for leading apps. So far, we’re working with 60 companies and 230 applications.
What approach are you taking when selling app inventory to brands?
Whenever I read that no one is monetizing applications, it makes me angry because we’re selling some very high CPM’s. We focus on contextual relevant advertising. Lookery and Social Media are traditional ad networks with lower CPMs, and the agencies don’t know where the ads are going to appear. We tell the brands what apps their ads will appear on and, and we’re doing $15 CPMs.
For example, we’re working with Sony on the new movie Maid of Honor. So we found an app called Wedding Book, and called the developer, Kevin, in Toronto. We asked him if he would skin his app and give us all of his IAB ad units. Kevin will make more money than he could otherwise.
As another example, we’re working with Adidas. We found an app called Shoes, another called StyleFeeder, and 6 more – all for a $14 CPM. Recently closed another deal for $200k at $19 CPM that will include 20 apps. And we’re about to close a $250k deal, our largest to date.
We’re able to do this because we’ve spent 10 years traveling the country and becoming good friends with the clients and agencies. Advertising is relationship based – I fundamentally disagree that advertising is about technology.
So are you building any apps directly for brands?
10% of our business is custom. When I first started, I thought a much larger part of our business would be custom. However, we only want to build custom apps if clients are willing to devote the energy and resources to support it. Rather than trying to reinvent the wheel, it makes more sense to partner/sponsor with an existing user base. If you build an app and the viral idea doesn’t work, that brand manager will hate social media.
Who are some of the larger developers you’re working with?
Right now, we’re working with RockYou, Flixster, SGN, and several others. RockYou is the only company in our network that has some internal people selling and some external people selling. Most people don’t have the bandwidth or time to do ad sales, and that makes sense, because it’s not their core competency. I’ll be the first person to help introduce your VP sales if that’s what you want to do.
Thanks Chris. Any last thoughts for developers out there?
We want developers to realize that we’re not another network, and to reach out and challenge us. We’re also trying to hire sales people. The waters are murky, especially from the agency perspective. Agencies are making sloppy buys, and we want to educate the agencies on who does what in the social media space.