• by Mark Naples , November 4, 2005

Steve Smith did a great job in his three-part series that ran this week in OnlineMediaDaily, explaining why media executives have been shying away from behavioral targeting. BT is tough to explain to people, no question. When was the last time you tried explaining the differences among BT, performance marketing, single-site versus network buys, or any of the other arcane-to-everyone-else-but-second-nature-to-us idioms of our business to someone on the outside?

Heck, try explaining search engine marketing to someone who's never used a search engine. You might be surprised at how many senior executives--you know, the ones who ultimately make the decisions--have no idea what a search engine is or how it can be used for marketing.

Indeed, it gets dicey when that someone on the outside is the one writing the checks. People selling BT and other products, developing thick skins (as David Berkowitz explained in a quote in the third OMD article) and pushing through frontiers are really the heroes of our industry, as far as I'm concerned. Theirs may be the hardest jobs of all.

That's one of the reasons Google has been such a darling of Wall Street. There's nothing like an intuitive self-serve model to make revenue growth simple. But, while models like that one can make individual companies grow, the really interesting story for my money is how they make entire industries grow around them.

After all, as Google, Yahoo and MSN have spawned the enormous SEM industry, eBay drove revenue for more than 430,000 businesses and individuals last year. It's easy to remind myself from time to time that what we all do for a living hardly even existed as an industry two presidents ago. The point is, whenever major business models are built online, they create businesses--and jobs--downstream.

So, what are some of the industries that we'll see spawn downstream from some of these self-service models online? If Google is as serious as it seems about entering all manner of media markets, including classifieds and television media buying, what are some of the industries that will come along for the ride?

One such industry is likely to be small-scale video production. In the late 1980s and early 1990s, the advent of affordable satellite communications and the rise of cable television created the environment for the rise of the video news release to help fill all that new airtime. PR firms across the US needed to know how to produce a Video News Release (VNR) as readily as a regular print press release. VNRs and Broadcast News Releases (BNRs) remain a staple among broadcast types in television and radio. By 1999, millions of dollars were being poured into startup companies that raced to acquire and digitize all manner of video, especially special interest and instructional video. I should know--I toiled for one of these companies. And I do mean toiled. Any of us who were working for companies then that were built on broadband models now know that we were just a wee bit early--like by five years.

Today, similar commercial and professional video is surging online. As Comcast and other cable networks have begun targeting broadcast ads as precisely as the plus-four Zip Code, the opportunities for precise, local targeting are creating market needs for these smaller advertisers to produce video.

Enter companies that are building substantial business models by empowering affiliates who ride incentive plans to augment their income from other jobs and move cottage industries like commercial digital video forward. While the large rich media companies that are written about on these pages frequently have enjoyed robust growth, an entirely different, far more disparate, but perhaps somewhat similar industry is being built on the backs of video production companies.

Those of you who can remember watching late-night television 20 years ago probably also recall how bad the ads usually were. While quality control among smaller companies is understandable inconsistent, those who succeed will do so by maintaining strong quality control. After all, in a performance marketplace, there won't be much room for untrained talking heads in cheap plaid blazers.

"This is such an easy item to sell, partly because most of the people doing the buying have never seen the power of their products on video before," said Patrick Graham, an independent affiliate of video production company VM Direct. "If the video is well-produced and the files stream evenly over broadband connections, the advertiser or individual will be amazed at how much better they can look than ordinary photos. The leap to video from static photo files is akin to the leap to photos from text-only, so business is fantastic."

That last assertion is hard to argue with if you're anywhere near the creative end of our business. If you can include a jpg in your listing on Craigslist, eBay, or Google Base, then the ability to include a short video is going to revolutionize and democratize all manner of classified ads for the masses. Taking it a step further, the opportunity for small-scale video will have to grow since someone is going to have to make those online videos easy to create. I'm sure we'll learn about other companies who do this on the Spin Board.