The buzz around harnessing
user-generated video to boost brands may have peaked a few years ago, but startup Poptent has managed to find a profitable niche as a platform for crowdsourcing video
ads.
Started in 2007, the company matches its social network of 20,000 independent videographers and filmmakers with assignments for mostly online video (but also TV) spots from major brands
including Anheuser-Busch, Nokia and American Express. Think LinkedIn for freelance video producers complete with member profiles, work samples and a discussion board.
Each assignment is in effect
a contest where brands select two or three commercials from the roughly 35 to 100 submissions each project attracts. Advertisers typically pay $7,500 per winning ad, although that figure is lately
starting to climb to $10,000 as marketers compete to draw the most talented videographers, according to Poptent President Neil Perry, a former senior marketing executive at McDonald's Corporation and
Monster.com.
The Philadephia-based company today announced crossing the $1 million mark in cash payments for contributors' completed assignments, with $10,000 awarded to New York City-based video
maker Sean Cunningham for one of four winning ads for GE's user-generated "Tag Your Green" effort as part of its ecomagination campaign. Poptent.net usually has eight to 10 active assignments posted
at any time.
A current project from Frito-Lay, for example, asks members to create videos inspired by its tagline, "We Make it Natural. You Make it Fun." "Since our traditional media will focus
on the 'We Make it Natural' piece, we would like for the focus of this Poptent ad to lean more heavily on the 'You Make it Fun' portion of this tagline knowing that natural is another reason to
believe that mom can have fun," reads the creative brief.
Frito-Lay is paying $10,000 apiece for three ads, and possibly more based on the quality of submissions. Poptent gets about 25% to 30%
repeat business from advertisers, according to Perry, with Anheuser-Busch and Procter & Gamble each sending seven campaigns to the site so far. FedEx ended up buying nine ads this year at $5,000 after starting with just three for its "Think FedEx First" campaign
aimed at small businesses.
The spots are clever, quirky and professional-looking, if not the product of lavish production values (although one circus-themed spot does feature a live elephant).
Unlike its video contributors, Poptent itself doesn't work on spec. It gets paid $25,000 up front for each assignment to help manage the process and screen submissions for any inappropriate or
copyright-infringing material. Even with the video freelancer's fee added in, the cost is still considerably less than paying six figures or more for creation of a tradtional 30-second spot.
But
Poptent isn't always leaving agencies out of the loop -- about 20% of its work comes from agencies rather than directly from brands. Chicago-based marketing firm Robinson Maites, for example, which
works with FedEx, handled the ad buys via Poptent for the shipping giant. And Poptent worked with OMD on campaign strategy related to the GE "Tag Your Green" assignment. Boutique creative shops may
also be among those submitting prospective ads.
Poptent's steady growth and profitability haven't been lost on investors. In October, the company received $3 million in first-round funding from
MK Capital. That financing will help the company expand its 25-persoff staff, including sales and marketing employees, as well as grow beyond the U.S. market through its network of video makers in 80
countries.
Poptent is not alone in pursuing the "crowdsourced creativity" model, however, with other startups such as GeniusRocket and Tongal also vying for talented contributors and brand and investor dollars. GeniusRocket, for instance, touts a "curated crowsourcing" approach in which any member that
produces for content for a project gets compensated whether the client buys their work or not.
Perhaps most crucial for Poptent's success so far is that advertiser expectations haven't been set
too high. If a video spot goes viral, that's gravy -- but it's not something brands are counting on due to the fickle nature of the Web video audience, according to Perry. As many brands have found to
their dismay, manufacturing a viral video hit is a dicey proposition no matter how big the production budget.