Digitalx : AirPocket Marketing Update

ASX ANNOUNCEMENT

26 September 2016

Highlights:

• AirPocket Top Up App made available on iOS and Google Play in late May 2016.

• Marketing rollout for the AirPocket commenced in late June 2016.

• Currently marketed online and through telecommunications partner Telefonica.

• On target for 5000 downloads by end of September.

AirPocket, a mobile first solution, targets the predominantly prepaid mobile phone market in Latin America. Initial marketing focus has been on the USA and Mexico, a country where 83.6% of all mobile devices in 2015 were prepaid [1]. AirPocket allows consumers in the United States to recharge the mobile phones of Latin American carrier subscribers. The marketing to US consumers is a multi-channel approach through social media and google adwords campaigns and has yielded approximately 75% of the users to date.

The marketing component of the partnership with telecommunications giant Telefonica has been making solid progress. Telefonica's role in the direct SMS campaign is in sending and delivering SMS messages to their end users with DigitalX being responsible for the design of the messages. The SMS messages to Telefonica consumers has delivered nearly 1000 downloads in Mexico alone with less than 1% of the 230 million mobile devices across Latin America targeted in this long term campaign. The partnership has expectations of a large uptick in use when the full service offering of carriers is added to the AirPocket application. DigitalX expects to add another Telecommunication carrier partnership during September and offer full service global coverage in October.

During the month of August, the request feature of the AirPocket application was added. This feature allows subscribers in Mexico to request a mobile top up from friends and family in the United States directly from the user interface of their AirPocket mobile application. We have seen pleasing use of this feature since implementation.

AirPocket installations are growing exponentially and the mobile application is on track to gain an excess of 5,000 installations before the end of September. The following graph shows the trend in installations:

Since inception, our total marketing spend has resulted in an average CPI of $6.81 USD. However, throughout the past 3 months, the CPI has been trending lower and is currently hovering around $3.50 USD per install. The following graph shows the declining cost per CPI:

Expanding on the current mobile top up offerings, AirPocket will soon offer its bill payment capabilities to other industries and services to the current AirPocket users. Following, mobile bill payment, AirPocket will then bring the remittance feature to market by providing the ability to send remittances from the United States to Mexico, the world's largest remittance corridor.

Chief Executive Officer of DigitalX, Alex Karis, commented: "I am pleased with the success of the AirPocket marketing campaign and our ability to decrease the CPI dramatically in just a few short months. I look forward to carrying this momentum into the busy holiday quarter."

Reference

[1] https://www.statista.com/statistics/598042/mobile-connections-in-mexico/

DigitalX is a Blockchain-based software solutions group disrupting the payments industry. Its products allow consumers to make secure and cost-effective money transfers worldwide. Partners can use DigitalX's technology to offer new financial products. DigitalX is based in Boston and has offices in New Jersey and Australia.