Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
Authenticity, relevance and entertainment help make online videos effective selling tools, said speakers this week at an Electronic Retailing Association conference.
Online video can help sell, especially if the videos are authentic, relevant and entertaining, said speakers this week at an Electronic Retailing Association eRetailer Summit in Miami.
SensiClear, a new acne medication that launched in January, says its corporate site that includes video is converting at a 50% higher rate than affiliate sites with the same offers but no video. The company has been broadcasting infomercials on television that include a toll-free number and web address, and getting at least three times more orders via the web than by phone, says Charles F. Benard, chief marketing officer. “Teens don’t want to call an 800 number,” Benard says.
Another youth-oriented site using video is HoneyShed, where videos often include hip, young actors introducing products, much as a host would on a home shopping show. Visitors can buy the products online, “stash” them in a wish list or send video links to friends. “It’s wired, it’s cool, it’s great,” said Mark Hillman, associate creative director at marketing firm Resource Interactive, one of the speakers on a panel on online video.
Panelist Eric Elia showed a video on the web site of Northeastern grocery chain Stop & Shop in which a customer named Ken, with his dog Bunker at his side, explained how Stop & Shop always has in stock the treats Bunker loves. “What jumps out is the authenticity,” said Elia, vice president of creative services at Brightcove, a company that specializes in Internet video. “This is a message from a real customer, with all the rough edges around the video. That’s what makes it particularly compelling.”
YouTube, the web’s leading video site, gets 68.5 million visitors per month, and those visitors are not just kids, said Brian Cusack, a sales team manager for Google-owned YouTube, who delivered a keynote address at the conference. He gave the age group breakdown of YouTube viewers as 18% under 18, 20% 18-34, 19% 35-44, 21% 45-54 and 21% over 55. 51% are male, he said.
Cusack also advised marketers to create online videos that are authentic, and advised those planning to create a video to post to YouTube to “let users know you understand the context, that you’re talking to them on YouTube.”
He cited a campaign last year by food manufacturer H. J. Heinz Company, which invited consumers to create 30-second videos about ketchup for posting on YouTube. 8,000 videos were submitted and the 3,989 videos Heinz approved for posting were viewed 5.4 million times, Cusack says. He says Heinz ketchup sales went up 3% during the second and third quarters of last year when the contest was going on.
Despite the sales increase, a speaker on a later panel questioned the wisdom of rejecting half the videos submitted. “Maybe you’re protecting yourself from legal problems, but what did you do to your customers who created these videos?” asked Jeffrey Greenbaum, a partner with the New York law firm of Frankfurt Kurnit Klein & Selz PC. When it comes to user-generated content, he said, “You’re going to have to balance risk and reward.”