More business is being conducted online than ever before, and with such a trend has come major increases to online marketing budgets. Identifying an opportunity to provide businesses with better returns on their online advertising, artificial intelligence company Crowd Media (ASX: CM8) has developed a solution to reduce customer acquisition costs using conversational AI.
In the first three months of their partnership with media search marketing company SrcFlare, Crowd Media’s conversational AI has generated approximately $150k (USD $101k) in fees, from leads generated. These leads are generated by SrcFlare’s search engine marketing platform which has integrated a Proof of Concept (POC) developed by Crowd Media.
With $150k generated for Crowd Media in just three months, both Crowd and SrcFlare have been impressed with the results to date and are now planning to expand the POC further to be offered to more clients.
“The media search industry is ripe for changes in business practices where the amount of business being done through search engines is exponentially larger than it was a decade ago, and with it comes opportunities for disruption,” said Crowd Media CEO, Idan Schmorak.
“By introducing conversational AI as an alternative means of interaction, the Proof of Concept has validated our thoughts in a short period of time so we look forward to upscaling our tech to generate more leads at lower acquisition costs for SrcFlare clients.”
Crowd Media’s integration enables SrcFlare clients to engage with prospective customers through a digital avatar generated by Crowd’s Talking Head platform. This is a new generation of media search lead generation that eclipses the standard webpage that customers click through to from Google advertising where increased competition has pushed cost-per-lead expenses higher during the pandemic.
Instead of just being presented with a summary of websites that match searched words, SrcFlare and Crowd Media generate an in-browser pop-up where a digital avatar engages in a conversation about the searched words. The avatar’s conversation then proceeds using Crowd Media’s conversational AI with the intention to generate a lead for the advertiser, or convert the engagement to a sale.
SrcFlare CEO, Gilad Cohen said, “It has been exciting to see the results delivered since integrating Crowd Media’s technology into the SrcFlare platform as an opportunity for businesses to gain a competitive edge when it comes to engaging prospective customers.
“The results to date have been promising so we look forward to scaling this tech which enables businesses to revolutionize how they engage with prospective customers in such a competitive landscape.”
As a platform provider, the $150k generated by Crowd is independent of any sales made by SrcFlare clients over the past three months, which would equal $600k revenue for Crowd on an annualised basis.
That $600k (annualised) may be even higher in the months ahead with SrcFlare and Crowd confirming they will increase the number of clients that will be offered conversational AI integrations. This will see an increase in Crowd’s licensing fee from a minimum of USD $15k to $55k (AUD $81k) for the three months ending 30 November 2022.
Results from the upscaled POC will likely be announced in Crowd Media’s December quarter report.
A strong start to Crowd Media’s partnership with SrcFlare continues a strong run of form by the AI company which recently reported a $1 million increase in their underlying earnings for FY22 having commenced commercialisation of their Talking Head platform just 12 months ago.
Jarryd is an experienced Investment Adviser at Emerald Financial Group
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