Would you install an Android app that put ads directly on your smartphone’s lock screen? No? What if you were paid to do so, and whenever you swiped to unlock your device, you made a little money? That’s the promise of a new mobile application called Locket, launching today for Android, backed by $500,000 in funding from Great Oaks VC and a couple of undisclosed angel investors from the entertainment and marketing industries.
The New York-based startup was founded in March by Yunha Kim, Paul Jang, and Christopher Crawford, and is currently working out of a Manhattan apartment where five founding team members live and work alongside their three dogs and a hamster.
Kim tells TechCrunch that the startup closed on the Great Oaks funding just three days after its pitch – their first VC pitch ever, she notes.
Before building Locket, Kim graduated magna cum laude from Duke University and worked as an investment banking analyst at Jefferies.
“Working in banking, my only outlet to my outside life was my phone,” she says. “And looking at my lock screen – which was just a picture of a daisy – the question was, ‘how do we monetize that?’” The idea inspired her to team up with fellow Duke grad Jang and Crawford, whose background is in advertising.
The company thinks there’s room to define a new market for mobile advertising, which they’re calling “first glance” ads. The idea is already taking off in some overseas markets like Korea, where similar businesses have achieved over 20 percent of Android market share penetration in three months after their debut, Kim explains. However, in the U.S., where Locket is currently focused, it’s basically untapped.
The experience of Locket is not all that different from those lock screen ads on some Kindle devices. But instead of forcing users to view the ads, like the ad-supported Kindles do, users have the choice to engage or not. They can choose to engage by swiping in one direction to be directed to a website, Facebook Page, coupon voucher, or movie trailer, for example, or they can go directly to their homescreen by swiping the other way. Regardless of whether they “click-through,” users are paid 1 cent per swipe, capped at 3 cents per hour for now.
Ads will also be targeted using social profile data from Facebook (or a brief questionnaire), geolocation, other app usage, and engagement history.
At launch, Locket has a limited selection of about eight advertisers on board, and will also be running house ads to fill the space. However, Kim says that in around a month, they plan to offer ads from more than ten advertisers. The company also has deals in the works with two larger Fortune 500 companies, but she’s not allowed yet to disclose them by name.
Not all advertisers will be accepted, as Locket’s goal is to respect the very personal landscape that is the mobile phone lock screen. The startup has already rejected ads from alcohol and lingerie brands, for instance, as well as one for a mobile app that wasn’t well-designed.
After an advertiser is approved, the turnaround time to get their creative onto users’ phones is about two weeks. Locket also has an in-house creative team, and a technical crew that tests ads on 20 top Android smartphones they keep in the office (um, apartment). They do try to achieve compatibility with most leading Android phones, but the market today includes some 1,600 devices, so the long tail may still experience issues during Locket’s beta, which begins now. The company claims they’ve also worked hard to limit the impact on battery usage.
Advertiser costs vary, but the goal is to push Locket over $10 CPM, eventually hoping to top Flipboard’s $30 CPM for its in-app, full-screen ads, says Kim. “We want to be able to charge more than that because we’re front of your mind, right in front of your face. Whatever you’re doing, you’ll see the ad on the lock screen.”
Will Consumers Bite?
Locket’s launch comes at a time when Facebook’s move to take over users’ Android lock screens – and devices – has been met with some resistance. Facebook’s Android launcher Home has not yet been the success the social network hoped for, but there are parts of the experience users liked. One of those parts is the “Cover Feed” which brings images and status updates to the Android lock screen. What made users uncomfortable, however, was news that Home would one day include ads on this screen, as well. Users didn’t like the idea of having ads forced upon them, but Locket works around that psychological hurdle by offering to pay users for their time.
One cent per swipe, and no more than 3 cents per hour (at least, for now), is not much money, of course. But given how much users interact with their phones it’s easy money that could add up over time. Maybe you won’t make but a few dollars per month at first, but as more advertisers come on board, that could change. If anything, the couponing craze and success of rewards sites like Swagbucks demonstrate there’s at least a portion of the market that will work hard for little reward. Locket, meanwhile, requires very little user effort.
“What we’re trying to do is change the perception people have towards ads. On mobile, ads suck right now,” says Kim. “But our ads are different because they’re beautiful and they actually reward you for your glances. We hope users will like it.”
Locket is a free download on Google Play here.