Puree a rake for fun and profit

Blendtec CEO Tom Dickson with products he has destroyed on camera

Dickson in what became the most watched video in the "Will It Blend?" series.

He places the iPhone in a Blendtec blender.

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(FORTUNE Small Business) -- George Wright figured a construction project was underway when he noticed wood shavings inside a room his company used for customer demonstrations.

The marketing manager at Blendtec, based in Orem, Utah, he had been onboard for only a year. But he was fairly sure that his brand of food blenders was not packed in sawdust. When Wright, 41, asked his colleagues, they told him the shavings came from one of the CEO's product tests. This time he had jammed a two-by-two board into a blender on full speed.

That evoked images in Wright's head not of his CEO in a padded cell - but of his CEO in an Internet video.

Immediately Wright gathered together his webmaster and his video producer, who usually made instructional and maintenance videos. They spent $50 on a lab coat, a bag of marbles, a 12-pack of Diet Coke, a McDonald's (MCD, Fortune 500) meal, a rotisserie chicken, and a garden rake. Then they went to the CEO, Tom Dickson, and asked him to don the lab coat and to blend each of the items they had purchased - on camera.

"He was very nonchalant about it," says Wright. "We knew we were on to something."

That was an understatement. Wright had stumbled upon one of the hottest marketing forces of the Internet age: viral video ads. Whether they are posted on YouTube or some other popular free video-sharing site such as Dailymotion, these cheap commercials can spread from person to person like wildfire - as long as they're fun or useful to watch. More than half of Internet users have watched a video ad online, according to research by the Kelsey Group. Nearly half of those viewers went on to visit the company website, and 15% of those made a purchase. Think of viral videos as Super Bowl advertising that any small business with a $300 videocamera can afford.

Blendtec's first "Will It Blend?" videos became the 33rd-most-viewed series ever on YouTube, and helped drive sales of the company's $399 high-end consumer blender up 500% in 2007. (Until then, Blendtec's $40 million in sales came mostly from commercial blenders for restaurants and bars.) Dickson went on to film 62 other "Will It Blend?" videos, blending everything from glow sticks and a Halo 3 videogame to a Chuck Norris doll. Dickson even blended a videocamera, and then filmed an attempt to return the blended camera to the store.

"Now there are millions of people who know about our product," says Wright.

A good internet video, says Kelsey analyst Michael Boland, can be more powerful than traditional advertising because viewers are sitting at their computers instead of on their couches. Watch a TV ad, and you're likely to do no more than make a mental note of the product. Watch an ad on YouTube, and you can immediately Google (GOOG, Fortune 500) the company's website. "It's that lean-forward medium," Boland says.

Unlike TV advertising, online videos are free to post, and can be uploaded to sites such as YouTube in a matter of minutes. They don't have to be as wacky as Blendtec's videos to catch on. Create compelling information for your customers, and you create a reputation of trust. A tire business, for instance, might produce a video of tips on driving safely in the snow.

"You're entertaining, solving a problem, or providing value to viewers," says David Meerman Scott, author of The New Rules of Marketing and PR.

In 2007, Sierra Snowboard in Sacramento posted a "How to Wax a Snowboard" video on YouTube, featuring an employee demonstrating each step of waxing a board and talking to the camera as if the viewer were a snowboarding buddy. Humdrum, perhaps, but the company's target audience - snowboarders - flocked to it. It was viewed more than 117,000 times on YouTube.

Blendtec employees promoted the YouTube campaign by sending the videos to their friends. They also created a separate site called WillItBlend.com, featuring all the Blentec videos, a blog, and a virtual suggestion box for what items to blend next. The company played off media events such as the July 2007 debut of Apple (AAPL, Fortune 500)'s iPhone, which Dickson promptly threw into a blender.

"You could almost hear people saying, 'Oh, no!' as they watched the video," says Wright. News stories popped up all over the web about the video, which got 3.7 million views.

Jetpack International saw a similar spike in interest last December, when a video accompanying an FSB story ("Jetpacks on the Rise") about it showed the Denver company's pilot zooming through the sky in a James Bond-style jetpack. The video became one of the most popular videos on CNNMoney.com, and viewers flooded JetPack with hundreds of e-mail messages each day, said Troy Widgery, the company's CEO.

"Now everyone wants us to do air shows," he says.

Less exciting products can require more creativity. San Francisco-based Vertical Response banked on humor to boost sales of its e-mail marketing software. The company created two video spoofs of the rap songs "Ice Ice Baby" and "Nothing But a G Thang" with hopes of impressing Salesforce.com (CRM), which often recommends e-mail marketing software to business clients. Vertical Response CEO Janine Popick initially posted the videos on YouTube and e-mailed them to the top ten executives at Salesforce, who forwarded them to the rest of the company's 2,070 employees.

Alf Brand, Vertical Response marketing director and star of the videos, even dressed the part in an old school rap outfit and signed autographs at Salesforce.com's annual trade show. The strategy worked. Last year Vertical Response's revenue generated from Salesforce.com doubled to $1.1 million.

"People want to do business with a company that has a personality," says Popick.

That said, Internet video experts caution that your video should still relate to your product. Vertical Response used custom lyrics in the rap spoofs to tout the company's e-mail products. And because online videos are watched on a small screen, they're best kept simple, with little movement and few people on camera.

"One person talking in front of a webcam is fine if they're doing something interesting," says Michael Miller, author of YouTube 4 You.

Videos should be no longer than two to three minutes. "Better to have a video that makes people want to watch it again than one that is too long and bores them," says author Scott. Companies also should carefully choose the keywords attached to the video, which helps search engines find it. The more descriptive the keywords, the higher the video will show up in an Internet search.

Finally, never try to fake a video by posing as a customer or creating a contrived situation, warns Miller. Diligent YouTube viewers will find you out. Witness the backlash faced by Sony in late 2006, when its marketing firm Zipatoni posted fake videos in which marketers pretended to be customers who wanted the Sony (SNE) PSP for Christmas.

Indeed, sheer realness may be the secret behind the success of Blendtec's "Will It Blend?" series. The quirky feel of the videos boils down to Dickson, who ad-libs jokes and is clearly enjoying himself. After all, he blended two-by-two boards on his own before the videos were even conceived.

"We filmed Tom Dickson as Dickson," says Wright. "It's not an actor. It's not a show. It's the way he really acts." And judging by the sales, people love it.