- It helps a user quickly and easily (in a fun way) understand what a product is about and why they might use it
- It forces a company to really focus on the value they're providing to the market - if you can't explain what you're providing to the market and why it's important in less than one minute, then chances are you don't have a focused enough offering
Some great examples of this that I've seen include a few from Google:
One from the personal finance application, Mint.com:
Just a great way to get your product idea out there and gain awareness.
Enjoy!
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