• by Mark Walsh  @markfwal, November 28, 2007

Spotzer Media Group has launched an upgraded version of its automated ad service and received a second round of venture financing from Sierra Ventures and European Directories, a large yellow pages publisher in Europe.

The €10 million investment (about US$15 million) will mainly be used by Amsterdam-based Spotzer to expand operations in the U.S market., where it plans to generate half of its revenues by next year.

The deal also includes a partnership with European Directories in which Spotzer's ad-creation services will be offered to local businesses by the publisher's yellow pages sales staff.

Started earlier this year, Spotzer provides "ready-to-air" spots to small- and medium-sized marketers that are unable to afford traditional TV and video media buying and production costs. It maintains a library of 500 generic commercials that can be customized for any client and targeted geographically and demographically across broadcast and cable TV, out-of-home TV networks, and the Web.

Spotzer competes with a handful of other emerging self-service ad systems, chiefly SpotRunner, which has backing from heavyweights including CBS, WPP and Interpublic Group.

The new features of Spotzer's online platform are aimed at making the system more fully automated. Clients can now use new editing tools to create a "rough cut" of an ad with different logos, slogans or other branding elements before actually licensing the ad.

A geographic mapping and scheduling engine lets users determine the price and availability of ads. A local TV spot for the New York metro area that would run for could cost as little as $500, for instance. New online tools also allow marketers to develop basic media plans based on campaign goals and budgets. That might include driving traffic to a Web site, creating general awareness or promoting a special sale.

The actual media buys are completed by Spotzer through the relationships it has with TV broadcasters, Web sites and other outlets. "We offer the comprehensive turnkey media services traditionally offered by media agencies," says Spotzer founder and CEO Andrew Klein, who previously founded Wit Capital in New York.

A key goal for Spotzer is to enable a complete media mix for clients to reach the right audience at the right time. "The next big reality for local business is that the online environment is far more interesting than local television," explains Klein. "We're hugely focused on the convergence of TV-like advertising coming to more measurable Internet platforms."

To that end, the company aims to build ties to yellow pages advertisers starting with its alliance with European Directories, which operates in nine countries including the Netherlands, Austria and Poland. If successful selling its service in Europe, Spotzer plans to expand the initiative to Yellow Pages directories in the U.S. and other parts of the world.

The company currently operates sales and media offices in New York and Emeryville, Calif., and plans to expand from a dozen to 30 U.S. employees by January. "We're making a major push in the U.S. starting now," says Klein, whose company has focused mainly on the Dutch market to date.

Spotzer received prior funding of €8.7 million from investors including Cyrte Investments.