Micro-movies offer new platform for profits(2)

Take one of its most important clients - Red Star Macalline, a leading furniture retailer. Red Star invested 5 million yuan in its first micro-movie, but the figure for the second one grew by more than 50 percent, He said.

The furniture seller made the decision because it found the product worthwhile, he said. In the month after its first micro-movie was released, its hits on domestic online video websites reached 60 million, and it has been shared 13 million times on micro-blogging platforms.

To get the same result using traditional marketing would cost 100 million yuan, He said.

While social-networking sites and mobile applications have spurred micro-movies' rise, Linksus OpTIPoint is casting its net even wider.

Company revenue went from 10 million yuan in 2012 to 30 million yuan as of September this year, with new clients constituting almost half of that growth, said He.

It has a client list of more than a dozen companies, including domestic auto brand Landwind, pharmaceutical enterprise Yunnan Baiyao Group Co Ltd and Japanese electronics firm Toshiba Corp.

Beyond developing more clients, the micro-movie company has even more ambitious plans up its sleeve.

"We hope that in the future, wherever there are mobile screens, you will see our micro-movies," said He.

More exposure

Presently, its micro-movies can be viewed on screens in subways and buses in 22 major metropolitan areas, like Beijing, Shanghai and Shenzhen. Air passengers can view the micro-movies on China Southern Airlines Co Ltd and Hainan Airlines Co Ltd flights.

He said the company is looking to expand onto trains.

"Negotiations with related railway authorities are still under way," he said. "But we look forward to getting good news."

Screens in subways and on buses are ideal platforms for showing micro-movies.

But the short movies shown there have been tailored down to 1-minute, 3-minute or 5-minute versions of the originals.

"In essence, micro-movies aren't any different from well-designed advertisements, and in the sector, the critical point lies in establishing broadcast platforms," said Yang Shuting, senior analyst with EntGroup Consulting, a Beijing-based entertainment industry consultancy.

Music copyrights offer the company another source of revenue, because the company deliberately places a theme song in every product it makes.

"We are considering expanding our business to the music industry and artists' management agencies," He said.

Since the company owns copyrights for its theme songs, and the songs have gained popularity with the general public, it could save substantially on marketing and promotion once they sell the songs in the form of disks or through paid downloads at online music websites.

"To us, it is a business in which we will never lose money," he added.

The challenges the company faces include not only disorderly competition but also potential clients' misunderstanding of the industry.

"When one of our clients finds our service useful and yields a sound return of investment, what happens next is not its rivals coming to us for a deal but its rivals going to our rivals for a deal instead," said He.

This indicates that companies think the micro-movie industry is the same as the advertising industry, which has a rule of exclusivity. But that is totally a misinterpretation for the short-movie sector in China.

He said that his business can serve rival companies in the same industry.

"Currently, China's micro-movie industry has entered 'version 3.0' times, when companies and brands blend the corporate culture or brand images into the plot in a less obvious way," said Shao Gang, deputy director of consulting for the culture and entertainment industry at Horizon Research Consultancy Group.