Matching creatives with jobs has always been a challenge. Artists often work alone, making it extremely difficult for brands to find the talented artists that they are looking for. In turn, artists get frustrated when creating high quality work but being passed over by brands that stick with a tried and tested list of suppliers, or just getting lost in the noise and never getting ‘discovered’. Confidence takes a knock and often creativity takes a dip as a result. A key unlock in this is the advent of social media advertising, specifically video content. Traditional agencies couldn’t fulfil the sheer volume and uniqueness of content required across the various platforms, and the need for an alternative marketplace arose. And it’s into this arena that Vidsy stepped, to empower creators and make them accessible to large brands seeking their offerings.
Vidsy was started in 2015 by Gerard Keeley, Alex Morris, and Archie Campbell. While not in the advertising industry themselves, they each separately came to the realisation that the structure of the market at the time wasn’t set up well for the transition to video-based social media advertising. Their creative/entrepreneur combination meant they were attuned to both the power that new social platforms could bring to brand advertising, and to the gap between brands’ needs and the offerings of traditional agencies in this space.
It’s almost impossible for one or two people to design and execute a media campaign for a large brand that includes TV, print, radio, banner and other advertising mediums. It made sense in this time to pool resources to meet the needs of the largest and most lucrative brands. Agencies flourished in this space for a long time. Artists trying to go it alone would generally do some work for much smaller brands or make a name for themselves in one particular area of advertising (often with the aim of being acquired for their client base).
Technological arrow of progress
A few interlinking factors have changed this. Internet speed and bandwidth improved dramatically, to the point where accessing a large volume of images and then video through social media platforms was feasible. The direct result of this was the likes of Snapchat, Instagram and Facebook Stories, Tiktok, Quibi, YouTube and a host of other video streaming and communication platforms. Video has proven the most desirable form of communication for the younger generation. This is unsurprising, given how close the messages are in information content between the sender and the receiver relative to in person communication. Plus, the ability to edit and plan videos often makes them better forms of information transfer than in person communication, which lacks the opportunity for a take 2. This wasn’t possible even 10 years ago, when streaming video was being pioneered by YouTube and Netflix (Snapchat was only founded in September 2011). Data transfer was too expensive and too slow to create the right product. As soon as those challenges were solved, tools were built to maximise the experience and the volume of content exploded.
Brands of course, took notice. With a new medium of communication came a new way of getting closer to consumers. Brands joined the wave of short-form video communication and started creating content to match this novel form of conversation. As a result, the volume of short videos needed by brands rose incredibly quickly and with it, a need for creators to rapidly produce them.
Key characteristics of these videos are their short format, sharp delivery and varied output. Brands couldn’t simply run one or two of the same videos for a month. An almost daily variety of videos was needed, changing for different audiences and demographics (targeted advertising drove this trend even further). The videos are also a lot more playful compared to traditional TV advertising, largely as a result of this ability to run a variety of ad content at lower cost.
While traditional agencies play a role in this market, the sheer volume of videos and the need for artists that connect on any given brief, have made it more difficult for a centralized body of creatives in agencies to completely fulfil this role. Coupled with this was the much-reduced cost of creating and marketing your own brand online. With the likes of Shopify for your digital storefront and logistics, Facebook (and Instagram), Snap and Tiktok covering your advertising and various other low-cost cloud services, you can now launch a brand at a fraction of the cost that was previously possible. With more small brands looking for social video advertising, the demand for these products has kept growing, and some of these companies have got extremely large – Gym Shark being a good example (grown largely through influencers and video marketing).
Making the marketplace
Marketplaces are fickle things. The amount of times it has been said that ‘that marketplace can’t work, the incumbent marketplace is too big” just for a new very large marketplace to form and flourish anyway. Sarah Tavel, the marketplace guru from Benchmark, writes extensively about this here. When applied to Vidsy, it is clear that they did a number of things right early on. They started in a segment of the market small enough for them to win in – just video social. Not all video, or all creative or anything that grand, but video social. They also seemingly grew through the marketplace ‘happiness’ index that Sarah notes as the most important part of her framework. i.e. Vidsy’s customers and creatives were both so satisfied that they returned to the marketplace along with others. Gross Marketplace Value (the total value of transactions going through the Vidsy) grew through satisfied customers. Vidsy doesn’t release their marketplace transaction volume. As a proxy, though, one can look at how much Vidsy has paid out to its creatives. While GBP 2 million was paid to creatives in July 2019 (four years after launch), this doubled within the next ten months – accelerating growth and happy creatives. And when it comes to keeping their creatives happy, they’re not stopping there: They’re building a creative engine.
To make social videos quickly, creators need the right tools to rapidly execute ideas. Vidsy is centralising these tools as part of their creative engine. This strengthens the marketplace through higher quality and faster projects, but it also builds up a defensible product for Vidsy. The admin automation and creative tools have significant value to both Vidsy’s creators and in theory any creators of video content. For now, this product is used solely by Vidsy’s creative audience, but it could certainly be used more widely to service the video creation world in general.
The way Vidsy facilitates the demand side of the marketplace (the brands) is also interesting. Traditional marketplaces mainly facilitate the meeting of buyers and sellers. However, for big brands it often isn’t feasible to simply post a job and hope that the right creatives pick it up and deliver as they expect. For a high quality, ‘happy’ experience, they need a function in the marketplace to make sure that creatives deliver as they would want. In this way, Vidsy often plays agent to the demand side of the marketplace. Brands often go through Vidsy, rather than directly to creatives. Vidsy sources the creatives, collates the work and presents it back to the brands. Vidsy seems to be the only agency playing this role on the platform for now, but there is a possibility of the product being used by other agencies as the marketplace grows dominant.
It will be interesting to see where Vidsy goes next. On the distribution side, there is obviously a lot of runway. The dual focus on America and Europe, where social video advertising is growing rapidly is a big and daunting focus area. I’d guess their focus in the short-term will be around the tool set and assets that they’re making for their creatives, as that’s what sets them apart from competitors. It is easy to see them drifting into other competitors’ territory (such as Play Play), focusing on the tool set of actual video-making, as opposed the content itself. A tie-up between the two would be an interesting proposition. The core Vidsy product could also be spun out and used to service not only the Vidsy marketplace, but companies’ in-house creative teams. Their library is largely unmatched and, as long as their creatives don’t feel that they were being cut out of the process, this could significantly grow the market for their core creative tools.
There is also scope to grow their marketplace itself, either further up the chain of video or into different media channels. Given the assets they sit on, going up the video chain into longer format to be used for television makes the most sense, and I’d be surprised if they didn’t naturally drift into this area in the coming years. However, with the likes of TikTok recently adding their ad block, the focus on social video may stay for some time to come.
As a global, fast-growing market, social video has seemingly endless possibilities. This presents a huge opportunity for Vidsy and their creators. Social video has made all users a lot more playful and creative with the content they make. Everyone is an amateur film maker on IG/Tiktok and Snap these days. It is inevitable that brands (and unfortunately, politicians) will want more and more connection with this space, especially with its link to younger users – the wealthy and influential of tomorrow. Vidsy is well positioned to take advantage of this trend and its approach of empowering individual artists is a good way to go about it. It’ll be exciting to see where social video and Vidsy go in this incredibly fast-moving world.