YPB underlines reach of transformational technology

Product authentication and consumer engagement solutions provider YPB Group Ltd (ASX:YPB) has provided further information on the opportunities unlocked by its smartphone authentication breakthrough, a significant development for the company which Finfeed outlined in mid-September.

Not surprisingly, news of YPB’s smartphone authentication product resulted in a substantial share price rally of some 65%.

While there appeared to be profit-taking last week, management’s comments today served to reinforce the breakthrough technology as a clear pivotal point in YPB’s evolution as an innovative technology group.

Harking back to the original announcement, YPB reported a major technical breakthrough, namely smartphone readability of a high security authentication mark under “real world” conditions which the company believes is a world-first achievement.

At the time, management illustrated the commercial significance of this breakthrough, and this has been explained in greater depth today.

Firstly, management pointed to a larger potential customer base with a sales shift from a business to business solution to a business to customer solution, providing the company with a much greater end market and as a consequence, significantly increased and diversified revenue streams.

On this note, executive chairman John Houston said, “YPB’s smartphone authentication technology is without doubt transformational for us.

‘’We are now selling something a much bigger population of brands consumers genuinely want.

‘’We are now selling direct consumer engagement powered by assured authenticity rather than anti-counterfeit.

‘’This is a game-changer as it radically lifts the value proposition to brands.

‘’We are creating an entirely new marketing channel directly from the brand to every consumer’s hip pocket, and those consumers are willingly engaged.’’

YPB also sees improved sales probability because brands are buying a novel, low-cost, highly effective marketing solution.

Another important feature of this development is the shorter sales cycle, a result of increased urgency to take action and drive direct engagement with consumers.

High demand in China and South-East Asia

These benefits flow from YPB’s integration of smartphone authentication with YPB Connect, the company’s SaaS-based consumer-direct engagement solution.

Smartphone readability of a high security authentication mark means consumers can assure themselves that a product is either fake or real.

Authenticity is a major trigger to engagement, particularly in high-fake geographies of China and South-East Asia.

Via YPB Connect, smartphone product authentication opens a direct digital channel to the brand, allowing it to cultivate an ongoing, personalised relationship with the consumer via the smartphone. Valuable consented data is also captured by YPB Connect in the process.

Brands are increasingly struggling to understand who their consumers are, and their needs and preferences, particularly export consumers.

YPB Connect’s data set consists of comprehensive, first-person information allowing brands to know and communicate directly with their consumers.

Management says it is poised to deliver in 2019/2020

As announced earlier this month, YPB has signed its first commercial client for the technology, Pan Pass Inc, China’s largest data identity management service provider which produces 3 billion QR codes and marks over 15 billion items per annum for its customers.

From a broader company perspective, Houston said, ‘’Brands value consumer engagement very highly, and interest in our target sectors of wine, dairy, health and beauty, pharmaceutical and legal cannabis is strong and building.

“Our recent presentation sets out clear deliverables for the second half of 2019 and 2020, and our willingness to explicitly set clear milestones is based on our interactions with significant channel partners and brands.

‘’We are intent on converting this opportunity into tangible financial outcomes as quickly as we can.”