Creating Online Customer Idols

Think of Drew Peloso's latest venture as "American Idol" meets E-bay on You Tube. The serial entrepreneur, who previously operated the knowledge management software startup, Onclave (U.S. 1, April 25, 2001), has now launched Shycast, which develops online competitions for companies hoping to connect with their clients and customers.

The general idea is this: your company wants to see how your customers live with your product, so you invite them to submit videos on a specific theme. Shycast helps you develop the parameters, from concept through managing the submissions to writing up the rules. The videos air on your company's site and from there, with a little word of mouth and viral marketing, viewers log on to watch and vote.

Unilever, makers of All detergent, and furniture giant Ikea were Shycast's two first major league clients, Peloso says. They came on board in 2007. shortly after Peloso, pictured above, shopped the idea around his former Madison Avenue haunts, where he once worked in public relations. And if the original concepts of the two companies were a little lame - Unilever asked customers to show off their favorite pieces of clothing while Ikea asked them to "break the rules of bed-making" - the response was enough of a surprise to alter Shycast's focus.

Shycast's original direction, germinated in summer 2006, was a website for competitions on any subject, where everyday people could create videos and/or vote for favorites like they do on "American Idol." With the help of several Princeton undergraduates, Peloso says the kinks were worked through and the idea evolved from the public-driven "create any contest any time" format to a more commercial format through which brands could present a contest theme and let the public run wild with it.

While Unilever did not invest too much into the idea, Peloso says, Ikea loved it - and so did its fans. An overwhelming response from Ikea fans (and there a many - check out www.ikeafans.com) led that company to drop "a big check" on Shycast and start a new contest inviting Main Street businesses from across the country to show how tiny business districts are trying to make the ideal community. That contest - ultimately won by East Lansing, Michigan - got videos from 50 communities, many of which took it upon themselves to hang banners and signs around town pointing residents to the website.

Ikea's contest, and one run with classroom media company Interwrite, surprised everyone who did not expect whole communities to galvanize behind these video projects, Peloso says. Entire towns, he says, backed their business districts for the Ikea contest and their schools for the Interwrite contest. The results altered Shycast's focus from one of a destination website where all the videos would be shown to its current incarnation as behind-the-scenes engineer of projects.

"We did not set out to start an agency," he says, "but here we are."

Peloso graduated from the University of Colorado in 1988 with a bachelor's in finance. He also has an MBA from Cornell. He helped start NBC Interactive and went on to Market Source. He and his wife, Stephanie, whom he met at Cornell in the mid-1990s, run Shycast together on Murray Place - he as the artistic one and she as the one who is all business. She is a graduate of Vanderbilt, where she studied chemical engineering.

Though he would not give specific numbers, Peloso says he and his wife financed the entire business with their own money and have not yet taken in any outside capital. Barely a year old, Peloso says the business has "made about eight times" the startup capital.