Some Assembly Required? San Diego’s ShowUhow Uses Web-Based Video to Displace Printed Instruction Guide
Kim Folsom tells me that she tried using video for education in the late 1990s at Seminar Source, a venture-backed, Web-based software company in San Diego that tried to take advantage of the fact that it’s easier for many people to learn visually. “You could do video over the Web, but it wasn’t the best,” she says.
Years later, Folsom went to work as a vice president and general manager at DriveCam, the San Diego company that uses a video camera “event recorder” mounted on the windshields of delivery trucks and other fleet vehicles. The device helps fleet managers promote safety by identifying risky driving behaviors it records while staffers are behind the wheel.
These days Folsom is taking another swing at online video. She’s now the founding CEO of ShowUhow, a San Diego-based startup she founded in mid-2007 to create and host online video instruction guides that already are replacing printed instruction manuals. The video guides demonstrate how to assemble everything from Little Tikes’ riding toys and toddler furniture to consumer electronics from Radio Shack.
ShowUhow’s Web-based video instruction guides are far easier to follow and understand, she says, than printed assembly instructions that are written by too many people who don’t use the products, or whose directions leave too much open to interpretation.
“Newer smart phones and YouTube have helped make video adoption much more ubiquitous than it used to be,” Folsom says. With the iPhone, Folsom says users can find an item’s related ShowUhow video by using the smartphone camera to scan the product’s UPC bar code.
Some manufacturers perceive that assembling their products after purchase is not that hard to do. But Folsom says, “Complex products require ‘work’ for proper set-up and use, and when frustrated consumers seek support, it costs between $10 and $30 per request.”
“A poor out-of-box experience is expensive,” Folsom says. She estimates that problems with assembly or setup account for 30 percent of returns, and ShowUhow’s goal is to close these miscommunication gaps between the consumer, retailer, and manufacturer. The company provides its Web-based services to manufacturers, such as Panasonic and Swann, but as Folsom puts it, “ours is a B2B2C business”—meaning they interact with the businesses that sell to retailers, and those retailers are selling to consumers.
Manufacturers often help retailing partners answer consumer questions about product assembly by operating call centers to handle queries. Manufacturers also typically bear much of the cost of product returns. Folsom says the value of ShowUhow’s service lies in helping manufacturers and retailers lower those costs because its Web-based “how to” videos provide better and clearer instructions, which means happier customers. So retailers and manufacturers deal with fewer frustrated customers. It helps explain how the startup has managed to establish partnerships with 30 retailers, including such major brands as Home Depot, Target, Best Buy, Costco, Walmart, Amazon and Toys ‘R’ Us.
The company has developed an online technology platform to host manufacturers’ “how to” and “do-it-yourself” videos. ShowUhow charges its manufacturing and retailer customers a monthly service fee to host the videos. The company also can help its customers create videos; ShowUhow operates a studio in San Diego where it can record and produce videos. “Our patent-pending platform technology can be deployed on both the Web and smartphones,” says Folsom, who estimates ShowUhow will generate $1 million in revenue this year and $5.8 million in 2011. Instead of focusing their online service on ad-click conversion, Folsom says, “we’re focused on sale, satisfaction, and [customer] retention.”
Folsom says she raised a small amount of angel funding at the outset from investors she knew from previous companies. In August, ShowUhow raised $3 million in Series A funding from Syncom Venture Partners, a Silver Springs, MD, firm that specializes in media, mobile technologies, and Web-based service companies. The startup also announced in August that Giles Bateman, former co-founder of Price Club/Costco and former chairman of CompUSA, had joined its board of directors.
Folsom acknowledges that ShowUhow faces a range of competitors, from in-home service reps to internal call centers and companies such as Chino, CA-based Alorica, which provides a range of “customer contact services” for its business customers. Folsom says amateur users also create a tremendous amount of “how-to” video content that can be found online for free. But the free online content is problematic, and Folsom says most manufacturers wouldn’t seriously consider using them.