• Invodo Pursues New Model of Syndicating Product Videos to Online Retailers

    Ever find yourself shopping online and wish that there was a video that showed you the product's key features and benefits, and maybe even showed the product in action? And assuming that the video educated you and in turn increased the likelihood that you actually followed through and bought the product, wouldn't that delight the online retailer because it increased their conversion rate?

    This is the context that Invodo, an Austin, TX based company that recently hit my radar is banking on. Craig Wax, CEO and Trey Swain, President and COO briefed me on how Invodo's model works.

    Invodo has built up a library of 20,000 product videos from 1,900 manufacturers that it is now syndicating for free to over 1,000 online retailers like Amazon, Sears, Buy.com and others. Craig said that they've been able to build their video catalog in less than a year primarily by sending crews to industry trade shows, where they arrange to have company reps explain their products on camera. Though there was nothing fancy about the videos I randomly selected to watch, they did convey valuable product texture and would have helped in the purchase consideration process.

    My first inclination was to think Invodo should be charging for the videos, all the more so if they help drive higher conversion for the online retailers. However, Craig and Trey explained they've been most focused on scaling distribution and simply giving the video away to retailers for free is the best way to do that. That makes Invodo another example of the free business model that Chris Anderson discussed in his original Wired article, which will released as the book "Free" in a few weeks.

    But giving away the core product (both the content and platform), with the goal of upgrading the customer to pay for premium features (the so called "freemium" model), means Invodo's business model depends on identifying valuable premium features that retailers will be willing to pay for.

    There are two premium paths the company is pursuing. First it is offering a "buy now" button in the videos, which supports impulse buying, raising conversion. And second, it is offering an embedded player, so the video plays within the retailer's product page (as opposed to being a link to a new player window). The embedded player also provides features like ratings, sharing, etc. All of this too is meant to increase conversion rates.

    With video becoming more pervasive and expected by users, it is only natural to think that retailers will embrace it as well. The only other company I can think of that is doing something vaguely similar is ExpoTV. But their product reviews are created by users, and I don't think they syndicate these videos to retailers.

    It's clearly still very early days for Invodo and the category. I'll be curious to see how things work out.

    What do you think? Post a comment now.