Interview with Sinch CEO Oscar Werner about the future of conversational messaging
As of November 1, 2021, MessengerPeople is officially a part of the Swedish technology company Sinch AB (publ), a global leader in cloud communications for mobile customer engagement. In our regular WUMMM weekly we were delighted to interview Oscar Werner, CEO, Sinch as our guest.
We were very keen to hear more about Sinch’s role in mobile customer communication, its experience with text messaging, and its upcoming changes and plans for the future with MessengerPeople on board. Of course we also talked about what will change in line with the merger of MessengerPeople and Sinch.
What is Sinch? Where are you coming from?
We began as a pure garage start-up. Sinch was founded in the shop window of a travel agency in Stockholm called African Caribbean Travel. In the first office one had to pass the travel agency people and walk in the back to the one room office, and later further into the basement with no windows. The founder team spent all of its money on the customer and not on a fancy office. The numbers, in fact impressed and gained the trust of bankers, who were brought in, in spite of the humble office space.
The only capital injected to run the operations was 10,000 dollars in share capital. It’s been profitable since day one.
Every single dollar that we brought in after has been to do with acquisitions and never to fund operations. That’s core to the culture – really delivering customer value.
The point where we are coming from matches very well with MessengerPeople. Because you are also founder lead, delivering customer value, you have been through good times and bad times, and you fought through. That is so much like the culture of Sinch. That’s why we truly love the team and the ethos of the team.
What is Sinch’s position and customer use cases on the market?
We are the world’s largest messaging provider among all channels like text and all the OTT channels. We are the largest provider in Germany as well. The largest portion of text messages you get from your bank, your insurance company or your hair dresser would be powered by us.
And then moving in to all the new OTT channels like WhatsApp, Apples Messages for Business, Telegram, Instagram – these have also been integrated in our portfolio. With recent acquisitions we are also the largest voice provider in the US – all the 1800 numbers and the highest number of customer care calls go through our pipes. We also recently acquired Pathwire, one of the largest mail providers in the world. With this we also have a large share of the e-mail market now. And we also joined forces with MessageMedia, which is in the SMB play. So from a channel perspective we are pretty broad, but
Then we really believe in the conversational use case, that’s truly why MessengerPeople comes in. We believe that this is going from outbound to conversations. Really taking care of the customers care use cases and marketing use cases which are driving conversations. We already do a lot of tools on the marketing side, we have a chatbot technology, we have various types of technologies and then MessengerPeople fits very nicely into that.
It’s about the big tech transformation where enterprises are moving to conversational use cases via new channels. That’s why we are joining forces.
Which German brands use Sinch and for what?
One use case that we just did was together with Deutsche Telekom. Deutsche Telecom wanted to do a device upgrade campaign. They wanted to offer the customers an environmental friendly option for upgrading their phones. So they had refurbished phones from Apple and they wanted to communicate this offer to consumers. This is a bit complex offer to communicate. They tried via e-mail, via text and various channels. But it didn’t work out that well.
So they came to us and asked: Can we do a personalized video campaign in Germany. So we took our Sinch for Marketing unit and created a video which is personalized for you as a customer. It has your name, the link is personalized, it has integrated which phone you currently use, what would be the update possibilities for you etc. – every possible parameter was personalized to you. The link to the video was sent via text.
This personalized video campaign had a 40% uplift compared to the control group, which received it via e-mail.
Here you really see the power of the mobile channel vs. e-mail but also when you are doing a personalized campaign vs. a non-personalized campaign.
How do you see the impact of OTT channels in such kind of campaigns globally?
The most advanced markets on WhatsApp and these new channels are probably Brazil or Latin America, India and then Europe, with Germany as one of the most advanced markets.
US is definitely lagging on the new channels partly because the text messaging prices are so low. It is also because the penetration of the messenger apps is more fragmented in the US. It is harder to have one channel to use.
But the next logical step of the Deutsche Telekom case is to do it on RCS or WhatsApp. And the conversion rates will be even better when you are using a RCS channel or a WhatsApp or Instagram channel.
Why did you and the team decide to get MessengerPeople on board?
It is all about competence! It is about knowledge of the market, the competence in the people, the understanding of the market, the use cases, the customer.
So the number one reason is huge competence in the MessengerPeople team, how you work with customers, the use cases you have proven. Getting that together with the use cases we have proven, and joining forces on driving even better use cases and performance to our customers.
Then MessengerPeople has got good tech in certain areas and we have got good tech in other areas, combining this all will be good. And you have got a lot of good customers that we can continue to develop with and continue to invest in together.
So we are super excited of all these things to continue the drive of growth of MessengerPeople and Sinch together.
How do you see our future as the conversational messaging dream team?
The vision is very simple and straight forward: we want to be the best conversational messaging provider on the planet! We are very humble in that way. We don’t believe, that we can do everything by ourselves.
We don’t see it as an acquisition. We partner with the teams we really can learn from.
So we can learn from you and then I hope you can learn some from us. So if we do that, I think we can be the best conversational messaging provider on the planet. That is the goal!
What can MessengerPeople Customers expect in the future? What will change?
So right now nothing is changing, we want to keep the MessengerPeople tech and the team. We continue to do the good work that you are doing.
What is changing is partly that the MessengerPeople team gets access to a lot of new technologies, like a tool box they may not have had before. For example we have a dedicated AI machine learning team – from the Chatlayer acquisition – which we will in some way integrate with the MessengerPeople platform.
If MessengerPeople wants to add an e-mail technology, we have the Pathwire team. If you want to add voice, to this entire conversational flow, we have a lot of competence in that. If you want to have real high scale outbound messaging need, we have that down right. We serve the biggest companies on the planet on that side.
On the other hand it is really longevity in knowing that you are with one of the top two providers of CPaaS or messaging on the planet. We are the largest or second largest provider on the planet. We are very profitable and have a very solid financial standing. We can make the investments that you need.
I think now together we can set up a long term roadmap, we can commit to deliver, you know we will be there. If there are good technologies in the market you can trust that this combined team will be up-to-date.
We have deeper pockets and a broader portfolio to drive growth.
How do you handle GDPR, a very important topic among our customers?
We are very core on GDPR. Our biggest segment is financial institutions and banks, we have a lot of the German banks as customers. So we have been down this route many times. We are fully GDPR compliant and ISO certified. We are certifying to all these standards in all the different parts in the world. That’s key and we going to continue to drive this agenda. We are very careful about customer data!