Going Back To The Future Of Advertising

Paul recently did a great post on his blog about Jim Henson's early commercial spots and how that could be a successful advertising model today. I think he's absolutely right; his post reminds me of one I wrote a couple years ago called Using Puppets To Pay The Bills.

The 30 second pre-roll ad is almost universally hated. The web is a new medium that we're still in early stages of exploring. The people who really "break through" and define it will be the ones who figure out new ways of telling stories and develop new (old?) ways of thinking about advertising and sponsorship.

Linear vs. Passive Income

You may not know this about me, but I went to business school.

Actually, I went to a special one-year program here in Toronto that incubates small businesses and trains them in entrepreneurship. While I was there, we frequently had business owners come in to do guest lectures. One of the lecturers was the owner of a rapidly expanding bakery who told us a story that I've thought about a lot lately.

The story was about the first few years of his business and how he barely made a living running a small shop selling his baked goods. One day, finally fed up with not having any money and with a baby on the way, he decided something had to change. He started trying new things, altered his business model and starting selling his products wholesale to supermarkets and other stores. This worked really well because the supermarkets and stores could sell a lot more of his products to the public than he ever could. As an additional bonus, because the stores and supermarkets now took care of most of the sales work he was able to focus on his real passion, making food.

Not long after he made the change he was out with his wife one night and they stopped at a supermarket to pick something up. He saw people buying his products and realized that he was making money right then and there even though he was out on a date with his wife!

In business there are two types of income - linear income and passive income. Most people make a linear income. If you have a job and work X number of hours to get paid X number of dollars or if you make something (like a puppet) and then sell it, you make a linear income. There's nothing wrong with a linear income per se, but the difficulty with it is that in order to make more money you usually have to do more work. At a certain point you just can't work any more hours so there's a pretty firm ceiling on how much money you can earn from a linear income source.

By comparison, a passive income is money that you make with little to no effort. Advertising is a good example of a passive income source; it takes about the same amount of work to write a blog read by one million visitors as it does to write one read by ten people, but you can make a lot more money advertising to one million readers than ten. Other good examples of passive income would be selling merchandise through Cafepress or selling a puppet pattern that people can download from your online store. A passive income scales much better than a linear one does, so in theory you can make more and more money without having to do more and more work.

Selling baked goods wholesale probably isn't a textbook example of a passive income source, but the underlying lesson of the bakery story - maximizing profit while minimizing effort - is what passive income is all about. It's also something that I think all artists need to understand. After all, if you look at puppetry or just entertainment in general, the most successful companies all rely on passive income streams like licensing and advertising to make most of their profits.

I know his might seem really simple and an obvious thing to point out, but if it's common sense then it's not so common. Think about how many people you know who are struggling and make a linear income? Are you? Earning any kind of income - passive or linear - takes hard work, but the more I think about it, the more having a passive income seems like a better, smarter way to work.

Utilizing Your Backlist

If you're an artist, it's important to understand how to properly utilize your backlist (photo credit: Alex).

I've been writing PuppetVision for years now. When you visit the site or read it in an RSS reader you see 8-10 of the most recent posts I've made here. That's PuppetVision's frontlist. You have to dig a little deeper to find the other 1,470 or so posts I've made over the years and they're PuppetVision's backlist. I'm always amazed that consistently, month after month, no matter what I write about, by far the most popular page on PuppetVision is this post about Topo Gigio that took me just twenty minutes to write three years ago.

About two weeks ago I went to TCAF and saw Scott McCloud, who had people lined up to see him laregly because of a book he published over 15 years ago. I've heard Elton John say in interviews that while he loves having a number one hit, it's his catalog (one helluva backlist) that makes him a living. Popular web sites like Google, Amazon, YouTube, Hulu and iTunes? They're all about backlists.

It's really the Long Tail that we're talking about here and Seth Godin suggests a very simple method for taking advantage of it:

1. Assemble a tribe, a group of true fans, followers, people who have given you permission. Give them all the frontlist they can handle. Make it easy for them to spread the word, to Digg you or bring a friend to your movie or buy your new book for their friends. If you create too much content for this crowd, then you're publishing too much. They care, and they want to hear from you.
2. Promote your backlist. Invest significant time and money to make your backlist available, to recirculate it, to have it adopted as a textbook in English class or featured on Netflix or part of a retrospective on TV. Take all that money you waste in frontlist marketing and spend it on the backlist instead.
3. Repeat. Frontlist becomes backlist, backlist grows, fan base grows, it scales.

This may seem like obvious advice, but if that's true why don't more people do it?

What Puppeteers Can Learn From A Teenager

Lucas Cruikshank is a 15 year-old YouTube mogul.

My recent post about "Bad Puppetry" stirred up some interesting discussion and generated a lot of feedback. I'm still sorting through some of it, but one of the things that has been most surprising to me was how many puppeteers are actually hostile towards many of the pioneering shows out there and who still don't grasp the potential the internet offers puppetry as an art form.

A discussion about the current state of puppetry on the web is a debate for another day, but to everybody out there doesn't yet grasp puppetry's potential online I have a two word rebuttal: Lucas Cruikshank.

You probably haven't heard of Lucas before; I hadn't either until a few months ago. He's a 15 year old who posts short, improvised videos on YouTube in the guise of Fred, an annoying six year-old with a squeaky voice. Lucas has the number one most subscribed channel on YouTube and was the first YouTube user to have one million subscribers. He's not even old enough to drive, but Lucas has already earned well in to six figures thanks to sponsorships and an advertising deal with Google. Sure, Fred is annoying to most adults, but Lucas doesn't seem to care. He has a simple formula for success, he listens to and understands his audience and he's created a character that they love and identify with.

The recession is hitting artists everywhere really hard. I know a bunch of puppeteers who are currently either unemployed or under-employed, myself included. I can't help but notice though that the people who sound the most pessimistic are the ones who seem to be doing the least to embrace and experiment with new media. If you look at what Lucas has done - his videos have been viewed over 260 million times, he has more subscribers than most major media companies and tens of thousands of dollars in monthly income - he's attracted a bigger audience and makes more money than just about every puppeteer I know of. There's absolutely no reason why puppeteers can't learn from new media pioneers like him and replicate that kind of success.

Of course most puppeteers won't - either because that's not what their work is about (which I respect) or more likely because it's just a little too much work. That's unfortunate though, because for the few that do make the effort I think there is bright, bright future ahead for them. As dark as the current economic clouds are, I don't think there has ever been a better or more exciting time to be involved in puppetry.

Why The TV Apocalypse is a Very Good Thing

The television industry is ill and the prognosis isn't good.

I originally intended to write about this last month, when The New York Times reported that profits of the major American networks were in sharp decline. The situation has been much the same here in Canada, with CBC making steep cuts because of a funding shortfall, CTV on track to loose $100 million this year and the Global TV network teetering on the verge of bankruptcy (and those were just the headlines last month).

But you know what? I think all this is ultimately a very good thing.

Don't get me wrong, if you make your living in television what's going on right now is downright scary. No one wants to see companies losing millions, freezing wages and axing jobs, but that is what is going to happen. Because it needs to. The television industry has always been a big, fat, inefficient businesses. Andrew Baron (the creator of Rocketboom) did a really good blog post a little while ago about this, explaining his belief that the TV studios will die. And die they should, if that's the price of having a new generation of talented, creative and dynamic people engaged in open, accessible media.

What does all this mean for puppeteers and puppetry? Well, if you're entrepreneurial, creative and want to produce your own low-cost shows online there's probably never been a better time for you than this. On the other hand, relatively high-paying unionized film and television puppetry gigs (which were already in decline) are going to be a thing of the past. The puppeteers/companies that are going to thrive are the ones that seize the moment instead of bemoaning that things aren't the way they used to be.

Walt Disney once said that if it wasn't for the Great Depression he never would have been able to build his studio; the combination of harsh economic conditions and Disney's ability to offer a relatively steady pay cheque meant that he could have his pick of the best artists in America. It seems we're entering a similar period in history now and that "creative destruction" is the order of the day. Sure there is a lot of bad news in the air, but as Disney himself put it, sometimes "a kick in the teeth may be the best thing in the world for you."

Monday Afternoon Inspiration: 279 Days To Overnight Success

Chris Guillebeau is the author of The Art of Nonconformity, a blog about personal development, entrepreneurship and unconventional work. Last year Chris set himself the goal of becoming a full-time, self-employed writer and launched his blog. His "overnight success" took less than a year to achieve and he expects to have a (mostly) passive income of over $40,000 this year. And he's done it without running ads on his site, posting on Digg or doing all the other things that the "experts" say you have to do to have a successful website. And no, it's not some kind of gimmick or get-rich-quick scheme (the real secret is a lot of hard work, dedication and patience).

Chris has written a really interesting manifesto called 279 Days to Overnight Success that tells the story of his website, how he's making his living and offers free advice on how to be successful with your own project if you're an artist, entrepreneur or just a little unconventional. Also worth checking out is his World Domination Manifesto (also totally free). Both contain lots of good, unconventional advice about doing unconvenntional work in unconventional times.

Via Seth Godin.

Did Terry Fator "String Out" His Manager?

Newly-minted millionaire Ventriloquist Terry Fator is being sued by his former manager.

Terry Fator might be about to lose the nice guy image he cultivated on America's Got Talent last year. He's being sued by his ex-manager John Raymond, who alleges that Terry is trying to avoid paying him an (estimated) $20 million commission on his huge Las Vegas contract. Raymond had a 5 year deal with Terry that wasn't set to expire until 2010, but he claims Terry found him "too nice" and fired him because he needed a manager who was "a bastard." None of the allegations have been proven in court.

It's not unusual for entertainers to fire the managers who helped them get started once they finally reach "the big time" for a variety of reasons, not the least of which is the huge commissions their managers earn (it's also not unusual for managers to sue once they've been kicked to the curb). Although though Terry has a $100 million contract to play Las Vegas, by the time income tax is deducted and the lawyers, agents and managers get paid (or not) he's probably only keeping about 25 cents of every dollar he earns. It's also worth noting that according to the lawsuit documents, Raymond was taking a 20% commission from Terry, which seems a little excessive (the industry norm is usually 10-15% and it's actually illegal for an agent to charge more than that in some jurisdictions).

I guess if nothing else, you really know you're a famous puppeteer when gossip sites like TMZ start giving you coverage.

On the Subject of Getting What You're Worth

For the puppeteers and puppet builders out there, here's a great line to use the next time you get asked to do something for low/no money because "it'll be great exposure":

"You know, you can die from exposure".

Thanks to Karen Larson for sharing this great quote!

Monday Evening Inspiration: M dot Strange

M dot Strange turned his back on Hollywood deals and leverages the power of YouTube and the internet to make his films, his way.

M dot Strange is a one-of-a-kind filmmaker who seems to be mastering the art of successful self-distribution. He got lots of offers to distribute his film We Are The Strange after it debuted to mixed reviews at Sundance last year, but he's gone the independent route instead and explains that it offers him more freedom, exposure and financial success.

That last link above goes to a video of presentation Strange did back in February explaining his self-distribution journey. It's filled with lots of great information and insight that puppet podcasters can put to use.

Monday Morning Inspiration: 1,000 True Fans

You don't need a million fans to make a living as an artist, just one thousand "true" ones.

What could you do with just 1,000 "True Fans"?

According to Kevin Kelly, you could make a living doing just about whatever you want. Kevin's theory - which has been in wide circulation on the web since last week - is that an artist can make a living with just 1,000 of what he calls "True Fans":

A True Fan is defined as someone who will purchase anything and everything you produce. They will drive 200 miles to see you sing. They will buy the super deluxe re-issued hi-res box set of your stuff even though they have the low-res version. They have a Google Alert set for your name. They bookmark the eBay page where your out-of-print editions show up. They come to your openings. They have you sign their copies. They buy the t-shirt, and the mug, and the hat. They can't wait till you issue your next work. They are true fans.

Kevin points out that if you assume that each True Fan is willing to spend just one day's wages per year in support of what you do (let's say that's $100) and if you have 1,000 fans that works out to $100,000 per year, which is more than enough for an individual artist to live on.

Of course it's not as easy as it sounds, but it does seem like a very practical business model to me. It's also further support of the theory that puppeteers are better off focusing on the web.

Why Puppeteers are Probably Better off on the Web

Paul Hokanson (see previous post) has written a great blog post about why aspiring puppeteers should focus on the web rather than TV. Here's an excerpt:

"I would love to see another Muppet Show type of thing broadcast to the masses, but I don't think "prime time" is the best way to go about this anymore. And it shouldn't be the only goal that creative people strive for...getting any program from idea to pilot to an actual season on TV, let alone a prime time slot, is exceedingly difficult. Especially an idea featuring puppets. I'm not saying it can't be done, just that it is an especially steep hill to climb."

I think that Paul has done an excellent job of making the case for why the web is probably a much better bet for producing your own show than TV. As he mentions, viewing habits are rapidly changing. The value of prime time (and network) TV is eroding more and more with each passing month.

When I lived in Mexico for two years I got in to the habit of watching my favourite shows online because they weren't available locally on TV. These days I use a PVR, timeshift shows that I like to watch and skip most of the commercials. People are doing this in the millions and it's killing network TV revenues. The recent, bitter writer's strike in the U.S. happened because everyone involved knows the future of video content is going to be built around the web, not over-the-air TV stations and cable channels.

Also, it's sad reality is that if you're an independent or unknown artist, creating a show for TV is a sucker's game. Unless you've got a well-established track record behind you, in order to get a show on the air you usually have to give up ownership of your work and/or a huge chunk of any profits that go along with it (that's if there's any profit...most puppet shows don't generate huge royalties for the creators or puppeteers involved). You'll also likely have to endure endless soul-crushing notes and critiques from crackpot executive types.

On the other hand, if you can produce a good show on your own on the web, build a real audience for your work and figure out a decent business model (that's usually the hard part) you can laugh all the way to the bank. There are lots of examples of independent creators finding money and success online, including Rocketboom, Homestarrunner, JibJab, Penny Arcade and the Ask A Ninja guys. All of those online properties reportedly take in at least six figures a year, are owned and operated by their creators and enjoy total artistic freedom.

Give the choice, which approach would you choose?

Monday Evening Inspiration: 7 Rules For Making A Hit

Spinmaster Toys developed the popular new Bakugan toys and share seven of their keys to success.

You may not have heard of it yet, but the next big thing in the world of toys is called Bakugan, a new game played with cards and magnetic spring-loaded marbles that open and depict different characters. The game was developed by Toronto's Spinmaster Toys, who recently shared seven key ingredients that go in to making a hit with The National Post:

1. Focus on ideas that don't fit what everyone else is doing.
2. When you have a hunch, act on it fast.
3. Share the wealth through partnerships.
4. Build on what works.
5. Go global.
6. Take the time to do things properly.
7. Whatever you're doing, keep it fresh.

Spinmaster may make toys, but (of course!) this formula can be applied to puppet podcasts, or anything else you're doing. For more on these "rules" from Spinmaster check out the article in the National Post online.

About The Writers' Strike

As most people know, film and television production in the United States is slowly grinding to a halt because The Writers Guild of America went on strike this week. The main reason for the walkout (and kudos to the WGA for having the guts to stand on their principles and stage a real strike, unlike one of their Canadian counterparts) is that the studios have been shafting Hollywood writers for years on royalties for videos, DVDs and digital downloads and the writers are demanding a much better deal. If the strike isn't settled quickly they could be joined on the picket lines in the new year by actors who are planning to walkout over similar issues.

It will be interesting to see how the strike plays out and what (if any) opportunities it will create for small, independent creators who distribute their work online. I'm not aware of any puppet series currently in production that will be affected by the strike, but if the strike continues for very long it might jeopardize a new Muppet project that is the works.

For anyone who is interested in learning more, the WGA has posted a video on YouTube explaining why they've decided to go on strike (thanks to Kevin Carlson for the link!).

The Web’s Niche Shows are Winning Sponsors

An article in the Wall Street Journal yesterday talked about how niche web shows are starting to attract sponsors. Some of the shows mentioned in the article are attracting decent sponsorship with relatively small, but loyal audiences of just 10,000 to 20,000 viewers. The key to getting sponsorship seems to be consistency and quality. According to the article, web advertisers are still leery of running their ads next to random user generated content on sites like YouTube, but are actively seeking out high quality video content to sponsor. If you produce a puppet podcast or web series (or you want to) the story is definitely worth a read.

Via the Blip.tv Blog.

Transylvania Television

Transylvania TV and a cast of ghoulish characters led by Count LeShoc are coming to TVs near Minnesota soon.

One upcoming puppetry project I am really looking forward to is Transylvania TV or "TVTV" from Gordon Smuder (see previous post). TVTV looks great with nice puppets and amazingly detailed props and sets (not surprising since Gordon is a supervisor for MNFX, a miniature FX studio in Minnesota), but what I really like about it is the unusual old school business model that's being using to produce the show.

Gordon created TVTV as a real, honest-to-goodness, over-the-air local TV show in Minneapolis/St. Paul, MN. He's gone out and found a local comic book shop to sponsor airing the pilot (and hopefully a regular series) on late night television. He's using old fashioned marketing techniques from the early days of television too; after watching the show viewers can join "Count LeShoc's Midnight Zombie Legion" and receive a package in the mail that includes a certificate, a membership card, TVTV newsletters and, yes, even a secret decoder card.

I think this is a great example of a direct sponsorship business model. Most people don't realize it, but it's actually relatively inexpensive to buy late night airtime on local TV stations (the going rate in many North American markets can be as low as $400 to $1000 per half hour). If you can find a sponsor and keep your production costs under control this is a very interesting way to get a puppet TV series on the air.

If you want to check out TVTV for yourself, a sketch from the pilot was posted on YouTube a few months ago and a trailer for the half-hour series (link goes directly to a .mov file) was recently put online. Keep an eye out for more on Transylvania Television soon.

Advertise on PuppetBuilding.com

PuppetBuilding.com is starting to explode, with hundreds and (increasingly) thousands of new visitors everyday, which is great news except that as traffic goes up so do the costs associated with running the site. So to help offset the site's hosting bill and pay for several new features that are on the way advertising is now available on PuppetBuilding.com.

There's a number of advertising options available, including banner ads and text ad squares like the one on the left. These ad squares are especially good for anyone advertising on a limited budget; they're cost-per-click (you only pay if someone clicks on your ad) and cost as much as 50% less than CPC ads on services like Google's AdSense...plus they can be customized to feature your snazzy looking logo.

So if you've got a product or service you'd like to tell 20,000 crafters, teachers and puppet builders about each month at PuppetBuilding.com drop me a line at puppetvision [at] gmail dot com and we can chat about putting together a customized advertising package.

Free Puppet Classifieds on PuppetBuilding.com

Got some puppets to sell? Looking for a particular type of puppet? Try the new puppet classified ads on PuppetBuilding.com. They're totally free and best of all automated so there's no waiting for ads to be manually added to the site. To publish an ad just register with PuppetBuilding.com, type in your ad, upload a couple pictures (if needed) and it should be automatically published in less than 24 hours.

And don't forget, if you're a puppet builder you can also create a listing for yourself in the free Puppet Builder Directory.

New Online Puppet Builder Directory

Build puppets? Looking for puppets? Try the new Puppet Builder Directory at PuppetBuilding.com. It's a totally free service designed to help puppet builders and people looking for puppets find each other.

If you're searching for a puppet builder or places to buy puppets you can browse the categories or search for someone close to where you live. If you're a puppet builder you can add yourself to the directory by going to the link above, registering and adding an entry in the appropriate categories. In addition to your location and contact information you can also upload photos of your work and you can come back and edit/update your listing at any time.

More features like the ability to embed video demo reels in your profile and a global map of puppet builders (similar to the Puppeteer Map on Frappr) will be added soon along with lots of other useful stuff, so keep an eye on PuppetBuilding.com for updates.

Innovative Podcasting Sponsorship

I've written about searching for effective business models for podcasting before (see previous post) and it's an important issue for anyone who wants to try actually making a living doing puppetry on the web. The latest episode of Ask A Ninja came out today and is an innovative example of direct sponsorship - which I think is the best business model for podcasting - that current and aspiring puppeteer/podcasters may want to take notes on.

The way the sponsorship works is simple. The Ninja spends his latest episode defining various Ninja-related words and at the end of it does a quick plug, telling the audience that the episode has been sponsored by Ask.com and telling them to go to Ask.com and search for a specific Ninja-related term. When viewers search for this word on Ask.com (you'll have to watch the episode to find out what it is) at the top of the search results is a link to a special bonus video featuring the Ninja.

This is a brilliant example of direct sponsorship because the promotion has viewers actually use the sponsor's product and immediately rewards them for their effort with a short video. It's simple, it's honest and a win-win for everybody. The Ask A Ninja guys gets sponsorship, Ask.com gets new people trying their search engine and fans of the show get a short bonus video.

Wouldn't it be nice if all advertising and promotion worked like this?

Update: NewTeeVee reports that Ask A Ninja is using Castfire to dynamically insert the Ask.com clips.

The Competition Wants To Steal YouTube's Stars

Despite all the great puppetry content on YouTube, there still hasn't been a true breakout puppetry star emerge yet. It's probably a matter of when not if that happens and with that in mind it's interesting to read that the newest wrinkle in the online video wars is that apparently YouTube's competitors are trying to poach talent in an effort gain market share.

This is a smart strategy, since user generated content is one of the big two forces driving YouTube's traffic (the other one, pirated content, is probably going to start drying up very soon). I wonder if sites like this will become like networks or studios and ambitious users will start pitching them content in an effort to get better deals?