November 20, 2014
According to a recent Forbes article, video ads are hot right now. Nearly every major internet platform launched a new video ad product, big brands love it, and video ad spending is up 76 percent year-over-year in 2014.
Recently graduated from the 500 Startups accelerator, as part of Batch 10, Shakr has decided that they want to unlock this world of video advertising for the people who need it most: small businesses. According to David Lee, founder of Shakr, the only thing holding small businesses back from running video ad campaigns is the high upfront cost of producing the creative.
Currently, Shakr has over 600 video templates designed by the same people that make video ads for Nike, Samsung, and CBS Sports. Naturally, I sat down with Lee to dig in deeper to Shakr and some of the amazing progress they’ve made with an assist from 500 Startups.
Tech Cocktail: Who are some of the people using your platform?
David Lee: We’ve seen a great uptake from car dealerships. In fact, every major car brand in the world with the exception of Hyundai-Kia and Tesla have a local dealership using videos made at Shakr. Here’s one for Fletcher Jones Audi, and another for Toyota of Springfield.
Currently our primary customers are mostly small businesses with lots of restaurants, fashion brands, and manufacturers. But we’re still in the early stages of growing the ecosystem, and we’re finding that as we introduce new video templates in new categories, we’re seeing entirely new segments of users coming to Shakr. For example, recently we launched video ad templates for independent game developers. It’s still new for us, but we’re seeing interesting uptake from game developers.
Tech Cocktail: Where did the idea come from?
Lee: I spend a bit more than half of my time in Seoul, a city that just might have the highest pixel density in the world: there is a digital display wherever you look, with great video content running from big brands. It struck me that the voice of normal folks is missing – where are the small businesses? Where are the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes… where are the ones who see things differently?
People and companies with deep pockets aside, the only thing holding people back from leveraging video for communication is the cost of producing video creative. Everything else is already, or nearly, in place, including programmatic access to video ad inventory, smartphones that shoot gorgeous video footage.
Tech Cocktail: What’s your analysis of competition in this field?
Lee: There are tons of video editing sites out there. What really sets us apart is the ecosystem that provides a steady supply of great video templates. We’ve built the equivalent of the Apple App Store, where developers submit apps and keep 70 percent of the earnings; designers submitting video templates keep 70 percent of the earnings.
Similar to the App Store, Shakr took the approach of bringing high quality designers into the fold first, and helping them realize meaningful monthly earnings from their portfolio. And now we’re seeing independent designers from around the world coming to Shakr to sell their video templates.
The bottom line is: Shakr is the only place where you can make hyper-effective video ads without the need to hire a professional designer to do a bespoke project. And from what we hear, those professional designers prefer it this way because they can make substantially more money while maintaining creative ownership of their work.
Tech Cocktail: How do you see this fitting, or maybe shaping, larger trends?
Lee: The macro forces around us are rumbling: Marissa Mayer is turning Yahoo and its properties into a video behemoth, including a shift at Tumblr towards video and the acquisition of Brightroll. Facebook is working to make video ads available to everyone, but without helping small businesses overcome the issue of producing video ad creative yet.
There is a massive shift towards video consumption, the floodgates to video ad inventory are opening up, and the effectiveness of video ads is proven to be 3 times higher in terms of click-through rates than even mobile ads.
The one thing that is missing is helping small and medium sized advertisers produce video ad creative. Our role in this larger trend is that of a bridge – Shakr.com helps small businesses realize the incredible benefits of video for promotion, benefits that big brands have already proven and are enjoying immensely.
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