Download Advertising Trends 2006

November 21, 2005
THE JOURNAL REPORT: TRENDS
Advertising
Anywhere, Anytime
By SUZANNE VRANICA
Staff Reporter of THE WALL STREET JOURNAL
November 21, 2005; Page R6
This is not your father's advertising.
The decades-old model of blanketing the airwaves with snazzy, expensive
television commercials is coming under unprecedented pressure from the advent of
commercial-skipping devices like TiVo and the fragmentation of audiences among
new TV channels, video games and the Internet.
THE JOURNAL REPORT
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See the full Trends report2.
So with consumers becoming harder to reach, marketers are increasingly turning to
new, nontraditional approaches to hawk their products.
Below is a look at those and other trends reshaping the industry:
1 > MAKING THE CALL
Marketers have found a new way to reach today's always-on-the-go consumers: the
now-ubiquitous cellphone.
Companies are making their pitches by sponsoring content or sending text
messages directly to individual cellphones. Insurer Allstate Corp., for instance, is
sponsoring college football rankings that are being sent to people who subscribe to
an ESPN program via their cellphones. Every Monday for eight weeks during the
fall, subscribers are sent a text message that reads: "Allstate BSC rankings."
College football rankings appear under the headline.
"Over the last six months, this sector has really heated up," says Courtney Acuff, a
wireless specialist at Starcom USA, a media buying company owned by France's
Publicis Groupe. "It's a must for advertisers to be educated about this space."
2 > YOU'VE GOT (ELABORATE INTERACTIVE) MAIL
You open an email to find a photo of a fictional newspaper. The headline reads:
"Another slaying at Datadyne HQ." Below it is a link that sends you to a Web site
where a video of an autopsy is running. Suddenly, the camera pans down and you
see your name etched onto the toe tag of the body.
The screen then tells you about Perfect Dark Zero, a videogame from Microsoft
Corp.'s Xbox. It also allows you to send a similar email to a friend. After you send
your friend the link, your phone rings and a recorded message from Joanna Dark,
the game's heroine, announces: "The job is done, friend." Then suddenly, you
receive an email from Joanna that has a picture of another dead body. And the toe
tag bears your friend's name.
These days, audiences want to be both informed and entertained. So elaborate
online marketing campaigns like Microsoft's -- which marry product plugs and
high-tech entertainment -- are increasingly being used by major advertisers. And as
the penetration of high-speed Internet service continues, more people will be able to
see such video on a computer as smoothly as a commercial on TV.
"Response rates to ads are higher when there is rich-media advertising as opposed
to static banner ads," says Tom Bedecarre, chief executive officer of AKQA, the
interactive ad firm that created the Xbox campaign. Using video is now the "price
of entry" when developing a good experience online, Mr. Bedecarre says.
3 > BREAKOUT ROLES
Companies are taking product placement to
the next level by weaving products into the
plots of entertainment programs. And they
are even helping to create and finance the
content.
PepsiCo Inc.'s Mountain Dew brand
recently financed "First Descent," a
documentary on snowboarding. [TEXT]The
soft drinks also make an occasional
appearance in the movie.[/TEXT]
DaimlerChrysler AG's Crossfire and PT
Cruiser cars played a role in "Cry Wolf." In
the thriller, singer and actor Jon Bon Jovi
drives a Chrysler Crossfire. The film was the
winner of Chrysler's "Million Dollar Film
Festival." As part of the contest, film makers
had to weave a Chrysler vehicle into the
script. While the winning film was produced
and distributed by Universal Studios and
Hypnotic, the car company did get a small
share of the film's profits. So far, the movie,
which opened earlier this year, has taken in
more than $10 million at the box office.
Chrysler declines to disclose how much it
has made from the project.
"Fear" is driving the new push into content,
says Jeff Bell, vice president of the Chrysler/Jeep brand. "We are concerned with
increased fragmentation of audiences. In the 1950s, you could buy three 30-second
spots and hit 80% of the population. Those days are gone."
4 > GETTING IN ON THE FUN
Madison Avenue executives are calling it the Age of Engagement.
Advertisers believe you'll be more inclined to buy a product if you are in on the
action. So they are using marketing techniques that invite consumers to play games
or enter contests.
For instance, to promote its new Torrent sport-utility vehicle, General Motors
Corp.'s Pontiac division hired six former winners of the reality series "Survivor" to
drive around their home cities in Torrents. Meanwhile, television and online ads
running during the series asked consumers to snap a photograph of one of the
winners and send the image to the car maker for a chance to win a new Torrent.
"It's no secret the traditional 30-second ad doesn't work like it used to," says Mary
Kubitsky, Pontiac's ad manager. "You have to deliver something to consumers that
will engage them at an emotional level."
5 > THE LOOK OF THINGS
Being cheap isn't enough anymore. Companies are recognizing that design is as
important to developing and marketing a successful low- and mid-priced product as
a high-end one.
"I call it the democratization of design," says Joe Duffy, chairman of Duffy &
Partners, a design and branding firm in Minneapolis.
Adds Chuck Porter, chairman of Crispin Porter & Bogusky, a Miami advertising
firm: "Packaging and product design is much more important now."
No one knows that better than discount retailer Target Corp., which is known for
making affordable stuff look like it should cost more. A current ad campaign for
Target stars Thomas O'Brien, a high-end New York interior designer. Print ads for
the campaign feature a picture of Mr. O'Brien and shots of products from a new line
of home goods he is creating for the chain. The ads, which are appearing in
magazines like Metropolitan Home, bear the tagline "Design for All."
6 > WHERE THE BOYS ARE
For the past few years, companies like DaimlerChrysler and McDonald's Corp.
have been embracing videogames as a way to reach 18-to-34-year-old males, a
fickle audience that is spending less time watching TV.
Advertising in videogames is expected to jump to $875 million by 2008 from an
estimated $186 million this year, according to Yankee Group, a Boston-based
research firm.
A few months ago, Matsushita Electric Industrial Co.'s Panasonic brand ran a 15second commercial within Anarchy Online, a science-fiction online videogame. As
game characters passed a billboard within the game, the video and audio clip would
begin playing.
The idea is to "generate buzz around the advertising in the game," says Mitch
Davis, chief executive of Massive Inc., a New York firm that places ads in
videogames. If a company does something cool in a game, gamers are likely to chat
about it on message boards, and that "generates word-of-mouth buzz," he says.
7 > IT'S A CULTURE THING
Some companies are taking niche marketing to a new level by playing to a specific
culture and its beliefs.
Take Procter & Gamble Co., which earlier this year relaunched its Biomat laundry
detergent in Israel. In its marketing, the consumer-products company targeted
Orthodox Jews, who represent about 15% of the population. It was a tough
assignment, since many Orthodox Jews don't own traditional media like television
sets.
So, P&G's ad agency devised a plan that tapped into the Orthodox Jews' belief that
they should aid those less fortunate. A Biomat truck equipped with giant washing
machines traveled around towns. People would donate their clothing, and Biomat
would wash and distribute it to the needy.
Biomat's share in the Orthodox sector has grown by almost 50% since the activity
began, says Jim Stengel, P&G's global chief marketing officer.
Says Faith Popcorn, chief executive of BrainReserve, a New York marketing firm
that predicts trends: "The culture is the new media."
8 > YOU TALKIN' TO ME?
Buzz words come and go, but "addressability" seems to be here to stay.
Advertisers are increasingly exploring ways to better target consumers. So
companies like New York-based Visible World Inc. are popping up to help
advertisers customize ads and target households by ZIP Code.
For example, last year UAL Corp.'s United Airlines used the technology to promote
its discount airline, Ted, in the Chicago market. TV ads running on cable systems
were customized to include the name of each suburb in Chicago. The technology
allows different Zip Codes in the same neighborhood, where households are
watching the same TV program, to get targeted ads.
"Consumers don't hate advertising, they hate irrelevant disruption," says Tracy
Scheppach, video innovation director at Publicis' Starcom. "The key to getting
permission is relevancy."
Meantime, the holy grail of advertisers -- tailoring ads based on specific
demographics -- may be on its way. OpenTV Corp., a San Francisco-based
technology company, is teaming up with Philadelphia-based cable provider
Comcast Corp. on a service that will allow advertisers to target households using
even more specific data provided by Experian Marketing Solutions, a division of
credit-reporting agency Experian.
The data include demographic and geographic attributes like ethnicity, age,
estimated household income and how many people live in the household. The cable
operator is currently conducting a test on the service in Miami. An Experian
spokesman declines to comment on the project.
9 > GLAMMING UP THE GLOSSIES
Publishers are finding new ways to move the needle on magazine ads, which critics
claim are static and boring.
Gimmicks range from a single-advertiser issue to inserts like CD-ROMs to ads that
have microchips embedded in them, which allow sound to accompany print ads.
They are a far cry from the standard perfume strips magazines have carried for
years.
Discount retailer Target was the sole advertiser in the Aug. 22 issue of the New
Yorker magazine. It's the first time the magazine carried just one advertiser. Not
only did Target buy all of the ad pages in the issue, it also commissioned various
pieces of original artwork featuring Target's bull's-eye red and white logo to run as
an ad. The New Yorker is known for its clever illustrations.
Playboy magazine's October issue featured a videogame ad that resembles the
magazine's famous centerfold. But instead of a naked woman, the ad showed a
scantily clad videogame character.
While some people express concern that the line between advertising and editorial
content is blurring, media buyers are quick to point out that if magazines don't add
new twists to their offerings, advertising revenue will get harder to come by.
10 > ONE STOP NO MORE
With all the diverse places to advertise, companies are looking to advertising
agencies that can best produce a pitch for a given medium. And that means looking
for ideas beyond the big players on Madison Avenue.
Earlier this year, Unilever PLC handed Bartle Bogle Hegarty, a midsize ad firm
based in London, an advertising assignment for its Dove brand -- even though the
bulk of the Dove account is handled by WPP Group's Ogilvy & Mather.
"The changes in media force you to work with more agencies," says Silvia
Lagnado, Unilever's senior vice president for Dove.
Allstate, which has worked with Publicis' Leo Burnett since 1957, recently handed
an ad assignment to Not Traditional Media, a small New York advertising firm.
The boutique agency created a nontraditional marketing program for the insurance
company that used the Internet to promote Allstate's brand to Hispanic car buffs in
the Chicago area.
"I reject the notion of one-stop shopping" when it comes to agencies, says Joe
Tripodi, chief marketing officer of Allstate, based in Northbrook, Ill. "I think smart
marketers will have a lead shop, but you can supplement that shop with smaller
firms that have a different perspective on marketing."
--Ms. Vranica is a staff reporter in The Wall Street Journal's New York bureau.
Write to Suzanne Vranica at [email protected]
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