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Blippar founder Rish Mitra: we turned down a $1m deal when we were earning $5k a month

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Explains where that self-confidence came from – and how the Queen invented AR (kind of)

augmented realityWhat’s the most powerful piece of real estate for a brand message?

TV? Billboard?

Maybe something digital. Mobile web, perhaps?

Well, here’s something to consider: what if the best channel for marketing is the product itself?

That’s the view of Blippar, the UK augmented reality pioneer. It believes a company’s product is more visible and accessible to a customer than any bought media.

Historically, of course, marketers have advertised offers and coupons on their packaging. But what AR offers is the ability to track user engagement with product messages in real time and with geographical accuracy.

For the uninitiated, Blippar is a mobile app that lets users scan an image, which then comes to life on the screen and permits more activity like playing a game or watching a video or downloading a coupon.

You can see some video examples here.

Blippar was founded in 2011, and has raised $17 million from Qualcomm, Intel Capital, Sunstone and others.

It believes AR can transform marketing. And it has entrenched beliefs about how to achieve this. Which is why it turned down a $1m contract from a would-be client who had other ideas.

We met its founder and CEO Rish Mitra, who told us more…

How did the idea for Blippar come about?

Blippar was never meant to be a business. It started out as a joke. I was sitting with my friend Omar Tayeb in a pub in Surrey in 2010. The last round of drinks was £15 and I put down a £20 note and said ‘imagine if the Queen could come to life and say here’s your five pounds change’.

A stupid joke. I barely remember saying it. But Omar came back a few weeks later with a prototype. He had an HTC Desire which he placed over the Queen’s head. It wasn’t her face that come to life, but a perfect representation of mine. That became our party trick. Everywhere we went, we’d put someone’s face on the Queen.

But we came to see that a bank note is just an image; you can do the same trick with anything. That’s how Blippar was born.

At what point did the joke become a company?

In the summer of 2010, I showed the prototype to my old friend Jess (Butcher, now CMO of Blippar). She had just got engaged and we met to talk about that – and all I wanted to talk about was Blippar! But she instantly got it and wanted to join. I then asked a lot of other friends to quit their jobs and come in with me. Most of them did.

Why were you so confident?

It felt everything had aligned with Blippar. I always say to entrepreneurs to wait for your perfect gig. And this was definitely mine. I’ve always been a risk taker. The job I had at Axa when I started Blippar was actually my first job. I’d been an entrepreneur before that and had had a very successful exit – an IPO – at 17. But then I had three failures and I began to wonder if I could ever have a success again.

How did you fund Blippar at the start?

I put everything I had into it. I quit my job at the height of the recession and Omar and I bootstrapped the business with £110,000.

How far did £110,000 get you?

Quite far because we were earning inside three months.

You weren’t the only company to have the idea for Augmented Reality though…

Yeah, it was pretty amazing that within one month, three companies in the UK had all had the same idea – us, Mike Lynch’s Aurasma and Caspar Thykier’s Zapper.

I think we all benefited from the PR around augmented reality at that time. Especially from Aurasma, because it was such a well-backed product.

Of course, no one knew about AR back then. So how did you go about finding clients?

We knew from day one that we had to change behaviour, and that we couldn’t do that ourselves. The only people who can do that are big brands and celebrities.

So we went to 107 companies asking if they wanted to see a new way to make their campaigns and brands interactive. 101 said no. The six who said yes were Tesco, Samsung, Cadbury, Nike, Heinz and Microsoft Xbox.

Not a bad list.

Yes. It’s easier to get the whole pyramid if you get the top of it first.

What kind of objections did you face?

Most often it was from brands who wanted to white label our platform. They didn’t want to work with a third party brand like Blippar.

But I always say if you have a problem with third party platforms, close your Twitter account. It’s the same thing. It happens less now, but there are brands who still just want to do things themselves.

In fact, when we were making £5,000 a month, we turned down a million dollar deal with a major retailer. They wanted us to do a white label product. That was wrong for us.

That must have been a difficult decision…

Not for me. It is fundamental to me that the platform has to stay neutral.

OK, so what’s your pitch to all these CMOs?

Blippar works on virtually every touchpoint – TV, bus shelters, print, everywhere. Around 78 per cent of the world’s $600bn marketing spend is still above the line. With Blippar, you can enhance all that activity and make it interactive.

But in our opinion the biggest media in the world is products. No marketer thinks this. But there are more products sold every day than Google searches, Facebook likes and so on.

When you deliver a pizza, the box sits there on the table for 45 minutes. Most marketers think when the product is sold their job is done. We say, you can continue the story.

It’s such an opportunity. Marketers spend up to $150m a year to maintain their web sites in 47 languages. How many people actually visit pepsi.com? This is a much better way to do marketing.

Leading CMOs are taking Blippar very seriously because it’s putting the product at the centre of marketing. Basically, your product can be your domain name.

The message is getting though. 50 per cent of our business comes to us. In that sense, we have gone viral in the B2B space. And it’s meant we’ve spent nothing on marketing. Zero.

How many products are Blippable right now?

We appear on 6bn products a month.

How does ‘blipping’ a product benefit a marketer?

First, engagement rates are higher. Our worst conversion is one per cent. But it can go up to 15 per cent. And brands get phenomenal data from these interactions: average dwell times, time of day, location.

Average dwell time is a minute and a half. The biggest campaigns get a million interactions. In other words 1.5m of engagement. You can spend $100m to get that level of engagement with conventional media buy.

Brands can discover things they never knew existed by measuring how people react to brands in the real world. They can know whether page 48 on Vogue is more profitable than page 7 in Cosmo. We can show which branch sells the most chicken.

So we’re actually helping old school media. You don’t just need to go digital to measure conversions. You can do it in print.

What’s the business model for Blippar? Do you charge per interaction?

No. Brands have so many platforms try to do that. We charge a single fee that varies depending on how much complexity there is in the campaign. There are hundreds of features in Blippar so a brand could just create a coupon or make a million person online game.

We do find though that in most cases the ROI is achieved on day one.

What’s the average value of a campaign?

From around $20,000 to $1m.

Would you accept that for all your progress, most people still don’t know about AR?

I agree. It’s not mainstream yet, though we have 4m active users in both the UK and the US. What I say to marketers though is that the numbers don’t matter. For example, there are tens of millions of Twitter users, but when you send a tweet, you don’t send it to them all. It’s just your network. It’s the same with brands. It’s about their ability to reach their own audience.

The fact is, no brand we’ve worked with has ever left us.

Presumably, you have tried to work with handset companies on pre-loading Blippar on devices…

Well, obviously, I want a blip mode on the camera. That would make a huge difference to us. We’re talked to OEMs. But these are long conversations.

What long term vision are you building towards?

We want Blippar to become a utility – a visual search engine. That’s our path. We’re not far from it. At first, we could recognise 10 images; now we can recognise 5bn. If you think about search engines now, words are not the best way of describing things.

So I think we can find exciting new opportunities beyond marketing – in editorial, healthcare, education and so on.

Do you see Shazam as an example of how this kind of recognition tech can go mainstream?

Actually, I think visual search has so much more potential. In a room you can get one sound source, but 1500 visual cues. Also, there’s sound distortion but no visual distortion.

In the last few months, see saw Amazon launch Firefly and Google has done things like Google Goggles. Are you worried about being steamrolled by a giant tech company?

If you look back, you see that big doesn’t beat small. IBM didn’t make Microsoft. Microsoft didn’t make Google, Google didn’t make Facebook and so on. There are 300 of us here. It’s our life, it’s not just a department. To be honest, the smaller companies give me more sleepless nights.

I assume some of these giants have looked at buying Blippar…

There have been a few approaches. The fact is we have significant double digit million revenue and we’re not building the business to sell.