03/01/2013 04:02 pm ET Updated May 01, 2013

The Demise of Madison Avenue -- 5 Steps to Crowdsource Creative Video Genius

In this blog I'm going to talk further about the video content creation site Tongal and outline its founder James DeJulio's suggestions for how best to use it.

As we saw in my last blog, Tongal uses exponential mechanisms to create video advertising content that's much more cost-effective, timely and downright creative than the "linear-thinking" mindset of Hollywood or Madison Avenue. As founder +James DeJulio told me, "When you have a closed system that's run by insiders, you're going to get closed outputs, you're going to get the same outputs all the time and you're going to get less people."

Tongal does away with that by opening up creativity to the crowd and creating competitions that reward people for their creativity, rather than for whom they know.

I'm really impressed by the thinking behind Tongal. A Tongal competition to make a 15-second ad can be done in a few days -- much less time than it would take a traditional bureaucracy-bound ad agency to even get a first round of creative conversations going.

"We just completed a great project for Unilever for their 'I Can't Believe It's Not Butter!' brand. It literally took three weeks," DeJulio said, "and resulted in multiple versions of a TV ad. The brand got really excited. It's empowering. Companies will see a thousand ideas. Statistically speaking, in the pool of a thousand ideas there is going to be some that you never would have thought of."

Another brand, LEGO, tapped into the Tongal crowd to further its connection with its audience of LEGO lovers. "LEGO was such a brilliant content marketer and its business is two times bigger than it was five years ago," he said. "They've invited people who love this brand to get involved, and that invites creativity just by the nature of it. It invites different kinds of thinking. LEGO is leveraging our platform to harness the creative energy that's out there around LEGO. It gets amazing results across different product lines. It's not canned. It's somebody's true creativity coming to the surface."

In effect, through Tongal, a brand gets to make the important big decisions but allows the creative genius out there to be the pure director. Madison Avenue, for example, will charge millions on annual retainers from a brand and the brand will get only a few content ideas for that money.

"A large brand will typically spend between 10 percent and 20 percent of their media buy on creative," DeJulio said. "So, for example, if they have a $500-million media budget, there's somewhere between $50 to $100 million going towards creating content. For that money they'll get maybe seven to 10 pieces of content. And," DeJulio adds, "if you're going to spend $1 million on one piece of content, it's going to take a long time, six months, nine months, a year to fully develop. With this budget and timeline you have no margin to take chances creatively."

By contrast, Tongal competitions generate an average of 422 concepts in the idea phase, followed by an average of 20 to 100 finished video pieces in the video production phase. That is a huge return for the invested dollars and time.

"The majority of the creative people working in the Tongal community were hobbyists who grew up making content for the Internet," said DeJulio, "but as our prize purses have steadily increased in value, we're starting to see super-talented people -- who would otherwise have been hired in the traditional advertising industry -- opt into using our platform instead. And, as Tongal-generated content gets better, brands are putting more money on the line. It's a very positive, self-reinforcing cycle. So now, it's not unusual to have a $50,000 or $60,000 prize purse result in a set of deliverables for which a traditional agency would have normally charged millions."

And compared to those millions of dollars, these purses generate dozens of usable ideas. "What we're finding is that people who are real professional are starting to develop commercials through Tongal because they can be creative and provide quality work with far less bureaucracy, without having to get on a million conference calls."

At this point in my interview, I'm sold on Tongal and thinking about how I can use it for X PRIZE, Singularity U, Planetary Resources, and even promoting Abundance and BOLD. So I ask DeJulio to give me advice on the key lessons and advice he'd offer an early user to consider. Here's his answer:
  1. Have an open mind -- allow different ideas into your way of thinking. "Don't do what's expected," DeJulio said. "Try something new." Allow the crowd to come up with wild and crazy bold ideas that might complement the genius of your brand. "Trust us, trust the process, don't try to recreate what you're doing normally. The goal is to get something new and fresh."
  2. Know what you want. "If you know where you want to go, the process will get you to that point," DeJulio said. For example, decide whether you want to use Tongal to create a television commercial or a series of YouTube shorts. "Once you know that, we reverse-engineer everything to get you there and the community will do the rest of the work. That's the brilliant part of this is. Turn the signal on and it will find its way."
  3. Offer a good-size purse. "This would still be a fraction of what you might normally pay," DeJulio said, "but if you offer a bit more, you're going to attract more players and better content. The higher the purse, the higher the quality of deliverables. The more diversity you will get." A purse size can range from $2,500 to $250,000 (and more going forward). "But we're really talking about six-figure compared to a seven- or eight-figure sum" that might be charged by a traditional advertising agency.
  4. Allocate less time than traditionally needed for a campaign to be created. The typical Madison Avenue process takes between six months to a year, and sometimes as long as two years to come up with, develop and fully execute on a concept. With Tongal, it can go from concept to execution in weeks, even days. In general, DeJulio said, "Tongal comes in "10 times better, 10 times faster, 10 times cheaper."
  5. Use Tongal as a distribution mechanism to drive traffic to your video content. "There are people who are good at coming up with ideas, there are people who are good at producing the content and there are people who are really good at sharing content so we opened up a third Tongal competition phase for them," DeJulio said. "We call it our Exhibition Phase. If someone is good at pushing page views, this Exhibition Phase is a chance for them to shine. Someone with a YouTube channel, friends on Facebook or followers on Twitter, could earn cash and prizes for sharing Tongal videos with friends and fans." In success, this final phase will drive millions of views to the videos you create on Tongal.
Tongal offers a CEO or CMO the opportunity to "have an open mind, to find new markets, to find a new voice for their brand," says DeJulio. "The world is changing so fast, and getting hung up on your brand equity from 20 years ago may not be the best decision." And if you're looking for something new, you may not look for creativity from your traditional sources. "Sometimes if five brilliant people get together you can get to something really exciting and really creative. But why would you ever bet on the same five people over and over again? The world's a big place," says DeJulio, "I believe that talent is scarce but I don't think it's just five people -- I think its 50 million people, and Tongal can help you tap into that amazing crowd of genius."

In my next blog, I follow up with DeJulio on Tongal's recent Super Bowl win for Speed Stick.

NOTE: Over the next year, I'm embarking on a BOLD mission -- to speak to top CEOs and entrepreneurs to find out their secrets to success. My last book Abundance, which hit No. 1 on Amazon, No. 2 on the New York Times and was at the top of Bill Gates' personal reading list, shows us the technologies that empower us to create a world of Abundance over the next 20 to 30 years. BOLD, my next book, will provide you with tools you can use to make your dreams come true and help you solve the world's grand challenges to create a world of Abundance. I'm going to write this book and share it with you every week through a series of blog posts. Each step of the way, I'll ask for your input and feedback. Top contributors will be credited within the book as a special "thank you," and all contributors will be recognized on the forthcoming BOLD book website. To ensure you never miss a message, sign up for my newsletter here.