Spot Runner, the high profile video production house and media buyer for small businesses, is winning some big deals with national players that want to provide solutions for partners and affiliates, and also target locally.
During his Day 1 Keynote at Local ’07, Founder Nick Grouf says that “by solving problems for small business, we’re seeing substantial demand from Fortune 1000 brands.”
Jewelers, for instance are getting coop dollars from manufacturers, such as DeBeers diamonds, so that “a dollar invested is bigger than a dollar.” The manufacturer foots 25-to-50 percent of the bill. Similarly, Realtors are coming in via Caldwell Banker and other brokerages. “We’re the agency of record for 260,000 real estate agents, working out of 10,000 offices,” he says. While Spot Runner’s stock footage is templated, with multiple options, it appears to be unique to local audiences, because the company grants geographic exclusivity.
To date, the power of combining production and media buying has apparently proved compelling. And small businesses apparently see the company’s price point in the environs of $500 as a good deal (although some competitors are coming in cheaper). “$500 is not the negating item. We’re pretty confident if we wanted to raise price, we could. But what we’re doing is working with very small businesses.”
While Spot Runner is pushing hard on self-serve – if Google can do it, why not Spot Runner? — Grouf says the company has also begun working with agencies to extend the local sales channel. “Many account executives have been banging on the doors of accounts for decades. People say they can’t afford the price of an ad” and its production.
But the company’s media buying side – reaching into markets such as Santa Barbara for as little as $10-12 per spot — is becoming a larger part of the equation, even for companies with no apparent use for the production side. “We provide greater reach and efficiency from the targeting we want to do. For instance, the company recently launched a campaign for Warner Bros.’ ‘The Painted Veil’ for 200 movie screen locations. “They bought a five-ten mile radius around each screen,” he says. “They targeted $5,000 per screen, but working with Spot Runner, they did $12,000 per screen.”
The key to the small business market, Grouf believes, is to be a value added partner, and not cut in on traditional relationships. “Google is stumbling in the market not because it is reselling other people’s inventory, but in an increasingly difficult market, it has strained relationships with partners,” he says. “After the YouTube acquisition, the perception of Google changed in a major way. Google put its flag in the sand, saying ‘your future is mine.’ They’re creating a certain channel conflict for themselves.
“They are going to have to resolve whether they are a media company, or whether they help companies buy media,” Grouf continues. But they are savvy and “they will fix it.”
Nick’s presentation was extremely impressive… Looking around at the audience as he was explaining Spot Runner’s service, you would be hard pressed to have found anyone who was not completely sold on both their business model and self-serve system…
When Nick listed some of the per-spot prices (ie. the $10-12 you have quoted above), several people around us literally gasped…
I am definitely interested in using Spot Runner’s platform to run creative produced in-house, and could also see reselling their service to the SMEs we deal with through one of our other companies.
The one issue that immediately came to mind was that as this system takes off, the $10-12 in Santa Barbara could quickly become $1,000-1,200, negating much of the benefit of the service for the SME market… Unlike Google’s AdSense platform, the ‘real estate’ in the TV market is fairly limited and is not expanding at double and triple digit rates…
Spot Runner’s ease of use and degree of control would definitely still appeal to those larger organizations (as it obviously already is), who are less interested in cost-savings than small businesses…
Spot Runner is definitely a company to keep an eye on, and after hearing Nick speak, I wish I would have been an early investor in the company… They are destined for success!
It’s been said that this guy is a good speaker. Doesn’t mean he has the model right.
These pre-made ad templates are the true opposite of economical branding. Who wants to share an ad with your competition, in your same market, as soon as you stop airing the ad? Who wants to be be baited by a seemingly low production rate only to be forced into a long term contract for overpriced air time?
I think the end user will eventually catch on to this sham and abandon all these unoriginal template companies in favor of inexpensive custom-made ads like those produced by the world’s first global internet-based discount TV ad agency, Cheap-TV-Spots.com. They offer a smart combination of award-winning, flat rate custom ads and honest, targeted air time that is significantly less expensive than any other online ad agency. Try them out to see. They also do not restrict regions for airings, so one ad, at one price, can air anywhere in the entire world.
Here’s the kicker: Their sister agency, BareNakedAds.com , produces custom TV ads for free and airs them nationwide for less than spotrunner says it could air in your example of Santa Barbara. Honestly, $10-12 per spot isn’t unusual, and real discount agencies often have an even better deal than that. It just shows how little most people know about local TV advertising.
I suspect that the template companies have a chink in their armor – that the end user becomes informed enough to see that these companies really don’t have anything significant to offer, and that it’s all a strategy for the purpose of posing for potential acquisition suitors. If you listen, you can just hear the self-service media bubble starting to burst.