When Rob Duva, co-founder and chief marketing officer of Santa Barbara technology startup RingRevenue, was on the golf team at The George Washington University in Washington, D.C., his passion was to one day fulfill his lifelong goal of becoming a professional golfer.
While Duva’s dream of a life on the links hasn’t come to fruition, RingRevenue is certainly busy “driving the green” these days.
Founded in 2007 by industry veterans Duva, Chief Executive Officer Jason Spievak and Chief Technology Officer Colin Kelley, RingRevenue is a performance-based, pay-per-call platform that allows affiliate networks and advertising agencies to track purchases made by phone.
For years, traditional pay-per-click platforms have allowed publishers to drive leads for advertisers through Internet banners in return for a percentage of the sales generated through the publisher’s site. Advertisers have been able to track these clicks to determine their origin, so that the publishers are paid on a performance basis. But Duva says there have always been some glaring deficiencies in the pay-per-click model.
“What ends up happening with the higher-end, more consultative products and services is that a lot of times you have questions as a consumer,” Duva said, “and there’s a toll-free number that sits on a lot of these landing pages, and when you pick up the phone and call that phone number, the publisher that drove that lead is no longer associated with any transaction that winds up occurring over the phone.”
While lower-end products and services transact quite well through the online affiliate networks, Duva says that typically once the consumer price-point on a product or service exceeds $200, that product or service begins to move into the call centers. A rift began to form between advertisers and publishers using the pay-per-click model, as publishers became reluctant to drive traffic to advertisement banners that included phone numbers, because the publishers knew they wouldn’t get credit for those leads. This posed a formidable problem for both sides, since clicks typically only convert sales at 1 to 3 percent, while calls convert at 30 percent to 50 percent, with an average order value of nearly double that of clicks.
The three founding members of RingRevenue recognized an opportunity to draw on their collective experience to bridge this gap in the affiliate space.
“As a management team, we understood the online performance marketing elements, we had built out platforms that were handling billions of calls a year, and managing millions of different phone numbers,” Duva said. “We took that core expertise and got to build from scratch to solve this specific problem within the performance marketing space.”
Before RingRevenue, all three founding members cut their teeth in the world of technology startups at CallWave Inc., a voice-over-Internet software and service provider.
Duva was the director of customer acquisition for CallWave, where he helped build the subscription base to nearly 15 million subscribers, driving more than $50 million in annual revenue. During that time, Spievak served CallWave as chief financial officer, delivering 12 consecutive quarters of revenue growth, profitability and positive cash flow. Kelley was CallWave’s chief technology officer, and he was the architect behind the company’s voice services platform to more than 10 million free and paid users.
For their first year and a half in business, the RingRevenue triumvirate was completely self-funded. Duva said they wanted to make sure they got the initial platform built and started to see some transaction flow before looking for financing. But in the summer of 2008, the burgeoning company got a chance invitation that would change everything.
“We weren’t really looking to raise venture capital at the time, but we received an invite to head down to VentureNet, a conference in Orange County, and we weren’t sure if we were going to do it at first,” Duva said. “But we wound up going and engaging in dialogue with about half a dozen different top-tier VCs. So we started that process earlier than anticipated, and out of those relationships we found a pretty unique set of investors.”
Among those investors were GRP Partners, Rincon Venture Partners and Great Pacific Capital, and in June 2009, RingRevenue closed its first round of funding at $3.5 million. That same year, the company won the business of affiliate industry heavyweights Commission Junction, LinkShare and ShareaSale.
Duva attributes RingRevenue’s success to the unique understanding and perspective that he and his partners bring to the affiliate network landscape.
“Call tracking has been around for a while now,” he said. “But what is unique about what we’re doing is that it’s purpose built for performance marketing. Having been an advertiser in these networks, we were also a large publisher in the CallWave days, so we understand the dynamics of both sides very well. You’ve got advertisers on one side, who want highly qualified calls that are going to translate into dollars. On the other side, you’ve got publishers who often have massive amounts of inventory, and they just want to drive volume and get paid for as much as they can.
“It ultimately winds up being a balance. What we’ve created is the right level of control mechanisms for the advertiser to be able to come into our network and set up a call-based campaign.”
Each campaign is individualized to the advertiser. Through the easy-to-use platform, advertisers can specify the exact criteria they want. They can decide on specific targeting profiles, set up qualifying questions, specify call-flow and decide on the pricing they’re willing to pay for calls. It’s also easy for publishers to get onto the platform and activate unique phone numbers, with the ability to track those numbers through blogs, paid search initiatives or local publications, and Duva said RingRevenue helps get the phone numbers integrated into the right creative resources, both online and offline.
“One of our core principles is ‘ease-of-use equals use — and use equals revenue,’” Duva said. “We’ve spent a lot of time trying to make very complex technology very simple and easy to use.”
What does the future of pay-per-call hold for RingRevenue? Duva said he sees an exciting trend in the world of advertising that he believes will translate into continued growth and success for the promising young company.
“One of the things that Jason, Colin and I knew from buying media is that as an advertiser, you want to eliminate as much risk as you can,” Duva said. “So you prefer to pay for performance — you prefer to pay for a lead form submission, or as a percentage of sales, or some specific action that has taken place. Advertising over time has continued to shift in that direction, and that’s what we do — we enable networks to really extend their advertising dollars on a performance basis.”
— Kevin McFadden is a Noozhawk contributor.