We’re all consumers of the world around us — the music blasting in our headphones, the sounds and advertising on the streets, the stores and events we attend — and for many of us, our smartphones are with us each step of the way. Armed with audio-beacon and smart app engine technology, Cincinnati-based startup LISNR has capitalized on this extra limb by providing consumers with triggered content via their smartphone that aims to amplify (not distract from) listening experiences.
Founded in March 2012 by former Procter & Gamble manager Rodney Williams, LISNR strives to make mobile technology an even more integrated part of consumer’s lives in part by embedding tones within audio tunes and broadcasts which can trigger messages, exclusive content, and promotions through its own LISNR application and third-party mobile apps.
You may be familiar with beacons. Similar concept to these audio tones, beacons are small devices that send relevant content to consumer’s smartphones based on their location via low-frequency bluetooth technology. Apple created the iBeacon in 2013 that serves as a notification system within iPhones to awaken and launch applications, and third-party manufacturers have built the physical transmitters that can send iBeacon messages to smartphones (Apple is rumored to be working on its own device).
As smartphone users and usage increase every day, this field of proximity marketing is heating up and inspiring more players to jump into the arena. These companies have strategized within specific sectors and have built on the existing technology. While Shopkick has focused on the retail market, LISNR has latched onto the music industry.
The new LISNR app, to be released in August, creates an entertainment channel and triggers content... [+]
Williams began devising LISNR while he was as an assistant brand manager at Procter & Gamble. His work looked at the future of furthering content in the media, and after being exposed to beacon technology, he saw great potential in connecting media with live audiences, whether it be at sports stadiums, shopping malls, or concert venues.
With little startup experience, a full-time job, and a big idea, Williams joined the StartupBus, a competition in which participants launch a company in 72 hours aboard a bus. It was there, on a ride from Ohio to Texas in March 2012, where he built his founding team. Williams said that aboard the bus he learned the importance of narrowing the scope of his idea and creating a viable product. By the end of the trip, Williams and his team rolled out a demo reel on an application specifically catered to music.
“If we could tap into music that would allow us to test our idea,” Williams said.
In its original version the LISNR application was similar to Shopkick in that users were rewarded based on their activity. With each song listeners connected to the app, they would receive exclusive content, such as interviews with artists and backstage photos. Throughout this campaign, Williams said LISNR worked with about 50 artists, and the app had about 200,000 downloads. But now, based on the beta results, they’ve gone through a complete rehaul of the app, which will be released in August.
“The reality is that the majority of music that’s important to us is the music that’s already on our phone,” Williams said.
Previously the triggered content was driven solely by audio tunes or beacons within songs. Now, Williams explains that the new LISNR app will cater to the music you listen to within your phone (whether it be through iTunes, Spotify, or YouTube) and create a personalized channel, sending messages and content, not all of which is exclusive, based on your interests. These messages can include articles from entertainment magazines or other recent news from the artists. It doesn’t mean non-stop notifications, Williams assured. The app runs passively and can be closed to pause content.
The LISNR app is free for users to download but leaves ample opportunity for branded content and advertising; hence, how LISNR can pull revenues. Currently, over 80 percent of the content has receive brand support. But the company’s main profitability lies in their technology platform: application programming interface, encrypted smart-tones, content recommendation engine. They can apply the software to third-party applications and create specific executions. According to Williams, LISNR’s technology is in over 6 million downloaded apps, and the company executed over 30 campaigns in 2013. This business is subscription based in that customers are charged based on how many tones or beacons they want to install, what type of content they want triggered, and the length of the campaign.
LISNR launched their first big execution with Swedish House Mafia in March 2013 which involved a fan-led lightshow during the band’s final tour. They also worked with J. Cole on a national listening party for his newest album. This August, LISNR will re-execute the app, smart-tones, and beacons they premiered in last year’s Budweiser Made In America tour.
In its early stages, LISNR was powered by Sonic Notify but has since created its own technology (The new application will be solely LISNR). Founded in 2011, Sonic Notify was one of the first companies to begin selling the physical hardware for beacons and to provide management and consulting for implementation. The NYC-based company, which raised $4.25 million in 2012, has worked on projects with Lady Gaga, Fashion Week, and the Golden State Warriors, and provides its technology to several Fortune 100 companies.
But unlike LISNR, Sonic Notify does not offer a consumer-facing app and brand. Sonic Notify cofounder Alex Bell said that his company serves more as the “man in the background.”
“Where LISNR is intriguing and Rodney is in particular is because of his background with Procter & Gamble he understands brands. His company is uniquely suited to use this technology to make a difference for specific brands,” Bell said.
Williams secured a strategic partnership with Roc Nation, the record label founded by Jay-Z, which has granted LISNR access to many artists and corporations along with office space in New York City to supplement their headquarters in Cincinnati — a necessary location when you’re hoping to connect with the nation’s top artists.
In June, LISNR closed on a $3.5 million Series A round led by Boston-based Progress Ventures. Nick MacShane, founder of Progress Partners, has also taken a seat on the board and said he will work on establishing future partnerships.
“The music industry is a difficult and rocky place, but what we’ve always been interested in is when a technology can ease the path for our consumers and marketers and brands. Take out some middle steps,” MacShane said to explain his company’s interest in LISNR.
With the new funding, Williams hopes to further product development, including more analytics, and expand his engineering and leadership teams. For scaling, LISNR is planning more individualized executions with artists and partner with more labels. The startup isn’t short when it comes to eager customers. But their biggest feedback, according to Williams, has been needing to be more self-serve. Currently, the LISNR technology can be live within 3 to 4 weeks, which Williams said he hopes to shorten to just days.
And while the priority right now is music, Williams said he sees a wide future in the second-screen experience for television when it comes to watching your favorite shows and sitting through commercials. LISNR, which made about $500,000 in 2013 and is expected to make between $1 to $2 million this year, has already done a lot in an industry that is rapidly evolving. As more phones become bluetooth enabled, beacon technology gets more widely adopted, and smartphone users increase, we can expect a lot more from LISNR.
