Firm offers marketing through text messaging

Conrad Carney has seen the growth of mobile communications firsthand. After college, he went to work for a cell-phone company and recalls how it celebrated its 40th customer in 1987. Today, he's heading his own mobile marketing company.

Carney, who played football for the University of Kentucky in the 1980s, began CMSText, a text-message marketing firm, in August 2007 and is aiming for restaurants, physicians and others as he looks to grow.

Carney, who also heads American Mortgage Lenders in Lexington, said the growth prospects are enormous.

"Today's environment is 'I want it quick, I want it fast, I want it now,'" Carney said. "I don't want to read War and Peace about your advertisement."

He hired a developer to design user-friendly text messaging software so that "people like myself could use it, just point and click," he said.

The company has grown from two to seven employees this year, as Carney has brought on sales managers in regional areas like Chicago and Florida.

But the handful of managers and the company rely on a network of independent contractors that now number 780 in 44 states plus the District of Columbia. The contractors, whom he has lured in using online advertising and word of mouth, get 35 percent of the monthly service fees associated with their clients, as well as $50 for signing up a client.

"What's nice about it is anyone can offer this product," he said, and businesses are receptive because of its pricing.

Messages cost $99 per thousand, or less than 10 cents per message, he noted. Buying in bulk — 10,000 for $800 — drops the price further.

"It's definitely worth the money," said Erin O'Brien, co-owner of a Beef O'Brady's restaurant in Lexington.

O'Brien said the restaurant spends about $30 monthly on the text messaging campaigns and offers coupons via the service. Users sign up to receive the messages and can opt out by replying "STOP" to a message.

Research provided by the Mobile Marketing Association shows redemption rates are far higher on mobile advertising than other avenues like printed coupons.

Carney said CMSText's clients can see redemption rates up to 30 percent. O'Brien said her redemption rate hasn't been nearly that high, but "we need to probably get more people in."

She said her database of customers that receive the messages aren't just regulars, either, and that it works best for businesses with younger clientele.

But Carney said that mobile marketing is beginning to get more traction with older audiences, too.

Citing research from the Mobile Marketing Association, he noted the fastest growing demographic for mobile marketing is people ages 40 to 55.

In that demographic himself, Carney credited his young daughters, who text frequently.

"They're bringing us into the texting world," he said.

Children are at the forefront of another of CMSText's new markets. The company has signed a deal with Cincinnati Children's Hospital Medical Center to provide text messaging medication reminders for children with asthma.

"There's some research in other areas ... that seem promising," said Jennifer Munafo, project specialist for the hospital.

Carney said he's focusing on expanding CMSText to more medical businesses, too, particularly in providing appointment reminders.

Research from the Medical Group Management Association suggests doctors' offices can lose $138,000 in revenue annually because of missed appointments.

"That's the reason why over the last five years, you keep getting more and more phone calls to remind you of your appointment," Carney said.

And with the continued growth in wireless, it's just one of many areas where the company will look for expanding in the future.

"We definitely feel the growth in this market is such that CMSText will be a force in mobile marketing," he said.