Think it’s tough getting local advertisers to embrace Internet advertising? Try TV advertising. The complexities and cost of producing a video and buying air time are too daunting for most small business owners. Spot Runner, a start-up that comes out of its closed beta today, is aiming to change that. It’s developed a unique self-serve, web-based ad-buying system for TV. Think AdWords, but for TV ads.
The service works like this: The local business owner goes to the Spot Runner site, picks a business category and then chooses from among thousands of generic, pre-taped video ads. Each ad comes with pre-written voice-over text that can be customized (see screen shots below). Once the business has picked an ad, it tells Spot Runner how much it wants to spend on air time and which media markets it wants the ad to run in. Spot Runner comes back with a media plan. It then completes the production work of the customized ad, buys the air time and gets the video into the hands of all the pertinent networks. Later, it sends the advertiser a report of where all the ads ran and when.
Co-founder David Waxman says the advantage of Spot Runner over a regular ad agency is lower cost and the speed and ease of the self-serve site. The professionally produced ad costs about $500, compared to several thousand dollars otherwise. The airtime itself is extra, of course, and Spot Runner takes a commission. Waxman envisions the service opening new doors for small businesses that maybe never would have considered TV advertising before.
“There’s too much friction for a local business to get on TV,” he told us yesterday. “We wanted to make TV available and let these guys compete on TV. Our mission is to use the Internet to put the power of TV in the hands of everyone.”
Waxman says the ads can show up anywhere that a regular ad agency can place them, such as reputable cable networks Discovery Channel and ESPN. “It’s definitely not second-tier stuff,” he says. “There’s no media that is inaccessible.”
The business model is straightforward. SpotRunner charges for each ad video and takes a commission on the media buy.
The commercials are slickly produced, and offer a quality that would otherwise be unaffordable for many businesses. But the cookie-cutter template concept may not appeal to everyone. Waxman notes that customers can seek to have exclusive use of an ad in a certain market – you wouldn’t want your pizza parlor ad to look the same as your competitor’s. Outside of their markets, businesses shouldn’t care if a pizza parlor across the country is using the same general ad.
We asked if businesses would be able to supply their own video. Not now, Waxman said. But he implied that would come. (UPDATE: Turns out companies can supply their own video.)
The company is based in LA, although Waxman is based up here in the East Bay. His co-founder is Nick Grouf. The two of them built and sold two other companies, People PC (it went to Earthlink in 2002) and Firefly Network (sold to Microsoft in 1998). SpotRunner has taken a $10 million round of funding from Battery Ventures, Index Ventures and an unnamed third investor.