Hollywood Production Studio Launches SMB Video Ad Service
Sam Rogoway, lawyer turned entrepreneur and founder of the Hollywood production studio, calls the less than two-minute high-def network clips "documentary style programming." He believes each provides an inside view of businesses, such as local restaurants, hotels, retailers and realtors.
Christine Alvarez, director of sales at Oceana Santa Monica, agrees. The Oceana Santa Monica hotel contracted with Near Networks to create three videos that showcase everything from the hotel to the surrounding area. She said the videos convey the mood of the hotel "in a way you can't do through still photos."
The clips appear on the Near Networks channel, as well as YouTube and Facebook pages. The 70-room boutique hotel typically has a 92% occupancy rate daily, she said. The hotel relies on word-of-mouth marketing, rather than advertising or social media, so online video will become the test to determine whether bookings increase.
Videographers scattered around the country keep costs low and support the service, starting at $1,599 for one 90- to-120-second HD clip and one 30- to-45-second HD vignette. The company will support search engine optimization (SEO) to help videos index in Google search query results.
Businesses can embed their Near Networks video channel on their Web site, blog and e-newsletters, and share their videos across various social media sites. Clients include Hotel Oceana, Sarah's Pastries & Candies, Tavern Restaurant, and Hearth Restaurant. Locations range from Los Angeles to New York to Chicago to Portland.
The model is similar to online production company TurnHere, which also produces video ads for small businesses. More than 180 million U.S. Internet users watched online video content in July 2011 for an average of 18.5 hours per viewer, according to comScore. The total U.S. Internet audience engaged in 6.9 billion viewing sessions, according to the research firm.
Video advertising is expected to grow faster than all other online ad formats, and this year eMarketer estimates online video will surpass rich media in terms of ad spend. U.S. online video advertising spend will grow 52.1% to $2.16 billion -- up from $1.42 billion last year, according to the research firm.
"Photos or text can only take someone so far inside a business," Rogoway said. "If a local business runs a deal on Living Social or Groupon, consumers can only learn so much through a written description."
Rogoway's previous venture TripUp was acquired by Sidestep -- now Kayak. Along with production head Jen Ringel, who helped launch the MTV Networks division MTV New Media, and will support production.