Articles of Interest

Pheedo Bows Self-Service RSS Ad Product

2006-05-03T14:49:00.000-07:00

Pheedo Bows Self-Service RSS Ad Product
by Shankar Gupta, Wednesday, Apr 26, 2006 6:00 AM EST
RSS MARKETING FIRM PHEEDO IS expected to unveil a new product that allows Web site publishers to insert and track advertisements in their RSS feeds.

Pheedo founder Bill Flitter said the product, dubbed "Ads for Feeds," will simplify the process of inserting ads into syndicated feeds. "What we've created is a way to make RSS advertising and analytics available to everyone," said Pheedo Founder Bill Flitter. "Before, publishers were a little bit in the dark. What this product does is shed some light onto some of the problems with RSS. We created this product really to be easy, almost to the point of cutting and pasting code into their template."

With Ads for Feeds, publishers host a piece of Pheedo code on their own Web sites, and that code inserts ads and tracks the advertisements. The more extensive, expensive version, now called "Ads For Feeds+," redirects the feed through Pheedo's own servers, allowing for more data to be collected.

The product currently works with the major blog content management systems, including Wordpress, Moveable Type, and Typepad. According to Flitter, Pheedo can write custom code for proprietary content management systems, as well.

Flitter said the company hoped the new service would allow it to capture more of the widening marketplace. "A real motivation behind this particular product was to appeal to the market. The market is changing quite a bit over a year ago, and more and more people are becoming aware of RSS, and they're RSS enabling their sites," he said.

Engagement Panel: No Currency, No Clarity

2006-05-01T10:18:00.001-07:00

Engagement Panel: No Currency, No Clarity
by Erik Sass, Friday, Apr 28, 2006 8:19 AM EST

ENGAGEMENT IS REAL AND MEANINGFUL, but its usefulness is limited by the lack of a single measurement currency, speakers on the "Engagement" panel agreed during Media Magazine's "Outfront Conference" on Thursday. During the course of the panel, it became obvious that in large part that's due to the fact that the meaning of engagement itself is still up for debate.

According to Deborah Reichig, senior vice president of sales strategy for CourtTV, "We're talking to one agency who thinks that loyalty is an important factor, and they measure that by the number of people who have watched three out of four episodes. Another thinks it's persistence, and that's measured by numbers of minutes watched per show. And there's others who want to look at 'persuasiveness.' We actually did a literature review and there are 85 different words and phrases that people have used to get at this concept."

The reality and importance of engagement were established early on by Paul Iaffaldano, executive vice-president and general manager of the Weather Channel's media solutions group, who noted statistics on the disparity between viewer attention to programming and ads: "There can be a 25 percent drop-off between ratings in program and ratings in minutes where commercials run. That is a very significant drop-off, and that is worth measuring."

By the same token, minute-by-minute data is not always reliable, according to Sandy Eubank, director of U.S. research and communications insight for OMD: "We don't think that the minute-by-minute ratings are engagement, and we don't think that they are commercial ratings... sets tuned doesn't necessarily indicate engagement... we prefer a measure of engagement where we actually ask something of the consumer."

Eubank went on to explain that it would be a mistake to use simple statistics like the number of sets tuned to measure a more complicated phenomenon like engagement: "Engagement occurs on a continuum... and if you just look at that tuning data you're missing a richness in data that is very important to advertisers. Having minute-by-minute data is far from a commercial rating." Above all, Eubank suggested a metric "where someone has asked the consumer something that suggests that they're involved with the program."

Although the means and object of measurement remained ambiguous, the other panelists seemed to agree with David Marans, executive vice president of IAG, when he summed it up: "Ratings are currency for transactions, and Nielsen does them well... but if you're building a house, they're the foundation, not the whole house."

And where might media execs find other sources of data? Deborah Reichig, senior vice president of sales strategy for CourtTV, noted: "There is a wealth of data hidden in those syndicated services we all use every day. There are ways to get at loyalty, and length of tune, and audience retention... you can use a combination of syndicated data and proprietary data to get a much better feel for what's going on."

Of course, proprietary methods for measuring engagement also allow competing research and media firms to distinguish themselves--a fact that seems to suggest a single measurement currency may still be a long way off. But it's worth noting that the basic ratings currency provided by Nielsen was at one time a proprietary service too. If "engagement" is to become a meaningful metric, it too must be standardized.

"They're probably all different," Eubank said of media deals that focus on engagement. "What's hard is to get other people around the table to accept your measure of engagement... What we would like to see is that everyone accepts one measure--and there's a currency, and a level playing field. But it may be ten years before that actually happens."

Wired News: Movie Mashups Take on Trailers

2006-05-01T04:47:00.000-07:00

Wired News: Movie Mashups Take on Trailers
Movie Mashups Take on Trailers

By Niall McKay| Also by this reporter
02:00 AM May, 01, 2006

Hollywood has drafted a British VJ outfit to produce the first official movie mashup.

New Line Cinema commissioned Addictive TV, a British VJ duo, to mashup the new Antonio Banderas blockbuster Take The Lead to market to the iPod generation.

Watch the mashup here:

The Brit duo, known for bootleg movie remixes of titles like the Italian Job and James Bond were commissioned by New Line in a VJ faceoff with DJ 2nd Nature and Electric Method.

"It's the first time that a Hollywood studio has included a mix as part of its (marketing) package," said Graham Daniels, who runs Addictive TV with DJ Trolly.

The pair are no newcomers to mixing and mashing video. As a live act, they've been on the road VJing since 1992. Performing live, they blend film footage, video and audio clips using video and audio mixers, DVD turntables, laptop computers and video projectors. But the recent upswing in mashup culture is giving them a new lease of life.

The pair have also been hired by EMI to create a Doors versus Blondie mix that will feature live Doors concerts mixed with snippets of Blondie's '80s videos.

"EMI liked our Queen vs. Tarantino bootleg mashup so they asked to create one for Blondie," Daniels said.

The pair will be performing a VJ "symphony" on Monday night at the San Francisco International Film Festival called "The Eye of the Pilot."

The audiovisual symphony will feature a collection of color 8-mm film from the '50s shot by French commercial airline pilot Raymond Lamy, mixed live with guitar playing, ambient music and images drawn from Addictive TVs archive.

"We like to perform special mixes for our concerts," said Daniels. "We did a Crouching Tiger Hidden Dragon mix for our Shanghai concert and the crowd went mad on the dance floor."

Is Poker Losing Its First Flush? - New York Times

2006-04-16T08:09:00.000-07:00

Is Poker Losing Its First Flush? - New York Times
April 16, 2006
Is Poker Losing Its First Flush?

By TIMOTHY L. O'BRIEN
LAS VEGAS

NEXT month, Fox Broadcasting plans to introduce "Poker Dome Challenge," a live television show that will be broadcast from inside the Neonopolis, a shopping mall just down the block from Binion's, the gleefully bawdy casino where high-stakes poker started here more than 50 years ago.

While "Poker Dome" may be Binion's neighbor, the show will be as far removed from poker's leisurely Mississippi Delta roots as weekend paintball matches are from big-game hunting. "Poker Dome" will encase a group of players in a soundproof, glass-walled stage, while viewers and a studio audience watch everything they do.

Microphones will capture game chatter, and pulse monitors strapped to the gamblers will track their heart rates. Robotic cameras will scrutinize every nervous tic on the gamblers' faces, projecting the angst of brinkmanship onto oversized video screens. New to the mix will be an N.B.A.-like shot clock that gives gamblers only 15 seconds to bet, check or fold, an innovation that Fox says will increase the rate of play to 80 to 100 hands an hour from the usual 15 to 20. "It's poker on triple espresso," Fox boasts in a "Poker Dome" news release.

Three years into the poker boom, the game's purveyors are out to prove that it is not a mere fad, but a form of entertainment with real legs — even as there are signs that the country's poker appetite may be becoming less ravenous. Some industry analysts expect the growth of online poker to slow sharply, and televised poker is already drawing fewer viewers.

The Travel Channel says ratings for its "World Poker Tour" have fallen 36 percent in the last two years. Poker even has its own miniature stock scandal, with the Securities and Exchange Commission investigating whether the poker legend, Doyle Brunson, and his Las Vegas lawyers manipulated the stock price of WPT Enterprises, the company that runs the "World Poker Tour."

Even so, the commercialization and transformation of the old game zips along at light speed. Fox, as well as other companies and networks that produce and broadcast poker, dismiss naysaying and continue to inject more adrenaline into promotion.

"I do think that poker is one of the most durable and cost-effective forms of programming in television," said George Greenberg, a Fox executive overseeing the network's poker forays. "Quality poker, dramatic poker and poker that is in your face is the poker that will be left standing."

Big-money poker, of course, is in everyone's face now, thanks to Fox, its television brethren, and the Internet. The "World Poker Tour" is modeling a major new tournament after invitation-only events found in professional golf, much to the chagrin of some players who worry they will be cut out of lucrative licensing deals. ESPN showcases the "World Series of Poker," in June, and this year's entry list is expected to briskly outpace last year's roster of about 5,600. And the Bravo network continues to play the glamour card on " Celebrity Poker Showdown" (Ben Affleck! Martin Sheen! Ray Romano!).

The Web is a distinctive sugar daddy in all of this. PartyPoker.com, a leading Web site, is host for about 32 hands of poker play per second, according to a British securities filing by its parent company, PartyGaming. In 2005, that amounted to about $1,454 wagered per second, or $45 billion for the year — and PartyPoker is just one among some 2,400 online poker sites.

The growth of the poker industry, meanwhile, has led some television executives to bet that darts, dominoes or blackjack will be next. A group of Las Vegas and Los Angeles entrepreneurs has filmed a new blackjack tournament that it is pitching to networks as the next big thing. For his part, Mr. Greenberg at Fox still sees poker as the biggest game in town — and "Poker Dome" as its most robust incarnation.

" 'Poker Dome' will be the Nascar of poker," he said, "because of its style, design, graphics, information and the speed with which the game is played."

But are speed, the currency of slot machines and other quick-fix gambling gimmicks a virtue in poker? And are all the people joining the dizzying electronic and tabletop smorgasbord of tournaments really playing poker anymore?

Well, no, some purists say. They contend that real poker is about a sober assessment of risk and long-term gains at the table, and not about speed or frequent high-stakes collisions over big pots.

"The minute you make it a tournament meant to bankrupt someone else then it isn't poker anymore," said Aaron Brown, an executive director at Morgan Stanley and the author of a new poker book, "The Poker Face of Wall Street." "It's the same difference between being a career singer and being on 'American Idol.' Tournament play may be great entertainment, but it's not poker."

Poker industry honchos dismiss such critiques. They say that their efforts have snared a mass audience of new poker enthusiasts and that those who are not enamored of high-octane tournament play simply have not adapted to modern times.

"Poker has gone from something that has been hardly an afterthought to a big, big business," says Steven Lipscomb, the chief executive of WPT and co-founder of the "World Poker Tour."

"Inevitably, no matter what you do, anybody who drops out of a tournament will gripe about structure," he said.

ON a recent evening at Caesar's Palace in Las Vegas, Phil Gordon, a former commentator on "Celebrity Poker Showdown," regaled a Wall Street group with tales from the poker trenches. J. P. Morgan had hired him to entertain a group of professional money managers who would set off after a sumptuous dinner to play poker with one another in a small, private tournament.

"I am not a professional gambler — I have never gambled a day in my life," said Mr. Gordon, who became a full-time poker player several years ago after he made about $2 million exercising stock options earned as a high-tech entrepreneur. "What I am is very similar to what you do. I'm a strategic investor."

"All I'm trying to do is get my money in and invest as often as I possibly can," he told his audience. "Every time I put $100 into the pot I expect to take $100 or more out."

The gambler reinvented as investor, shrewdly calculating expected values and other statistical realities, is one face of contemporary poker, and Mr. Gordon is an advocate of the game's new business-minded mantra. Lanky, genial and savvy, he is a talented poker player who is quick to point out that he does not consider himself a great player. But he is clearly an avid promoter. He comes to speaking engagements loaded with slick poker-training DVD's, copies of his popular poker books, a snappy résumé and talking points.

Mr. Gordon says he can now make more money, more consistently, from his speeches, books and DVD's than he ever made playing poker. As he stands in the middle of Caesar's poker room, a few poker groupies spot him and rush over to get his autograph, making him something quite other than the back-alley poker tough Steve McQueen played in "The Cincinnati Kid," the 1965 film.

Mr. Gordon has had a ringside seat at the poker boom. He finished in fourth place at the 2001 World Series and then won the "World Poker Tour" the next year, all just before the introduction of a hole-card camera helped ignite poker ratings on television by allowing viewers to peek at cards that were once hidden in players' hands. A chance encounter with the actor Hank Azaria, in late 2002, led Mr. Azaria to suggest that Mr. Gordon get in touch with Joshua Malina, another actor producing a charitable poker event, which evolved into "Celebrity Poker Showdown."

Mr. Molina asked Mr. Gordon to be a commentator on "Showdown," which made its debut in 2003 and found itself a sudden and unexpected catalyst in poker mania.

From his years in the game, Mr. Gordon has mapped out qualities that he believes make a great poker player — qualities like aggressiveness, courage, patience, observational brilliance and open-mindedness. He also asserts that an ability to assess opponents' psychological makeup is far more important than mathematical dexterity. In fact, he says in his poker primers, all that any player needs to succeed are fourth-grade math skills and emotional discipline.

"It's the only game that normal, everyday people can visualize themselves doing at the highest level," he said. "They know they will never be able to hit a Randy Johnson fastball or catch a Joe Montana pass, but they can imagine themselves sitting across from Phil Ivey and going all-in. A plumber with marital difficulties can find himself suddenly rich and famous."

Those particular fantasies took flight among poker fans when Chris Moneymaker, an otherwise nondescript 27-year-old novice with a poker-perfect surname, unexpectedly won the 2003 World Series, taking home $2.5 million.

In 2001, poker players around the world spent a combined $72 million buying their way into live games. Last year, the global buy-in was $376.6 million, according to PokerPages.com, a firm that tracks the industry. About 304,500 people entered those tournaments in 2005, according to the firm, compared with about 147,500 in 2001. For now, the popularity of poker playing remains. The number of people entering tournaments and the amount they spent doing so were both higher in the first quarter this year than they were in the same period in 2005.

The emerging powerhouse in tournament play is the "World Poker Tour," shown on the Travel Channel. Mr. Lipscomb, a former documentary filmmaker who said he was inspired to create a slickly packaged professional poker league after he filmed the 1999 World Series, joined a casino industry veteran, Lyle Berman, to found WPT Enterprises. Mr. Berman minces few words in describing the partners' original aspirations: "Our whole goal was to create a brand around poker and monetize it."

That attitude has upset players like Mr. Gordon, who say the tour is trying to monopolize all of the financial action floating around tournament play, like licensing deals. But other players say they are grateful for the tour's national platform and for television exposure as they play in top poker rooms like those at the Bellagio in Las Vegas, the Borgata in Atlantic City and Foxwoods in Ledyard, Conn.

THE Travel Channel and WPT televised the first "World Poker Tour" from March to June 2003, featuring about 1,400 entrants competing for a total prize pool of $11.6 million. When the tour's fourth season ends this June, WPT says it will have had about 10,000 entrants competing for a pool worth $90 million to $100 million.

While new poker players are clearly continuing to flock to tournaments and online forums, it is less clear that television fans will share that enthusiasm. The Travel Channel said that about 850,000 households, on average, tuned in to the "World Poker Tour" in its first season, in 2003. That figure jumped to 1.2 million in the second season, broadcast from December 2003 to September 2004. But during the tour's fourth season, which began in March and ends in June, an average of only 760,000 households have been tuning in.

ESPN has experienced a dip in its "World Series" viewership, and viewers have also been abandoning "Celebrity Poker Showdown." Bravo said "Showdown" had an average of 957,000 households watching in its first season, from November 2003 to January 2004. In the seventh season, which was broadcast from last October to last December, the average household viewership plunged to 387,000. Bravo said that part of the dropoff in average ratings, though not all, was attributable to added "Showdown" episodes.

Although Mr. Gordon says he thinks that poker play has about two years of growth left before it plateaus — a view he bases on anecdotal evidence like book sales and e-mail traffic — his former bosses at Bravo say they are in for the long haul. Lauren Zalaznick, Bravo's president, describes "Showdown" as one of her most bankable franchises, along with "Queer Eye for the Straight Guy" and "Project Runway."

On the financial side of the ledger, WPT also has doubters. While the stock market is never a perfect predictor, investors do not appear convinced that the World Poker Tour's owner is telling a growth story. Even though WPT's revenue grew to $18 million last year from about $4.3 million in 2003, the company is unprofitable and its stock price closed at $6.86 yesterday, exactly where it was shortly after the company went public in the summer of 2004.

For a brief time after its initial offering, the stock rose smartly — including a surprising spike to about $29.50 last July, after Mr. Brunson announced on his Web site that he planned to start a takeover bid. Less than a week later, Mr. Brunson allowed his WPT bid to lapse, causing the stock price to begin falling back to earth, where it has since remained. The S.E.C. said in December that it was investigating Mr. Brunson and two of his Las Vegas lawyers, Chaka Henry and David Chesnoff, regarding the circumstances surrounding the takeover offer. All of the parties involved in the investigation declined to comment.

Mr. Lipscomb also declined to comment on the investigation, but said that he was confident about WPT's future, primarily because he was ramping up his company's online presence.

The legality of online poker betting in the United States is murky, with the Justice Department and some states flatly considering it illegal, even though some courts have interpreted the situation differently. Regardless, setting up shop on a computer server abroad and establishing an online poker presence identity is easy, and WPT has already started sites in 150 countries to do so. (Mr. Lipscomb says that American players are blocked from accessing WPT's overseas pay-for-play gambling sites.)

The earnings of the online poker titan PartyGaming, especially in comparison with WPT's anemic numbers, illustrate why Mr. Lipscomb is in such a hurry. PartyGaming's revenue leapt to $977 million in 2005, from $30.1 million in 2002, while its profits in those same years soared to $293.2 million from $4.4 million.

Feverish online poker play accounts for the difference. According to PokerPages.com, digital gamblers open their wallets at a far lustier rate than poker players entering live tournaments. The company estimates that 40 million poker players entered online tournaments last year and forked over buy-ins totaling about $1.1 billion.

PartyGaming says its PartyPoker Web site had about 41 percent of global online poker play last year, with most players based in the United States. But PartyGaming's securities filings also cite a study indicating that the growth of online poker revenue will slow sharply. While revenue grew at an annual rate of 158 percent from 2000 to 2005, the study projects annual increases of only about 18 percent from 2005 to 2010.

The Internet fosters speedy poker play as much as television tournaments like "Poker Dome" do, and analysts are curious about whether such haste may also give rise to compulsive gambling problems. Dr. Howard J. Shaffer, director of Harvard Medical School's division on addictions and an authority on problem gambling, is completing a study of online gambling and poker play. He says that online poker is in its infancy and that his data need to be interpreted carefully.

I THINK online poker play has changed the gambling landscape," he said. "I think younger people see it as much more average and acceptable, and without the same apprehensions and restraints, as earlier generations. That could make current online players more vulnerable or even less vulnerable. We just don't know yet."

Another age-old threat that is given a new twist in the online poker world is cheating. Cardsharps have always prowled poker rooms, colluding with one another to set up naïve or unwitting players. But some poker veterans say that the Internet makes collusion much harder to discern and avoid. Richard Marcus, a gambler who has written an autobiography about his exploits as a professional cheater, recently published a book, "Dirty Poker: The Poker Underworld Exposed," that purports to detail the poker world's underbelly.

For example, Mr. Marcus contends that it is simple for a skilled cheater to adopt several digital guises and "sit" anonymously at several seats at one online poker table and control a match's outcome. "I've been cheating at everything, including poker, since I was old enough to walk, to put it bluntly," he said. "There is no policing of the online sites. None."

John Shepherd, a PartyGaming spokesman, disputes this view, saying that his company carefully monitors its poker sites for cheaters. "We have absolutely zero tolerance for cheating," he said.

PartyGaming also has zero tolerance for sitting still. The company continues to start a variety of new online casino games, including blackjack, which has generated about $800,000 a day in revenue since its debut in October.

OTHERS also say that blackjack may be ready for prime time. Russ Hamilton, a professional poker player in Las Vegas, received the backing of Los Angeles investors to produce a new show called the "Ultimate Blackjack Tour." Mr. Hamilton says he has introduced some innovative tweaks, like a secret-betting button, that are designed to speed up wagering and make blackjack just as telegenic as poker. Mr. Hamilton and a Las Vegas consultant, Anthony Curtis, say they have shot 10 episodes of the show and are negotiating with networks to broadcast them.

"There are more blackjack players than poker players, and blackjack is far easier than poker," Mr. Curtis said. "I believe it's the next big thing. Poker is big, but it's got to hit a wall."

If tournament poker has yet to hit a wall in terms of popularity, some people say it may already have reached a breaking point in terms of its quality. Televised tournaments are demanding bigger "blinds" — designated antes that players are required to throw into the pot before a new hand begins — that cause players to burn through their bankrolls more quickly. That forces faster play and speedier eliminations. And that, in turn, makes luck a much bigger factor in those games than it is in normal poker matches.

"It's as if you played golf where every hole was just one or two shots — that's what they've done to TV poker," Mr. Gordon said. "They're more interested in production values than in letting a player's true skill play out on the green felt."

Still, the game goes on. In addition to the thrills of its new "Poker Dome," Fox says its series will also offer pricey, stand-alone "mega events." The first such "Poker Dome" event is planned for July and is scheduled to star the poker wizard Phil Ivey. Mr. Ivey, along with five other gamblers, will each have to pay $10 million buy-ins for the right to participate in a $60 million, winner-take-all face-off. The money promises to trade hands very, very fast.

Why Can't I Have Just the Cable Channels I Want? - New York Times

2006-04-16T08:07:00.000-07:00

Why Can't I Have Just the Cable Channels I Want? - New York Times
April 16, 2006
Media Frenzy
Why Can't I Have Just the Cable Channels I Want?

By RICHARD SIKLOS
AT the National Cable and Telecommunications Association convention in Atlanta last week, the cable guys were at it again. They were kvetching that the Federal Communications Commission had gotten it terribly wrong in pushing to loosen the way that cable television channels were packaged and sold. Essentially, the cable contingent says that its current practice of selling a package of 75 or so broadcast and cable channels is better for consumers and the public good than letting people pick and choose the 10 or 20 stations they actually watch.

The average price of extended basic cable — the type of channel package to which most of the nation's 73 million cable-watching households subscribe — is $41 a month, according to Kagan Research. Plenty of other premium channels and services are available, but the only cheaper option is truly basic: a package of mostly local stations with none of the popular cable channels (ESPN, MTV and CNN, to name but a few). At my house in Connecticut, for instance, basic cable runs me $13 a month.

The cable operators say that forcing them to give people more latitude over the channels they buy would constitute rank government interference, the equivalent of forcing restaurants to sell burgers and buns separately. The à la carte model favored by some regulators would lead to much higher rates for individual channels, executives argue. Whereas that same $41 might get you only 10 hand-picked channels, the bundle model both pays for the infrastructure — all those pipes and set-top boxes and servers and repair trucks — and preserves the smorgasbord of big and small channels to suit all demographics and tastes.

Without bundling, programmers like Disney and Viacom might no longer be able to afford shows with smaller but loyal followings. Under the current system, they can produce niche channels like ESPN Classic because they are bundled with ESPN and other channels, the programmers say.

For the most part, the F.C.C. rolls its watchdog eyes and notes that the price of expanded basic has increased well beyond other goods and services over the past few years. It and the cable association have drawers full of studies disputing the other's studies about their studies. Kevin J. Martin, the F.C.C. chairman, showed up briefly in Atlanta to reiterate that he was not giving up the fight, even after recently cajoling cable companies to agree to put together a new, smaller tier of family-oriented channels that was a few dollars less than extended basic. "Putting more control in the hands of consumers is always good," he said.

Alas, the legislative year is rapidly winding to a close in Washington, making it unlikely that Congress will pass any à la carte legislation this time around. Still, even a few renegade television providers are finding it difficult not to side with Mr. Martin. Cablevision Systems in New York and the satellite service EchoStar have done so, though they remain a clear minority. Comcast, Time Warner, the News Corporation, Walt Disney and others are lined up to harrumph at Mr. Martin.

The great paradox of this debate is that it comes as the number of media options is exploding and the way they are being priced is all over the map. The much-maligned bundle will most probably prevail as the most popular business model for media, although it, too, is likely going to need an extreme makeover.

Just look at the big picture: At one end of the spectrum is the push to sell more and more programming on a per-show or per-viewing basis, via video-on-demand or some kind of download service. Whether it is iTunes from Apple Computer, the new video services from Google and Yahoo, or the newest iterations of nascent mobile telephone services through Verizon, Sprint and others, it's clear that we are approaching a future where there will be no chance that a favorite show can be missed.

Last week, Disney pushed the ball forward by announcing a trial to show four of its popular television shows free on www.abc.com, with commercial sponsors. And Fox said it had worked out a deal with affiliate stations that would let it join the other big networks in making popular shows available in new digital and online formats.

All this is happening not so much because content makers sense gigantic riches in these new ventures, but out of fear that if they don't make their programming more freely available, younger audiences will grow up accustomed to getting their favorite shows free via illegal file-sharing services and DVD's burned by their pals.

At the other end of the spectrum from selling individual shows is the equally au courant concept of überbundling — selling digital cable services combined with high-speed Internet and telephone service, and maybe throwing some wireless into the mix.

Ask cable industry executives, and most will argue that a majority of people still prefer buying the existing pre-ordained packages of cable. And the addition of new services like high-speed access gives viewers conveniences like a single bill and shared customer service. Yet a recent USA Today/CNN/Gallup poll found that 54 percent of television viewers said they would prefer to buy channels individually, while only 43 percent said they'd rather pay a flat fee for a fixed number of channels.

Strangely, these colliding views make sense. When asked whether they want total choice, especially from historically monopolistic quasi-utilities, it's no shock that most people say: heck, yes. Yet, as the author and psychology professor Barry Schwartz and two of his colleagues pointed out a few weeks ago in The New York Times Magazine, Americans have this funny habit of confusing freedom, which they cherish, with choice, which can give them headaches.

"We're definitely at an overwhelming number of options," Maribel D. Lopez, a media analyst at Forrester Research, told me. "It's frequently difficult to understand what you're buying. There's also different content that goes on different devices. We run the risk of consumers moving to indecision because they have a lot of choice."

Stephen B. Burke, the chief operating officer of Comcast, also contends that people are most comfortable paying for subscription services they can rely on at a set price, even if they don't consume every minute or inch of it — whether the subscription is to cable service or Time magazine.

Mr. Burke pointed out to me that well under 10 percent of subscribers bought pay-per-view or video-on-demand movies from Comcast. But as many as 70 percent of Comcast's customers avail themselves each month of the free video-on-demand programming that is part of its digital package.

Mr. Burke says part of the problem with buying individual shows is that, amazingly, more than 90 percent of Comcast's 22 million customers still pay monthly cable bills by cash or check. That kind of customer isn't ideal for impulse digital purchases.

And Ms. Lopez says that one reason new mobile services may be slow to take off is that even tech-savvy consumers in the United States are not as culturally attuned to prepaying for communications services as those in Europe and elsewhere.

There are examples to the contrary that suggest that consumers are more than keen to buy products by the bite — but they are fewer than you'd expect. Ring tones, music downloads and pornography come immediately to mind, but, needless to say, these models don't translate across all media.

Rather than unfettered choice, maybe what most people yearn for is more, better choice. Video providers in Britain, Hong Kong and Canada have figured out how to offer a much wider variety of ways for their audiences to pay for TV without invoking video Armageddon.

The cable operators are indisputably right about one thing: they shouldn't need Mr. Martin to tell them to do the right thing.

Ken Belson contributed reporting for this article.

MySpace Exec: Teen Users Promote Brands

2006-04-14T11:28:00.000-07:00

MySpace Exec: Teen Users Promote Brands
by Tobi Elkin, Wednesday, Mar 29, 2006 6:00 AM EST
LOS ANGELES--MARKETERS NEED TO BECOME cultural anthropologists if they want to connect with people on MySpace.com. "We take a sociological approach to building MySpace, and advertisers need to be cultural anthropologists when they're thinking about their communications strategy on social networks," said Shawn Gold, senior vice president of marketing and content for MySpace.com, during a keynote on Tuesday at the OMMA Hollywood Conference & Expo in Los Angeles.

Social networks, including MySpace.com, are "about individuality and identification and connecting with others," Gold said, adding that kids on MySpace.com are looking to belong, and for discovery, access, self-expression, recognition, confidence-building, appreciation, and building knowledge. "We think that every feature on the site needs to tie in with these core needs."

In presenting a highlight video from MySpace.com, Gold showed examples of how teens are incorporating brand networking into their MySpace pages. One page showed images of the LA Lakers, an Aston Martin, and other auto brands. "Teens are brand networking on their pages--they are trend-setters and they want to be the first to know or to spread something," Gold said, adding: "that's the cultural currency of life on MySpace."

Gold mentioned MySpace programs with Aquafina and the Beastie Boys, as well as Wendy's, which has managed to rack up 94,000 friends on MySpace and boasts a variety of features on its page including downloads, wallpapers, screensavers, AIM icons, slides, audio, and video. Verizon Wireless, the Honda Element, and Toyota are among the marketers that are evolving profiles on MySpace.

Gold offered a few predictions when it comes to marketing to the "everywhere, always there consumer." He said consumer empowerment marketing is a "now and forever trend," that social networks/blogs are a publishing platform for early adopters, and that word-of-mouth has turned into citizen journalism as a trusted form of media. In addition, marketers will step up their focus on brand programming designed to "catch consumers in their stride as they communicate and connect," but he said, "people don't come to social networks to click on the advertising." Marketers that have turned to brand programming on MySpace include Boost Mobile, Best Buy, and TV properties like "The Family Guy." The marketing opportunity is to create mini social networks within a social network.

Marketers can slice and dice the database. "There are thousands of brand programming opportunities that have yet to be exploited," Gold said, citing niche communities on MySpace of DJs, comedians, filmmakers, and musicians. "A marketer could create a celebrity brand of the month because there is so much content that can be sliced and diced." Exclusive and original content, including previews of TV shows like "The Office," and albums ranging from artists like Audioslave and Madonna to Neil Diamond can premiere successfully on MySpace.com.

Gold told OMMA attendees that communications will become more important than marketing, and that choice will lead to an even greater fragmenting of the media landscape. "If an average person is getting 30 visits per day on MySpace, how do you maximize the opportunity? Smart marketers are trying to get onto people's home pages," he said. For example, for the film "She's the Man," MySpace enabled a member to take their Top 8 "friends" and categorize them as best-looking, most secrets, biggest crush, and so forth, and created a special HTML graphic for the feature. MySpace found that 82,000 people accessed the generator application and used it on their home page to maximize their personal reach.

Cause-related marketing on MySpace is growing, Gold explained after showing the video "Life Rolls On," about a young surfer who was injured and paralyzed doing the sport he loves. "Marketers will create cause-related programs that enhance their brand's position in society. Marketers can get behind some of these people."

Gold predicted that event marketers will lead social networking advertising by increasing their contact opportunities to get people more invested in an event. He cited Aquafina's tying in to a Beastie Boys concert for MySpace devotees, in which there was a contest to create a music video and a trip to the Sundance Film Festival for the winners.

As for advertiser skepticism and scrutiny of MySpace.com, Gold said: "Results are the only way to build advertiser confidence. We have enough major advertisers using MySpace right now--it's not who's going to go first, it's about not being left behind." In addition, "to really capitalize on the future and efficiencies of media, marketers need to credibly insert their message." Gold explained that walled gardens exist on MySpace where an advertiser doesn't have to be on a person's page, but can appear on the site's home, TV, and music pages where there's "exceptional reach."

MySpace stands for "empowerment of the individual" and "now you have this exceptional efficiency and intimacy to reach people. Advertisers somewhat have to unlearn tactics of traditional media in order to take advantage of it," Gold said, adding: "We know the audience really well, and we won't let advertisers do something it won't accept."

During a panel discussion after Gold's keynote, Doug Neil, senior vice president, new media at Universal Pictures, said his team is leveraging consumer-generated media to create buzz around the upcoming film "Slither." "It's all about personalization and customization. We allowed fans the chance to create their own 30-second spot for the film, and the winning spot will run in one of our TV ads," Neil said, adding, "We're empowering consumers to be part of the marketing message and to spread it virally." He hopes the effort will build awareness for the film by getting people involved early in buzz-building. Neil added that Universal put nearly 30 percent of its marketing budget into online media.

Gold said advertisers can deploy MySpace users and fan clubs to do their marketing for them, and added that MySpace is actively looking at how users can control which advertisers appear on their profile pages.

Some MySpace fast facts: As of Tuesday, there were 66 million people on MySpace, with 230,000 people joining each day on average. By year-end, that number is projected to reach 98 million. About 90 percent of MySpace users are from the United States.

MySpace is the No. 2 site on the Web behind Yahoo in content consumption. About 15 million log on to the site, 30 million songs are streamed, 11.5 million friends are added, and 15.5 million comments are left each day.

To the MySpace generation, "MySpace is not technology. A user's profile can be thought of as a metaphor for their life or apartment. The profile is a characterization of who users are, and they want to express themselves creatively," Gold said.

Tiny screens pitch one last ad

2006-04-14T09:43:00.000-07:00

Tiny screens pitch one last ad

By Kelly P. Kissel
Associated Press
Published April 3, 2006

Shelf space: For retailers worried that their advertisements are reaching smaller audiences, it's the final frontier.

Retailers are losing their traditional television audiences to cable, their radio listeners to satellite services and newspaper readers to the Internet.

So Vestcom, a company that makes price labels that adorn shelves nationwide is developing a different way to reach shoppers: video monitors attached to store shelves.

"You're in the store. You're making a decision and they have the last chance to try to influence you to buy their product," said Tim McKenzie, executive vice president and director of sales and marketing at Vestcom, which produces shelf tags for thousands of stores including Kroger Co., Target Corp. and Walgreen Co.

"It is where the industry is going in terms of trying to redirect advertising dollars to what they call the last three feet of the marketing plan," he said.

Vestcom's video monitor, about 4 inches wide, will show 10-, 20- or 30-second commercials as well as an item's price. It's the next logical step after ceiling-mounted video displays and end-of-the-aisle kiosks promoting weekly or daily specials that have become commonplace in grocery and drugstore chains.

Vestcom is developing a prototype for a large national retailer that it won't identify publicly, but it says shoppers could catch commercials on the small screen this time next year.

Retailing experts say the concept is likely to work.

"Consumers are spontaneous and if you can catch their attention, that's going to increase the chance that they will look at your product," said Jack Taylor, a professor of retailing at Birmingham-Southern College in Alabama.

Retailers will be walking a fine line between informing shoppers and irritating them, but because the target audience is already in the store, a shelf-level commercial is an effective way to spend advertising dollars, Taylor said.

"It's not going out to people who aren't going to go shopping. You've already got the people who are shopping," he said.

Still, he said, with advertising already on shopping carts, ceiling monitors and checkout stands, placing monitors at eye level might be a bit too much. If consumers feel overwhelmed, there might not be a sale at all.

Change from price tags

The video monitors are a big change for a company founded to print inch-high black-and-white price tags.

Vestcom began 21 years ago as Electronic Imaging Systems. On a machine that appears fashioned from the sides of an old dishwasher, some gears and wide rolls of Scotch tape, the company produced labels that carried a product's bar code and the price, and not much else.

EIS merged in 1997 with six other companies to form Vestcom, which was traded publicly until 2002. It is now privately held.

"We wouldn't have predicted that 50 million people would view our products every day or that we would be processing 100 million price changes each week," said Vestcom President Steve Bardwell, whose bread-and-butter operation remains price tags for grocery store and drugstore chains.

Inside Vestcom's football-field-size building in Little Rock, Ark., clerks compile price tag information from stores. Printers push out reams of paper to be sliced into strips or perforated for later detachment. Vestcom has a dozen similar plants nationwide to provide a quick turnaround for retailers as they change prices weekly.

"The lead time can be 12 hours to 48 hours," McKenzie said.

Vestcom's new video monitor can accomplish price changes virtually on the fly.

Customized messages

For companies not wanting or needing videotaped commercials, Vestcom in the last year has expanded development of "ad tags," which combine shelf price tags and static advertisements that can tell consumers which cough syrup is best for a dry cough, or advise them which wine is best with chicken.

"You can customize the message to consumers depending on what you want to tell them," said Mark Feinberg, marketing director for Centerra Wine Co., a division of Constellation Wines U.S., which has used the tags for a year.

In a tag attached to a Turner Road Shiraz, Feinberg recently highlighted the "fragrant aromas of ripe plum, blueberry and blackberry...." Vendange wines recently promoted a cancer-related charity, and the Three Blind Moose label said simply: "New. Try me."

"It's getting people to notice the product," Feinberg said. But, he pointed out, the product still has to be worth the investment. "If the wine in the bottle isn't good, they'll only buy it once."

Coming soon to the US: gaming kiosks?

2006-04-13T14:20:00.000-07:00

This is from IG's TrendCentral newsletter, April 10, 2006. The bit about kiosks at airports w/ downloadable content sounds brilliant.
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Coming soon to the US: gaming kiosks? Already found in Japan, these download stations are tearing gamers away from the screen and out of the house. Located in high traffic public spaces such as train stations, these systems-specific kiosks offer demos, trailers and other gaming-related files to the Nintendo DS and the PlayStation Portable. According to an announcement Nintendo made at the recent DICE Summit, the DS download stations will be here in the U.S. any day now. Gamers are a little dismayed that the stations will be limited to mass retail locations such as Target, but stores are excited about the extra traffic they may bring and the new revenue they could ultimately inspire.

We can envision this growing into a much bigger trend, with kiosks at travel hubs offering downloadable TV shows and movies for portable media players. While entertainment ATMs exist on the trade show circuit, they haven’t really gone mass. Their marketing potential has yet to be fully harnessed, but we imagine that as the number of people owning portable media players increases, we’ll see more of these kiosks loaded with coupons and promotional materials.

Networks Tout Podcasting

2006-04-13T10:27:00.000-07:00

From AdWeek IQ Interactive, April 10, 2006

Networks Tout Podcasting
NEW YORK Sometime this summer, Battlestar Galactica executive producer Ron Moore will sit his writing team down at an undisclosed location to begin mapping out the upcoming season of the Sci Fi Channel hit. And before the team gets started, someone will hit the record button to tape the session for a future podcast.

Moore typically records a weekly podcast and fans eat it up (2.4 million Battlestar podcasts have been downloaded to date). Witness this comment, recently posted on iTunes: "For diehard sci-fi fans, it's as if Gene Roddenberry called you after each original of [Star] Trek and told you what he was thinking that week."

Podcasts -- once solely the domain of small-time content producers -- are increasingly being embraced by traditional media players. In fact, the top 20 list of podcasts on Apple's iTunes Music Store is regularly littered with big names from cable: As of April 7, Cartoon Network's three-week old AdultSwim.com video podcast was ranked No. 2 overall. In the last few months, podcasts from VH1, Nickelodeon and ESPN have made regular appearances in the top 10.

"The demand has been phenomenal," said Marc Horine, general manager of new media for ESPN Radio, which hits in the million-plus download range. To answer that demand, today ESPN is launching PodCenter, a new podcast-centric hub located on ESPN.com, along with 11 new podcasts, ranging from an audio version of Pardon the Interruption to originally produced podcasts built around specific pro sports as well as poker.

While ESPN's content is a close cousin to sports talk-radio, most TV content producers are experimenting with producing DVD-like content in podcast form. "We know our audience has a voracious appetite," said Dave Howe executive vice president and general manager of the Sci Fi Channel. "Podcasting is an opportunity to dive deep and get more into a show."

For Adult Swim's new podcasts, fans are able to watch the creators of Robot Chicken banter, while also getting a look at how the show's twisted puppets are actually built. According to Paul Condolora, vice president and general manager of new media at the Cartoon Network, this sort of fare plays a dual role. "It's definitely marketing in the sense that it is tied to on-air shows and is used to build awareness," said Condolora. "At the same time, this content is definitely sought out."

Steve Youngwood, executive vice president of digital media at Nickelodeon, added that Nick has deliberately released podcasts for big events like the Kids Choice Awards or the recent release of the Zoey 101 movie. "We usually don't do these things in isolation," he said.

In terms of a business, Sci Fi's Howe said an ad-supported model will likely evolve, though it's early. Advertisers are watching closely, particularly video podcasts, according to Greg Smith, executive vice president of director of insights, planning and data analysis at Aegis Group's Carat Fusion. "We're actually teaching our network people to buy video in all forms," he said.

For ESPN, an ad model has already taken hold, as most podcasts carry both a 15-second pre-spot and a 30-second post-content spot, from "blue-chip advertisers," according to Horine, who acknowledged that his company's built-in radio infrastructure provides a major sales advantage. "We've already spent the big money," he said, adding that podcasting has been "very profitable." It's likely that most programmers will need to bake in advertising to offset production costs, despite their low-budget reputation. "There are resource and production issues absolutely," said Condolora. "It's not just flipping a switch."

Still, most agree quality podcasting can only tighten TV's hold on viewers. "The more immersive the experience, the more people will bond with your content," said Howe.

Wired News: The MySpace Economy

2006-04-11T04:38:00.000-07:00

Wired News: The MySpace Economy
The MySpace Economy

By Rachel Rosmarin, Forbes.com 02:00 AM Apr, 11, 2006

Tens of millions of people show up regularly at MySpace, News Corp.'s suddenly popular virtual hangout. That's good news for News Corp. boss Rupert Murdoch, who raised eyebrows by shelling out $580 million for the website last summer. But it's also an opportunity for ambitious entrepreneurs who have figured out how to make money by catering to the site's hordes of visitors.
Like mega-sites eBay and Google before it, MySpace is creating its own economic ecosystem, populated by small businesses that do everything from helping users decorate their profiles to creating tools that let advertisers target MySpace users.

It's unlikely, though, that the MySpace spinoffs approach a fraction of the revenue News Corp. is generating from the site itself. Even though some mainstream advertisers have expressed reservations about participating in MySpace's wild, just-about-anything-goes atmosphere, plenty are willing to get in front of the site's users, who have made it the second-most trafficked site on the internet, according to ComScore Networks. Analyst Richard Greenfield of Pali Research estimates that News Corp. sells $13 million in ad revenue each month.

Also at Forbes.com:
Check out these slide shows from Forbes:

Google Spawn
The World's Billionaires
The Global 2000
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Media Moguls

Meanwhile, Louis Ramos, a freshman at Southern Illinois University, says he has made more than $200,000 since last June by running Pimpmyspace.com and Myspaceeditor.org, two sites that offer MySpace users free tools to upgrade and spruce up their profiles with colors and images. MySpace doesn't build many customization options into users' profiles.

Ramos, who makes money by hosting ads from Google's AdSense and ValueClick's FastClick networks, says he's received six-figure offers from internet companies interested in buying his sites. "Hundreds of people are doing this," he says. Other programmers offer to overhaul MySpace profiles for a fee, charging several hundred dollars for the service.

Another subset of sites has cashed in on MySpace's popularity by creating and selling software designed to automate tasks within the network, such as inviting and confirming friends, posting messages and sending bulletins.

Some versions of this software allow MySpace users with thousands of friends—such as companies that have created profiles—to contact groups of friends by age, ZIP code and other demographic information. Without the tools, users would need to complete transactions one click at a time, but the software effectively allows them to conduct a highly targeted direct-mail campaign.

Programmer Justin Lavoie, whose Silent Productions firm sells bundles of software like "Friend Request Broadcast" and "Comment Broadcast," says he has more than 4,000 customers. Lavoie sells the packages, which start at $50, through affiliates, which take a cut of each sale.

Lavoie says he and some of his affiliates have received cease-and-desist letters from MySpace commanding them to stop selling the software; he also says some of his competitors have received similar warnings. MySpace officials declined to comment on Lavoie's business or any other MySpace spinoffs.

"MySpace doesn't want any marketing on its site other than what they are getting paid for in the form of banners and other ads," says Brandon Hoffman, director of internet marketing at Kea Advertising, an agency in Valley Cottage, N.Y.

Hoffman uses Lavoie's software in the MySpace accounts he created for several of his clients, primarily car dealerships. "The beauty of it is that it is 100 percent permission-based," he says. "The dealerships' friends can cancel at any time, so it isn't like we're spamming them."

Entrepreneurs say some of the most successful MySpace spinoff businesses are now being auctioned for thousands of dollars. "People make a ton of money" selling the sites, says Michael Melen, who operates several MySpace-related services. Melen's offerings include Myspacesponsor.com, which shares ad revenues with MySpace users who put banner ads in their profiles, and Unblockmyspace.com, which allows users to surf the site anonymously.

But some MySpace businesses don't require any particular technical skill or web savvy, just a sense of what the teens and twenty-somethings who flock to the site are interested in. Like poking fun at the fact that MySpace users' profiles come preconfigured, with co-founder Tom Anderson listed as a "friend."

Josh Abramson, co-founder of Connected Ventures, has sold more than 610 $18 shirts in six weeks that take advantage of what is becoming quite a public in-joke. The shirts read, "Tom is NOT my friend."

What P&G Learned From the Veg-O-Matic and Ginsu-Knife

2006-04-10T11:41:00.000-07:00

What P&G Learned From the Veg-O-Matic and Ginsu-Knife
Direct-response-TV Metrics Gain Traction Among Mainstream Marketers
By Jack Neff

Published: April 09, 2006

CINCINNATI (AdAge.com) -- Don't be so quick to sneer at that late-night Ginsu-knife ad. It likely represents the future of TV advertising.
Long considered a second-tier and somewhat tacky sub genre, direct-response advertising is gaining new respectability among major marketers.

Bold predictions
Direct-response TV experts boldly predict that in five or 10 years all TV advertising will be some form of direct-response as mainstream marketers seek greater return on investment and look to switch to a metric that reflects how engaged an audience is with an ad rather than sheer number of eyeballs reached. And as the analytics for measuring DTRV ads are applied to conventional buys, more marketers will start to appreciate the merits of knowing whether or not an ad was on the mark. It's a view shared by the world's largest advertiser, Procter & Gamble Co.

"People think that direct response is all about pills and potions and get-rich-quick schemes," said Michael Kokernak, CEO of Backchannel Media, a DRTV specialty agency in Boston. "But direct response is really just a measure of human engagement. You're going to find it will be the only way TV is bought and sold."

Ad costs rise
Already, direct-response TV -- made up largely of remnant inventory -- has soared in the past two years, and more rate inflation is anticipated for next year. So far, however, the tumult in DRTV is happening largely outside the view of the mainstream advertising industry; TNS Media Intelligence pegs direct-response advertising as a $3 billion segment that grew 16.4% last year.

DRTV time-usually the lowest-rated daypart of the most thinly viewed networks frequented by the bottom-feeders of the industry-is no longer its own media ecosystem, populated by the Little Giant Ladder and the Ab-Lounge. An influx of blue-chip marketers has changed the makeup of the client pool.

After about four years of growing experimentation with DRTV, P&G, the biggest conventional advertiser in the U.S., signaled a much deeper commitment last month when it named its first DRTV media-buying agency of record, Quigley-Simpson Brand Response, Los Angeles.

P&G broadens involvement
P&G quietly broadened its use of DRTV in recent years, from small efforts for low-priority brands such as Dryel to more than a dozen including Cover Girl, Iams and Old Spice.

Last year, P&G's top-spending brand in conventional advertising channels, Olay, made direct-response a major part of its media mix, with 60-second ads by Red, Cincinnati, for microdermabrasion kits and other products directing consumers to its Web site for special offers.

In all, P&G buying in the DRTV space may now be approaching nine figures, according to people familiar with the industry, though P&G and Quigley-Simpson declined to comment on the spending level.

P&G isn't alone. Other general-market advertisers, now labeled "hybrid" advertisers in the DRTV industry, such as Clorox Co., Bose, and several pharmaceutical marketers, also have crowded into the space.

P&G 'very comfortable'
As a result, "We're seeing [rate increases] across the board," said Kristi Moran, VP-media services for Hawthorne Direct. "One of the main contributing factors is that your major hybrid clients [such as P&G] have become very comfortable advertising on direct response."

A.J. Khubani, founder-CEO of Telebrands (see sidebar), has seen his media rates explode 250% the past two years, though he isn't sure why.

Even so, direct-response still offers CPMs 30% to 70% lower than broadcast or national cable prime-time rates, said Gerald Bagg, founder and CEO of Quigley-Simpson.

The consolidation of the WB and UPN broadcast networks-long two reliable generators of DRTV inventory-could fuel even more rate increases, Ms. Moran said. She believes much of what ordinarily might have been DRTV time on CW will be consumed with network promotion at least initially to pump Nielsen ratings that may put much of the time out of reach for DRTV.

Impact of CW consolidation
Yet the CW consolidation leaves many former UPN and WB affiliates without networks. They could end up with more DRTV availability than ever, Ms. Moran said, though in the form of more labor-intensive spot buys. It may be the perfect environment for P&G to apply its massive scale to a small and fragmented market. That's exactly what Quigley-Simpson looks to do as P&G's new DRTV agency of record. "DRTV is a lot more negotiable, since it's in the scatter market," Mr. Bagg said. "When you're buying with the heft of major clients behind you, you can drive those rates down, particularly with inventory that has fallen into remnant."

Mr. Bagg said he's seeing a broader "awakening" among Fortune 50 companies. "In five years every form of advertising is going to be direct-response," he said. "It's just a question of degree. It's going to be having a toll-free number or a URL in it. It's going to be video on demand. It's going to be mobile [phone] response."

What's ultimately driving DRTV, said Erwin Ephron, principal of the Ephron Consultancy, is readily measurable return on investment.

The trouble for conventional advertisers, he said, is that their consumer response rates don't measure the whole impact of their TV advertising, just like click-throughs never measured the brand-messaging impact of online ads. "A lot of the way TV works is not by eliciting response," he said. Still, by measuring comparative response rates on the same ads across different media, he believes advertisers may ultimately be able to apply analytics to the data their DRTV ads generate in order to get a better handle on the comparative value of conventional TV buys.

WSJ.com - Teasing Out the Effects of Clutter

2006-04-05T04:17:00.000-07:00

WSJ.com - Teasing Out the Effects of Clutter
Teasing Out the Effects of Clutter
NBC Universal Is Studying
Whether Shorter Ad Breaks
Give TV Spots More Impact
By SUZANNE VRANICA
April 5, 2006; Page B3
The number of ads crammed into television shows has been a longstanding complaint of both viewers and advertisers. Now NBC Universal is testing whether cutting the "clutter" improves the value of the ads that do run.

In a five-night test that began Monday, one program airing on the company's USA cable channel will feature one commercial break that runs just one minute, considerably shorter than the others, which run about two to four minutes. Only two 30-second ads will air in the shorter break. Insurer Allstate and drugstore chain Walgreen are participating in the test.

NBC Universal, which is working with Publicis Groupe media-buying firm Starcom on the test, wants to see whether viewers pay more attention to ads they watch in a less-cluttered environment. "We want to see if shorter commercial pods impact advertising performance," says Sam Armando, director of TV research at Starcom, which cooked up the deal.

"We are all trying to better understand commercial effectiveness," says Marianne Gambelli, executive vice president of sales and marketing for General Electric's NBC Universal, which owns the NBC broadcast network as well as USA and several other cable channels.

The outcome of the test could lead to changes in the decades-old advertising model. If the test shows that viewers remember the remaining ads more clearly, it could give advertisers the ammunition they need to ask TV networks to cut back the number of ads they air.

Networks likely would recoup the lost revenue by charging higher prices. A reduction in the number of ads would reverse the trend of the past decade, a period in which broadcast networks and cable channels alike have squeezed more ads into each hour of TV programming.

Ms. Gambelli played down the test's short-term significance, noting USA has "no intention to change any [business] model. All this is for later discussion."

Still, changes in the media landscape are increasing pressure on TV networks. Devices such as digital video recorders are making it easier for people to speed through ad breaks.

Media buyers and marketers have long complained that the crowded TV ad environment diminishes the impact of all the commercials. "Clutter affects all our messages," says Eric Plaskonos, director of brand communications for Philips Electronics. Many believe that the more ads that run, the more willing consumers are to change the channel or speed through commercials on a DVR.

Last year, Walt Disney's ABC, NBC, CBS and News Corp.'s Fox each ran an average of about 15 minutes an hour in prime time of "nonprogram material time," defined as commercials, public-service announcements and network promotions, according to research complied by WPP Group's media-buying unit MindShare. USA cable channel, like some other cable channels, aired nearly 16 minutes of "nonprogram" material an hour.

Other media have begun to respond to complaints about ad clutter. In 2004, radio titan Clear Channel Communications reduced the number of ads on its radio stations in hopes of increasing the value and impact of the spots that air.

Cubicle Dwellers' Funniest Home Video - New York Times

2006-03-26T07:10:00.000-08:00

Cubicle Dwellers' Funniest Home Video - New York Times
Cubicle Dwellers' Funniest Home Video

By DAN CRANE
"I love these clips," said Patrice O'Neal, introducing snippets from shows like "Maury" and "Judge Hatchet" in which men ecstatically celebrate a negative result on a paternity test. "Because there's no greater joy in the world than hearing those five beautiful words, 'You are not the father!' "

The montage was originally shown on "Jimmy Kimmel Live," after which it instantly became Internet viral video fodder — sent around via e-mail messages and posted on blogs and Web sites like iFilm.com, YouTube.com and eBaumsworld.com. From there, the video was scooped up by "Web Junk 20," a weekly countdown of Internet videos on VH1 that began in January and for which Mr. O'Neal serves as host. After being properly ridiculed there, the clips could once again be found online at VH1's VSPOT Web site vh1.com/vspot.

That's more or less the path that all the show's Web junk follows, and it may be perfectly suited to today's multiplatform (television, Web, mobile phone, iPod) media universe. "These things are becoming ground zero for pop culture," Brian Graden, president of entertainment for MTV Networks Group, VH1's parent company, said. "It's no longer the moment on the Jon Stewart show, it's 'Did you watch the viral video of the moment on the Jon Stewart show?' "

But many of the videos on "Web Junk" come from viewers — creative people using affordable digital video cameras and desktop software to shoot and edit and post their own clever shorts. "Saturday Night Live's" rap sketch "Lazy Sunday," perhaps the most widely seen viral video of late, has already inspired numerous parodies, including "Lazy Monday" (featuring two 11-year-old Chicago boys lip-synching to the original), "Lazy Muncie" (where the honor of the Midwest is defended) and "Lazy Saturday" (the West Coast answer to "Lazy Sunday"), which was featured on Episode 4 of "Web Junk 20."

It's an updated version of the long-running series "America's Funniest Home Videos," but with a twist: "The distinction," said Mr. Graden, "would be that I would call 'America's Funniest Home Videos' accidentally created, and these are often purposely created by people to express their own sense of comedy and commentary."

As on the original show, you can still see the occasional child mishap, or animal running amok, but on "Web Junk" odds are good you'll also witness someone throwing up, and there will be at least one clip celebrating the passing of gas. Mr. O'Neal, a rotund comedian who peppers his mocking commentary with numerous bleeped-out expletives and off-color jabs, embodies the other difference between the old show and the new: attitude.

"He's an equal opportunity offender," said Michael Hirschorn, the show's creator and VH1's executive vice president of original programming and production. "He's got a willingness to say the uncomfortable things that not everyone is willing to say." For example, "Web Junk" showed "Tom Cruise Kills Oprah," a homespun video that plays off the actor's infamous appearance on "The Oprah Winfrey Show" but uses sound and visual effects so it seems he is electrocuting her. "See what happens," Mr. O'Neal asked the audience, "when white people touch black people?"

True to the nature of the clips themselves, the concept of using viral videos on television is spreading rapidly. Just weeks after VH1's show was first broadcast, Bravo — which had shown a half-hour special last November — began its own series, "Outrageous and Contagious: Viral Videos," which offers some of the same content but less of the mocking commentary.

Most of the clips look much better on the Bravo show than they do on VH1's, where videos are often so pixilated that they become indiscernible. But Mr. Graden thinks image quality doesn't really matter; in fact, he suggests, the worse the clips look the more effective they tend to be. "People want to believe these were completely homemade expressions," he said, "that they were discovered out in the universe and were brought to air. If they look like slickly produced television I don't think people would buy into the utter randomness that is that show."

Slickly produced they are not. While the shows do pay for some of the content (Bravo paid to use the recent computer geek sendup of "Brokeback Mountain," titled "Broke Mac Mountain," according to the clip's creators), it is obviously a lot cheaper to license these videos than it is to shell out for actors and set designers and so on. Additionally, by partnering with video Web portals like iFilm.com, which also is owned by MTV Networks, VH1 gains access to a virtual community of filmmakers and actors constantly uploading fresh content, each member waiting for his or her 30 seconds of fame.

"You can almost see a continuum with reality TV," Mr. Graden said. "Fame has become an overblown aphrodisiac in our culture, and now here you go: put your video you made on iFilm and maybe you'll be on TV next week."

NBC and USA Networks also have viral video shows in development. Carson Daly is to be the host for "The Net with Carson Daly" on NBC, and USA Networks has partnered with the "extreme content" site eBaumsworld.com to exploit its digital content for a late-night clip show.

Ruth Caruso, head of development for Carson Daly Productions, identifies an ambitious goal for the show. "Now that our country is more culturally divided than ever," Ms. Caruso said, "we see networks struggling to find shows that have broad appeal. By tapping into the country's talent pool we hope to cross these gaps, much like 'American Idol' massively accomplishes."

And the more new shows there are, the more opportunities for the nation's grass-roots filmmakers to have their material seen. "The technology has opened up in a massive way so that everyone in some way or another is potentially the next great viral auteur," said Andrew Cohen, Bravo's vice president of production and programming. "I think that's great. I just don't want anyone to hurt themselves lighting themselves on fire or jumping off a building."

So far, nobody has reported doing either — though much of what's shown does look painful: one video on Bravo's show features a man getting a pair of scissors thrown into his arm. Both the Bravo and VH1 shows do encourage viewers to submit content online (as will "The Net with Carson Daly," according to the show's creators), driving increased traffic to their respective Web sites. And as "Web Junk 20's" television ratings have been respectable, VH1 has already seen a record increase in Web traffic to their VSPOT broadband channel and to iFilm.com each week since the show began in January.

With four viral video shows soon to be on the air, what's the next wave of user-generated content? "One could imagine a next generation version of 'Saturday Night Live' that's created entirely by the viewers," Mr. Hirschorn speculated. "It might even be better."

Google's Print Auction Fizzles

2006-03-26T07:05:00.000-08:00

Google's Print Auction Fizzles
Google's Print Auction Fizzles
The search giant's auction of magazine ad space didn't generate much enthusiasm -- or business, in the case of one successful bidder

Google's effort to roll its advertising juggernaut beyond digital and into the world of print publications is struggling. And that may not be a good thing for the print industry.

In February, Google (GOOG ) auctioned off ad space it had purchased in about two dozen magazines, from Martha Stewart Living to Road & Track. The auction -- the latest twist in a six-month experiment with buying and reselling print ads -- was open to thousands of advertisers. However, Google was forced to extend the auction by several days to lure more buyers.

The tepid demand became evident in some of the winning bids, which were recognized earlier this month. Nicholas Longo, CEO of CoffeeCup Software, which makes tools for creating Web sites, wound up paying just $4,000 for each of three half-page ads in Martha Stewart Living. It was a long shot: The magazine's rate card pegs the price of a half-page ad at more than $59,000. Neither Google nor Martha Stewart Living would say what Google originally paid for the space, but it didn't get a similar discount.

SPIN CYCLE. Google can certainly digest a loss of tens of thousands of dollars. The outfit's net profits jumped 267% in 2005, to $1.5 billion, almost exclusively on its thriving business of selling text ads next to Internet search results. A company spokesman acknowledges that demand was light for its print auction, but says Google did little to market the opportunity to its network of several hundred thousand advertisers. Its primary goal, he says, was to test the auction process for print ads. "We're pleased with the data we've gathered and will use it to inform future experiments we conduct on different aspects of the print process," says Google spokesman Barry Schnitt.

Investors, who have bid up Google's stock valuation to more than $100 billion, are expecting the company to successfully diversify its business. Google executives have often stated that they are seeking to expand Google's online advertising stronghold into various offline media, including radio, print, and television ads. In addition to its efforts to broker the sale of print ads, Google in January, 2006, acquired dMarc Broadcasting, which facilitates the sale of radio advertising.

The lackluster appetite for its February auction is just the latest challenge for Google's six-month foray into print ads. Late last year, Google conducted its first trial by purchasing and reselling ad space in a handful of magazines. Although the Internet giant lauded the trial's outcome, a BusinessWeek analysis found that 8 of 10 participating advertisers were disappointed with the results and probably wouldn't buy print ads through Google again (see BW Online, 12/12/05, "Can Google Go Glossy?").

INDUSTRY SKEPTICISM. Several more advertisers spoke with BusinessWeek following the story's publication, echoing similar sentiments. Carl D. Haugen, president of BluePenguin Software, spent $3,000 on an ad through Google, which ran in the November issue of Budget Living magazine. Haugen offered a 20% discount on its antispyware software to Budget Living readers, so he could better track the ad's performance. Over one month later, the ad had only generated $181.37 in sales, says Haugen.

Google's struggle to transfer its online success to magazines doesn't necessarily bode well for the publishing industry. Hundreds of publications have contacted Google about the program, with the hopes that the online giant can extend their reach to Google's army of smaller marketers who otherwise would not consider magazine ads. But the weak performance may indicate that the true value of a page of print lags its list price -- at least in the eyes of Google's advertisers, who are used to high-return search engine campaigns.

Even Longo, winner of the bargain-basement ad space in Martha Stewart Living, is somewhat skeptical. "If at these rates it doesn't work," says Longo, "it never will."

Simmons Chief: Behavioral To Supplant Demos

2006-03-23T12:49:00.000-08:00

Simmons Chief: Behavioral To Supplant Demos
by Kristin Sidorak, Thursday, Mar 23, 2006 7:47 AM EST
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BEHAVIORAL TARGETING, A PRACTICE THAT has been transforming the way marketers target consumers online, is poised to become a big factor in the media world at large, potentially replacing traditional demographic data as the basis for media planning. At least that's what Bill Engel, co-CEO of Simmons Market Research Bureau, told a group of marketing executives last week during a keynote at the 2006 Promotion Marketing Association Conference in Chicago.

"Targeting has become more complex than ever before," says Engel, whose company has transformed itself over the past several years to reflect that change. Once a big player in traditional, demographic-based audience estimates for magazine planners, Simmons in recent years has developed and adapted a wide variety of targeting tools derived from consumer behavior including actual product purchases and media usage. Such behaviors, asserts Engel, trump simple demographic analysis--which assumes that age, sex, income, and educational attributes are good proxies for such behavior.

"Given the proliferation of brands, a consumer who is a value shopper for one category may be a luxury shopper for another category, which seems perhaps counterintuitive," cites Engel as one example.

In another, he cites a consumer who shops at Saks Fifth Avenue to buy high-end haute couture for a ball, but who goes to low-end retailers such as TJ Maxx or Marshalls to buy white polo shirts. Thus, advertisers must understand the luxury versus value-based purchaser, and that they may be one and the same, he suggests.

According to Engel, the big picture concerning behavioral targeting from the advertisers' perspective is that they have their brand, they know who is buying their brand, and their questions are; what media should I buy from, and what messaging should I use? Moreover, he says those ad messages need to factor in what medium a consumer might be exposed to at any given time.

"The technology exists today for a number of clients to target behaviors," says Engel, touting Simmons' Television BehaviorGraphics study as an example. The BehaviorGraphics system integrates Simmons' National Consumer Survey data with actual TV viewing behavior from Nielsen Media Research's national TV ratings.

Some research purists are critical of such data integrations, but research pragmatists are beginning to embrace the practice as a means of correlating consumer behavior with media usage. By correlating Simmons' surveys on consumer behavior, attitudes, lifestyles, and product usage with Nielsen's tracking of TV viewing behavior, Engel claims that advertisers can more effectively target the audiences of national TV shows.

Engel says the application has two benefits: 1) Selecting media buys that target consumers more effectively; and 2) Scheduling advertising messages that are more relevant to those consumers.

MBA'S MAY BE A MARKETING LIABILITY

2006-03-23T04:00:00.000-08:00

MBA'S MAY BE A MARKETING LIABILITY
MBA'S MAY BE A MARKETING LIABILITY
New Study Finds Those With Degrees Underperform
March 21, 2006
QwikFIND ID: AAR52X
By Jack Neff
CINCINNATI (AdAge.com) -- A Master of Business Administration degree is not only worthless, it can work against a marketer, according to a survey of marketing executives from 32 consumer-products companies by consulting firm Ken Coogan & Partners.

The study found that marketing executives from underperforming companies were twice as likely to have been recruited out of M.B.A. programs than marketing executives from out-performing companies.
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The study used scanner and panel data from VNU’s ACNielsen to show marketers from companies with significant market-share gains are far less likely to have M.B.A.s than those from companies posting significant share losses.
Major marketers
The M.B.A. factor wasn’t the only difference, but it was perhaps the most striking one between winners and losers among the companies, which included General Mills, Kraft Foods, Nestle, Pfizer, Clorox Co., Reckitt Benckiser, Energizer, Alberto Culver Co., Hasbro, Cadbury Schweppes, Kodak and Dunkin’ Donuts.
Marketing executives from 18 underperforming companies -- which had sales grow 7% less than their categories on average in the two years ended August 2005 -- were twice as likely to have been recruited out of M.B.A. programs than marketing executives from out-performing companies, which averaged growth 6.2% faster than their categories over the two years. Of executives from underperforming companies, 90% had M.B.A.s vs. 55% at outperforming companies.
Not all master’s degrees appear worthless in the study. Just M.B.A.s. About 10% of the marketing executives at the out-performers had master’s degrees other than M.B.A.s vs. none at underperformers.
That twice as many underperforming companies as out-performing ones participated in the survey may indicate something, too. Possible theories: Underperforming executives, particularly ones with M.B.A.s, spend more time filling out surveys, or are more likely to be in contact with consulting firms like the one that administered the study.
Recruitment practices
The out-performers in the survey got about a fifth of their marketing executives from undergraduate programs and another fifth from advertising or marketing agencies or other industry vendors. None of the executives from underperformers had been recruited as undergrads and only 5% came from agencies or suppliers.
Perhaps surprisingly, the out-performers were understaffed compared to their underperforming peers. Out-performers averaged one marketing executive for every $37.9 million in sales, compared to one for every $28.5 million in sales at the underperformers. But the out-performers spent more on marketing—averaging 12.4% of sales vs. 11.6% for the underperformers.
Ken Coogan, principal of the consulting firm, isn’t sure the marketing-budget differential is significant, but believes the staffing number might be. Possibly, it reflects staffing at both out- and underperformers not having caught up yet with their changing marketplace results, he said. But he said too much staff -- and bureaucracy -- could actually be slowing down the underperformers.
Outsourced marketing services
In a separate bit of counterintuitive research, Mr. Coogan said he has found marketers that outsource marketing-services functions the most actually have higher staffing levels than ones that outsource less.
Though they don’t value M.B.A.s as much, out-performers in the survey place a much higher value on personal and professional development once they hire people. The survey showed the share winners far more likely than the losers to support attendance at industry conferences and seminars, involvement in industry associations and peer-share groups, internal training groups, formal mentoring programs and graduate-level seminars.
The only professional-development perks supported more by the underperformers were -- you guessed it -- executive M.B.A. programs.
Equally unsurprising, executives at the out-performing companies were far more likely to believe career advancement at their companies was based on merit rather than politics. Underperforming marketers were more likely to see politics at play. Overall job satisfaction measures were higher at the out-performers.
Stock option differential
But executives were about equally happy with compensation at both the winners and losers. And the underperforming marketers were more likely to offer stock options than the out-performers. Both findings could create some interesting fodder for executive-compensation critics.
Retention programs that were more common among the out-performers than the underperformers included assignments outside marketing to groom for general management, part-time or job-sharing assignments for managers who request them and giving more tenured executives preference in job assignments.

mcdonalds_bus_stop.jpg (JPEG Image, 320x242 pixels)

2006-03-21T04:46:00.000-08:00

mcdonalds_bus_stop.jpg (JPEG Image, 320x242 pixels)
From AdRants:
Just what you want while waiting for the bus: that mouth watering, tantalizing reminder of how much you'd love to stuff your face with a 1,000 calorie burger only to be reminded later by your stomach it wasn't the best decision you could have made.

Nielsen: Network Prime-Time Clutter Surpasses Cable, Hispanic

2006-03-19T14:16:00.000-08:00

Nielsen: Network Prime-Time Clutter Surpasses Cable, Hispanic
by Joe Mandese, Thursday, Mar 16, 2006 8:15 AM EST
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A NEW REPORT FROM NIELSEN Media Research appears to refute the conventional wisdom that cable is more cluttered than the broadcast networks. The study, based on an analysis of the non-programming time on major national TV outlets during the fourth quarter of 2005, finds that the seven broadcast networks carried an average of 15 minutes and 23 seconds of so-called clutter--advertising, promos, PSAs, and IDs--during the average prime-time hour, 22 seconds more than the average prime-time hour on cable TV.

Spanish-language TV networks, which also are perceived as being heavily cluttered, prove to have the highest percentage of programming time per prime-time hour, with only 14 minutes and 16 seconds of clutter.

"The mix of non-program content varied significantly across the three media: 31 percent of the non-program content on the Spanish Language networks was dedicated to promotional announcements while cable devoted 17 percent and broadcast 15 percent to promos," found the report, released Wednesday by Nielsen's Monitor-Plus unit.

The report, an annual recap of all forms of ad spending during 2005, also found another form of commercialization expanding within programming time: product placements. And the biggest contender was, well, NBC's "The Contender," with 7,502 product plugs during 2005--more than twice the branded mentions of the next closest contender, NBC's "The Apprentice," with 3,577 product mentions during the year.

Prime-time Clutter
Minutes:Seconds
Network TV 15:23
Cable TV 15:01
Spanish-Language TV 14:16

Source: Nielsen Monitor-Plus, fourth-quarter 2005 analysis.

Satirical Superheroes for the Rude Set

2006-03-18T06:21:00.000-08:00

Satirical Superheroes for the Rude Set

By LOLA OGUNNAIKE
They don't leap tall buildings in a single bound or scale skyscrapers. They don't transform into not-so-jolly green giants or zoom around in tricked-out sportsmobiles. Instead, Minoriteam — a motley band of minority superheroes — uses stereotypes to fight their archenemy: racism.

Created by Adam de la Peña, Todd James and Peter Girardi — all alumni of the ribald Comedy Central puppet series "Crank Yankers" — "Minoriteam" is a provocative animated show that sends up bigotry. It makes its debut tomorrow night on Cartoon Network's late-night "Adult Swim" block of animated shows for viewers who have outgrown the Disney Channel.

Having found success with "The Boondocks," the animated series based on Aaron McGruder's comic strip that takes a satirical look at race and class in America, Mike Lazzo, the network's senior vice president for "Adult Swim," said he was more than willing to invest in another show with a distinctive voice on issues. "I think television is well served by social commentary, especially if you can make it feel like it's not a lesson that's being slammed over someone's head."

Metropolis had Superman. Gotham City had Batman. And Corporate City has Minoriteam:

The team's leader, Dr. Wang, is an Asian, wheelchair-bound mathematical genius with a freakishly large brain. He speaks with a heavy Chinese accent and is in the laundry business.

Non-Stop is the alter ego of Dave Raj, an Indian, former professional skateboarder turned convenience store clerk who is incapable of being killed by firearms. After having been shot 235 times during various attempted robberies, his skin is saturated with lead, which serves as a bulletproof armor of sorts; when necessary, his skateboard morphs into a flying carpet.

Landon K. Dutton, a black man awkwardly teaching women's studies at Male University, turns into Fasto, the world's fastest man. His extreme rage propels him to travel at breakneck speeds. When not fighting crime he spends his time "studying" the opposite sex; during one episode, it takes him only seconds to satisfy a roomful of Thai prostitutes.

Richard Escartin, a Mexican oil baron, trades his tailored suits and silk ties for a giant sombrero and a leaf blower when he becomes El Jefe, Minoriteam's hardest working member. El Jefe's blower is no ordinary garden tool. It can suck and blow with deadly force and rip holes through time and space. His kryptonite? Tequila. "I think a lot of people can relate to that," Mr. de la Peña said.

Neil Horvitz may be a wimpy mail clerk in his early 20's, but his alter ego, Jewcano, is a muscle-bound 62-year-old who sports an XXXL yarmulke and has all the power of the Jewish faith and a raging volcano. Watch him shoot molten lava from his wrists (move over, Spider-Man).

The multiethnic crew battles a gang of villains including the sniveling Corporate Ladder (an anthropomorphized ladder with a cape and a pipe), Racist Frankenstein (a bigoted monster) and Standardized Test, whose head is shaped like a No. 2 pencil and whose body resembles a Scantron test. White Shadow, the bad guys' bumbling leader, has a head that looks eerily like the pyramid found on the back of a dollar bill. He spews nonsensical corporate-speak, using words like "synergy" and phrases like "Let's all get on the same page."

"He's an amalgam of a thousand morons that we've all dealt with in our lives, starting with the lackey at the D.M.V. and all the way up to Dick Cheney," Mr. Girardi said. "Shooting your friend in the face is totally something White Shadow would do and Corporate Ladder would be like, 'Boss, I'm sorry my face got in the way of your gun.' " For recreation, the villains enjoy a nice relaxing game of Oligarchy or a racist version of Scrabble.

In one episode White Shadow and his minions travel back in time to destroy the accomplishments of minorities throughout history. Another episode finds Minoriteam on trial in a parallel universe. Their crime? Not being racist. And during the season opener, White Shadow, bothered by the rising power of black-owned business, kidnaps Sebastian Jefferson, a prominent African-American mogul. Grape-soda factories and soul food restaurants immediately close.

But it will take more than playing the race card for this show to succeed, Mr. Lazzo acknowledged. "You have to empathize with the characters," he said. "If the characters aren't interesting, then it will be a one-trick pony and it won't last because our audience will suss that out in a few weeks."

The creators have braced themselves for negative feedback. Surely someone will be uncomfortable watching a Jewish superhero get aroused while chasing a giant glowing nickel, they said. "But who exactly will it offend?" Mr. de la Peña asked. "I have no idea. We're really targeting Eskimos."

Unlike "The Boondocks," which is drawn in a sophisticated anime style, "Minoriteam" is crudely drawn and the show's color palette is limited to those available for comic-book printing in the 1960's, Mr. Girardi said.

"It's not a true animated show," he said, "it's more like a moving comic book, moving very little actually, which is on purpose. Using that style of animation is part of the humor. But we're not parodying those cartoons or cheap animation. We actually really love cheap animation."

The three self-professed comic-book junkies happily recall many an afternoon spent at their favorite local comic-book stores. "Mine was named Comic Book Castle and it was not a castle," Mr. de la Peña said. "It was run by a lunatic man who had a parrot on his shoulder that didn't talk, so it might as well have been a pigeon."

Based in Hollywood, their headquarters is a veritable shrine to Jack Kirby, the comic artist whose résumé included such iconic characters as Captain America, the Fantastic Four, the X-Men, and the Incredible Hulk. Kirby's work fills the cramped office the animators share, and each can discuss the legendary illustrator's contributions to the world of comics in exhaustive detail. "I think that's why we get along so much, because we don't have hierarchal distinctions between fine art and vernacular art," Mr. Girardi said. "To us good is good and Kirby is right up there with Picasso."

Mr. Girardi and Mr. James have known each other since they were adolescent graffiti artists, altering subway trains and abandoned buildings around New York City. "We expressed our youthful rage through urban artistry," Mr. Girardi joked.

Mr. de la Peña, a fourth-generation Mexican-American, was raised in a racially diverse community in Orange County, Calif. He has been a staff writer for "The Man Show" and "Jimmy Kimmel Live" and he co-starred in the 2003 Comedy Central series, "I'm With Busey," a reality show involving the actor Gary Busey.

Mr. Girardi's background is in digital media design. In addition to his "Minoriteam" work, he still runs Funny Garbage, the design company he started more than a decade ago. Mr. James has created logos for rappers like Eminem, Red Man and the Beastie Boys, and he was the puppet designer for "Crank Yankers."

Coming episodes of "Minoriteam" will poke fun at the Internal Revenue Service, illegal aliens and an assortment of conspiracy theories. But Mr. James said, "We're not sitting around and saying, 'Man, we've got to talk about this 'cause it's heavy.' That's not our m.o. It's about justice and condemnation of everyone for everyone."

The Web's First Rock n' Roll Success?

2006-03-18T06:13:00.000-08:00

Friday, 17 March 2006
The Web's First Rock n' Roll Success?
Topic: music
The Arctic Monkeys came out of nowhere.

Well, not exactly nowhere, but a year ago, the impossibly young indie rock quartet were playing small clubs in their native Sheffield, UK. Now they have a best-selling album. They are currently playing a few shows in the major North American cities (all of which sold out in minutes), and afterwards, they will set out on a thirty-plus date tour of Japan and Europe before doing the obligatory festival circuit this summer.

None of this is really remarkable in a music industry that sees two or three overnight successes come and go every year. What makes Arctic Monkeys remarkable is that they are an indie band on an independent label, and that they achieved their sudden success almost entirely through grassroots promotion on the web.

The foursome got together in 2002. They started playing shows around Sheffield and passing out free CDs at gigs. They encouraged their fans to trade the tunes online and to post them to websites and P2P networks. Yes, they encouraged file trading. Eventually, more and more people found them on MySpace or on their website via word-of-mouth, and their reach started to widen. Fans started booking them in venues farther and farther away from their hometown. Wherever they played, everyone in the crowd knew the words to the songs. This is all before they even signed to a record label.

Then, when they finally signed to Domino Records (a UK indie) and released their debut album, "Whatever People Say I Am, That's What I'm Not," it hit number one on the UK charts, selling 360,000 copies in the first week. Nobody anticipated those kinds of numbers. In fact, those kinds of numbers made "Whatever People Say I Am, That's What I'm Not" the fastest-selling independent debut in UK history.

Their story is remarkable because of one fact: grassroots communication channels like MySpace and P2P file trading networks worked better than the major-label hype machine. The Arctic Monkeys became hugely popular because they wrote good songs, made them available to their fans for free, and encouraged them to share the MP3s with their friends.

Going by the current record company logic, that's a huge no-no. If a band gives away all of its songs for free, then puts out a record filled with the same songs (even re-recorded versions), so the old philosophy goes, nobody's going to buy the record. They already have the songs. It turns out that this scenario is decidedly not the case.

The final version of "Whatever People Say I Am, That's What I'm Not," was leaked onto P2P networks a few weeks before its official release. And it didn't seem to have hurt the sales numbers when the record hit the retail shelves.

Many of us on this side of the music business (the consumer side) have been saying that the old logic is a myth, and that trading songs via P2P actually encourages people to buy more music. They are exposed to more bands and a wider variety of music. They get a chance to get excited about new music in a much more direct and natural way. They aren't told about it by an advertisement or a video. They find it on their own or a friend tells them about it. They check it out, they like it, then they go to the store and buy the CD. And they probably buy more than just that one CD while they're there.

Of course, it's irresponsible to say that piracy isn't hurting the record business in some way. It certainly isn't healthy to your bottom line and your longevity to allow people to take your product without paying. And downloading without permission is stealing. But it's also true that downloading a record and realizing that it's a load of garbage is not going to get you excited about spending $17 on the real thing. Good music will always sell, either on CD or in the iTunes Music Store. But if you put out good music and allow people to hear it any way they want, it will sell, and it will sell well.

By the way, the Arctic Monkeys were the top sellers in the iTMS for ten days when their record was released stateside. They only sold one tenth of the amount of records here as they sold in the UK in the first week, but the sales were still rather impressive for a foreign indie act with minimal mainstream exposure.

Another point proven by the Arctic Monkey's success is that the major labels are misguided about promotion and marketing. Pure word of mouth and an open trading policy actually work better than big-budget videos and full-page magazine spreads.

Or maybe the AMs just have a better view of what works and what doesn't when you're promoting a band on the internet. It's probably because they are young — the four members range in age somewhere between 19 and 21 — and they have a sort of hipster radar that suits at the record companies usually lack. They mention ringtones and email in their lyrics. They know their audience.

In the end, the Arctic Monkeys are a really good band, plain and simple. They have good songs with strong lyrics, and they are well-produced. Thousands of bands know that giving away their music for free is the best way to get heard and the best way to reach new fans. They also understand that the fans you find on the Internet are far more loyal — and forgiving — than the fans you find through MTV or corporate radio. So why aren't those other bands succeeding? Maybe they are afraid to give it all away for free, maybe they aren't playing enough shows. Or maybe they just aren't that good.

All it took was one band from this new subculture to hit it big — really big — in order to signal that a change is needed. The major labels are still scratching their heads wondering why the kids aren't buying records they way they used to. And meanwhile, the Arctic Monkeys are selling hundreds of thousands of records and enjoying the success they made for themselves.

Posted by michael calore at 2:03 PM PST | post your comment (0) | link to this post

Americans Get More Channels, Watch Fewer Of Them, Especially Broadcast

2006-03-15T17:56:00.000-08:00

Americans Get More Channels, Watch Fewer Of Them, Especially Broadcast
by Joe Mandese, Monday, Mar 13, 2006 8:00 AM EST
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AMERICANS ARE RECEIVING MORE TV channels than ever before, but they're watching a smaller percentage of them, especially those from broadcasters. Those are the top line conclusions from an important annual benchmark study on the way people watch TV released late last week by Nielsen Media Research. The report, which comes as Nielsen holds its annual client meetings in Orlando this week, shows that the average household received 96.4 channels during 2005, an increase of nearly four channels from 92.6 in 2004. However, the average number of channels tuned barely changed, rising to 15.4 from 15.0 in 2004. The data appears to support a fundamental principle of rising media choice: that given an unlimited number of media options, the average person will still opt to use a relatively small number.
What makes the principle especially interesting for TV, is that Americans are spending more time watching TV than ever before. During 2005, the average household was tuned to their TV 57 hours and 17 minutes per week, a huge jump over 2004, when the average household was tuned to TV 56 hours and seven minutes per week. That's up from an average of 43 hours and 42 minutes per week in 1975, the benchmark year in the Nielsen report.

Not surprisingly, Americans appear to be spending more of their time with cable and satellite TV channels than those from broadcasters. The number of broadcast TV channels tuned by the average TV household actually declined from 16.4 in 2004 to 16.3 in 2005, the first time Nielsen has reported a drop in broadcast channels tuned since it began benchmarking the data.

TV Channels Received Vs. Tuned

Receivable Tuned 1985 NA NA 1990 NA NA 1995 NA NA 2000 61.4 NA 2001 71.9 NA 2002 79.7 NA 2003 85.8 NA 2004 92.6 15.0 2005 96.4 15.4

Source: Nielsen Media Research.

MediaPost Publications - Nielsen Seeks To Engage Clients, Unveils Engagement Panel - 03/15/2006

2006-03-15T05:10:00.000-08:00

MediaPost Publications - Nielsen Seeks To Engage Clients, Unveils Engagement Panel - 03/15/2006
Nielsen Seeks To Engage Clients, Unveils Engagement Panel
by Joe Mandese, Wednesday, Mar 15, 2006 7:45 AM EST
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SEEKING TO ENGAGE CLIENTS DURING the opening session an annual two-day meeting in Orlando on Tuesday, Nielsen Media Research released plans for measuring one of the hottest subjects in the TV advertising business: audience engagement. As part of the plan, Nielsen said it would launch a separate panel next month comprised of households and individuals who are retired from its people meter ratings panel to participate in the engagement research. Households normally stay in Nielsen's people meter panels for two-year intervals, and then are replaced by new panelists. Nielsen has always considered the old panelists a valuable asset for ancillary research projects, because they are already installed with metering technology, they have agreed to participate in TV audience research, and because they have up to two-years worth of conventional TV audience measurement data, but this is the first time it will be utilizing them as part of an ongoing research endeavor. Nielsen has a policy of not conducting tests via its "live" ratings panel due to concerns that it could influence natural viewing behavior that would impact TV ratings.
Once they leave the official ratings panel, the new engagement panelists will continue to have their TV viewing behavior metered, but will also participate in periodic phone surveys to measure the connection between what they watch on TV and their recall, awareness and attitudes toward brands and products advertised on TV.

The new Nielsen engagement panel comes as Madison Avenue has become transfixed with engagement metrics as a solution to growing concerns that people avoid advertising. An industry-wide task force known as MI4 is expected to release its definition for engagement next week during the Advertising Research Foundation's annual conference in New York.

MI4, which describes the engagement effort as the "search for the 21st Century GRPs," a reference to Nielsen's conventional "gross rating points," has been using a working definition of media engagement as: "Engagement is turning on a prospect to a brand idea enhanced by the surrounding media context."

Nielsen is by no means the only researcher to jump into engagement measurement. IAG Research has made that the core focus of its measurement of TV programming, advertising and even product placement, and is expected to expand that soon into other forms of media such as online and print.

Nielsen Senior Vice President-Client Insights Howard Shimmel has been alluding to a Nielsen solution for much of the past year, and had been known to be championing an alternate panel concept.

Nielsen clients, meanwhile, have been developing their own solutions, especially spunky cable networks like Court TV and The Weather Channel, including a variety of custom studies, analysis of conventional Nielsen ratings, and even minute-by-minute ratings analyses.

During the first day of its annual client meetings, Nielsen also announced that it has committed to fund its so-called Council For Research Excellence for a second year for an additional $2.5 million. The council, which as yet to yield any research, currently is evaluating proposals for primary and methodological research, including a study that would measure the impact of the simultaneous use of media.

During Tuesday's session, Nielsen also updated clients on its so-called "extended home" sample, including the measurement of TV viewing done by members of Nielsen households residing on college campuses.

During today's final half-day session, Nielsen CEO Susan Whiting will deliver a keynote on "The Digital Consumer," and how Nielsen plans to measure their media behavior, followed by an overview on the "consumer technology landscape," including digital video recorders and video on demand, as well as long-term research methods and technology solutions by Nielsen's chief research and technology executives.

The event concludes with an open forum discussion between Nielsen clients and Whiting, which is typically a lively exchange.

GIVE UP ON YOUR REGRESSIVE REBUNDLING FANTASIES

2006-03-14T06:16:00.000-08:00

GIVE UP ON YOUR REGRESSIVE REBUNDLING FANTASIES
General Market and Media Agencies Are Split Apart Forever -- and for Good Reason
March 14, 2006
QwikFIND ID: AAR49O
By Jonah Bloom
For an exercise in futility it is hard to beat the argument that ad and media agencies should be rebundled. It was a pointless, if forgivable, polemic when it was first rehearsed in Europe in the late ‘90s and with every rehashing it gets just a little more painful.
Jonah Bloom, executive editor of Advertising Age.
--------------------------------------------------------------------------------

Today its proponents are not only wasting their time engaging in a nostalgic nondebate, but missing the opportunity to make collaborative progress instead of, Canute-like, ordering back a tide that has already swept past them.

Perhaps it was inevitable, in the run-up to this month’s 4A’s media conference, that a couple of the ad-agency folk who yearn for a time when they held strategic sway over clients’ budgets would yet again proclaim the need to reclaim the media high ground. Yet the terms they used, “bringing it back in-house,” for example, sounded a lot like they were laboring under the illusion that the entire marketing world still revolves around their shops -- “we are the house, these others houses aren’t houses” -- and, in tone, it sounded a lot like whining rather than the spawning of new models that suit their clients.

For the last time
So, hopefully for the last time, let’s get this straight: Media agencies are not going to be integrated into ad agencies. Have you been to MediaVest, Starcom, MindShare or OMD? Can you imagine squeezing them into the ad agencies? The bureaucracy, the politics, the confusion, the office-supply orders ...

The big media agencies are gigantic, busy-to-bursting businesses that plan and buy, between them, more than $50 billion in media in America alone. And, according to my admittedly half-assed, back-of-a-business-card calculations, they make over $4 billion in global revenue for their holding companies. You’d have to be crazy to imagine that Messrs. Wren, Sorrell, Roth and Levy are about to put that at risk by reintegrating those units.

What’s more, while it is critical that media and message are intrinsically linked in the planning of a campaign, it is questionable whether it benefits the client to have the organization that does its communications planning be the same organization that has, historically at least, produced one particular type of communication. That’s hardly the way to get broader, media-neutral thinking.

Linking marketer to consumer
Then there’s the fact that the separation of the media agencies has enabled them to equip themselves better for an era in which the navigation of channels between marketer and consumer is arguably the trickiest task in marketing. Today’s media shops have research arms, planning tools and processes that are way more advanced than anything the old in-house departments had to offer. And the truth is that they still need more data-analytics talent and deeper planning resources to take the reams of research and turn it into meaningful insight for their clients. To take away their P&Ls and return them to ad agencies where they might, in some quarters, still be regarded as second-class citizens, would be seriously short-changing them -- and their clients.

Rather than looking backward, wishing for the impossible and generally sounding regressive, these ad-agency bosses ought to be helping to create new, flexible and collaborative models to serve the client that make the best use of a variety of resources regardless of the name over the door. Some smart marketers have already demanded such arrangements -- think Coca-Cola City or SMG United for P&G -- and no two will look the same. What they will have in common, however, is that they’ll find ways to unite channel or engagement planners with brand planners and message masters without insisting that they all share a stapler.

WHY GUATEMALA'S NEW TOURISM SLOGAN DOESN'T WORK

2006-02-21T11:11:00.000-08:00

From AdAge.com
WHY GUATEMALA'S NEW TOURISM SLOGAN DOESN'T WORK
And Why the Country Should Think Bigger and Change Its Name
February 20, 2006
QwikFIND ID: AAR43G
By Al Ries
Recently, the country of Guatemala hired a global branding consultancy to develop a new tourist strategy.
Photo: AP
Guatemala, which was once a capital of Mayan civilization, is littered with ruins such as this pyramid at Tikal.
--------------------------------------------------------------------------------

Focus groups
According to the consultants, “Extensive focus groups were carried out to understand the perspective of a broad range of Guatemalans, including the business, artistic, literary, hospitality and indigenous communities.”

“Working from the values of Mysticism, Intimacy, Diversity, Evolution, and Authenticity,” states the consultancy, “we defined a distinctive and credible brand essence.”

Guatemala’s new brand essence: “Soul of the Earth.”

Is Soul of the Earth a good idea? Are there any objective criteria to determine if a new position is going to be effective?

If you’re sitting in a boardroom listening to an agency present the concept for your new advertising campaign, how do you respond? Do you go with your gut? Or do you have another way to figure out whether the proposed idea is going to work?

Reverse strategy test
One test we use all the time is this one: just reverse the strategy and ask if the reversed strategy applies to the competition.

Take “Think small,” the Volkswagen program selected by Advertising Age as the best advertising campaign of the 20th century.

Reverse the strategy and you have “Think big.” Did other automotive brands think big? They sure did. Not only that, their advertisements at the time boasted about how big and long and low their automobiles were.

Prospects don’t think in a vacuum. They accept or reject a new idea not just on its merits, but also on whether the new idea fits in the mind with all the other ideas they have accumulated over the years about the category.
Photo: AP
A hieroglyphic expert and archeology student Ana Torres clean a newly excavated altar stone from a Guatemalan Mayan site. The country continues to discover new ruins that shed further light on Mayan culture, which was North America's most advanced prior to the arrival of Europeans.
--------------------------------------------------------------------------------

A new cola brand, for example, has to fit in with everything the cola drinker thinks about Coca-Cola, Pepsi-Cola and the other brands in the category. If there’s no match, there’s no acceptance of the new idea.

Avis example
Take the Avis program, selected by Advertising Age as the 10th best advertising campaign of the 20th century. “Avis is No. 2 in rent-a-cars, so why go with us? We try harder.”

Reverse the strategy and you have “Hertz is No. 1 in rent-a-cars, so they don’t have to try as hard.” Sounds reasonable to car-rental prospects, so they buy into the Avis position.

Most advertising strategies fail miserably on the reversal test and the reason is clear. They sell the category rather than the brand. Take American Airlines, “We know why you fly,” and reverse it. Other airlines don’t know why you fly?

Come on, American. Every airline knows why you fly, but what they need to figure out is why you should fly American. Or Delta. Or United.

Very few advertising strategies pass the reversal test and I think I know why. Having participated in many agency brainstorming sessions, I find that most creative people zero in on the essence of the category rather than the essence of the brand. The strategy then becomes “pre-empt the category with advertising messages that capture consumers’ minds through their sheer creativity.”

The Nike exception
Sometimes this strategy will work, especially if the competition is weak and the client has enough money to spend. Nike’s “Just do it” is a good example. Through brilliant advertising and massive amounts of money, the idea has become associated with the Nike brand.

Most clients don’t have the money or the patience to make a category campaign successful. Having visited Guatemala, one of the poorest countries in Central America, many times, I can assure you that the country doesn’t have the resources to take a category idea and make it successful.

Soul of the Earth? Reverse the idea and what do you get? Soul of the Sky? Most reversals of category ideas don’t make any sense and it’s certainly so for Guatemala’s new brand essence.

What should Guatemala’s new strategy be? Actually, Guatemala is a country rich in heritage. It was the cultural center of the Mayas, the most advanced civilization in all of North and South America before the arrival of the Spanish. Even today, 43 percent of Guatemala’s population of 14 million people are of Maya descent. Many still speak dialects of the Maya language.

Spectacular ruins
With mountain ranges as high as 10,000 feet and a culture seemingly unchanged for 500 years, Guatemala is a tourist paradise. Scattered throughout Guatemala are hundreds of spectacular Maya ruins. Cities, temples, houses, playing fields. The relics of a glorious past. More spectacular than the Pyramids of Egypt or the Taj Mahal of India, and built for the living rather than the dead.

Guatemala: “Center of Maya civilization.”

Reverse the strategy and what do you have? “Other countries might have some Maya ruins, but they weren’t the center of Maya civilization.” The reversal sounds reasonable.

There’s one problem, however. Even though Guatemala was the center of Maya civilization, there are Maya ruins scattered over Belize, El Salvador, western Honduras and southern Mexico. (Even worse, in Mexico’s Yucatan Peninsula a marketing group has formed to promote the “Riviera Maya.”)

Besides the Maya confusion, there’s also the country confusion. In addition to Guatemala, Belize, El Salvador and Honduras, there are three other countries in Central America: Costa Rica, Nicaragua and Panama. It’s going to be hard for the average consumer to associate “Maya” with just one of these seven countries.

Change the country's name
How do you solve the country confusion problem? You change the name of the country from Guatemala to Guatemaya.

Guatemaya would solve both problems. Guatemaya pre-empts the Maya position and it serves as a memory device to link the Mayas to the county which contains the most spectacular Maya artifacts. (It also solves a third problem. “Mala” is Spanish slang for “bad woman.”)

Soul of the Earth or Center of Maya Civilization? The two approaches to developing an advertising strategy.

You pays your money and you takes your choice.

Throwing All Cultures Into the Marketing Pot

2006-02-21T10:29:00.000-08:00

From NYTimes.com
February 21, 2006
Advertising
Throwing All Cultures Into the Marketing Pot
By HILLARY CHURA
MARKETERS are embracing America's mishmash of cultures as the influence of immigrants is felt in areas like cuisine, music, holidays and clothing.

"You don't see it creeping up," said Luke Visconti, co-founder and partner in DiversityInc Media, which measures diversity management at large companies and publishes a magazine on the subject. "You don't see the changes unless you go back and think of it."

These days, contemporary men seek advice from old-world marriage brokers; home sellers consult feng shui practitioners before an open house; shops selling Asian-style bubble tea (made with tapioca) are opening in central business districts. And the results of earlier waves of cultural immigration, like Brazilian-inspired bathing suits and Caribbean cocktails, have given way to Cossack-inspired fur coats and sparkly Indian slippers. Many dishware manufacturers seem to offer square Asian-inspired dishes.

Some insurance covers acupuncture. Japanese anime comic books are becoming more popular. The Japanese pop music group Puffy AmiYumi performed during the Macy's Thanksgiving Day Parade, and Broadway has had at least two Latino-influenced plays — "Forever Tango" and "Latinologues." Companies like Pepsi-Cola and Ford Motor are tapping into reggaetón, which mixes Spanish-language hip-hop with the rhythms of Caribbean music.

Marketers seeking innovations may need only to commandeer ideas from home, tweak a flavor, change packaging or borrow from an old-country holiday. "The Chinese New Year in a generation or two could be what St. Patrick's Day became a long time ago," said Robert Thompson, professor of popular culture at Syracuse University. "Hunan and Sichuan food is served in school cafeterias, and you've got sweet and sour sauce with your McNuggets."

Immigration may have had its greatest impact on the palate. Before the 1980's, a city's ethnic offerings may have started and stopped at chop suey and pizza; today, it could include Vietnamese, Thai, Korean, Ethiopian or some fusion of two or more cuisines. Shoppers and diners have their choice of Greek yogurt, ready-to-drink mojito mixes, short-rib flautas, tortilla chips with tamari seasoning, sushi and Mediterranean olive bars. Asian ingredients like lemon grass and bok choy increasingly show up in recipes.

So, too, do peppers like chipotle and jalapeño and fruits like mangoes and guavas. "These weren't mainstream until the Hispanic population grew," said Marcia Mogelonsky, a senior research analyst for Mintel International.

According to the Census Bureau, by 2020 the Hispanic population will account for 18 percent of the total population, up from 6 percent in 1980. But the trend has moved well beyond Spanish-speaking Americans to include Indians, Chinese, Russians and other ethnicities. While immigrant influence remains greatest in major metropolitan areas, these enclaves have expanded to smaller cities.

Children's television reflects that diversity. Disney now shows "American Dragon: Jake Long," featuring a pint-size superhero who is half-Asian and half-Caucasian, hangs out with blacks and whites and consults a wizened Asian elder.

Other crossover shows include Nickelodeon's "Dora the Explorer," a 7-year-old Latina cartoon heroine who has several merchandise deals, including Campbell's soup. Last year, she spun off "Go, Diego, Go" that features her equally bilingual cousin.

Some marketers are inching forward. Bank of America sponsored a Manhattan family music festival — promoted in English and Spanish — with a Chinese music ensemble and a gospel choir from Soweto. McDonald's spun off the Chipotle Mexican Grill chain this year and still owns a big stake.

Last year, Schieffelin & Company rolled out Navan, a vanilla cognac intended to play off the spice's appeal to Hispanics but also to blacks and Asians. Diageo last year introduced the high-end Brazilian rum Orinoco.

Procter & Gamble is trying to expand sales for its Ariel laundry detergent, which is popular in Mexico, into Wal-Mart in the United States, said one Procter & Gamble marketer who asked not to be named because he is not authorized to speak to the media.

He said a mainstream marketing campaign for Pantene shampoo, likely to begin before July, will be based in part on market research that showed Latina women prefer long, straight hair.

At the same time that Asian chains like 99 Ranch Market have grown more popular with non-Asian customers, Wal-Mart and other supermarkets have expanded their ethnic food aisles, said Saul S. Gitlin, executive vice president for strategic services at Kang & Lee, part of WPP Group's Young & Rubicam Brands.

In introducing the Ford Fusion four-door midsize sedan in 2005, Ford's general market advertising campaign borrowed from its Asian campaign's soap operas, said David Rodriguez, multicultural marketing manager for Ford, Lincoln and Mercury brands.

He said the Ford Fusion Mixer, a Web-based music mix that includes genres like R&B, salsa, reggaetón, Asian, hip-hop, rock and alternative music, was developed for Fordenespanol.com but now runs on all company sites.

"In many cases, we will very much acknowledge that what is multicultural today very much will be general market tomorrow," Mr. Rodriguez said.

Pepsi-Cola North America is bringing Manzanita Sol, a popular apple-flavored soft drink in Mexico, to Southern California, Texas, Arizona, New York City and Miami. It is aimed primarily at Latinos but is also tied to the American affinity for apple juice.

Lara Montilla, senior marketing manager for multicultural marketing at Pepsi, says the drink is selling well, in part because of nonethnic consumers.

"The U.S. consumer is exploring different flavors more now than before," Ms. Montilla said. "We definitely will see a lot of crossing paths when it comes to innovation — innovation that is targeted to ethnic consumers but crosses over to the general market."

She said only a handful of companies had figured out how to achieve that crossover and that Pepsi-Cola North America had learned from its sibling, Frito-Lay. The snack company introduced Doritos Guacamole for Latinos but expanded it to the general market. She said aguas frescas, a drink with fruit pulp, sugar and water that is popular in Latin countries, was an area of interest and that Pepsi was considering how to make the category more prevalent here.

Expanding a product from a specific ethnic group to the general market makes good business sense.

"A lot of major companies have tried developing merchandise just for specific ethnic groups and may not have gotten the volume," said Peter Krivkovich, president and chief executive of the Chicago-based advertising agency Cramer-Krasselt, whose clients include Barton Beer, which imports Corona, and H. J. Heinz. "For large companies, small brands are just not worth it."

The tactic, however, could also alienate a brand's core clientele, said Tom Pirko, president of the beverage consultancy Bevmark. "A lot of people, if you give them something other than what they want or expect, will reject your product, boycott it," Mr. Pirko said.

Mr. Rodriguez of Ford said the automaker would accelerate ethnic efforts this year, taking into account how many immigrants were big adopters of technology and were more accepting of the Internet, broadband, text messaging and mobile marketing.

"As fluency levels increase," Mr. Rodriguez said, "you are going to see more opportunity via different media mixes to reach out and connect with these people in more creative and innovative ways."

MARKETING LESSONS FROM DIGITAL LIFESTYLE DAY

2006-02-13T07:14:00.000-08:00

MARKETING LESSONS FROM DIGITAL LIFESTYLE DAY
Creativity Has Never Been More Important
February 13, 2006
QwikFIND ID: AAQ41K
By Randall Rothenberg
The World Economic Forum was not the only event to attract VIPs to Europe’s snow country in recent weeks. Hubert Burda Media, one of Germany’s largest and most influential media companies, convened its second annual Digital Lifestyle Day in Munich late in January. And while Davos’ attendees (prime ministers, presidents
Digital Lifestyle Day in Munich brought together game designers, historians, techies and professors from around the world.
--------------------------------------------------------------------------------

and CEOs) gingerly grappled with the state of the world, DLD’s participants (game designers, VCs, historians, techies and professors) were more outspoken about where the media and marketing worlds are heading. I walked away with six conclusions:

1. Because the native costs of crafting and distributing creative product are trending toward zero, anyone can be a creative. Those who’ve been obsessing over the blogging phenomenon have missed the point; blogs are merely the most visible manifestation of an explosion in creativity. “Tools are now so inexpensive, anyone can be a publisher,” said Dan Gillmor, founder of the Center for Citizen Media. Examples touted included podcasts produced by the U.S. military and myriad examples of “nanopublishing,” Jeff Jarvis’ term for the finely targeted, ad-supported blogs cropping up on the Web.

2. Individuals control their media. Forget about the mantra “consumers are in control,” because consumers, producers, experimenters, receivers, perceivers and the merely-want-to-be-amused are all in this big stew together, creating micro-markets on the fly. “Hi, my name is Anina, and I’m a model and a blogger,” said one fashionable speaker early in DLD. “I started a models blog because I was tired of the way the media was portraying my profession.”

3. Whatever creativity is, its essence is more important in marketing and media now than ever. Do the math: A billion channels equal a billion creators and an awful lot of crap. Market mechanisms -- basically, the engagement of peoples’ attention and their encouragement to subsequent action -- will determine winners and losers. BBDO Worldwide President-CEO Andrew Robertson noted that the Meow Mix Co. now makes $1.2 million per year selling cellphone ring tones. He told the crowd, “My dream is that that’s how we’ll get paid.”

4. Mobile social networking is the next big thing. The most excitement at DLD surrounded communities-on-the-hoof. Ignore Myspace and Friendster. Keep your eye out for Area/code, Kevin Slavin’s New York startup that’s using mobile networking to facilitate large-scale, real-world multiplayer games, and for Plazes.com, which uses GPS and Wi-Fi triangulation to enable the pasting of virtual “sticky notes” on physical places.

5. The “long tail” is making vast new forms of business possible. EBay allows a lone Nebraska quilt-maker to find a national market; Netflix can make indie straight-to-DVD films a profit; and Google enables them to advertise successfully. “People can quit their day jobs to become publishers, thanks to AdSense,” Marissa Mayer, Google’s president for search products and user experience, noted -- accurately -- about her company’s ad-relevancy mechanism.

6. The physical world still matters -- especially as a validator. Mainstream media still count, even to the digi crowd. The number of major marketers at DLD engaging in cross-platform programs that start with incumbent media and leap to the Web to prompt customization, data collection and actions was striking, including BMWs Mini division, which showcased a youth promotion involving Burda’s own print and digital properties.

“Over the next three years, I foresee new business models for advertising,” Hubert Burda himself exulted. At 65 years of age, he is leading the way from Germany.

One in Five Blogs Is Spam

2005-12-21T18:29:00.000-08:00

From AdWeek/IQ Daily 12/21/05

One in Five Blogs Is Spam
NEW YORK While 80,000 blogs may be created every day, about one in five is spam, according to new research.

Umbria Communications, a Boulder, Colo.-based consumer-generated media monitor, found that 2.7 million out of 20.3 million blogs are spam, or splogs as they are sometimes known. It estimates between 10 and 20 percent of blogs are spam.

Spam blogs are sites created only for marketing purposes, often using stolen content via RSS feeds to trigger keyword-based ads from Google's AdSense and other contextual ad programs.

Splogs "could become a detractor to people using, enjoying and finding value in the blogosphere," said Howard Kaushansky, CEO of Umbria.

Umbria examined results in October from three blog search engines—Technorati, IceRocket and BlogPulse—and found them rife with spam sites. On average, 44 of the top 100 results on the engines were spam. For instance, an Apple iPod search turned up splogs in 80 of the top 100 results on IceRocket, and 75 and 71 on BlogPulse and Technorati, respectively.

Research found the splog problem is getting worse. Kaushansky said while many splogs are usually created to boost search engine rankings for sites, they are more frequently created to make money from text ads or affiliate programs. The main culprit often fingered is Google, which has fed the splog problem through its Blogger tool, then made it profitable through AdSense.

Blogger's open API made it easier for computer programs to create splogs, Kaushansky said.

"We noticed a very strong correlation between the date Blogger opened [its application program interface] and when we saw spam starting to explode," he said.

--Brian Morrissey

Online Advertising's Tipping Point Approaches

2005-12-08T17:29:00.000-08:00

http://www.clickz.com/news/article.php/3569361

Online Advertising's Tipping Point Approaches
› › › ClickZ News

By Kevin Newcomb | December 8, 2005

The "tipping point" for offline ad dollars moving online may be here in the second half of 2006, according to a report by Piper Jaffray analyst Safa Rashtchy.

The speed of online advertising's growth, its benefits to offline campaigns, and recent online ad spending increases from major marketers all seem to be converging, according to Safa Rashtchy, senior research analyst at Piper Jaffray.

"We believe online media now receives about 5 percent of total marketing spending, up from 3 percent two years ago. However, online is on its way to a 10 percent share much faster then we anticipated, and we believe we are now approaching an inflection point when spending growth could accelerate," Rashtchy wrote in a newly-released report. "This point is likely to be in the second half of 2006, as the full impact of some of the recent allocation increases from major marketers becomes evident and creates a momentum that will attract more spending by advertisers who are on the sidelines now."

Rashtchy's "conservative" estimate is that online advertising will exceed $55 billion globally by 2010, a 27 percent compound annual growth rate (CAGR) over 2005. He points to large advertisers like Absolut Vodka, GM and Ford, all of which plan to spend 20 percent of their marketing budgets online next year, he said.

"These allocations are now creating a new momentum in the online advertising space which we believe will be most evident in the first half of 2006, creating the background for the inflection point in the second half of 2006," Rashtchy said in the report.

At Piper Jaffray' Online Advertising Search Symposium last week, Rashtchy said attendees made it clear that search and online advertising are becoming increasingly intertwined, and benefiting each other instead of competing.

"Advertisers are interested in enhancing the effects of both display and search advertising by creating a coherent campaign that reaches the consumers in various types of inventories," Rashtchy said.

Similarly, Rashtchy said nearly 10 percent of search spending is done for its branding impact, with agencies increasingly being able to tap into the client's branding budget for search spending.

Rashtchy also found that an online inventory shortage was not holding anyone back, since networks, remnant space, and contextual search all continue to expand, even if inventory on large portals is sold out.

"While the effectiveness of these additional inventory types do not match the premium inventory that is often sold out, as one panelist noted, 'there is no such thing as bad inventory,' and advertisers are able to effectively use various types of inventory at the appropriate price and effectiveness levels," Rashtchy wrote.

The big winners in the shift of ad dollars online will be Google and Yahoo!, he said, but additional spending will be made with networks and smaller vertical sites, such as ValueClick and 24/7 Real Media. Rashtchy also predicts that agencies and intermediaries like aQuantive, Marchex and Digitas will see growing demand for their services, because of the growing complexity of search campaigns and the increasing reliance on technology in buying online advertising.

WSJ.com - Philips Electronics Arranges '60 Minutes' of Ads

2005-10-22T10:48:00.000-07:00

WSJ.com - Philips Electronics Arranges '60 Minutes' of Ads
Interesting idea, likely prompted by the Target/NewYorker execution. Originality, though, should not be higher priority than effectiveness. Question is what messaging will they run. If they run the same spot w/in each ad break they will have missed serious potential.

<<<<<<<<<<<
Philips Electronics Arranges
'60 Minutes' of Ads
Dutch Firm Is Sole Sponsor
For One Week of CBS Show;
Longer Story Segments
By BRIAN STEINBERG
Staff Reporter of THE WALL STREET JOURNAL
October 19, 2005; Page B4
Television's "60 Minutes" is getting a few more minutes -- at least this Sunday.

This week's edition of the CBS current-affairs program will run longer news segments, and fewer ads, as a result of an unusual sponsorship deal with Philips Electronics. The Amsterdam-based consumer electronics company says it is paying about $2 million to be the sole national sponsor of the program. Aside from spots promoting CBS's coming shows, and local ads sold by CBS stations, only Philips ads will appear on the show.

"There is more content, and less clutter," says Jeff Fager, executive producer of "60 Minutes."

The deal is the latest example of an advertiser aligning itself with a specific media outlet to get consumer attention. Over the summer, Target bought up all the ad pages in one issue of Cond�Nast Publications' the New Yorker magazine. Ford Motor, for a number of years, sponsored commercial-free season debuts of "24" on News Corp.'s Fox.

Advertisers used to plaster the same commercial across many TV channels and the same print ad in major publications. But as audiences have fragmented among television, the Internet and other media, advertisers are getting more choosy. When they find a media property that attracts a desirable crowd, "there is more appetite to dominate" than in the past, says Charlie Rutman, chief executive of MPG North America, a Havas media-buying firm.

"I think traditional 30-second advertising is in serious danger," says Andrea Ragnetti, Philips's chief marketing officer. He says he's looking for other media properties that reach Philips's target customer -- middle-age, affluent and well-educated -- with an eye toward developing unique ad strategies with them.

Philips's sponsorship of "60 Minutes" this Sunday will be hard to ignore. After a 90-second ad for Philips at the start of the show, the first two stories will run slightly longer than usual and free of ads. The second half of the program will carry two ad breaks, with ads for Philips, network promotions and local-station ads. Ad time will total about 6� minutes, excluding network promotions, down from the usual 12 minutes. The story segments, which typically run between 11 and 12 minutes, will average around 14 minutes in length. Philips has no say over the program's editorial content, according to the parties involved.

CBS won't comment on the pricing of the deal but says it is getting at least as much revenue as it would have for a normal episode of the show. CBS said it has taken care of other advertisers who may have wanted to be on the show.

An on-screen graphic will tell viewers about the Philips sponsorship, giving them a chance to offer feedback about the broadcast through the CBS News Web site, says Victor Ruvolo, senior vice president and group client director for Carat USA, the Aegis Group media-buying firm that helped negotiate the deal.

Mr. Fager said he'd do this kind of deal "every week if I could." In reality, however, these sponsorships are complicated. Making a company a sole sponsor sometimes requires broadcast networks to ask the TV stations that carry its signal to give up some of the ad time they sell. In this case, local stations got to sell their usual allotment. Use of the technique "will be sporadic," says Bill Cella, chairman and chief executive of Interpublic Group's Magna Global Worldwide.

Philips's Mr. Ragnetti is hunting for more opportunities for unusual ad plays. One outlet that has caught his eye is Time Warner's Real Simple, a home-oriented lifestyle magazine, whose readership fits Philips's target. "We don't have any plans so far, but if there was a chance to do something specific together, I would be very happy," he says. Real Simple would "absolutely entertain the idea of a single-sponsor issue," provided the concept matches the mission of the magazine, says Robin Domeniconi, Real Simple's president and publisher.

GOOGLE, COMCAST IN PRELIMINARY AOL BUY-IN TALKS

2005-10-13T05:33:00.000-07:00

GOOGLE, COMCAST IN PRELIMINARY AOL BUY-IN TALKS
GOOGLE, COMCAST IN PRELIMINARY AOL BUY-IN TALKS
A Deal Could Ultimately Alter the Media Landscape
October 12, 2005
QwikFIND ID: AAR02K
By Claire Atkinson and Abbey Klaassen
NEW YORK (AdAge.com) -- Search giant Google has joined with cable colossus Comcast to make a play for a stake in Time Warner’s AOL portal business.

Related Stories:
MICROSOFT IN DISCUSSIONS TO BUY STAKE IN AOL
'New York Post' Report Cites Two Sources
THE STRATEGY DRIVING MSN'S AOL BUY-IN QUEST
Combination Would Top Google's Traffic Numbers and Potentially Deprive it of 11% of Revenue
An executive familiar with discussions confirmed that Google brought Comcast into talks this past week to acquire a portion of AOL. This executive said that no deal is imminent and negotiations were characterized as “preliminary.” The news was first reported by the Wall Street Journal.
Global partnership
Neither Comcast Corp. nor Time Warner would comment. A Google spokesman said the company didn’t comment on market rumors but added, “Google and AOL have a healthy global partnership and AOL remains a valued partner.”
If the deal goes ahead, the AOL portal business could be transformed and relaunched to take advantage of its powerful partners. For advertisers the move would alter the media landscape, pushing further ahead a vision of consumer-controlled media future that would allow marketers greater ability to target customers. Online advertising is currently experiencing a renaissance of popularity among major ad spenders.
Yahoo and Microsoft
Google, Comcast and AOL are looking to bolster their profiles on both the content and distribution fronts. A deal would also leave Yahoo and Microsoft out in the cold, though Microsoft is understood to be continuing separate talks with AOL. Microsoft representatives did not return calls for comment.
Comcast has been aggressively pursuing video content for its cable delivered video-on-demand platform, while AOL made inroads with broadband video consumers as evidenced by traffic to its Live 8 concert earlier this year. Google, meanwhile, has been expanding its own video product in conjunction with broadcast network UPN, which provided the online giant with an episode of its top show, “Everybody Hates Chris.” Google has also been collecting video blogs from the public.
On the distribution front, Comcast is a major provider of high speed Internet access, with 7.7 million customers at the end of the second quarter. The company’s high-speed Internet product is currently ad free, something that a union with AOL and Google might alter. AOL has been buoyed of late by an increase in ad revenue and while overall revenues were down for the second quarter to $2.1 billion, online ad revenue was up by 45%.
Icahn letter
The news of a possible deal comes hot on the heels of complaints from Time Warner activist shareholder Carl Icahn. Earlier this week, Mr. Icahn sent Time Warner shareholders a letter packed with scathing criticism of the company’s board of directors. His shots specifically called out the 2000 AOL merger, in which he wrote the company “had an early belief in broadband evidenced by the billions spent on Time Warner Cable, yet failed to effectively address the migration of AOL dial-up subscribers to broadband access providers (punctuating the question of why they merged with an approximately $150 billion narrowband business).”
AOL has been bleeding subscribers from its narrowband service while trying to push the newly minted free AOL.com. Since AOL.com’s content is rich in broadband-enabled video, it has also been marketing a broadband-connection service through Roadrunner. AOL had 20.8 million U.S. members at the end of the second quarter, a decline of 917,000 from the previous quarter. If an AOL deal with Comcast included access to the cable giant’s 7.7 million broadband customers, AOL could be in a much better spot to sell its broadband service.
79 million monthly visitors
Google brings a premiere search capability to the possible union while AOL still maintains a sizeable subscription base. Google attracted 79 million visitors in September, according to Nielsen/NetRatings and is No. 4 among the top five brands on the Internet, behind Yahoo, Microsoft and MSN. AOL is No. 5. If Google and AOL were to merge, the resulting entity would become the No. 1 Web site, with an active reach of 72%.
Such a deal would make sense for Google, which lacks a content play in its quest to grow as a major media company. Google’s 2005 U.S. paid search revenue will reach nearly $3.2 billion in 2005, according to online market research firm eMarketer. Google will own nearly 25% of the online advertising spending in 2005 as well. With rich content from Time Warner, AOL would offer Google a way to enter the content/portal market now dominated by Yahoo and to a lesser extent, AOL. Last month, when reports surfaced that AOL and Microsoft’s MSN were considering a partnership, many industry watchers speculated that would include MSN powering AOL’s search engine and AOL dumping Google. Estimates suggest AOL represents 11% of Google’s revenue.
MSN-AOL talks continue
According to wire reports, MSN is also continuing talks with AOL. That led one media analyst, who wished to remain anonymous, to wonder why this deal would make sense for Comcast given that Microsoft is a shareholder in the cable operator. This analyst said: “Microsoft is a major investor in Comcast. The idea of them doing any joint transaction would be offensive to Microsoft. Strange things happen. But this doesn’t make sense.” An AOL/MSN merger would likewise be the largest entity on the Internet, with a reach of 79%.

FORD BOOSTS DIGITAL MARKETING SPEND FURTHER

2005-08-26T10:15:00.000-07:00

FORD BOOSTS DIGITAL MARKETING SPEND FURTHER
FORD BOOSTS DIGITAL MARKETING SPEND FURTHER
Allocates 15% of $1 Billion Budget to Online
August 25, 2005
QwikFIND ID: AAQ85Z
By Jean Halliday
DETROIT (AdAge.com) -- Ford Motor Co.’s Ford Division will spend 30% of its estimated $1 billion-plus marketing budget this year on “targeted” media, up from 20% last year and more than triple what it spent five years ago.

Ford is allocating 30% of its budget to 'targeted' marketing and half of that is earmarked for digital advertising.
--------------------------------------------------------------------------------

The budget moves come as the carmaker’s North American operations are trying to bounce back from a second-quarter loss of nearly $1 billion.

15% for digital
While Ford defines “targeted” approaches as direct mail, video on demand, mobile-phone ads, sponsorships, CRM and Internet marketing, it is the digital element that will benefit most. The brand will spend 15% of the budget there, according to Martin Collins, general marketing manager. “Our media spending in digital will go up because it creates more business for FordVehicles.com,” the marketer’s Web site, he said.

The online component is crucial, since some Ford dealers close one out of five deals begun via online contracts. Still, about 40% of all the industry’s Internet leads don’t get a response within 24 hours, Mr. Collins said, the equivalent of not being waited on in a department store that can result in lost business. To fix that, Ford is using a proprietary tool called Lead Response Time that monitors how long it takes Ford dealers to respond to an online lead from its site. “Leads acted on more quickly close at a rate four times higher” than slower responses, he said.

Between February and mid-June, more than 115,000 consumers who visited FordVehicles.com picked options and priced the all-new Fusion sedan, arriving this fall. Ford used that data to fine-tune the build mix for the car at launch.

Concert promotion
The marketer turned to the Web for the car’s pre-launch, tied to the title sponsorship of Fusion Flash Concerts. Consumers must register at FusionFlashConcerts.com or text “Go” to 35274 on their mobile phones to learn details about concerts in 10 cities. The Web site includes a tour blog, streaming video, music downloads and a promotion to win the 2006 Fusion, Sony electronics and VIP concert access. Cingular Wireless is a partner; its subscribers get extra perks such as premier viewing at the venues. Sony worked with Ford’s agency, WPP Group’s JWT Detroit, to create viral marketing that includes word of mouth. Ads themed “Break Free” are in Manhattan phone booths, subways and alternative newspapers.

A reorganization of Ford, Lincoln and Mercury’s U.S. marketing and sales organization takes effect Sept. 1. The change eliminates one marketing layer. Separate teams by brand have been consolidated into one for incentives, special events and auto shows. A unit dubbed “brand strategy and operations” for the three brands will be headed by Murat Yalman, formerly a global marketing manager.

VINTAGE AD TACTIC SHOWS NEW LIFE: PRESENTING SPONSORSHIPS

2005-08-25T05:24:00.000-07:00

VINTAGE AD TACTIC SHOWS NEW LIFE: PRESENTING SPONSORSHIPS
VINTAGE AD TACTIC SHOWS NEW LIFE: PRESENTING SPONSORSHIPS
Why Target's Takeover of 'The New Yorker' Was a Brilliant Move
August 22, 2005
QwikFIND ID: AAQ85G
By Jonah Bloom
The idea of a presenting sponsor taking ownership of a media channel is not new. As a tactic it enjoyed its broadcast heyday between 1930 and 1960, and has popped up periodically across all media

Jonah Bloom, executive editor of Advertising Age.
ever since. Still, as I flicked through the August 22 issue of the New Yorker it dawned on me that it’s time is now.
Top illustrators
As many will have read, that New Yorker issue had only one advertiser. Retail giant Target, abetted by Hayworth Marketing & Media and Peterson Milla Hooks, bought every ad site in the issue and then populated those spaces with exclusive images fashioned by world-renowned illustrators. The idea was that the works could have been in the magazine on artistic merit alone, but all incorporated the Target bulls-eye in one way or another, collectively giving the retailer ownership of the issue.
On a simple, immediate level, this campaign works because it is sufficiently unusual to have the disruptive, first-mover advantage that is central to many of today’s best campaigns. The smartest marketers have realized that if their advertising makes a unique statement, either in content or placement, it will spark a media and water-cooler conversation whose value will be tens or even hundreds of times the cost of the media buy.
Pack-following newsrooms
You think the folks at Dove hatched Real Beauty because they care about women’s self-esteem? No, they simply wanted to play to the pack-following newsrooms all over the country who they knew would give the campaign more media coverage than they could have bought with a decade’s worth of marketing dollars. And Target was doing the same, scoring pieces in Slate, The New York Times and the San Francisco Chronicle among a host of others. (As journalists we insist on church and state, but the best marketers make pawns of us without paying our publishers a dime.) Advertising-for-its-PR-value: Not new, but given today’s extreme media fragmentation, very smart.

Click below to see selected ads.
Ad 1 | Ad 2 | Ad 3 | Ad 4 | Ad 5
Even without the media coverage, the Target takeover was a better use of $1 million than a series of buys across different magazines, because it also recognizes the need to engage rather than chalk up meaningless numbers of eyeballs. While many media buyers are still paid to tick the reach and frequency boxes, such metrics look increasingly pathetic in today’s media environment because they tell marketers so little about whether they’re connecting with consumers.
New measurement vernacular
The Media Kitchen CEO Paul Woolmington says: “Magazines are still bought on average issue readership, with an acceptance that maybe half of the advertising is wasted. The truth is it’s probably way more than that. We need to de-construct the measurements and create a new vernacular that focuses on engagement.” That is exactly what Target did, focusing on depth and duration of engagement of the New Yorker reader and measuring its success based on striking up a relationship with this audience.
Even more importantly in today’s consumer-controlled, ad-savvy world, the presenting sponsor arrangement makes the marketer’s presence helpful rather than irritating: a media waiter delivering a choice morsel rather than a fly in the soup. And, in being an integral part of a positive experience, the marketer piggybacks that media outlet’s relationship with consumers to become a brand they regard as ‘one of theirs.’
Fringe benefit
Finally, a fringe benefit to presenting sponsorships: They remind consumers that ads support much of their entertainment. Coke recently bought up all the slots for several weeks on Jack FM in L.A., and ran brief commercials for Coke Zero and Minute Maid Fruit Punch. The creative: A Jack announcer comes on and says: “The people at Minute Maid Fruit Punch paid us lots of cash so you could listen to music not ads.” Not that sophisticated maybe, but wouldn’t you rather hear that than a spot that interrupts your favorite show to share the news that some teenagers want to teach the world to chill? Me, I’ll take the presenting sponsor every time.

WASHINGTON POST WEB SITE PUTS ADS IN RSS FEEDS

2005-07-19T20:12:00.000-07:00

WASHINGTON POST WEB SITE PUTS ADS IN RSS FEEDS
WASHINGTON POST WEB SITE PUTS ADS IN RSS FEEDS
Becomes First Major News Site to Sell the Ad Format
July 15, 2005
QwikFIND ID: AAQ75H
By Abbey Klaassen
NEW YORK (AdAge.com) -- Washingtonpost.com yesterday quietly began integrating advertising into its RSS feeds, the first major news site, it says, to offer such a service. The MSNBC TV show The Situation with Tucker Carlson is the inaugural advertiser.

Growing numbers of online news organizations now offer free RSS feeds of their stories and features. Readers can sign up for specific feeds and automatically receive updates with links about the latest stories on that topic. Washingtonpost.com now offers subscribers more than 150 feeds to choose from and is beginning to sell ads into the syndication service. (The feed icons shown above are labeled 'XML' because the feed technology is based on the XML coding system, which is similar to but different from HTML.)
Simple syndication
RSS was originally created by Netscape as a "Rich Site Summary" technology but is now best known as a "Really Simple Syndication" system for online readers. It is an increasingly popular way to automatically gather information from the Internet and deliver it to a computer’s browser. In some ways, it’s like a search engine, enabling an individual to define the kind of information he or she wants to receive as it is published across the Internet each day.
RSS is most frequently a stream of text information -- headline links, short synopses and excerpts from blogs -- to which other kinds of files can also be attached. RSS feeds function something like a private wire service, bringing subscribers daily updates about a particular topic.
More than 150 feeds
Washingtonpost.com, part of Washingtonpost.Newsweek Interactive -- the online publishing subsidiary of The Washington Post Co. -- offers more than 150 feeds, with politics and opinion sections among the most popular.
RSS advertisements are typically bare-bones text ads, but increasingly HTML ads are used. The key, according to most online marketers, is placing the ads near relevant content -- one reason the Washingtonpost.com feed appealed to Publicis Groupe’s MediaVest USA, which negotiated the deal for MSNBC.
RSS ads
Ad-supported RSS feeds aren’t new -- Yahoo and Google have both been experimenting with ad-supported RSS feeds, and companies such as Pheedo have created RSS advertising networks and blue-chip marketers like American Express, Continental Airlines and Verizon have started to take advantage. But Washingtonpost.com’s foray into the field is significant in that it foreshadows a future in which mainstream news organizations will compete more directly with search engines and blogs for new media dollars.
And part of the reason MediaVest got in now was to help lay the foundation for that future, said Mohan Renganathan, associate director of digital strategy for the agency.
How deal evolved
This particular ad deal evolved as MediaVest was looking for new technological means to reach the politicos and news junkies its client, MSNBC, wanted to target. After several discussions with Washingtonpost.com, Mr. Renganathan convinced MSNBC to try it out as a new ad platform.
When a user clicks on an article in the presence of a text ad, it brings the user to an intermediary advertisement, called an interstitial. There is also an area within the ad that lets the user sign up for MSNBC’s own RSS feed.
Capped ad frequency
But this deal is starting out slowly: to keep from interrupting and annoying the end user, Washingtonpost.com and MediaVest capped the ad frequency at every 3 1/2 to four days, meaning that an RSS user will only see an MSNBC ad once or maybe twice a week. Washingtonpost.com also established a feedback button to allow RSS users a platform to air their opinions on the new advertising model and help direct the company in future RSS advertising expansion.

Hoping To Find Its Place In Cyberspace, News Corp. Acquires MySpace - 07/19/2005

2005-07-19T19:49:00.000-07:00

MediaPost Publications - Hoping To Find Its Place In Cyberspace, News Corp. Acquires MySpace - 07/19/2005
Hoping To Find Its Place In Cyberspace, News Corp. Acquires MySpace
by Gavin O'Malley, Tuesday, Jul 19, 2005 8:00 AM EST
MORE THAN A DECADE AFTER it squandered its first foray online - the first of any major media conglomerate - News Corp. is once again betting big on online media, announcing a deal Monday to acquire Intermix Media Inc. for $580 million in cash. Intermix, which operates the wildly popular social networking Web site MySpace and about 30 other Web destinations, has made inroads in drawing both the precious youth market and advertisers. The timing of the deal is interesting for News Corp. in general and MySpace in particular. The deal comes 12 years after News Corp. bet big and failed with its first online strategy, and has been licking its digital wounds ever since. In 1993, it acquired Delphi Internet Services Corp., one of the world's first consumer Internet service providers. But News Corp. failed to formulate an integrated online strategy, squandering the opportunity as Delphi was passed by other emerging online services such as America Online, CompuServe, and Prodigy.
News Corp. isn't the only major media conglomerate to make an ill-timed bet online. Walt Disney Co. bet big when it acquired early popular search engine Infoseek, which ultimately was merged into Disney's online services. And, of course, Time Warner, merged with America Online, became dominated by an online strategy, before it regained its footing as a broad-based media and entertainment concern. Now Time Warner is once again looking to AOL to fuel its growth.

Mainly, big media companies like News Corp., Disney, Time Warner, and Viacom, have looked online as a way of extending their traditional media brand franchises and to help promote their usage. News Corp.'s acquisition of Intermix looks to be a genuine diversification play into the rapidly growing area of social networking.

Nielsen//NetRatings' AdRelevance unit reported last week that MySpace beat out heavyweights MSN Hotmail and Yahoo! Mail as the leading site for advertisers to promote their wares in June, with a 7.9 percent share of ad impressions. Advertisers include Procter & Gamble and Sony Pictures.

Additionally, MySpace.com currently dominates other social-networking sites on the Web, with 84.46 percent of the market for the week ending May 21, according to research firm Hitwise.

The deal represents one of many recent buyouts of Internet companies by traditional media players. For instance, earlier this year, Dow Jones & Co. purchased MarketWatch for $519 million, and New York Times Co. bought About.com from Primedia for $410 million.

Intermix, which said it had exercised its option to buy the 47 percent of MySpace.com it doesn't already own, will become part of News Corp.'s new Fox Interactive Media unit. The addition of Intermix's 27 million monthly users will more than double Fox Interactive's online audience.

Richard Rosenblatt, Intermix Media's chief executive officer, and Chris DeWolfe, chief executive officer of MySpace.com, will retain their jobs when the acquisition is completed. A company representative said MySpace had no plans to change under new management.

"MySpace will continue to create new ways to connect people online and to maintain a unique environment where our users can creatively express themselves," a spokeswoman said in a statement. "With this acquisition, MySpace will be able to accelerate its growth plans and expand into new markets."

In April, Intermix became the target of New York Attorney General Eliot Spitzer and his quest to curb spyware. Spitzer sued Intermix for spreading ad-serving programs without consumers' consent, along with the games and screensavers available on its sites. Intermix said it had stopped distributing programs mentioned in the lawsuit, but in June agreed to pay just over $7 million to settle the charges without admitting any wrongdoing.

WSJ.com - Turnover at Yahoo Slows Media Group's Los Angeles Move

2005-07-19T08:32:00.000-07:00

WSJ.com - Turnover at Yahoo Slows Media Group's Los Angeles Move
Turnover at Yahoo Slows Media Group's Los Angeles Move

By KEVIN J. DELANEY
Staff Reporter of THE WALL STREET JOURNAL
July 19, 2005; Page B1

Plans to give a stiff shot of Hollywood glamour to Yahoo Inc.'s media and entertainment offerings have instead given the Internet company a case of the hiccups, as several division heads have decided either to leave Yahoo or opted against relocating to new Los Angeles-area offices.

Of eight media division general managers, three heading Yahoo's finance, sports, and movies and television units have decided to leave the Sunnyvale, Calif., company, Yahoo said. Three other division heads have declined to move to Southern California from Silicon Valley and so are leaving their current posts, taking other jobs at the company.

The management turnover partly reflects some internal discontent directed toward Lloyd Braun, the former chairman of the entertainment division at Walt Disney Co.'s ABC network, whom Yahoo Chairman and Chief Executive Terry Semel brought in late last year to oversee the invigoration of the media group. Since then, Yahoo and Mr. Braun have hired a new layer of senior executives overseeing content in entertainment, sports and other areas in the media group. Some employees in the group have bristled at Mr. Braun's management style, according to three people familiar with the matter.

Mr. Braun declined to comment, through a Yahoo spokeswoman. She said criticism of Mr. Braun "doesn't represent the general consensus among the group." She said the management changes played a role in the decision by Yahoo executives to delay the deadline for "a relatively small number" of employees to decide whether to move.

Yahoo in 2001 hired Mr. Semel, former co-head of the Warner Bros. studio, to turn the Internet company around amid falling revenue. Since then, Yahoo has powered back, mounting a credible Web search challenge to Google Inc., among other moves. Mr. Braun arrived in November to oversee Yahoo's content-related activities: News, entertainment and other multimedia content is a centerpiece of its effort to keep Yahoo before Internet users at a time when more of them are consuming media and entertainment via computers and cellphones.

Currently, Yahoo's media activities range from Web sites dedicated to finance, news and health to online videogames. Last year, it edged out rivals to host the official Web site of "The Apprentice," a reality-TV show starring Donald Trump. In May, Yahoo's music division released an online music-subscription service priced aggressively lower than rival offerings. Mr. Braun has spoken publicly about his interest in trying to help create mass-market content hits on the Web, but he and the company have been coy about any specific products or services he plans to unveil.

Yahoo Media Group is a relatively small contributor to the company's revenue and profits now, but a major strategic focus. Yahoo's aim is "to take a leadership role in defining what Internet content will be and how it will be presented to the consumer," Mr. Braun said in a February interview.

Yahoo executives announced this year that most of the Yahoo Media Group would be moving to a new facility in Santa Monica called the Yahoo Center. The facility is big enough eventually to accommodate as many as 800 to 1,000 employees.

The recent turmoil suggests Yahoo may be struggling to keep up with its own aggressive expectations. The Yahoo spokeswoman said the changes hadn't slowed Yahoo's plans. "This is all expected....The groups are doing extremely well despite the transition," she said. A number of employees already have moved from Sunnyvale and additional moves are planned for September, she said. "We view this as a positive and necessary change to strengthen the group's management," she said.

The game of musical chairs is being played out against a backdrop of intensifying challenges to Yahoo's news and entertainment efforts online. Time Warner Inc.'s America Online division is aggressively promoting video feeds on its revamped Web site and scored a hit with its recent online broadcasts of video from the Live 8 concerts. Viacom Inc.'s CBS News division last week announced a souped-up Web site featuring an increased number of free video clips.

Yahoo declines to specify revenue for the Media division. People familiar with the matter said it accounted for roughly $170 million of Yahoo's $3.6 billion in revenue last year. They said they don't expect the changes within the group to affect second-quarter financial results, which Yahoo is scheduled to report today.

Mr. Braun addressed the turnover during a quarterly staff meeting in Sunnyvale last week, according to the people familiar with the matter. During the meeting, he jokingly thanked Neil Budde, general manager for Yahoo News, for his decision to move to the Santa Monica office. He also acknowledged that other general managers had either quit or elected not to move, they say.

Douglas Hirsch, general manager for movies and television, said he had resigned from Yahoo, declining to discuss the reasons for his resignation. Nathan Richardson, former general manager for finance, left Yahoo last month to join Dow Jones & Co., publisher of this newspaper. A Dow Jones spokeswoman confirmed Mr. Richardson's hiring but declined to comment further.

People familiar with the matter say Brian Grey, general manager for sports, recently announced his resignation and has been hired by News Corp.'s Fox Sports unit to oversee its Web site. Mr. Grey said in a telephone interview, "I may be leaving in the near future, but I am still employed at Yahoo," and declined to elaborate further. Yahoo confirmed the three executives had left or were leaving Yahoo.

News Corp. To Buy Intermix For $580 Million

2005-07-19T04:59:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
News Corp. To Buy Intermix For $580 Million
by Gavin O'Malley, Tuesday, Jul 19, 2005 6:01 AM EST
IN ANOTHER EXAMPLE OF A traditional media company snapping up an Internet player, Rupert Murdoch's News Corp. on Monday agreed to buy Intermix Media Inc., which controls the wildly popular social networking Web site MySpace, for $580 million in cash.
MySpace, along with Intermix's other 30-odd Web destinations, has made inroads in drawing both the precious youth market and advertisers. Nielsen//NetRatings' AdRelevance unit reported last week that MySpace beat out heavyweights MSN Hotmail and Yahoo! Mail as the leading site for advertisers to promote their wares in June, with a 7.9 percent share of ad impressions. Advertisers include Procter & Gamble and Sony Pictures.
Additionally, MySpace.com currently dominates other social-networking sites on the Web, with 84.46 percent of the market for the week ending May 21, according to research firm Hitwise.

The deal represents one of many recent buyouts of Internet companies by traditional media players. For instance, earlier this year, Dow Jones & Co. purchased MarketWatch for $519 million, and New York Times Co. bought About.com from Primedia for $410 million.

Intermix, which said it had exercised its option to buy the 47 percent of MySpace.com it doesn't already own, will become part of News Corp.'s new Fox Interactive Media unit. The addition of Intermix's 27 million monthly users will more than double Fox Interactive's online audience.

Richard Rosenblatt, Intermix Media's chief executive officer, and Chris DeWolfe, chief executive officer of MySpace.com, will retain their jobs when the acquisition is completed. A company representative said MySpace had no plans to change under new management.

"MySpace will continue to create new ways to connect people online and to maintain a unique environment where our users can creatively express themselves," a spokeswoman said in a statement. "With this acquisition, MySpace will be able to accelerate its growth plans and expand into new markets."

In April, Intermix became the target of New York Attorney General Eliot Spitzer and his quest to curb spyware. Spitzer sued Intermix for spreading ad-serving programs without consumers' consent, along with the games and screensavers available on its sites. Intermix said it had stopped distributing programs mentioned in the lawsuit, but in June agreed to pay just over $7 million to settle the charges without admitting any wrongdoing.

Intermix may be News Corp.'s latest foray online, but it's not its first. In fact, News Corp. was the first major media company to make a big online investment. In 1993, it acquired Delphi Internet Services Corp., one of the world's first consumer Internet service providers. But News Corp. failed to formulate an integrated online strategy, squandering the opportunity as Delphi was passed by other emerging online services such as America Online, CompuServe, and Prodigy.

AdAge - Al Ries: LEARNING FROM HILTON'S MARKETING MISTAKE

2005-07-13T04:09:00.000-07:00

LEARNING FROM HILTON'S MARKETING MISTAKE
LEARNING FROM HILTON'S MARKETING MISTAKE
Why a Brand Must Be Described in Three Words
July 11, 2005
QwikFIND ID: AAQ73J
By Al Ries
A Hilton executive was recently asked, “So what the hell is a Hilton?”
“People can’t necessarily articulate it,” said the marketing honcho. The brand is defined: “If we ... give people an experience that says, ‘Yes, I’m proud of what it says about me to stay here, it makes me feel good; I’m in charge of my stay.’”

What’s your brand? If you can’t answer that question about your own brand in two or three words, your brand’s in trouble.
That’s what differentiates a Hilton from a Hyatt, a Marriott, an Omni? Mind you, this is an organization that is spending $45 million a year on ads (and looking for a new agency).
Do you know your brand?
What’s your brand? If you can’t answer that question about your own brand in two or three words, your brand’s in trouble.
Powerful, long-lasting brands are built by owning a word in the mind.
What’s a Volvo? A safe car.
What’s a BMW? Fun to drive.
What’s a Barilla? Italy’s No. 1 pasta.
It’s astounding how many marketing executives can’t grasp this simple strategy: Own a word in the mind. A few years ago the CEO of Wal-Mart’s ad agency was asked, “What would you say is Wal-Mart’s USP?”
Value? No. Cheap? Yes
Without hesitation, he replied: “Value, loyalty and quality.” Rosser Reeves would have turned over in his grave. “Value, loyalty and quality” are hardly a uinique selling proposition. Outside of every Wal-Mart are the words, “We sell for less.” In every Wal-Mart ad are the words, “Always low prices. Always.” What word does Wal-Mart own? It’s “cheap.” Not a bad word. It has made Wal-Mart the world’s largest retailer.
Does “cheap” appeal to everybody? No. That’s why you know “cheap” is a good word to own. Any combination of words that appeals to everybody will never work in marketing.
In 1983, my agency was working for Holiday Inn, when our client decided to get into the all-suite hotel business. The brand name they chose: Embassy Suites.
At the time, there were only two significant players in the all-suite category. Granada Royale and Guest Quarters. We made two points.
First in mind
No. 1: The leading all-suite chain will be the first brand in the mind. To jump-start the Embassy Suites brand, buy the largest chain in the category, Granada Royale. Which they did.
No. 2: Embassy Suites would be reasonable, no more expensive than an ordinary hotel room. Furthermore, the primary benefit of a suite is to have one room for sleeping and one room for working. Hence our proposed positioning slogan: “Embassy Suites: Two rooms for the price of one.”
Which they didn’t do. Instead they hired the ad agency that proposed using Garfield, the cat. “You don’t have to be a fat cat to enjoy The Suite Life.”
Embassy Suites became a very successful brand. But it missed an opportunity to reposition traditional single-room hotels with a powerful strategy, “Two rooms for the price of one.” And today, of course, Garfield has checked out.
Learning a lesson
I learned a lesson: Maybe you can do both. Maybe you can take a simple positioning idea and “package” it, like putting bacon around a filet. When Federal Express decided to focus on its overnight business, it could have said, “The overnight delivery company.” Instead it wrapped bacon around the “overnight” idea with the slogan: “When it absolutely, positively has to be there overnight.”
What about Embassy Suites? After thinking about it for the last 22 years, how about “Embassy Suites: One room for you, one room for your cat?”

BOOM TIMES AT INTERPUBLIC'S R/GA

2005-07-13T04:08:00.000-07:00

BOOM TIMES AT INTERPUBLIC'S R/GA
BOOM TIMES AT INTERPUBLIC'S R/GA
Inside an Interactive Ad Shop With Strange and Winning Ways
July 11, 2005
QwikFIND ID: AAQ73I
By Jonah Bloom
What if I said the hottest ad agency in the country isn’t in Miami? What if I said the shop with the brightest business prospects is owned by the floundering Interpublic? What if I said that the most exciting new agency model is being built by a 57-year-old who could reasonably be claimed by the old guard as one of their own?

Jonah Bloom, executive editor of Advertising Age.
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Seven Sites, 50 Workers and Cutting Edge Everything
Before you write me off as dumb, crazy or preposterously provocative, I recommend a close look at R/GA, the IPG-owned, tech-centric shop tucked away on one of midtown Manhattan’s grittier side streets, and led by Bob Greenberg.
Been around since 1977
Please don’t misunderstand. This column isn’t claiming R/GA is either new or waiting to be discovered (readers, please also check out the films of this guy called Pedro Almodovar and take a trip to a little city I’ve found called Paris). It’s been around since 1977 and is as gong-laden as almost any agency you care to mention (there’s even an Academy Award in the trophy room). In fact, it was increasingly frequent, unprompted testimonials from admiring rivals, jealous siblings and a R/GA client that persuaded me to spend a morning in the shop’s offices.
It was worth it. Greenberg -- who looks Larry David, but sounds Noam Chomsky -- has hired more than 120 people this year, increasing his staff numbers by about 50% at a time when most agencies are still cutting. In the last year it has won business from Lowe’s, Target, Subaru, Lucent and Sharp, and, according to IPG agency insiders, played a big part in helping siblings Lowe and McCann win Nokia and Intel.
If you want to see R/GA’s work, look no further than NikeID.com, the sneaker giant’s incredible customization site. An idea spawned by agency and client collaboration, this is less an ad campaign or a Web site than a big business idea supported by impressive manufacturing and interactive sales technologies. (If you haven’t visited by now, you’re really not doing your homework.)
'Groupware'
R/GA’s structures and processes are radically different. There’s no account-man-creative-guy combos, no giant unwieldy media-based silos. In fact, the entire agency is structured into what Greenberg calls “Groupware” (he is master of nifty monikers), meaning teams of about eight people, each including technology developers, data analysts and interaction or experience designers as well as copywriters, media planners and project managers.
While some agencies outsource their software and

One of R/GA's most visible works was the 23-story-high interactive promotion on the Reuters Building sign in Times Square that allowed passersby to design their own shoes.
technology development, they are the creative backbone of R/GA’s offering, and the shop is built to produce invitational, interactive and database driven “experiences,” many with e-commerce elements -- ideal for this new media era. R/GA is also creating work that allows clients to make better use of their digital assets to feed the need for constantly changing messaging, reducing their dangerously expensive dependence on the periodic creation of new film-based content.
A study in change management
Of course R/GA’s tech-centricity won’t appeal to everyone (even if it should), but the shop is worth studying regardless, if only as a lesson in change management: It started out in 1977 as a production house, focusing on computer-assisted filmmaking; in 1986 it evolved into an integrated digital studio; by 1995 R/GA was becoming an interactive ad agency; now it intends to become an ad shop centered in interactivity.
So what forces drove Greenberg from the production business? Primarily technological change that had allowed the clients (agencies, filmmakers) to become backseat drivers in the editing suite, or to farm out whatever part of the process they wanted to whomever they wanted, what Greenberg calls the “modularization” of the business. Second, it was the fact that those same clients were bringing in cost-control agents and driving down prices. Sound familiar?
In this regard we should all be pulling for R/GA, because its success is proof that a business that accepts and adapts to change can win and win big.

Venture to Put Live Shows on Internet and Radio - New York Times

2005-07-13T03:43:00.000-07:00

Venture to Put Live Shows on Internet and Radio - New York Times
Venture to Put Live Shows on Internet and Radio

By JEFF LEEDS
In a bid to widen significantly the audience for concerts and live events, America Online and XM Satellite Radio are backing a venture that will deliver live performances to Internet, satellite and wireless customers and through other media.

The venture is expected to start offering its performances this fall. Many of them will originate from arenas and theaters owned by the AEG division of the Anschutz Company, a concert promoter that also holds a stake in the venture. Kevin Wall, executive producer of broadcasts of the multicity Live 8 concert this month calling for aid to Africa, will run the new venture, Network Live.

Mr. Wall, former vice chairman of the Internet services company iXL Enterprises, said AEG was aiming to offer up to 40 concerts from major acts this year and develop its own brand-name series, which could then be distributed or downloaded to an array of devices.

The company plans to generate revenue by licensing its events to various distributors, including AOL and XM, and by selling advertising and corporate sponsorships tied to its concerts, Mr. Wall said.

In addition, sales or fees "directly related" to a specific performance will probably be shared with the artist, said Timothy J. Leiweke, president and chief executive of AEG.

The accord creating Network Live comes as distributors of digital entertainment are trying to add programming to attract customers. AOL, for instance, has been developing new content for its revamped service in a race against Yahoo and other rivals. XM has been trying to one-up its smaller rival, Sirius Satellite Radio, by adding new radio talent.

It also arrives as the concert industry, reeling after a slide in attendance last year, is trying to determine how to use the Internet to make more money. Clear Channel, the nation's biggest concert promoter, last week said it planned to shift up to 25 percent of its advertising budget online and that it had struck a deal with Yahoo to alert music fans to coming concerts in their area.

In the past, the notion of attracting mass audiences for concerts online was considered a dubious one. House of Blues Entertainment, another owner of concert arenas, developed plans in the late 1990's to sell pay-per-view Webcasts of its performances, but they drew few viewers, and the company shelved a planned stock offering in 2000 amid the collapse of the dot-com bubble.

This month, however, the Live 8 concerts broke online audience records, AOL said, drawing a peak of 175,000 simultaneous users.

Mr. Leiweke said House of Blues, in retrospect, might have been "a little bit ahead of their time."

PARIS HILTON'S HOT BURGER AD GENERATES TEPID SALES

2005-07-05T11:06:00.000-07:00

PARIS HILTON'S HOT BURGER AD GENERATES TEPID SALES
PARIS HILTON'S HOT BURGER AD GENERATES TEPID SALES
Carl's Jr. Parent Company Defends Marketing Strategy
June 28, 2005
QwikFIND ID: AAQ70L
By Kate MacArthur
CHICAGO (AdAge.com) -- Despite the whirlwind of publicity generated by its Paris Hilton ad, the controversial spot does not appear to have significantly increased Carl's Jr. restaurant sales.
Despite the tepid sales, CKE President-CEO Andrew Puzder called the Paris Hilton ad impact 'nothing short of phenomenal.'
--------------------------------------------------------------------------------
Related Story:
PARIS HILTON RUCKUS EXPANDS CKE MARKETING PLANS
Web Sites Transformed Into Product Placement Entertainment Centers

--------------------------------------------------------------------------------

The chain posted a 1.7% gain in same-store sales for the four weeks ended June 20, while sibling chain Hardee’s posted a 0.7% gain. Both chains are operated by CKE Restaurants of Santa Barbara, Calif.

Carl's Jr. was running the ad for the full four weeks, while Hardee's began running its own version of the ad during the last week of the period.

Expecting higher returns
Analysts and industry watchers were expecting much higher returns in the wake of the worldwide attention paid to Carl's Jr. and its Spicy Barbecue burger courtesy of Ms. Hilton's erotic car-washing escapade in the ad.

During a conference call with analysts after the market closed yesterday, Anton Brenner of Roth Capital Partners said: “Particularly looking at Carl’s same-store sales, it doesn’t appear that there is a noticeable boost from the Paris Hilton ads,” he said. “They might have gotten a lot of attention, it’s hard to squint and see how it has impacted your actual sales performance.”

CKE President-CEO Andrew Puzder called the Paris Hilton burger ad impact “nothing short of phenomenal.” He said: “As I am sure you’ve heard others say you can’t buy this kind of publicity."

Mr. Puzder said Carl's Jr.'s average unit volumes were higher than for any comparable period in a decade. He appeared to put a positive spin on the Paris advertising period by merging it into sales performances over a two-year cumulative period for an increase of 9.9%. He also noted the company's 28 consecutive periods of positive sales.

Lacked 'newness' factor
When grilled further by analysts about the surprisingly tepid sales, Mr. Puzder said the spicy burger that Mr. Hilton promotes in the spot had already been out for two to three months, so it didn’t have the "newness" factor.

“Where would we’ve been without this Paris Hilton ad in this period?” Mr. Puzder said. “We certainly would have sold a whole lot less. I mean we have a lot of people going into restaurants ordering ‘The Paris Hilton burger,’ which was our Spicy Barbecue burger, and you’ve certainly wouldn’t have had those sales but for running the Paris ads. So I think we are –- we were very pleased with the results.”

At least one analyst has downgraded CKE shares after the company reported lower-than-expected earnings yesterday despite higher sales. Larry Miller, restaurant analyst at Prudential Equity Group, singled out financial issues at Hardee’s when he lowered his outlook for the stock.

"We remain concerned that the Hardee's turnaround ... may be in jeopardy," he wrote in a note to investors.

Mr. Puzder explained that the 1,420-calorie Monster Burger with 107 grams of fat launched by Hardees earlier in the quarter “exceeded all of our expectations with respect to both media attention and sales, helping solidify Hardee’s position as the place for big, juicy delicious burgers for young, hungry guys.”

Hearing the Boom Through Headphones

2005-07-01T10:22:00.000-07:00

Hearing the Boom Through Headphones
Published: June 29, 2005
(After July 07, 2005, this article will only be available to eStat Database subscribers.)

Digital music player revenue nearly tripled in 2004, reaching $4.5 billion, according to In-Stat.

In-Stat predicts that the number of hard disk and flash-based digital music players will almost quadruple between 2004 and 2009, rising from 27.8 million to 104 million units.

One-quarter of US consumers own digital audios players, up from 16% in 2001, In-Stat says. Although a number of competing devices, including Rio, iRiver and Creative, have emerged to challenge the popular iPod, Apple commands 30.2% of the worldwide digital audio player market.

Yankee Group also expects digital audio players to grow sharply in the coming years, but at a slower pace than projected by In-Stat. Yankee Group says the installed base of digital audio players in the US stood at 35.1 million in 2004, and will reach 41.6 million in 2005. By 2009, it projects that there will be 67.7 million digital music players in the US, almost twice as many as in 2004.

A recently released report from the NPD Group indicates that digital music players are leading some consumers to online music services. NPD found that 22% of US online consumers who had begun using music downloading services did so because they recently had purchased a digital audio player.

The percentage of US households using such services has expanded considerably since the beginning of 2004. Only 0.5% of US households used them in December 2003, while fully 4% of households used the services by March 2005. However, P2P file-sharing has proved consistently more popular than legal services, with around 8% to 10% of households using them throughout 2004 and 2005. By March 2005, 9.6% of households used P2P services.

Will legal music downloading ever be as popular as P2P services? eMarketer Senior Analyst Ben Macklin finds that changes in the market have made such a shift more probable: "With the recent launch of Yahoo!'s Music Unlimited service combined with the well established iTunes, Napster 2.0 and Real Network's music service, Internet users now have a genuinely compelling array of paid online music services that can compete with P2P networks."

eMarketer's report on online music will be released in July. Sign up to receive an e-mail notification when it is available.

MarketingSherpa's 10 Best Blogs for 2005: Winners Named + Hotlinks for Your Surfing Pleasure

2005-06-14T16:20:00.000-07:00

MarketingSherpa.com : Practical News & Case Studies on Internet Advertising, Marketing & PR
Congratulations to MarketingSherpa's 2005 Best Blog winners, and thanks to the 2,065 tough judges who carefully evaluated 52-nominated blogs to pick them:

Best individual's blog on the general topic of marketing and advertising

Awarded to: Seth Godin's Blog
http://www.sethgodin.com/sg/blog.html

Honorable Mention: Adrants
http://www.adrants.com

Editor's Note: Both these Blogs won last year, albiet in reversed positions. In a world where the average Blog lifetime is something like six months, we're impressed and inspired by two bloggers producing award-winning work year after year. So many bloggers start red-hot and then quickly run out of steam. Seth Godin and Steve Hall beat the odds and we salute them!

Best group weblog on the general topic of marketing and advertising

Winner: MarketingVOX
http://www.marketingvox.com

Honorable Mention (Tie):
Marketing Genius http://marketinggenius.blogspot.com
Church of the Customer http://www.churchofthecustomer.com

Editor's Note: Congrats to Tig Tillinghast of MarketingVox who has kept the editorial quality high while going through business model and management changes. MarketingVox is one of the few completely self-sustaining Blogs we know of. And, we've heard Tig's expanding his formula to new industry niches shortly, including a blog for defense industry news.

Best PR-topic blog

Winner: Media Guerrilla
http://mmanuel.typepad.com/media guerrilla

Honorable Mention: Strategic Public Relations
http://www.prblog.typepad.com

Editor's Note: Even if you're not into PR, definitely check out Mike Manuel's Media Guerrilla Blog to see one of our fave Blogger self-photos. If you're going to post a photo of yourself on your Blog -- which is a great idea -- this is one to be inspired by. Also, the writing and hotlinks rock. Mike deserved this award win.

Best B-to-B marketing-topic blog

Winner: Guerrilla Consulting
http://guerrillaconsulting.typepad.com

Honorable Mention: B-to-B Lead Generation Blog
http://blog.startwithalead.com/

Editor's Note: If you're in the consulting business (or you daydream about leaving your corporate job for a freelancing someday), check out this year's B-to-B category winner for genuinely useful advice and links on how to score clients.

By the way, we hear a new hardcover book is coming out soon by the author of the Honorable Mention Blog in this category, proving a blog can lead to fame in more ways than one.

Best blog on small business marketing

Winner: Duct Tape Marketing
http://www.DuctTapeMarketing.com/weblog.php

Honorable Mention: Small Business Trends
http://www.smallbusinesses.blogspot.com

Editor's Note: Wow! Duct Tape Marketing won hands-down for the second-year running, gaining more votes than any other blog in any category in the entire contest. Most bloggers can only dream of such a huge and passionate fan base.

Best blog on online marketing

Winner: Chris Baggott's Best Practices in Email
http://exacttarget.typepad.com/chrisbaggott

Honorable Mention: Charlotte Li's Blog
http://blogs.forrester.com/charleneli/

Editor's Note: As a leader at a fast-growing technology company, Chris has an insane travel schedule. Kudos to him for keeping this effort up for 18 months now. If you're trying to convince a C-level exec at your organization to start a Blog, and they say, 'I'm too busy", taunt them with Chris' example.

Blogs on Search Marketing

Winner: Search Engine Roundtable
http://www.seroundtable.com

Honorable Mention: Brad Fallon
http://www.bradfallon.com

Editor's Notes: We adore the unusual editorial tactic for the winning Blog in this category -- instead of linking to news sites, the authors comment on and link to the very best new threads on search marketing on discussion boards all over the Web. So, it's a true insiders-insider blog, and a reflection of what people are realy talking about (vs what the media thinks.)

Best Blog on Niche Marketing

Winners (tie):
Ypulse - Media for the Next Generation
http://www.ypulse.com/

WonderBranding - Marketing to Women
http://michelemiller.blogs.com/marketing to women

Honorable Mention:
Lipsticking- Smart marketing to women online
http://windsormedia.blogs.com/lipsticking

Editor's Note: All three of these blogs are not only useful for advice on their topics, but also worth watching if you plan to launch a Blog to promote yourself as a niche marketing consultant. (P.S. Whoa, get ready for neon-pink and orange when you visit Ypulse.)

Best non-English-Language Blog

Winner: MarketingFacts (completely in Dutch)
http://www.mediafact.nl/weblog.php

Honorable mention: Media Culpa (in Swedish with some English)
http://www.kullin.net/

Editor's Note: We only wish we could read them for ourselves. Many thanks to the European MarketingSherpa readers who evaluated these blogs for us.

Top readers' choice write-in vote

Winner: Easy Bake Weblogs
http://easybakeweblogs.com

Honorable Mention: Collateral Damage (CMO Magazine)
http://www.cmomagazine.com/blog view.html?ID=401

Editor's Note: Fascinating that these two winners, both with more than 50 write-in votes in a category that generated more than 500 nominations, represent the two ends of the online media spectrum.

Easy Bake is by a self-publishing entrepreneur, who hopes you'll like his Blog so much you'll buy his also-self-published book. Collateral Damage is by a professional journalist who was asked to write a Blog as part of his editorial duties at CMO Magazine which is published by the gargantuan trade magazine company IDG.

How the Best Blogs were chosen:

In April 2005, we asked MarketingSherpa's 173,000 readers (who are mainly marketing execs at medium-large businesses and the agencies who serve them) to nominate their favorite blogs on the subjects of marketing, advertising, and PR.

Our editorial staff was not allowed to make any nominations. This is a "People's Choice" award based on what MarketingSherpa readers really like.

It's awfully easy to start a blog on an impulse, but equally difficult to keep the effort up posting consistently over the long-term. So we cut nominated blogs that had been started after January 1st, 2005 (you guys can try again next year.)

We also cut blogs that were off-topic, rarely updated, or otherwise seemed to be less on target for MarketingSherpa's readership. A total of 52 nominated blogs qualified for the next round.

Next, we invited all 173,000 MarketingSherpa readers to vote for the best Blogs in the categories listed above, plus a write-in category where they could put any additional blog's name. We included hotlinks to every blog so folks could check them out prior to voting.

We also allowed nominated blogs to post links to the voting form for their own readers, however we asked all voters to evaluate every nominee in a category and not just one single blog. (Which worked out fine.) However, MarketingSherpa staff were not allowed to vote, or influence results in any way.

Voters were asked to rate each blog in a category by one of three designations - "Excellent", "Not bad", and "Blah". To make sure everyone understood what was expected from an "excellent" vote, we included the following instructions:

#1. Personality:
Is there a clear personality? Do you feel like you know the writer(s)? Is there a feeling of intimacy that may be missing from mainstream media?

#2. Usefulness:
Is the information either darned useful or very enjoyable to read? Did it make you think, or laugh, or click? Are there handy links to other places?

#3. Writing style:
Is it a sales pitch badly disguised as a blog? Is it a long-winded column instead of a snappy, slightly-informal blog? Is it just news briefs without analysis or insight?

#4. Usability & design:
Is the typeface easy to read? Can you find links to archives? Is the writing concise and skimmable? Are graphics limited to what's useful or fun?

#5. Would you revisit?:
Is it useful or engaging enough for you to visit it again someday? Or will you forget it the minute after you vote?

On June 13th, we closed the voting form in order to tabulate winners. 2065 people had cast votes. Although some votes appeared to come from links, these didn't appear to change the overall results. So, the same blogs almost certainly would have won even if only MarketingSherpa readers had voted.

Also interestingly, in several categories, the blog that was probably the best known to voters prior to voting, did not end up being the winner. So, fame didn't make a big difference.

What did winners get anyway?

Aside from fame, hotlinks, and glory, winners will receive an award icon they can put on their Blogs (if they choose) to impress visitors. They will also receive a lovely MarketingSherpa Best Blog 2005 coffee mug to display on their desks and make their visitors and/or co-workers jealous.

Again, our thanks to everyone who helped make our Readers' Choice Blog Awards successful. Get your voting cap ready for next year!

Useful links related to this article:

Want to see who won last year? Here are 2004 winners:
http://www.marketingsherpa.com/sample.cfm?contentID=2729
(Open access)

Three useful MarketingSherpa stories about marketing with Blogs:

#1. Case Study: How to Build Your eretail Business with a Blog (6-8% of Readers Convert to Buyers)
http://library.marketingsherpa.com/sample.cfm?contentID=2806

#2. Case Study: 7 Practical Tactics to Turn Your Blog Into a Sales Machine
http://library.marketingsherpa.com/sample.cfm?contentID=2937

#3. How to Discover & Get Mentioned in the Most Powerful Blogs for Your Industry
http://library.marketingsherpa.com/sample.cfm?contentID=2765

AOL UNVEILS DETAILS OF NEW FREE CONTENT STRATEGY

2005-06-14T12:12:00.000-07:00

AOL UNVEILS DETAILS OF NEW FREE CONTENT STRATEGY
AOL UNVEILS DETAILS OF NEW FREE CONTENT STRATEGY
Will Include 1.5 Million Searchable Videos and 27 Content Channels
June 14, 2005
QwikFIND ID: AAQ65E
By Kris Oser
NEW YORK (Adage.com) -- Music and video freely accessible to anyone on the Web is the centerpiece of America Online's planned switch to an advertising-supported operation aimed at maximizing daily traffic rather than subscription sales, according to the company.
AOL is planning to make most of its vast content, as well as new kinds of content, accessible for free to everyone on the Web.
--------------------------------------------------------------------------------

Executives from the Time Warner online service unveiled the new content strategy at a press event yesterday. The portal, which has 22.6 million subscribers, will still provide those subscribers with a package of software and support services such as parental controls, special sections for children and antivirus and security programs. But the emphasis beyond that will now be on providing free content for the general Web-surfing and -searching public.

The service has been steadily losing its paying subscribers.

The new version
The new version of AOL, scheduled to go live the end of this month, features 27 channels, a video “hub,” the ability to develop one’s own personalized home page with RSS feeds, free e-mail and a variety of upgraded search tools, including a new video search function.

AOL executives noted that 56% of Internet users in the U.S. use broadband connections to access the Internet from home and that the overall online market is now supporting much higher levels of mainstream advertising. The company believes that online video is now a key draw for the rapidly evolving broadband audience.

The video offerings will be a combination of licensed and original programming, said Kevin Conroy, executive vice president and chief operating officer of AOL Media Networks.

1.5 million videos
The AOL video hub will present clips, replays and other material from Time Warner’s HBO, along with a growing collection of film from movie, TV and other entertainment arenas. Original content includes The Biz reality show; a top 10 video listing of what’s popular each day; a top five of programs on TV the night before; a comedy channel of up-to-the-minute news; and sports updates. This content, which will be introduced over the course of the year, will be added and filed along with the 1.5 million videos housed in AOL’s video search engine, SingingFish, acquired in 2003.

Also searchable is AOL Music. Mr. Conroy points to AOL Sessions and Live performances of musical groups as proof that content will bring visitors. Although it was not promoted, the opening of AOL Music to the general public last October boosted its audience by 37%, he said.

Video advertising units will consist of 15-second "pre-rolls" (ads appearing before video clips) that include an “ad curtain,” which borders the video-play window and continues to show ad messages as the content plays, said Michael Kelly, president of AOL Media Networks. Some advertisers are considering 30-second spots, he said.

AOL has debuted a video player compatible with all video content on the Web. And, in taking down the for-pay wall, all AOL content will be accessible for the first time to search-engine spiders, exposing AOL content to a potentially much broader audience.

Search engine marketing is the core of the marketing tactics rolling out this summer, Mr. Conroy said. By tracking what keywords Web surfers respond to, AOL can determine what areas of AOL.com are performing best and how to target online promotions.

Micro Media Fragmentation Begets Micro Ratings, Need For TV Search

2005-06-13T11:15:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
by Joe Mandese, Monday, Jun 13, 2005 7:46 AM EST
SAN FRANCISCO - THE IMPACT of micro media fragmentation on the major electronic media came to light last week during a series of presentations and panel discussions at MediaPost's OMMA West conference here. That fragmentation will make the kind of average ratings erosion that has pulverized the TV landscape with the rise of multichannel TV over the past 20 years look quaint by comparison. As hundreds, thousands and potentially millions of new channels come on stream, average channel viewing may become meaningless and could become replaced by new media search methods. That scenario is premised not on theory, said eMarketer CEO Geoff Ramsey, but on what already is occurring on the Internet where millions of Web sites vie for prominence among a relatively limited number that the average consumer actually visits each week.
According to an eMarketer analysis, the average Internet user now spends 7.5 hours per week online surfing among "millions" of sites, but actually visits an average of only 17 per week. By comparison, Ramsey pointed out that the average TV viewer spends 34.4 hours per week, but watches an average of only 13.6 channels per week even though there are about 100 available to the average household. The same principle holds up on radio, where the average listener listens to only 3.2 stations per week, even though there are an average of 73 available.

This principle has been well known within the TV industry for decades, and has been used by executives at the major TV networks to explain why they would always reap a sizeable share of viewing despite rampant cable channel fragmentation. That principle comes from the field of cognitive research, and is known as the "rule of seven plus or minus three." That rule suggests that given a virtually unlimited set of choices, the human brain will gravitate to a relatively small number - somewhere between 7 and 10.

Nielsen Media Research's data has born that out, with the typical viewer watching less than 14 channels per week. Given millions of choices, eMarketer's Ramsey said the same thing is true of the Internet, where only 17 sites are used by the average person during the average week.

The impact of a new TV channel explosion fueled by digital cable and satellite TV, broadband Internet and other sources, will likely make the TV channel environment more akin to the Internet than old-time television, and would lead to an entirely new TV navigation system, said experts participating in a MediaPost Spin Board panel discussion.

That system, they said, would be based on search, and would likely make search engine data as important for TV as it currently is for the Internet.

"The meta data of that data is more important than" the data published by many Internet sites, said Shelly Palmer, managing partner of Advanced Media Ventures Group LLC, and a Spin Board columnist.

Palmer was referring to the current influence of Internet search engines for navigating the Web, and the fact that paid search terms continue to grow in value for marketers and publishers seeking to capture user traffic. Palmer suggested we would soon see a "My Yahoo!, or My Google for TV," and that would lead to similar bidding for key TV search terms.

eMarketer's Ramsey noted that keywords and terms now rival expensive prime-time CPMs in terms of price and are growing fast.

Tom Hespos, president of Underscore Marketing, and another Spin Board columnist, said the more toward TV search was a natural outgrowth of Internet navigation, as well as basic human psychology.

He described this as the "brand effect" of search, noting, "If you're in the place where people expect you to be, maybe you're the guy to go to."

The Effects Of Media Channel Fragmentation
Average Hours Per Week:
Television 34.4
Radio 19.9
The Web 7.5

Number of Channels/Sites:
Television - 100.0
Radio - 73.0
The Web - Millions

Average Used Per Week:
Television - 13.6
Radio - 3.2
The Web - 17.0

Source: eMarketer.

DISNEY CHIEF CITES 'GREAT MIGRATION' TO CONSUMER CONTROL

2005-06-09T05:30:00.000-07:00

DISNEY CHIEF CITES 'GREAT MIGRATION' TO CONSUMER CONTROL
DISNEY CHIEF CITES 'GREAT MIGRATION' TO CONSUMER CONTROL
Says New Media Initiatives Are a Company Priority
June 08, 2005
QwikFIND ID: AAQ63Y
By Claire Atkinson
NEW YORK (AdAge.com) -- Acknowledging his company's need to "leverage the great migration" of viewers to consumer-controlled media formats, Walt Disney Co. president and COO Bob Iger yesterday said the company has made video on demand and digital ad formats a high priority.

Photo: AP
Bob Iger, who takes over as CEO of Disney in October, sees video on demand and other new media formats as crucial to the company's long-term success.
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New media initiatives
Speaking to 200 industry analysts at the Deutsch Bank Media Conference in the ballroom of Manhattan's Pierre Hotel, Mr. Iger sought to allay concerns over potentially revenue draining technologies such as digital video recorders that encourage ad skipping. He said the company was involved in a number of new media initiatives, including discussions with advertisers about how to embed their message in content that would be DVR proof.
Mr. Iger, who takes over officially as CEO in October, said Disney plans to make content available in video-on-demand formats that had the potential to excite and attract consumers. "What we might offer is Desperate Housewives, with a scene that might have been missing -- that's something I believe we could actually sell." ABC has been offering additional unseen footage from its top rated show on its Good Morning America broadcast.
Mr. Iger said Disney is aggressively seeking out new business opportunities to capitalize on new media opportunities. "I think we need to create primary businesses in that space [new media]," he said. He added that Disney's traditional businesses and their management should not "get in the way of a very very important migration to new media platforms."
ESPN model
He added that he sees the ESPN new media model as a direction for other Disney media properties. "That's the profile I want to create for the whole company... content that lives on all media platforms." ESPN provides live sports cast and interactive games through broadband online channels ESPN 360. The company has also launched ESPN Mobile, its own branded cell phone.
Mr. Iger characterized ongoing talks with Time Warner Cable and Comcast about VOD program distribution as "pretty productive," and predicted that viewers might see such shows as early as 2006. One sticking point with cable systems operator, Comcast, has been the issue of how content providers would be compensated. Comcast envisions VOD essentially as a free service for subscribers.
ABC Network
Addressing the overall health of the ABC Network, Mr. Iger said it is likely to turn a profit this year in large part because of the positive response of advertisers to its program slate for fall 2006. "ABC is on track to have a modestly profitable year and obviously the success in the upfront goes a long way in terms of supporting strong economics next year," said Mr. Iger.
ABC is projected to shift from a $154 million loss last year to a $30 million profit for full year 2005, according to a research note issued by Deutsch Bank on May 27.
Mr. Iger said ABC's strong creative streak has helped the company beyond simply increasing ad rates at ABC. Disney rolls out first season DVDs in September of its two breakout hits, Desperate Housewives, and Lost. The shows have also been licensed around the world. Mr. Iger added that ABC was well positioned to take advantage of the scatter market this year. "ABC held back inventory in enough good shows that if business develops and it's a little too early to tell, they are certainly going to be well positioned to take advantage."

OPA: Web Ads A Draw For Many Consumers

2005-06-02T11:56:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
OPA: Web Ads A Draw For Many Consumers
by Wendy Davis, Thursday, Jun 2, 2005 6:00 AM EST
RATHER THAN CHASE CONSUMERS AWAY, advertising on Web sites can drive consumers to visit those sites and spend more time there, according to a report released Wednesday by the Online Publishers Association.

"Far from being a turn-off, relevant advertising is a reason why people get engaged with sites," said Michael Zimbalist, president of the Online Publishers Association. "Contextually relevant ads are considered to be a useful aspect of the site."
For the study, "Online User Experience Study," the Online Publishers Association and the Media Management Center at Northwestern University surveyed 2,215 online users and conducted in-person interviews with 65 respondents. Researchers questioned respondents about their experiences at 39 different sites in seven categories: national news, local news, aggregated news, entertainment, games, visits, finance, and lifestyle.

Zimbalist said that some respondents who cited ads as part of a site's appeal said that the site gave them ideas for shopping, or that the ads were "interesting."

Even when visitors reported annoyance with online ads, that didn't seem to translate into less usage, said Zimbalist.

The report also found a high correlation between how entertaining or absorbing visitors found sites and usage, as determined by the frequency of visits and the length of time spent visiting. Some other factors correlated with high usage included whether a site seems to be concerned with people such as the visitors, and whether it's a regular part of visitors' days.

WSJ.com - How Old MediaCan SurviveIn a New World

2005-05-31T21:07:00.000-07:00

WSJ.com - How Old Media
Can Survive
In a New World
The digital revolution threatens to push the traditional newspaper, television, radio, music and advertising industries into the dustbin of history. Here's what they might do to avoid the fate.
May 23, 2005; Page R1
There's no question: Traditional media businesses are struggling.

Newspaper publishers, book publishers, movie studios, music companies, ad agencies, television networks -- they're all trying to figure out how they fit into a new-media world. Their old way of doing business isn't as profitable as it used to be, but they haven't found a new way that's as profitable, either.

THE JOURNAL REPORT

• See the complete Technology report.

• New Media, Beware

• Plus, see a chart that shows the declining audience for traditional media outlets.

So we decided to ask a wide group of media experts for their suggestions. What do they think old-media companies should do to survive? The answers ranged from the general to the specific, from the mundane to the far-out. Here's a look at what's ailing various media industries -- and what our experts suggest to help cure their ills.

NETWORK NEWS

In April, CBS News correspondent John Roberts appeared on the Evening News without a tie for the first time -- a small cosmetic alteration meant to strike a casual tone and appeal to a younger audience. But in an era in which the nightly news is losing esteem and viewers, an open collar will only get the networks so far.

TV news broadcasts have been in a state of crisis ever since CNN emerged as a competitor in the 1980s. The nightly broadcasts on ABC, CBS and NBC have had a 28.4% decline in total viewers since 1991, according to Nielsen Media Research. With the rise of cable outlets like Fox News Channel and the advent of online news sources, blogs and email alerts, the crisis only grows more acute.

Allow the viewer behind the screen. Corey Bergman, a local-television news producer in Seattle who blogs about technology innovations in TV news at the site LostRemote.com, maintains that networks need to engage viewers in a conversation. That means tearing down the facade of how news is made. He suggests posting full, unedited video of interviews online. Networks also might present behind-the-scenes clips showing the creation of a news program from inception to broadcast, and let viewers relay feedback to help further report the story. "The end result is more accountability and more credibility," he says, "something the networks could use."

QUESTION OF THE DAY

Which form of "traditional" media is most likely to become obsolete over the next 25 years? Cast your vote.
Broadcast beyond the TV. Networks are just beginning to pay lip service to digital media as a way of getting ahead of the next curve. Last June, Walt Disney Co.'s ABC News launched a Web broadcast called ABC News Now that delivers information 24 hours a day. Viacom Inc.'s CBS recently announced a similar initiative.

Bernard Gershon, senior vice president and general manager of ABC News' Digital Media Group -- who spearheaded ABC News Now -- says offering 24-hour news online is only the beginning. ABC News Now has begun delivering content for Sony Corp.'s PlayStation portable device and other mobile gadgets by partnering with companies like Idetic Inc., Berkeley, Calif., which delivers video content to cellphone and handheld-gadget users. Subscribers can select and download news clips edited for quick viewing, or stream ABC News Now in real time. "Now we're going to create it for any screen you're looking at the content on," Mr. Gershon says.

Form overseas alliances. Not everyone thinks technology alone can save network news. As viewership shrinks, so do operating budgets for news gathering, especially expensive overseas reporting. Larry Ellin, an associate professor at the S.I. Newhouse School of Public Communications at Syracuse University, suggests that network news organizations create strategic alliances with outlets around the globe. Instead of sending NBC News anchor Brian Williams to cover a tsunami after the fact, networks could broadcast current reportage from Indonesian news agencies that know the territory.

Audiences might respond to the authenticity and novelty of the content. "People aren't going to the Internet because it looks like a newspaper," Mr. Ellin says. "It's because they're getting something exotic and fresh and new and unfiltered. It's like eating French cheese. It hasn't been pasteurized. And it's good."

--Joe Hagan

NETWORK TV

The six broadcast networks -- ABC, CBS, Fox, NBC, UPN and the WB -- are facing big threats. Aside from the ascent of cable channels and videogames, there's the evolution of the DVD and the birth of broadband and wireless technologies -- not to mention the creation of satellite radio, high-definition TV and digital video recorders like TiVo. In 1978, the three original broadcast networks captured about 90% of the prime-time audience. Today, it's less than 50%.

Cut prime time. The Big Three networks deliver 22 hours a week of prime-time programming; Robert Thompson, director of Syracuse University's Center for the Study of Popular Television, says networks could cut that back dramatically, to 15. Filling 22 hours with quality TV is impossible, Mr. Thompson argues, especially with the costs of making shows soaring. "Right now you've got to throw on a bunch of expensive stinkers just to keep the lights on," he says.

Instead of network shows, local affiliates could run cheaper, more profitable fare such as news, game shows or sitcoms in syndication. The networks would save money on prime-time programming, and the local stations they own would pump increased revenue.

Weep while you work. Tom Wolzien, an analyst at Sanford C. Bernstein & Co., thinks networks should make it easier for workers to see programs at their desks. In a recent study, he found that the number of women aged 18 to 49 with broadband access at work roughly matches the number who are at home during the day. "Web delivery of soap operas could potentially double network profits," he says.

Many employers, obviously, would block the shows. But Mr. Wolzien figures that profits would soar if even 5% of women with broadband access at work tune in. He adds that this model might work for other types of daytime programming as well, such as sports.

Let the new blood in. Ron Simon, television curator at New York's Museum of Television and Radio, thinks the government should force TV networks to set aside time for independent or upstart production companies. The TV business used to have such a requirement -- the Prime Time Access Rule. Created in 1970, the rule required networks to reserve part of prime time for affiliates to program independently. The goal was to encourage program diversity and the growth of independent producers.

Mr. Simon advocates reinstating the rule, which was repealed in 1996 under heavy lobbying from Big Media. He acknowledges that the rule spawned lots of mundane but profitable TV -- but it also helped create some highly regarded hits, such as "The Muppet Show." Independent production companies, because they're more likely to take risks than the big studios, are more likely to come up fresh programming that pops, he says.

"Sometimes regulation is a good thing," Mr. Simon says.

--Brooks Barnes

NEWSPAPERS

The headlines for the newspaper industry have been somber for some time. The Internet and other electronic-media platforms are drawing ad dollars away, and daily U.S. newspaper circulation recently took its biggest tumble in nearly a decade, falling 1.9% in the six-month period ended March 31, according to the Audit Bureau of Circulations.

With younger readers gleaning their news elsewhere -- whether "The Daily Show" or Google's news Web site -- newspapers have strong competition that can offer even fresher information in an easier-to-use format. Our experts advise newspapers to experiment with their Web sites and other high-tech ventures as a way to snag this new digital audience.

Thin more about news, less about paper. When Andrew Swinand, a senior vice president and group client director at Publicis Groupe SA's Starcom Worldwide, visits with newspaper executives, he says he hears too much focus on circulation, and not enough talk about creating more ideas and venues for news content.

For instance, Mr. Swinand says papers shouldn't just use their online sites to post the same stories readers can see in print. Some reporters should be allowed to craft blogs about their topic of expertise. Readers should be able to add comments and reaction to a story in an online community.

Let readers customize their own newspaper. "The newspaper of the future is going to be a coalition of niche products," says S.W. "Sammy" Papert III, chairman and CEO of Belden Associates, a Dallas newspaper-industry consultant. That means, for instance, that newspapers should offer online readers -- who are used to hunting for narrowly focused information that interests them -- an opportunity to create a specialized newspaper according to their areas of interest. So, for example, newspapers might allow their readers to click a few buttons and see all of a paper's coverage about local politics, excluding everything else. Or readers might opt for a page devoted to sports or cultural news.

Follow readers around. Ad executives think a crucial element of newspapers' future will be alerts: periodic news updates sent to Web-surfing cellphones and pocket-pinging BlackBerries. The ability to deliver information that's relevant to a consumer can help a publisher form an invaluable link with that person.

"I don't want my phone to buzz or ding or vibrate every 30 seconds with breaking news, but two or three times a day, I think I might be interested in catching up on sports events or some kind of breaking-news event that was of national stature," says Ty Montague, co-president and chief creative officer of WPP Group PLC's JWT New York. "I would definitely want to be alerted to that."

--Brian Steinberg

ADVERTISING

Never has the advertising industry -- whose best-known product remains the 30-second TV commercial -- faced such wide-ranging threats. Ad-skipping devices, including TiVo Inc.'s digital video recorder, continue to penetrate U.S. homes. The spread of portable electronic devices means the average couch potato can consume media on the go -- without ads. New programming venues such as broadband entertainment online and video on demand will only make it more difficult to catch consumers with traditional ads. Meanwhile, marketers have become more demanding, asking for better proof that the billions of dollars they sink into advertising actually pay off.

Tailor your garment. As media outlets proliferate, they're getting more focused. Advertisers need to narrow their efforts to their new narrower audiences, making ads relevant to those who are seeing them. This can mean creating TV ads that play off the programs they support, or individual magazine ads that are crafted for readers of one specific title.

"There is not a one-size-fits-all approach to media that works for every brand, every time," says Jim Stengel, global marketing officer at Procter & Gamble Co. This tailoring has been done before, but it is gaining increasing popularity among advertisers who want their messages to fit into consumers' lives. It's also easier than ever, given the rise of digital technology that makes manipulation of images much easier.

Larry Light, executive vice president and global chief marketing officer of McDonald's Corp., points to the company's "I'm Lovin' It" campaign, which uses the slogan as a unifying theme but does different things to appeal to different demographics. For example, the ad for a new fruit and walnut salad -- aimed at women -- features animated female characters. But a print ad aimed at a younger, male audience shows a young man with a strange hairdo above a picture of coffee and a McGriddles sandwich. The caption: "Bad Night? Good Morning."

Turn ads into programming. "We are thinking less about traditional paid-media advertising," says Chuck Porter, chairman of Crispin Porter + Bogusky, a Miami ad shop. "To an awful lot of people, in general terms, advertising has taken on a much broader meaning: What can we do to make this brand famous?"

So, instead of producing straightforward commercial campaigns, ad agencies would create entertaining programming around brand names -- things that viewers want to tune in, download or read for their own sake. For instance, Crispin helped Burger King stage a fight between two actors dressed as chickens, meant to symbolize two TenderCrisp sandwiches the fast-food chain offered. The effort involved a Web site, ads showing things such as a weigh-in and, ultimately, an event on DirecTV.

Advertise where least expected. If consumers are growing inured to traditional advertising, marketers must find a different route. "The old-media world told us we should jam our commercials in between their programming," suggests James Vincent, a global managing director on Apple Computer Inc. business at Omnicom Group Inc.'s TBWA\Chiat\Day. "What if a brand could communicate in a longer format? You can do that on the Internet or in places that become destinations."

He points to Apple's retail stores as an example. Since the stores are operated by Apple, much of the in-store marketing is focused on the company's products, and Apple can shape sales and other promotions. The outlets also feature events and workshops that get all kinds of customers to spend more time learning about Apple products and ideas.

--Brian Steinberg

BOOK PUBLISHERS

The biggest challenge facing book publishing today is winning over a younger generation that has made space on its shelves for Apple's iPod music player and Sony's PlayStation -- but not many books. A report last summer by the National Endowment for the Arts found that the steepest decline in literary reading between 1982 and 2002 took place among the youngest age groups surveyed.

Meet and greet. Ron Chernow, a leading biographer and author of such books as "Alexander Hamilton" and "Titan," says he worries that the screen is replacing the printed page. He suggests that publishers send authors into the public schools so that the process of writing is demystified.

"Publishers tend to be preoccupied with their immediate audience," says Mr. Chernow. "They can and should think in terms of programs where writers go into the schools. There might not be an immediate commercial benefit, but there could be a long-term advantage in terms of creating future readers."

Mr. Chernow says he has been involved with such programs in the past, and that they were effective. It helps significantly, he adds, when kids are given free books. "To actually have a chance to meet and discuss books with a living author stimulates reading," he says.

Don't get bound to paper. Richard Sarnoff, president of Bertelsmann AG's Random House Ventures, says publishers need to think beyond the printed page and find ways to reach younger readers with books that don't sit on shelves.

For instance, Random House is planning to deliver strategy tips to cellphones from videogame guides published by the company's Prima Games imprint. Random House also made an early, and significant, investment in Audible Inc., a publicly traded Internet venture that sells digital audio books that can be downloaded onto iPods and other MP3 players, as well as cellphones. "On a long-term basis, we have to create a thriving new base of readers," says Mr. Sarnoff.

Learn a new language. Lee Byrd, co-publisher of Cinco Puntos Press in El Paso, Texas, says publishers need to do a better job reaching a growing group of future book buyers: Spanish-speaking children. Ms. Byrd, whose publishing house focuses on children's books that often feature Spanish and English on the same page, says, "Publishing 'Little Red Riding Hood' in Spanish isn't going to get the job done. Kids want to read about their culture in their books."

Ms. Byrd urges publishers to find stories that reflect Spanish-speaking traditions. She cites "La Llorona/The Weeping Woman" by Joe Hayes, which has 105,000 paperback and hardcover copies in print, as an example of a book rooted in the Spanish-speaking culture. Ms. Byrd says that the ghost story, which involves a spurned wife who kills her children and immediately regrets it, is widely known in various forms throughout Latin America.

--Jeffrey A. Trachtenberg

MOVIES

The movie business is getting it from all sides. DVD-producing pirates siphon off customers who might otherwise buy a multiplex ticket or legitimate disc. Customers who once might have relied on movies for entertainment can choose from an increasing variety of alternatives, from videogames to the Internet. And internally, the studios are struggling to deal with technological issues, like how to introduce the next generation of DVD.

Expand the role of the multiplex. The filmgoing experience should "keep on evolving and changing," says Mark Cuban, who co-owns high-definition cable and satellite broadcaster HDNet along with the Landmark Theaters chain. Theaters can become "out-of-home entertainment hubs to watch not just movies, but live feeds of concerts, sporting events and probably even multiplayer gaming events."

To vie with the increasing sophistication of home-entertainment systems, theaters need to add some frills. More luxury reserved-seating theaters, chairs that can move in conjunction with onscreen action, and cocktail service in the theater would be a start.

Forget DVDs. It may come as bad news to studios, which are currently embroiled in complicated negotiations over the launch of the next generation of DVD, but they should start thinking beyond putting movies on a disc. "Physical media is going to be supplanted over time with material that sits in a hard drive," says Curt Marvis, chief executive of CinemaNow Inc., a Marina del Rey, Calif., movie-downloading service. That way, he argues, studios could take advantage of all the copy protection and bonus features of a next-generation DVD, and lose the expense and hassle of packaging and shipping the actual disc.

Movie owners would be able to use networking to zap movies to any television in their house, or any portable player they own, without having to search through bookcases and under sofa cushions for the right disc. "We'll enable consumers to watch content anywhere, anytime, on any device," says Mitch Singer, executive vice president of the digital-policy group at Sony Pictures.

Send movies home earlier. Right now, movies have a fixed dance card: first a few weeks in theaters, then a few weeks on pay-per-view television, then DVD. Maybe a year or more after its original release, the movie hits free television. But that system limits the revenue studios can get. Many moviegoers never get around to visiting the theater, and have lost interest in the title by the time it comes out on DVD.

Warren Lieberfarb, a Hollywood consultant and former Warner Bros. executive, says he has a better idea. He advocates making movies available at home at the same time they go into theaters, but on a limited basis -- for example, home watchers could have access to the movie for only 24 hours. They should also pay a stiff premium over the price of a movie ticket -- perhaps $40 per household, assuming several people will watch it.

"The economics of movie production are going to drive wider distribution," Mr. Lieberfarb says. "It will become irresistible for the studios."

--Sarah McBride

MUSIC

After five wrenching years of piracy and other troubles, the $33 billion global music industry has barely begun to show signs of a possible recovery. Lawsuits and other tactics may or may not have put any dent in piracy. The long slide in album sales hasn't stopped, while new delivery methods, such as online sales to computers and wireless sales to cellphones, currently make up only about 2% of sales. That share is likely to climb to only about 15% to 20% in coming years. And it remains to be seen whether consumers will deem DualDiscs, which add DVD content to the flip side of a CD, a more compelling proposition than plain CDs.

Embrace the enemy. Wayne Rosso, president of Mashboxx LLC, believes the music business needs to do the once unthinkable: Give an online file-sharing network -- namely, the one he runs -- license to distribute its releases legitimately.

File-sharing companies came under fire from the music industry for allowing users to swap songs illegally. Grokster, where Mr. Rosso used to work, is the target of an entertainment-industry lawsuit now pending before the U.S. Supreme Court.

But, he argues, Mashboxx is different. The site has built-in controls designed to make users pay for licensed content, while letting them freely trade only unregistered material. File-sharing services, he says, are more attractive than download sites like Apple's iTunes Music Store, because users will swap songs from their personal collections -- making available millions of obscure tracks that may not be sold anywhere.

Go mobile. Last year, Apple sold seven million iPods. But music executives have their eyes on a much bigger market: cellphones, which last year sold roughly 80 million in this country. For now at least, you can't buy tunes on your mobile service plan. Thirty-second ringtone snippets, sure. But not full-length, stereo songs. That's likely to change soon with a new generation of handsets and advanced wireless networks, and music executives are salivating at what they view as a massive opportunity.

Adam Klein, executive vice president of strategy and business development at EMI Group PLC, calls mobile phones "a very attractive environment" compared with the Internet. Whereas people are used to getting content free online, he says, they are accustomed to seeing items tacked onto their phone bill. And, Mr. Klein points out, the cellphone has become an indispensable accessory of modern life -- and one day it may become a tiny music store that goes everywhere with you.

Don't sell music -- sell musicians. Record companies are in a paradoxical bind. Sales of recorded music have been falling for five years running. But musicians are more in demand than ever among a host of media and advertising outlets, from film studios to fashion labels to liquor companies. So Jimmy Iovine, chairman of Vivendi Universal SA's Interscope Geffen A&M Records, reasons it's high time people like him look for more outside deals to take advantage of their artists' visibility.

Mr. Iovine's company has struck a movie-development deal with Viacom's MTV Films and explored launching a music-video cable channel. Sony and Bertelsmann's Sony BMG Music Entertainment has said it is exploring a film-development arrangement of its own, although details are scarce.

CHART OF TIMES SQUARE ADVERTISING PRICES

2005-05-10T05:07:00.000-07:00

CHART OF TIMES SQUARE ADVERTISING PRICES
CHART OF TIMES SQUARE ADVERTISING PRICES
A Guide to Fees and Sellers at 23 Prime Locations
May 10, 2005
QwikFIND ID: AAQ55D
By Abbey Klaassen and Photos by Darryl Estrine
Also see main story: The Cost of Times Square Advertising
Click for big photo Marketer
Location Price

HBO's Deadwood
On Broadway between 46th and 47th streets
$150,000/month (Clear Channel Spectacolor)

ABC Family On 47th at Broadway
$75,000/month
(Clear Channel Spectacolor)

CNN Headline News
On 47th at Broadway
$75,000/month
(Clear Channel Spectacolor)

LG Electronics
NE corner of 45th and Broadway
Approximately $165,000/month
(LG has long-term lease for space; Viacom Outdoor negotiated)

Mountain Dew
NE corner of 45th and Broadway
Approximately $175,000/month
(PepsiCo has long-term lease with building owner)

Prudential
South side of Two Times Square, 47th between 7th Avenue and Broadway
Between $200,000 and $350,000/month
(Sherwood Outdoor)

HSBC
South side of Two Times Square, 47th between 7th and Broadway
Between $200,000 and $350,000/month
(Sherwood Outdoor)

Samsung
South side of Two Times Square, 47th between 7th and Broadway
between $200,000 and $350,000/month
(Sherwood Outdoor)

Coca-Cola
South side of Two Times Square, 47th between 7th and Broadway (has been in Times Square since 1935)
between $200,000 and $350,000/month
(Sherwood Outdoor)

Nasdaq screen
SE corner of 43rd and Broadway
$60,750 for four weeks of 6,680 30-second spots; comes out to $8.86 a spot
(sold by Viacom Outdoor)

Reuters screen
SW corner of 43rd and 7th
$30,000 and up depending on spot load, frequency and customization. Because of the irregular screens, most messages have to be produced, which is extra.
(Sold by Instanet)

Planters
NW corner of 45th and Broadway
$85,000/month, moving parts extra
(Sold by Clear Channel Spectacolor)

Best Buy
NW corner of 45th and Broadway
$68,000/month
(Sold by Clear Channel Spectacolor)

Washington Mutual
SW corner of 42nd and 7th
$165,000/month, production into the millions
(Sold by Clear Channel Spectacolor)

Kodak
On Broadway at 46th
$175,000/month, screen production in the millions
(Sold by Clear Channel Spectacolor)

Cingular
On Broadway at 46th
$150,000/month
(Sold by Clear Channel Spectacolor)

Sean Jean
SW corner of 47th at Broadway
$120,000/month
(Sold by Clear Channel Spectacolor)

JDate
SW corner of 47th at Broadway
$65,000/month
(Sold by Clear Channel Spectacolor)

Thai Airways
SW corner of 47th at Broadway
$75,000/month
(Sold by Clear Channel Spectacolor)

Wm. Wrigley Jr. Co.
Broadway between 43rd and 44th (video screen changes messages by daypart: markets young-skewing brands during MTV's 'Total Request Live' and older-skewing brands at night for theater-goers)
$145,000/month
(Sold by Clear Channel Spectacolor)

Target
42nd St between 7th and Broadway (nine boards for a total of 23,000 square feet)
$850,000/month
(Sold by Van Wagner)

U.S. Army
Broadway and 43rd Free (a perk of owning Times Square real estate)

Toys 'R Us
Broadway, between 44th and 45th (windows face south and west). Messages scroll continuously - each ad is exposed for 7 minutes an hour, 20 hours a day.
$80,000 for a 6-week cycle. Production costs extra.

THE COST OF ADVERTISING ON TIMES SQUARE

2005-05-10T05:02:00.000-07:00

THE COST OF ADVERTISING ON TIMES SQUARETHE COST OF ADVERTISING ON TIMES SQUARE
Behind the Scenes of America's Most Famous Billboards
May 09, 2005
QwikFIND ID: AAQ54O
By Abbey Klaassen
NEW YORK (AdAge.com) -- It is a signature of America's marketing and financial prowess, a world-famous tourist attraction and one of the country’s most coveted marketing communications venues: Times Square. Awesomely bright and shamelessly gaudy, its billboards towering above the Broadway and

Photo: Darryl Estrine
The 11 ad spaces on One and Two Times Square cost up to $350,000 a month.
Also see: CHART OF TIMES SQUARE ADVERTISING PRICES
42nd Street neighborhood are also among the country's most effective -- and most expensive -- advertisements.
But how much do they cost and are they worth it?
Consider this: While 30-second Super Bowl commercials cost $2.6 million each and reach 80 million people, the One Times Square tower draws 211 million pairs of eyeballs when the New Year’s Eve ball drops, according to the president of Sherwood Outdoor, Brian Turner. “We like to think of [the Super Bowl] as just a tailgating party,” he said.
$325,000 a month
Like many involved in the buying and selling of Times Square ad space, Mr. Turner is circumspect about the daily financial details. He wouldn’t comment on advertising prices at One and Two Times Square but industry estimates peg the monthly rates for the 11 spaces on the two landmarks at $200,000 to $350,000 each.
According to media sellers, the rental prices for ad real estate varies widely depending, in part, on size and -- like everything else in Manhattan -- location. Electronics giant LG is said to be paying $165,000 per month for its corner-wrapping placement space above Planet Hollywood at 45th street and Broadway. The Mountain Dew sign just below it goes for $175,000 a month. Washington Mutual's six-story-high three-dimensional display of a giant beanstalk section topped by a castle costs $165,000 a month.
Of course, those prices cover only the rental space and not the price of the physical sign or its supporting technology -- costs that regularly rise into the millions for the customized, weatherproof, high-definition LED sign displays that have become so popular. At 135 feet long and 26 feet wide, the J.P. Morgan Chase sign at the base of the Reuters building at 42nd Street and 7th Avenue, for example, was a $10.3 million investment. It boasts 10 times the resolution of the average TV set.
Since 1935
Most ad buys in Times Square are long-term, multiyear deals, although some movie studio and TV network ads appear for just a month or two, according to sellers. At the famous One Times Square, for example, marketers sign on for 10-year

Photo: Darryl Estrine
The cost of the space rental is separate from that of the actual physical display devices -- some cost upward of $5 million.
stints -- although the Coca-Cola Co.'s sign on Two Times Square has been there since 1935. Several other marketers, including Wm. Wrigley Jr. Co.'s Wrigley brand, Planters nuts and Anheuser-Busch's Budweiser have had longstanding presences in the area, but have moved around to different spots.
Incumbency in the area is a powerful advantage. Target Corp. recently bought all nine billboards for a total of 23,000 square feet on a newly constructed 42nd Street building called Times Square Tower. The impact of the unprecedented deal has been lauded by many in the industry as one of the best outdoor buys in recent time and it’s highly unlikely the retailer will give up its incumbency any time soon -- thanks to the low odds of again being able to acquire so many concentrated spots.
The long-term deals also help justify the multimillion-dollar production costs for the high-tech automated and electronic boards.
Impact of technology
“As the tech grows so does the space,” said Jessica Coates, spectacular specialist for Viacom Outdoor. “If it’s a single ad unit -- LG, Pepsi, AT&T, Con Ed -- those are a long-term leases anywhere from 10 years on. But they’re constantly changing out the creative and technology to keep up with the times.”
Times Square draws 40 million annual individual visitors -- roughly equivalent to 14% of the U.S. population. Kodak estimates the area’s in more than 100 million snapshots a year. If the Times Square were an Arbitron metro media market, it would rank No. 152, right there between Rockford, Ill., and Flagstaff, Ariz.
The prime billboard neighborhood stretches north-south from 53rd to 41st streets and east-west from 6th to 8th avenues. Aside from building-sized advertisements, it also boasts a work force of 274,000 and includes entertainment, finance and media companies, counting ABC studios,

Photo: Darryl Estrine
Often used as a backdrop for TV shows and movies, the reach of Times Square ads is global and long term.
Ernst & Young and Conde Nast Publications among its residents.
Microcosm of global business
“It’s a microcosm of global business,” said Michael Steinberg, vice president of sales and marketing for Clear Channel’s Spectacolor division. And that influx of business has made Times Square a place for targeted ad buys as well as ego buys. “You can put a sign in front of Lehman Brothers and Morgan Stanley for less than what you’d probably pay to run in a monthly trade that covers the financial industry,” Mr. Steinberg said.
The overall annual Time Square advertising business is estimated to be worth $69 million, in a market dominated by outdoor players such as Viacom, Clear Channel, Sherwood, Van Wagner and Vista Media. Cost-per-thousand-viewers impressions for the area range from $2 to $5, compared to around $20 for a prime-time network TV buy. Individual monthly rates vary as well, depending on a variety of factors: Is the sign directly across from a busy subway stop? Can it be seen from MTV’s Total Request Live studio? Does the sign make it on the annual New Year’s Eve broadcast?
Immeasurable bonus impressions
Then there’s the immeasurable bonus impressions through residual media -- on TV shows like CSI: New York, in movies, magazines, newspapers, postcards and coffee table books. “You watch the 6 p.m. news and you have two major TV networks broadcasting from Times Square -- ABC and MTV,” said Tommy Turner, senior vice president and partner of Van Wagner Outdoor, which has had a longtime presence in the area. “That’s legitimate, even if it’s incalculable. It’s people from Peking to Minneapolis.”

Yahoo!: Display Ads Trigger Online Search

2005-05-09T10:15:00.000-07:00

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Yahoo!: Display Ads Trigger Online Search
by Gavin O'Malley, Monday, May 9, 2005 8:00 AM EST
ONLINE DISPLAY ADVERTISING APPEARS TO have a significant impact on consumer search behavior, according to a study Yahoo! plans to release today. For the report, Yahoo! conducted a three-week study of the search behavior of about two million consumers, half of whom were served Harrisdirect's display ads (standard rectangles and skyscrapers), and half of whom were not. Dynamic Logic collected the responses to display advertising, while the Yahoo! internal research team examined the search behavior.

The consumers who were served display ads conducted 61 percent more searches on keywords related to Harrisdirect--that is, those keywords purchased by Harrisdirect for search marketing purposes. Also, the group that was served the display ads clicked through on Harrisdirect-related terms at a rate 249 percent higher than consumers who were not exposed to the ads, and clicked on links leading to the Harrisdirect site at a rate 139 percent higher than those not served display ads.

Richard Kosinski, category development officer for financial services sales at Yahoo!, said the company plans to further study the relationship between search and display advertising. "Because the marketers we work with have so much riding on the investments they make, this study was the first of many we plan to conduct across different verticals to examine exactly what impact display and search advertising have on each other," said Kosinski.

A Yahoo! spokesman also said the company wasn't yet ready to draw any general conclusions about the relationship between consumer search behavior and display ads.

Listeners Agree Less Is More, Would Use More Radio With Fewer Ads

2005-05-05T05:41:00.000-07:00

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CLEAR CHANNEL COMMUNICATIONS, THE NATION'S largest operator of radio stations, gambled big earlier this year when it initiated a program to air fewer commercials, and more radio programming. The strategy appears to be paying off with advertisers and consumers alike. Recently, Clear Channel announced that it is getting more ad dollars for the fewer ad units it is broadcasting, and on Wednesday a top radio researcher revealed findings of a study indicating that ad clutter is an important issue for radio listeners, though not as much of a problem as for TV viewers. At least that was the perception of a majority of more than 1,000 radio listeners surveyed in March by Arbitron and Edison Media Research. While 37 percent of listeners perceived there are more commercials on radio than a year ago, a significant majority (71 percent) believe there are more commercials on TV, and (67 percent) that TV commercials are far more intrusive than radio's.
Commercial Perceptions: TV Vs. Radio

TV Radio
Has More Commercials: 71% 22%
Commercials Are More Intrusive: 67% 27%

Source: Arbitron, Edison Media Research.

The findings also appear to affirm Clear Channel's strategy. Nearly half (47 percent) of the respondents said they would listen to a radio station "a lot more" if that station had noticeably fewer commercial breaks, while 44 percent said they would listen "a lot more" if that station had shorter commercial breaks. "There is considerable evidence in this study that reductions in radio spots loads should lead to greater time spent listening to radio - as long as these spot load reductions are noticeable and stations inform their listeners of the changes," said Joe Lenski, executive vice president of Edison Media Research.

The study also found that consumers are more likely to change channels during commercial breaks while watching TV than listening to radio. While watching television at home, only 6% of viewers say they "never" change channels when television commercials come on, with a total of 19 percent saying they "rarely" or "never" do.

Nearly half of radio listeners at home (49 percent) say they "never" change stations when radio commercials come on, with a total of 73 percent saying they "rarely" or "never" do. Nearly half (48 percent) of television viewers "always" or "usually" change channels when a television commercial comes on. Just 11 percent of radio listeners at home "always" or "usually" change stations when radio commercials come on.

And while it was unclear how it might impact their actual media usage behavior, the researchers said the vast majority of listeners believe commercials are a "fair price to pay for free programming on radio" and that the percentage has actually grown since 1999, the last time that question was asked.

Listening to commercials a fair price to pay for free programming on the radio:

1999 82%
2005 84%

Source: Arbitron, Edison Media Research.

British Airways - contextually relevant OOH messaging

2005-05-04T16:55:00.000-07:00

MultiVu - Don't Be "Naff" -- Learn To Use "Chuffed," "Laughing Gear" "Half Four" and Dozens of Other British Slang Words Before Your London Holiday
Don't Be "Naff" -- Learn To Use "Chuffed," "Laughing Gear" "Half Four" and Dozens of Other British Slang Words Before Your London Holiday
New British Airways' "English to English" Online Dictionary Helps Travellers Conquer the English's English
New York, May 4, 2005 - For the millions of Americans who will visit London for the first time this summer, British Airways has created the world's first online "English to English" dictionary to ensure travellers can confidently ask for the location of the "loo" (restroom), the "lift" (elevator), the "blower" (telephone) or the "bin" (trash can). With this bit of local knowledge, Americans will be truly "sorted" and can look forward to quite smashing holidays in the UK.

The dictionary - available at www.ba.com/know -- will feature over 80 British words and translations and will be as much fun for the homesick ex-pat and the avid Anglophile as it will be for the first time London-bound traveller who needs to learn the idioms and favored slang of the Londoner's language.

"Nearly 1.5 billion people on the planet speak some version of English - but the version of English used in the UK does take a bit of getting used to," said Robin Hayes, executive vice president, British Airways, The Americas.

"Someone planning a London holiday could rent films like "The Full Monty," or "Lock, Stock and Two Smoking Barrels" to try and get a handle on the nuances of British slang", he noted. "However, our online website is a 'cheeky' bit of fun that may be the easiest and best way to learn some of the uniquely British words and phrases people often bring home from a London vacation. Our intention is that each visitor to the web site can also share the fun with his or her friends and family."

Each morning, throughout the month of May, British Airways will serve up a new British word of the day at www.ba.com/know. Viewers will learn what the word means, how to properly use it and will be able to continue to 'spread the word' via a text message to friends' cell phones or email. Examples of these words include:

Cheers- is a way of saying 'thanks' and 'goodbye'. If someone buys you a pint in a London pub, you'd respond with "Cheers!"
Chuffed- in London, means to be delighted. Used like, "I was chuffed to hear from you… it's been ages!"
Half-four- in London, means four-thirty. As in, "Let's meet back at the Tate Gallery at half-four."
Kip- in London, is a nap. As in, "Let's get a quick kip in before we go to dinner."
Laughing gear- in London, means mouth. When you hand someone a drink, you'd say "Wrap your laughing gear around this, mate!"
Loo- is the restroom. As in "Where's the loo, please?"
Peckish- in London, means hungry. As in, "When you get a bit peckish, give me a bell and we'll meet for lunch!"
Readies- available cash. As in 'Get your readies together, and let's go shopping."
Shout- in London, is to offer to buy someone a drink. In a pub, you might say "OK lads, whose shout?"
The "Real London" Uncovered With Tips/Hints
Once a traveller knows how to sound just like a British "bloke" or "bird," he or she needs the 'gen' (knowledge) on where to go and what to do while in London. British Airways' updated website offers customized and easy to download "insider" tips on the best, undiscovered London experiences… recommendations that allow travellers to experience London from a local's perspective, provided by those who really know London.

For example:

Pub Fare- for some traditional pub fare, try The Ship for a wonderful range of ales and beers and a restaurant that uses fresh, often organic products from farms also run by the owners. In the summer you'll find locals gathered on the edge of the Thames enjoying the Ship's famous outdoor barbecue - be warned it gets very busy on sunny days!
Puppetry- traveling with the kids? Puppets appeal to all ages and The Little Angel Theatre in Islington has been entertaining audiences since 1961. It puts on its own productions and welcomes a wide variety of visiting puppet companies to its stage - one not to miss!
Summer Concerts- on a summer evening, take in a live performance in one of London's many parks. Pack a picnic and glass of wine and head to Kew Gardens, Kenwood House, Regent's Park, Marble Hill or Audley End for a Shakespearian play or live music from many genres - from jazz to classical, Abba to the swinging Sixties.
British Airways - which flies from 22 gateways in North America and every year brings millions of visitors to the UK- recommends travellers save money by purchasing hotel accommodations and sightseeing tickets in North America before arriving in Europe.

BA.com offers one-stop shopping with a variety of special packages geared to just about every budget and taste. The package deals permit visitors to choose their own options, whether hotels, car rentals or a range of sightseeing excursions. A big benefit is that consumers are protected by currency fluctuation, as British Airways is able to lock in the price by bulk purchasing several months in advance.

In combination with the new site, designed by New York's Agency.com, there will be a full outdoor advertising experience in New York City for the month of May. M&C Saatchi New York collaborated with Optimedia New York to create the outdoor campaign that positions the British words near a place associated with the word. For example, Shout - is to offer to buy someone a drink, will be placed on coasters in bars.

Photographs or video of the outdoor and out-of-home "in situ," placement ads or screen shots are available at http://www.prnewswire.com/mnr/britishairways/21794/.

Hitwise: Consumers Deluge Dove.com After "Apprentice" Plug

2005-04-26T04:40:00.000-07:00

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Hitwise: Consumers Deluge Dove.com After "Apprentice" Plug
by Wendy Davis, Tuesday, Apr 26, 2005 7:00 AM EST
CONTESTANTS ON THE FOURTH EPISODE of the current "Apprentice" failed their assignments to create an ad for Unilever's Dove Body Wash, but the show still managed to spark a weekly 1,512 percent increase in traffic to the Web site www.dove.com, according to a report released Monday by research company Hitwise.
After the airing of the Feb. 10 episode, Yahoo!'s Apprentice Web site posted a link to Dove.com--which accounted for 50 percent of all visits to the site on Feb. 11. Also on Feb. 11, an MSNBC.com article about the players' bad luck with creating an ad was responsible for 15 percent of visits to the site. Searches on the term "dove" also increased by 1,062 percent for the week ending Feb. 12, compared to the prior week.
Other marketers to see an Apprentice-related spike in traffic to their Web sites include Pontiac, which had a 180 percent week-over-week jump in visits the week that an April 14 episode featured the Pontiac Solstice, and Domino's Pizza, which saw a 64 percent week-over-week traffic increase in traffic during the week of the March 31 show.

Study: Best Online Ads Draw On Print Techniques

2005-04-25T05:14:00.000-07:00

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Study: Best Online Ads Draw On Print Techniques
by Shankar Gupta, Monday, Apr 25, 2005 7:15 AM EST
SOME OF THE BEST WEB ads combine print advertising's use of powerful images that "pop" with animation that quickly draws in viewers and directs their attention toward a message, according to a new study of online ads by CNET Networks, Ignited Minds, and NOP World's Starch Communications.
For the report, expected to be released today, researchers surveyed 8,592 users intercepted at various CNET Network sites, including Gamespot.com and CNET.com. Respondents were asked to view several ads on a mock site, and rate them.
Hoping to fill what he described as a "huge void" in the knowledge of what works and doesn't work in terms of online ad creatives, CNET Chief Marketing Officer Joe Gillespie said that the purpose of the study was to explore which type of ad images are effective on the Web, and help guide advertisers away from running annoying ads that drive consumers from sites.

"Bad advertising really hurts our business. It hurts our user experience, and that's never really been the case before: On TV, you can run bad ads, and frankly, nobody knows," Gillespie said. "In our world, if we're running ads that are irrelevant or intrusive, people show up and tell us about it, or just vote with their feet and don't show up at all."

The study found that a good creative includes powerful images and a simple design; ads also should discuss the benefits of the product, and direct the viewer with a visual flow. One such ad discussed in the report was for "Vampire: The Masquerade Bloodlines," which was nearly two and a half times more likely than average to be chosen by respondents as "one of the best ads." The creative featured scantily clad cartoon vampires in front of a darkly lit cityscape.

Another ad to score highly was an ad for a Nokia video phone, which illustrated the study's conclusions about visual flow--the ad shows a woman throwing a Frisbee to a dog--drawing the user's attention from the top left to the top right--displaying the tagline "your life, with instant replay"--and then to the bottom right, when at the last moment, a kitten jumps into the air and nabs the Frisbee. The ad loops three times before the picture zooms out to shows the video phone and a link to the product specs.

The report revealed that, at least for gaming ads, the best visuals were drawings--"but very realistic ones," as opposed to exaggerated cartoons.

Gillespie hopes to shift the discussion from whether marketers should advertise online to what that advertising should look like. "We think it's time to have a change of emphasis within the Internet community. We've done a lot about why people need to advertise on the Internet, and now it's time to talk about how to do it and how to do it right," he said.

The survey, however, is not necessarily representative of the average Web browser--Gamespot's audience is 97 percent male with an average age of 25.4 years, and on average spent $1000 on video games in 2004. CNET.com's audience is 79 percent male, with an average age of 37.5 years, and spent $2,584 on consumer electronics in 2004.

Google To Offer Impression-Based Pricing

2005-04-25T05:12:00.000-07:00

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Google To Offer Impression-Based Pricing
by Shankar Gupta, Monday, Apr 25, 2005 7:15 AM EST
IN A MOVE THAT POTENTIALLY cuts down on click fraud, Google today is expected to announce that it will now allow advertisers who participate in AdSense to purchase inventory on a cost-per-thousand impression basis, rather than cost-per-click. The search giant also will announce today that AdSense advertisers may now purchase ad space on the sites of specific publishers, and also serve image ads through AdSense.
The upgrades, currently offered in beta to a select set of Google advertisers, will be rolled out to all Google advertisers within the next few weeks, a Google spokesman said. Advertisers will be able to select specific Web sites on which to place their ads, and then set a cost-per-thousand impression bid, as opposed to paying on a cost-per-click basis. Google already calculates likely cost-per-thousand impression prices by looking at cost-per-click and click-through rates.
The move away from cost-per-click pricing could help Google cut down on click fraud stemming from publishers' generating phony clicks on ads in order to receive a portion of the pay-per-click fee. Many industry observers think click fraud is a significant problem facing search engines--although the scope remains murky. Last November, Google sued a publisher in its AdSense network, Auctions Expert International, for allegedly fraudulently clicking on ads that had been served by Google.

eMarketer analyst David Hallerman said Google's strategy of offering to charge based on cost per thousand impressions might be attractive to some marketers who are anxious about fraudulent clicks. "If some advertisers have been concerned, it can allay their fears," he said.

In other revamps to the program, advertisers now will be able to serve image ads and animated ads. Google also introduced a new ad format for its AdSense publishers--a 160x600 "skyscraper" unit. Google's head of advertising sales strategy, Patrick Keane, said the ads will face a "very strict" editorial review before they can be served via AdSense, and have some restrictions on their formats: No flash ads--animated .gif files only--and ads cannot strobe or loop more than three times. In addition to Google's review, publishers will be able to block individual advertisers if they so choose.

Google also will offer advertisers a "site selection tool," which will hunt for sites that match a particular theme or concept using keyword searches.

Keane said that the changes give advertisers greater flexibility in terms of placing ads, while also giving publishers new creative formats. "We think this is a win for the three constituencies that matter to Google," said Keane. "Google in general is always evolving our advertising network. Our core mission here is a better user experience, and the opportunity for a new creative format is going to be better for our users as well."

David Hallerman added that the upgrades take Google a step closer toward offering branded advertising. "To give the advertiser the ability to choose a publisher--and to charge it on the CPM basis, which could be better for both parties, and moving on to allow graphical elements--are really the first major moves into some sort of branding advertising, which is one of the steps they need to diversify their income stream," he said.

BOB GARFIELD'S 'CHAOS SCENARIO'

2005-04-22T20:29:00.000-07:00

BOB GARFIELD'S 'CHAOS SCENARIO'
BOB GARFIELD'S 'CHAOS SCENARIO'
A Look at the Marketing Industry's Coming Disaster
April 13, 2005
QwikFIND ID: AAQ48M
By Bob Garfield
Meet George Jetson, circa 2020.
He doesn’t have a personal hovercraft or a food computer, but the rest of the future is more futuristic than he thought. Spacely Sprockets and Cogswell Cogs are out of business. Digits are the new widgets.

.
SEE Bob Garfield's NPR Radio version of 'Chaos.'
ALSO SEE Reader Letters Responding to This Article
TV is gone
Over-the-air network TV is gone, along with program schedules, affiliate stations and hotel demand in Cannes in the third week of June. George, Jane, Judy and Elroy get their entertainment, and their news, any way they wish: TV, phone, camera, laptop, game console, MP3 player. They get to choose from what the Hollywood big boys have funded and distributed, or what the greater vlogosphere has percolated to their attention.
ABC, NBC and CBS are still major brands, but they surely aren’t generating radio waves. Three initials never uttered, however, are CPM. They’ve long since been supplanted not just by ROI, but VOD, video on demand; P2P, the peer-to-peer Napsterization of content; DRM, the allocation of royalties for digital distribution of content; VOIP, Internet telephony; and RSS, the software that aggregates Web content for easy access by the user.
Branded Entertainment has long since been exposed as a false idol, because consumers got quickly fed up with their shows being contaminated by product placements. Satellite radio is a $4 billion 8-track tape player, stored on a high shelf in the garage, pushed aside by podcasting, which is free. The Upfront Market is an exhibit at the Smithsonian. The Super Bowl survived as the No. 1 pay-per-view event. Survivor didn’t.
The space-age family of the future can still watch CSI, any episode they want, whenever they want, but not on any advertiser’s dime -- unless they choose for their viewing costs to be subsidized. Yet advertisers know everything about them and understand virtually every move they make.
Marketers aren't adversaries
And the Jetsons don’t fight it. In 2020, consumers understand that marketers aren’t adversaries; they’re intimates, sharing info for everybody’s mutual benefit.
Yesiree, by George, it’s a brave and exciting new world that the near future holds, a democratized, consumer-empowered, bottom-up, pull-not-push, lean forward and lean back universe that will improve the quantity and quality of entertainment options, create hitherto unimaginable marketing opportunities and efficiencies and, not incidentally, generate wealth that will make the current $250 billion domestic ad market seem like pin money.
Alas, the future -- near or not -- doesn’t happen till later.
So let’s return to contemporary business reality in the digital revolution, already in progress. Because in the intervening 15 years -- or 20 years, or five -- there are three more initials to consider: SOS.
Because revolutions by their nature are neither seamless nor smooth.
Collapse of old model
Because there is no reason to believe the collapse of the old media model will yield a plug-and-play new one.
On the contrary, there is nothing especially orderly about media’s New World Order. At the moment it is a collection of technologies and ideas and vacant-lot bandwidth, a digital playground for visionaries and nerds.
So what happens when 30 Rock and Black Rock and the other towering edifices of network TV are rubble, and the vacant lot has yet to be developed?
Undeveloped and unprepared. Unprepared to lawfully deliver CSI. Unprepared to absorb $4 billion ad dollars, much less broadcast’s $42 billion. Unprepared legally, technologically and even socially to pick up the pieces of the old world order.
Hold on. Let’s change metaphors. Forget the construction site. Make it a space-age treadmill, cycling too fast for George Jetson to keep his footing. “Jane!” he pleads. “Stop this crazy thing!” But Jane can’t stop it. Nobody can stop it, and nobody can quite hang on.
Ah, yes. The Chaos Scenario.
Downward spiral
The statistics are already getting tiresome, but let’s review a few of the more salient ones, shall we?
According to Nielsen, network TV audience has eroded an average of 2% a year for a decade, although in the same period the U.S. population increased by 30 million.
In the last sweeps period, for the first time, cable commanded a larger audience than broadcast.
The cost of reaching 1,000 households in prime time has jumped from $7.64 in 1994 to $19.85 in 2004.
A 2000 Veronis Suhler Stevenson survey showed that Americans devoted an average of 866 hours to broadcast TV annually and 107 to the Internet, a ratio of 8:1. The projection for 2005 had the TV/Internet ratio at 785 hours to 200, or just under 4:1.
U.S. household broadband penetration has gone from 8% in March 2000 to an estimated 56% in March of this year, according to Nielsen/NetRatings.
70% of DVR users skip commercials
Five percent of U.S. homes are equipped with TiVo or other digital video recorders, and not only does time-shifting of favorite programs render network schedules irrelevant, 70% of DVR users skip past TV commercials.
Complicating problems, consolidation in the telecom industry and potential re-regulation of DTC drug advertising threaten billions in network ad revenue, jeopardizing the supply-demand quotient that has propped up network prices for five years. Meanwhile, there is the sword of Damocles called “cost.” The reality-TV fad has enabled networks to fill their ever-more-irrelevant schedules and cast for hits with cheap programming. But how much longer will they last? Westerns and spy shows, superheroes and hospital dramas all once burned bright. Then they burned out.
What’s ominous about that is not the inevitable end of the latest hot genre; it’s the inevitable end of the profitability that has gone with it. And the downward spiral could begin at any moment. In fact, to switch metaphors once again, Shawn Burns, managing director of Wunderman, Paris, looks at the 2005 upfront and sees “the last strand of the rope bridge.”
Mr. Burns, of course, makes a living preaching the wonders of segmentation and the bankruptcy of mass marketing. No wonder he observes with barely camouflaged glee that the efficiency pendulum has swung. “There’s been research,” he says, “that real cost of obtaining 30 seconds of the consumer’s attention is the same in 2005 as it was before the invention of television.”
Fraying rope
Emphasis his. Yes, he has a vested interest in being a doomsayer. He is by no means, however, the only one who sees the rope fraying.
“I still love and enjoy TV and believe it is very effective for advertisers,” says Association of National Advertisers President Bob Liodice. “But we’re killing it. We’re gradually killing it with cost increases, the level of clutter, the quality of the creative that is out there.”
“How can they continue to ask for more and more for fewer and fewer faces?” asks Geoffrey Frost, chief marketing officer of Motorola. “I don’t believe that is sustainable. I believe there will be disruption. There’s already disruption.”
“It’s an inevitable kind of slow collapse of the entire mass media advertising market,” says J.D. Lasica, author of Darknet: Remixing the Future of Entertainment and president of the Social Media Group consultancy. “What we’re seeing is that not only does television have to reinvent itself from the content point of view, it has to reinvent itself as an advertising medium.”
Primitive standards
No mystery as to how, either. As technology increasingly enables fine targeting and interaction between marketer and consumer, the old measurement and deployment standards are primitive almost to the point of absurdity.
“The industry’s key currency is basically reach, frequency, exposure and cost per thousand,” says Rishad Tobaccowala, president of Internet media shop Starcom IP. “I’m not saying whether it’s right or wrong but that’s currently the currency. And where the currency ought to be is about outcomes, engagement and effectiveness. Because right now all I’m doing is I’m measuring how cheaply or how expensively I’m buying the pig. I’m not figuring out whether the hot dog tastes good.”
None of this is lost on any sentient being in the media and marketing business. Any lingering denial most likely evaporated when Procter & Gamble Global Marketing Officer Jim Stengel -- he of the $5.5 billion marketing budget -- faced agency heads a year ago at the American Association of Advertising Agencies’ Media Conference and declared the existing model “broken.” But it’s not just the ad model; it’s the content model, as well. Writer and former venture capitalist Om Malik looks at TiVo and the video-on-demand horizon and is prepared to call in the backhoes for the institution of the prime-time schedule.
“Hasn’t it collapsed already?” asks the author of Broadbandits: Inside the $750 Billion Telecom Heist. “Look at their viewership. Isn’t it going down every day? I mean, we can pick and choose what foods we eat, what car we drive, what clothes we wear and what colognes we use. And some guy sitting in New York decides how I should watch?”
Consumer control
Point taken. As more control has been placed in the hands of the consumer, the consumer has shown every intention of exercising it. Especially in the coveted 18-34 cohort, viewers are fleeing TV and going online, where nobody need have their content dictated to them. But as to Mr. Malik’s rhetorical question -- hasn’t the old model collapsed already --the answer happens to be:
No, it hasn’t.
Network TV spending went up in 2004, by 10.7%. According to Jack Myers Report, last year’s upfront market yielded a 15.4% increase across the four majors, and Mr. Myers projects a 4% increase for the top four in 2005. Yes: increase. There are many possible explanations for the phenomenon. One is habit; gigantic institutions tend not to rapidly adapt. Another is greed: the self-interest of the comfortably situated old guard to preserve the status quo. The third is supply and demand, upward pricing pressure from Viagra, et al, which engorged the marketplace with billions in new spending. The main factor, though, is that network TV audiences remain coveted, because -- shrinking though they are -- they represent the last vestige of mass media and marketing, or, as Motorola’s Mr. Frost calls it, “the last surviving conglomeration of human beings in the living room.”
Precisely, says David Poltrack, executive vice president of research at CBS, who sees incremental revenue opportunities in video-on-demand, but no end to the dominance of broadcast TV in the foreseeable future. “Unless the advertising community finds something to replace television advertising, I think the relative value of the top-quality inventory is always going to be appreciating relative to all the other options,” he says. “Unless someone can come up with a more effective way of introducing a new product than broad-based advertising exposure, I think that business is always going to be there."
Which is why Motorola, whose nifty palm-sized Razr device represents the Jetsons’ media future today, mainly used TV to introduce the gizmo to the world. Because there are still a few programs that catch the imagination of enough human beings in enough living rooms to represent a mass-marketing opportunity.
“I still believe in TV,” Mr. Frost says. “People still watch it, and I love being associated with the right kind of programming that is different, that is appealing, that embodies the kind of innovation we want to stand for as a company.”
'Teetering ecosystem'
On the other hand, he acknowledges that the financing of the “right kind of programming” -- not to mention the overwhelming majority of flops --depends on network revenue streams that could dry up quickly. “The teetering ecosystem behind all this stuff that allows people like us to sort of cherry-pick” for exceptional programs, he says, “may begin to find itself in serious trouble.”
So while the old model hasn’t necessarily collapsed, new-media gurus could be forgiven for seeing the beginning -- or middle -- of the end. Steven Rosenbaum, pioneer of citizen-produced TV and founder of MagnifyMedia, envisions a world of content created by and for individuals over broadband. He snorts at Mr. Poltrack’s defense of the status quo.
“These guys,” he says, “their job is to postpone the future.”
Viacom split
Another skeptic apparently is Sumner Redstone, chairman of CBS parent Viacom. One week after Mr. Poltrack spoke to Ad Age, Mr. Redstone announced his plan to split the company in two, presumably to reduce the drain of CBS and its other broadcast properties on the stock value of the company’s faster-growing media assets.
So for the moment, let’s assume that there is indeed major trouble ahead, that the law of diminishing returns will eventually kick in, that advertisers who’ve paid more and more for less and less will not pay indefinitely for nothing. Marketers will begin to abandon network TV. Ad prices will fall. Profitability will disappear. Program development will suffer, leading to more advertiser defection, and so on in a consuming vortex of ruin. But wait. The network refugees will not flee empty handed. They’ll draw carts bearing steamer trunks stuffed with a quarter trillion dollars.
Then what? In the short run, obviously, more boom times for cable, and then:
Payday for the New World Order.
“A bit of it will go to this new emerging network which will be on the mobile phones,” says Mr. Malik. “The next thing, you will see is the emergence of more Internet-based video advertising. ... There’s going to be a lot of hit-and-miss in this but I think that’s another area you’ll see a lot of progress made. A third channel is ... Internet-enabled cable services. They’re not home runs by any means but they’re definite solid singles and doubles.“
Economics of scale
No dingers? So what? The whole point of new media is small ball. Quit playing for the three-run homer and amass the singles and doubles. Because, says Starcom’s Mr. Tobaccowala, “the key thing is economics of scale is going to disappear. That’s really what the issue is. Our business has been built on the economics of scale. And instead we’re going to go into the economics of re-aggregation. Which is how do you get 10, 20, 30, 40 thousand people instead of taking in 250 million and making them into 12 and 30 million dollar segments. How do you re-aggregate one at a time into the tens of thousands?”
Fragmentation, the bane of network TV and mass marketers everywhere, will become the Holy Grail, the opportunity to reach -- and have a conversation with -- small clusters of consumers who are consuming not what is force-fed them, but exactly what they want. Producers and broadcasters capitalized with billions of dollars will be on approximately equal footing with podcasters and video bloggers capitalized with $399.99 12-months same-as-cash from Best Buy. And just as DailyKos, Instapundit, Wonkette and Wil Wheaton have coalesced large followings in the cacophony of the blogosphere, some of the citizen-video programmers will find not just a voice but an audience.
Wait. Did I say “will find?” Make that “are finding.”
“All of that is happening,” says Drazen Pantic, founding member of videologging Web site unmediated.org, “In the last two or three years, we’ve had a silent revolution of consumer electronics. And broadband is coming. It’s a huge proliferation in the last two years. And so people are going to start broadcasting from home and so on. You will have zillions of people, broadcasting for the audience of 10.”
Except when it’s much bigger than 10. A month ago, a little girl named Dylan Verdi posted a home movie on her father’s Web site. PressThink.org’s Jay Rosen dubbed her the world’s youngest vlogger. The link went viral and, as her father Michael reports on his own videolog, “24 hours later 2,000 people had downloaded her video.” It would have been much more, but he had to shut his site down so he wouldn’t wind up penniless from bandwidth charges.
Web proves it can outdraw TV
The Internet has also demonstrated its ability to outdraw TV. JibJab satirical animations have been downloaded by the millions, for instance. And even TV programming has drawn better online than in its native habitat -- such as when comedian Jon Stewart went on CNN’s Crossfire to assassinate Tucker Carlson live on cable.
“That episode got, what, 400,000 viewers maybe on big old powerful CNN?” says Jeff Jarvis, president of Advance.net, the online arm of Advance Publications, and author of the media blog BuzzMachine.com. “Well that same segment was copied onto the Internet, where it got at least 5 million views. So what’s more powerful, the network CNN owns or the network no one owns? So now suddenly the distribution is exploded. Now on the Internet we can all swim in the same pool as content created by, you know, Universal or Disney. The tools are cheap and easy.”
It is a beautiful thing: the total democratization of media, combined with the total addressability of marketing communications. We, the people, cease to be demographics. We become individuals again.
”Choice is a good thing,” Mr. Jarvis says. “Choice is a proxy for power. The more choice we have the more power we have. The most important invention in the history of media was not the Guttenberg Press, it was the remote control. It gave us control over the consumption of media. Then came the cable box and the VCR and the TiVo and now come the means of creating content. Now I can create a radio show and put it on the Internet. Nyah, nyah, nyah.”
Maybe it’s “nyah, nyah, nyah -- take that Big Media.” Or maybe it’s “tra la, tra la -- what an empowering new world.” Either way, it’s underway.
Straight-to-Internet campaigns
On the advertising side, Google last year generated $3 billion in revenue, about the same as The New York Times Co. No surprise that Vonage, the Internet telephony carrier, is using the Internet to find subscribers, but Procter & Gamble put its money where Jim Stengel’s mouth is by launching Prilosec OTC with 75% of its budget allocated off TV. American Express allocates 80% of its budget off the airwaves. The new Pepsi One campaign will use no TV whatsoever. (Not Capital One. Not Purina One. Pepsi One.) In the new-media laboratory called South Korea, where universal broadband is social policy and its penetration exceeds 80%, the Internet’s share of ad spending is twice that of the U.S. TV, meanwhile, accounts for only 34.4%.
In the wake of BMW films, such diverse U.S. marketers as Amex, Burger King, Lincoln-Mercury and Motorola have created an ever-expanding universe of content/advertising hybrids, Webisodic short films to reach younger prospects online. Mercury’s “The Lucky Ones” is so barren of product and brand messages it is scarcely advertising at all.
Netcasting, of course, also delivers pure programming, too. From the top down was the streaming, on Yahoo, of Kirstie Allie’s new show, Fat Actress. From the bottom up, video logs -- or vlogs -- like Dylan Verdi’s are being generated every day. At Rocketboom.com, chirpy, irreverent host Amanda Congdon delivers oddball news and snarky observations in a primitive studio (or maybe a one-bedroom). At J.D. Lasica’s alpha Web site Ourmedia.com, citizen journalists and producers post their own news reports, animations, music videos and whatever else amuses them free of charge.
So that should be the answer: the seamless transition from TV to online, from mass media to micro media, from mass marketing to permission marketing. But not so fast. George Jetson does his vlogging in 2020. Om Malik says he believes the scenario could just as easily take place by 2010. But this is 2005. What if the rope bridge finally snaps, say, next year? Or the next?
It better hadn’t. Because the future isn’t quite ready.
Think: Yugoslavia.
Perhaps you are familiar with it. It used to be a country, ruled by an authoritarian criminal. Then it began to fragment. There went Slovenia, and Croatia next. Then Bosnia. Kosovo made its move, and in the ensuing madness, the regime collapsed. The unshakeable Slobodan Milosevic, who had fomented four wars in the name of Greater Serbia, was overthrown. Democracy! Empowered individuals! A new model!
And, five years later, unemployment is 32%. The average monthly income is $336. The prime minister was assassinated by organized criminals and the country’s most notorious war-crimes suspect is at large. Unmediated.org’s Mr. Pantic, formerly of Belgrade’s freedom-fighting radio station B92, is only too familiar with the problem.
“There is no way,” he says, “to make the transition into anything that is different or new or whatever without chaos. Because as with democracies you need five or six newly elected parliaments, you need to replace people who have ties with the old regime.”
Change doesn't happen overnight
Likewise, he says, in the transition from old media to new: “The new paradigm is not going to be established overnight.” There are too many obstacles.
BROADBAND PENETRATION It has catapulted to nearly 60%, but that is still a long way from 100%. In South Korea, where penetration exceeds 80%, online advertising does indeed have twice the share of the U.S. online industry, but it is still less than 5%.
CAPACITY “I don’t think the interactive community has sufficient capacity to handle a seismic change in a transition from network to online,” says the ANA’s Mr. Liodice. “I don’t think that’s gonna happen.” Online-marketing consultant Joseph Jaffe agrees. The author of the forthcoming Life After the 30-Second Spot doesn’t believe there will ever be a dollar-for-dollar transfer of TV money to the Internet. But even 10% of all money now allocated to TV would more than double the total online spending. “You’ve got a handful of publisher properties that may be able to kind of cope initially,” Mr. Jaffe says, “and then be able to at least kind of sustain that increased demand. But for the most part, when the tsunami hits, all hell’s gonna break loose.”
QUALITY Dylan Verdi is a cute little girl, but once the novelty of world’s-youngest-vloggerdom wears off, there is no reason for anyone outside of her immediate family to watch her iMovies. “I mean you can put a lot of bad video clips that you shoot with your camera phone on the Web,” says Mr. Malik, “but how many people want to watch that? If you’re going to create a product for passive consumption it has to be good. I mean look at all the shows that fail. There is very low tolerance for bad television.”
FINANCING “Where,” Mr. Malik asks, “does the money come from to produce the programming of high enough quality to reach the audiences that are obviously going to be smaller than the status quo?” In a video-on-demand universe, networks may send along free samples of new shows to paying customers of existing ones, but absent vast reservoirs of ad revenue, the risk of program development may well be prohibitive. A collapse of the old model could create a Hollywood dustbowl.
LEGISLATION. Peer-to-peer software such as BitTorrent, which permits affordable transfer of large video files, also enables video piracy, and could be legislated or litigated into oblivion by a beleaguered Hollywood desperate to preserve the value of its backlist. Sen. Orrin Hatch, R-Utah, last year introduced an anti-p2p bill called the Inducing Infringement of Copyright Act of 2004 (Induce Act).
COST. As pricing in the search business has amply demonstrated, any influx of spending into the online space will drive prices upwards, potentially erasing the efficiencies promised by even the most ultra-targeted media buy. The metrics of reach may change radically, but not necessarily those of frequency. As Mr. Tobaccowala puts it, “Millions of people arrive at the Yahoo Homepage. What people don’t realize is that they arrive one at a time.”
SUITABILITY Content will be enormously diverse, agrees Forrest Research research director Chris Charron, but will it constitute a legitimate advertising medium? “A lot of people talk about these social networks and blogs and the blogosphere as being great ways to attract consumers and attract eyeballs and potentially good advertising opportunities, but history shows that is not the case, even recent history. Remember GeoCities? I think they were bought by Yahoo for $3 or $4 billion. Well, it never became a very viable advertising outlet and that’s because it wasn’t a great context for people to place ads. Advertisers weren’t interested in putting it on a personal homepage for Chris Charron for my friends and relatives to see.”
CONTENT DIVIDE Convergence means not only technological and economic disruption; it means social disruption. Cost of broadband and VOD programming will surely exceed $100 per month for each household, and most likely twice that, disenfranchising tens of millions of Americans and changing the dynamics of a shared popular culture. The idea of a vast digital underclass mocks the Internet’s promise of the democratization of media.
Then, of course, there is the biggest monkey wrench in the works: the absurd lack of preparedness for anything other than the most deliberate evolution into a Jetsonian future.
“Even if all the technology were in place and scaled up to size,” says Mr. Tobaccowala, “what isn’t ready really is either clients, agencies, or the media companies. Because in effect what we have to change is the way we do business.”
Oh, preparations are underway. Earlier this year, Rupert Murdoch’s News Corp. retained McKinsey & Co. to figure out how to transition to this Internet thing -- which is something like nailing plywood to the windows when the hurricane makes landfall. News Corp. no doubt feels safe enough, because Fox network customers are still lining up to buy, partly because they know how to do that. GRPs are buggywhips that just feel so familiar and reassuring in their hands. No wonder Mr. Stengel is showing up at the 4A’s revival tent preaching salvation: “If we believe that there’s life beyond the 30-second spot,” he demanded, “why are we still dependant on reach, frequency and advertising pre-market scores?”
Yahoo's gambit
So don’t storm the Bastille just yet. Even the revolutionaries aren’t quite organized for the revolution. Among those not quite ready for the end of prime time is Yahoo, which hired ABC programming chief Lloyd Braun to develop whatever content will be when content will come from the likes of Yahoo.
“The key for us,” he told an iMedia Brand Summit in February, “is to be able to come up with that unique, signature, compelling content for the Internet, the way television has been able to do over the years.”
Duh. As to what that might look like, he was a little bit fuzzy.
“What I’m not saying is that we’re just going to be doing television shows on Yahoo, and we’re going to be streaming them, so we’re going to do our version of Lost, or our version of Alias. There’s going to be a big place for video streaming and all of that, don’t get me wrong, but I don’t believe ultimately that the future of Internet content is by doing on the PC, or on mobile devices, what you can already get on your living room television set. We have to really get our arms around what those expectations are. What is the audience looking for when they go on the Internet?”
Yes, that would seem to be the question. But nobody has definitively answered it. That’s why there are hand-wringing Cassandras like Jim Stengel and giddy opportunists like Wunderman’s Shawn Burns.
But what if you are a direct marketer in what promises to be the Golden Age for direct marketing and a historic opportunity knocks and you lack the manpower to answer the door? Under the current circumstances, Mr. Burns says he’d first advise clients to scale up their Web capabilities by a factor of 10. But he concedes that in a Gold Rush economy, he doesn’t know where all the Web designers would come from to do the work. That, of course, is the essence of the Chaos Scenario -- a critical shortage of resources and infrastructure.
It’s almost comical to hear Starcom’s Mr. Tobaccowala talk about the marketing landscape of the very near future.
“Expect to see a lot of event and store-based marketing,” he says. “Expect people to actually go completely away from electronic media to experiential media, if you can call it that. So expect for instance Starbucks, bars, all kinds of things -- bathrooms, OK?”
Bathrooms? Jim Stengel has $5.5 billion burning a hole in his pocket, and he’s supposed to invest it in bathrooms?
“That’s exactly the point,” says John Hayes, chief marketing officer for American Express. “There isn’t the off-the-shelf capacity today. You have to create it. You have to build them. You have to come up with the ideas. To access the talent, you have to basically construct solutions.”
Hence Amex’s Jerry Seinfeld/Superman Webisodes and sponsored concerts Webcast to prospects. If the old model is broken, Mr. Hayes can’t just sit around waiting for somebody else to fix it.
“As in any industry,” he says, “those who are unprepared for change will obviously suffer the consequences.”
That warning has to be pried from Mr. Hayes’ lips, but it is a warning nonetheless -- sort of a reciprocal to another sort of warning. David Poltack, of CBS, may or may not be the spokesman for the status quo, but you can’t miss the “You’ll be sorry” quality to his caution about his notion of the chaos scenario should marketers abandon network TV.
An economic downfall?
“If they do,” he says, “then the entire marketing system that perpetuates this economy will be weakened. And this is not a problem for just the broadcast television networks. This is a major problem for everyone who markets a product to the consumers in this country. Because there has been and there is not currently on the horizon anywhere near as effective a way to market products to the mass consumer marketplace. And if in fact that current system deteriorates to the point that advertisers and marketers abandon it, I don’t see anything that’s going to replace it and the entire marketing infrastructure and the economy is going to be diminished. And that’s a lot bigger problem than just a network television program.”
In other words, what’s good for CBS is good for America.
The other possibility is the opposite: that what’s bad for CBS, and for ABC and NBC and Fox and Conde Nast and the Gannett Co. is very good for America, because what emerges from the ruins will be superior in every way to what it replaced. Better for marketers, better for the economy and especially better for Mr. Jetson, who won’t have a robot maid but very likely will have a million-channel universe.
As Rishad Tobaccowala elegantly concludes, “Those who come to destroy TV are those who are eventually going to save it.”
And the world will rejoice, happily awash in electrons. But before the liberte, fraternite and egalite, beware. This is revolution, and first we will be awash in the blood of the old guard.

A SAD FAREWELL TO MILLER'S HIGH LIFE MAN

2005-04-19T03:17:00.000-07:00

A SAD FAREWELL TO MILLER'S HIGH LIFE MAN
A SAD FAREWELL TO MILLER'S HIGH LIFE MAN

An Ad Campaign as Authentic as It Was Appealing

April 18, 2005

QwikFIND ID: AAQ48U

By Jonah Bloom

Time was when an American advertiser wanted to stand out, not blend in. When a brewer’s sales pitch was based on research in the field [cut to shot of a bar], not concocted in some fancy marketing school. What next? Tailgaters with cocktail shakers? This is no way to sell ... the High Life.”

That many of America’s marketers muddy instincts with science, shy away from points of difference and kill

Is your name Sally the salad eater?

Why real men eat bacon grease.

Sometimes a man gets too hungry to clean his hands properly.

A lesson for the would-be Casanova.

great creative is not news. Still, I was somewhat surprised last week when Advertising Age magazine’s Jim Arndorfer, who reported the debut of the “High Life man” in 1998, learned Miller was planning to terminate this gem of a campaign.

The fakery in beer ads
In an era when much advertising feels fake, especially brewers’ ads, which tend to depict too-preened girlymen prancing around predictably beautiful women, the High Life man has been an honest, authentic campaign that regular beer drinkers could relate to. More young men than ever before are deserting beer for fancy liquors and silly spritzers -- on-premise spirit sales grew an estimated 10% last year, while beer sales declined -- and here was a campaign reminding us real men drink beer. It played perfectly into the cultural backlash against metrosexuality, it spoke to those of us who still aspire to our stoic fathers and grandfathers, who built stuff, who knew stuff.

Equally important in an age of growing consumer control and commercial clutter, it was so perfectly told, arch and entertaining -- the copywriting, as poorly mimicked at the top of this column, sometimes smacked of Mark Twain -- it could engage those who screen, either mentally or technologically, most of the ad dreck aimed at them.

A rare feat of advertising
It was the rare example of a campaign that appealed to young hipsters, and even some frat boys, without alienating the more-mature drinker. Rarer still, it combined art and effectiveness. It was initially commissioned to arrest the downward spiral of discounting to which Miller had succumbed and it did that. When backed with some decent media weight, it delivered a tasty uptick in sales, too.

Recent sales figures have been poor, however, which some blame on the creative, others on the lack of, or poor execution of, media buying, and yet others on distribution issues and the tough beer environment.

No campaign should rest on its laurels: Advertising being an art form, there is always the potential to create a better body of work. And, given Miller is working with Wieden & Kennedy to create the new High Life ads, it is just possible that it will come up with something so fabulous that I will wonder why I ever cared for the old High Life guy’s rugged reflections.

Ignore the accepted marketing wisdom
Many suggested Miller has long thought the High Life ads need to “be younger” or “place more emphasis on the beer’s value,” which is a worrying sign that it didn’t understand High Life man, and may be hankering after some prancing soda-pop starlets. Miller would not be alone in believing that ads have to show the audience that you want to reach. This almost seems to have slipped into the category of accepted marketing wisdom, despite the fact it’s claptrap. Most hipster influencers will shun your brand like a Celine Dion box set if they see it hawked on TV by their supposed peers.

Nostalgia has a powerful effect on the young as well as old. Just ask a 25-year-old about the candy they used to buy when they were kids, or the TV shows they watched, or the first time their dad gave them a beer. At a time when the real enemies of Anheuser-Busch and Miller are the spirits companies, a campaign that reconnects beer to the very essence of manhood seems a brilliant strategy.

The High Life man deserves a promotion, not retirement.

Less Proves Higher CPMs For Clear Channel, But Fewer Radio Ad Dollars

2005-04-18T05:19:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
LESS APPARENTLY DOES MEAN MORE in radio advertising -- more CPMs. Clear Channel Communications, which embarked on a controversial plan to reduce the amount of commercial time on its radio stations, boosted the price of its ad time during the first quarter, its top executive confirmed in an interview with Reuters on Thursday. "Advertisers are paying more for 60-second spots with us than they did last year, and more than they did the previous month," John Hogan, CEO of Clear Channel Radio, the nation's largest radio broadcaster told the newswire service, adding that radio advertisers are also relying less on the medium's traditional 60-second ad units and more on 30-second spots.

That was the goal of an ambitious plan launched by Clear Channel this year that it claimed would be a win for both its listeners and its advertisers.

"We're scaling back... less commercials, less station promos and even shorter breaks," the company proclaimed in promos touting the new format, which began in January. The company said the move was in direct response to feedback from radio listeners, but also is a tacit acknowledgement of outside pressures - everything from satellite radio services to Internet podcasts - that are making terrestrial broadcast radio sound cluttered by comparison.

"Clutter is a major issue in our industry and our decision to limit the amount of commercial time and length of breaks, while reducing promotional interruptions, will benefit listeners, advertisers and the industry as a whole," Hogan said when he announced the plan last summer. He noted that "specific ceilings" would be applied to every Clear Channel station and would vary by format and daypart.

While media buyers applauded the plan to reduce the overall clutter of Clear Channel's stations, some balked that the real strategy was to get advertisers to pay more for less by converting the medium's traditional 60-second units into :30s.

While Hogan says advertisers are beginning to wean off of radio :60s, it's unclear whether the broadcaster has been able to close the price gap between the two commercial formats.

On Thursday, Hogan confirmed that the strategy has slowed overall advertising revenues in the short term, and has driven some advertisers to competing radio stations.

The Mismeasure of TV

2005-04-11T08:08:00.000-07:00

The New York Times
April 10, 2005
Our Ratings, Ourselves
By JON GERTNER

The Mismeasure of TV
One of the great contradictions of modern American life is that almost everyone watches television while almost no one agrees anymore about what it really means to watch television. True, we know that as spring gets under way, new episodes of ''Desperate Housewives'' and ''C.S.I.'' and ''American Idol'' will battle for prime-time supremacy in the overnight Nielsen ratings. We also know that local broadcast stations around the country will begin scheming -- just as they do every April -- to win the May sweeps, the tense weeks when rival stations pursue a fierce one-upmanship of flamboyance and hype and the Nielsen-measured audience sizes determine future advertising rates. But when it comes to figuring out how many of us are watching these shows, and whether we're paying attention while we're watching and even whether we're actually noticing the advertisements among the shows we may or may not be watching -- well, this is where things get tricky.
For the past decade or so, watching television in America has been defined by the families recruited by Nielsen Media Research who have agreed to have an electronic meter attached to their televisions or to record in a diary what shows they watch. This setup may not last much longer. Just as programmers and advertisers are clamoring for a better understanding of the television audience, a wave of new consumer products has made it increasingly difficult to satisfy them. One day this January I sat in a Greenwich Village workroom with Bob Luff, the chief technology officer at Nielsen, as he pulled out gadget after gadget to show me what he's up against. Luff seemed to view the modern American home as a digital zoo where the lion is about to lie down with the lamb: radio is going on the Web, TV is going on cellphones, the Web is going on TV and everything, it seems, is moving to video-on-demand (V.O.D.) and (quite possibly) the iPod and the PlayStation Portable. ''Television and media,'' Luff said over the noise of five sets tuned to five different channels, ''will change more in the next 3 or 5 years than it's changed in the past 50.''
It is Luff's job to think this way, of course -- to observe Americans' embrace of new technologies and respond with new ways for Nielsen to measure that. It is also the job of a Maryland company called Arbitron, which has counted radio listeners -- and, at various times, television viewers -- since the late 1940's. For the past few months, Arbitron has been taking a distinctly unorthodox approach to measuring audiences. Currently the company is recruiting a couple of thousand volunteers in Houston and asking these randomly chosen men, women and children to wear a black plastic box that looks like a pager, three inches by two inches by one-half inch, whose circuitry is roughly as complex as that of a cellphone. In the radio and television industry, this little box is known as the portable people meter, or the P.P.M. In both a business and a cultural sense, it also seems to be the equivalent of a large explosive.
The Houston volunteers will clip the P.P.M.to their belts, or to any other article of clothing, and wear it all their waking hours. Before going to bed, the volunteers will be expected to dock the P.P.M. in a cradle so that overnight it can automatically send its data to a computer center in Maryland, where statisticians can download and review the information. There are still kinks to work out, but ideally the P.P.M. will tell Arbitron exactly what kind -- and exactly how much -- television and radio programming a person was exposed to during the day. Eventually the P.P.M. may also tell the technicians at Arbitron a host of other things too, like whether a P.P.M.-wearer heard any Web streaming, or supermarket Muzak, or any electronic media with audible sound that someone might encounter on a typical day.
It may not be immediately obvious why this little gadget should matter much to anyone beyond East and West Coast media elites. But one indisputable fact about media measurement is that if you change how you count, funny things happen. Or maybe not so funny. Nielsen's introduction of new electronic television meters in the New York area last winter, for instance, prompted a torrent of criticism from Fox Television, which saw the local ratings (and potential revenue) of several of its programs suddenly plummet. But this may prove a modest dust-up compared with what comes next, if devices like the P.P.M. or data from millions of set-top digital cable boxes reveal that what Americans are seeing and hearing do not correspond to what the big measurement companies have long been claiming.
Finding out whether ''C.S.I.'' beats ''Desperate Housewives'' is just the beginning. Change the way you count, for instance, and you can change where the advertising dollars go, which in turn determines what shows are made and what shows then are renewed. Change the way you count, and potentially you change the comparative value of entire genres (news versus sports, dramas versus comedies) as well as entire demographic segments (young versus old, men versus women, Hispanic versus black). Change the way you count, and you might revalue the worth of sitcom stars, news anchors and -- when a single ratings point can mean millions of dollars -- the revenue of local affiliates and networks alike. Counting differently can even alter the economics of entire industries, should advertisers (thanks to the P.P.M.) discover that radio or the Web is a better way to get people to know their brand or buy their products or even vote for their political candidates. Change the way you measure America's culture consumption, in other words, and you change America's culture business. And maybe even the culture itself.

The Code for All Media
Among the bedrock beliefs of the measurement business is the notion that a ''passive'' measurement device is more accurate than an ''active'' one. This is another way of saying that the more that volunteers have to do to actively chronicle their program choices, like pushing a button or writing something down, the less exact the information about the audience will be. For years, Arbitron's radio ratings and Nielsen's television ratings have depended on selectively recruited Americans who usually get between $2 and $15 to fill out weekly paper diaries in hundreds of local media markets around the country. The diaries are a highly active form of measurement, subject both to frequent errors of recollection (you tend to forget that you stopped on the Weather Channel for four minutes while flipping to another program) and to the human tendency to champion personal or habitual favorites (you might write down ''The Daily Show'' even if you were out of town that night). A diary can measure only what a person says he watched or heard. It can never reliably measure what everyone actually watched or heard.
The distinction matters. It's why, in the late 1980's, Nielsen first began to switch to a new electronic meter, the People Meter, which automatically notes what channel a television set is tuned to and can also register who watches, as long as each viewer presses a log-in button. This gave Nielsen (and, in turn, television programmers and advertisers) a wealth of new information. Thanks to the company's recruitment techniques, which included interviews and surveys of every prospective household, Nielsen could match the shows each viewer watched to his or her age, income and ethnicity.
In those days, Nielsen's only competitor in the television ratings business was Arbitron, which had already carved out a lucrative niche measuring radio audiences but was struggling to compete with Nielsen in local TV markets. In fact, by the early 1990's, Arbitron, which also built electronic meters to monitor television sets, was worried that the business was becoming prohibitively expensive. So in early 1992, Arbitron's top executives called in their chief engineer, Ron Kolessar, and asked him to come up with an answer to this problem. Could Kolessar find a less expensive way to measure television and radio audiences at the same time? Also, could he make the measurements better too?
Kolessar gathered his staff in an office in the summer of 1992 to toss around ideas and to periodically scribble the good ones down on a white board. In the beginning, of course, the engineers in the room were simply trying to satisfy their bosses -- to find a cheaper and more efficient way to evaluate Americans' TV and radio habits. The engineers figured they might, if they were lucky, come up with a way to make Arbitron competitive with Nielsen again. But their thinking soon changed. As they worked on their project, Kolessar and his team could see that they were trying to understand, and perhaps to shape, the future of media and advertising in America. When Kolessar finally made a presentation to Arbitron's executives, he suggested that the company go even further in the direction of passive metering than Nielsen's People Meter. No button-pushing, in other words. Until then, companies had been trying to collect data about American television viewers by monitoring the set. ''We need to monitor the person,'' Kolessar declared. Not long after, Arbitron pulled out of the television ratings business altogether.
One bitter, cold morning in January, Kolessar met me at the Arbitron offices, a four-story glass-paneled building in an undistinguished office park in Columbia, Md., not far from Baltimore Washington International Airport. Kolessar's lab is a small suite of rooms overflowing with computer parts and sound meters; he explained to me that it had taken him far longer and more money than he expected -- 13 years and $80 million and counting -- to actually transform the idea for the P.P.M. into a physical thing. In part that's because the technology behind the P.P.M. has proved formidably difficult. In the course of his brainstorming in the early 1990's, Kolessar and his colleagues came to the conclusion that the best way to capture an individual's media exposure was to bury a unique, repeating, inaudible digital code in the audio tracks of every radio or television channel in the country; the P.P.M. would recognize that code.
So Kolessar began to work on psychoacoustic masking, which places a sinal just beneath the frequency of whatever is being transmitted. As Kolessar and his team worked through years of frustration, they discovered that the masked code's frequency could not be too low (where it would run into technical problems) or too high (where it would bother dogs and cats). Nor could it even modestly compromise the audio quality of a show or a song. ''We used 'Achy Breaky Heart' for a while for our tests, but then I just couldn't take it anymore,'' Kolessar said. So he switched to ''Don't Give Up,'' the Peter Gabriel and Kate Bush duet from Gabriel's album ''So.'' The song is an intricate work of sonic architecture (of some 26 separate tracks, according to Kolessar), which made it a challenge for the engineers. Kolessar led me into Arbitron's sound studio to listen to what his team came up with after a decade. He cranked a recording of the Gabriel song through a pair of $20,000 speakers and switched back and forth between coded and uncoded versions. ''You can't tell the difference,'' he said, more as a statement than a question. I agreed.
Arbitron has begun to ask radio and television stations around the country to run their broadcasts through a patented Arbitron encoding device; at the moment, almost all of the radio and television stations that a listener can tune into in the Houston metro area -- including over-the-air, cable and satellite TV (though not satellite radio) -- are coded for the P.P.M. trial. The stations are not being paid for this; instead, Arbitron has convinced them, through literal door-to-door salesmanship, that encoded broadcasts will enable Arbitron to measure their audiences better and thereby ultimately boost their advertising sales.
To Steve Morris, the C.E.O. of Arbitron, encoding is as much a matter of logic as economics. In Morris's view, code is now the only plausible way to follow a piece of content to see if -- and how -- it reaches an individual. ''Media is following you not just when you consciously turn on your satellite radio in your car, or when you consciously flip open your cellphone and get some cable channel delivered to it,'' Morris told me. ''It's also coming at you when you walk through Grand Central station. It's on the floor and on the walls. It's coming at you at the malls, where the L.E.D. screens are all around you along with the piped-in music. Advertising is becoming incredibly ubiquitous, so you need measurement that is equally ubiquitous.'' Can everything with sound be coded, I asked? ''Yes,'' Morris said. Will everything with sound be coded? ''Yes,'' he said.
In all likelihood, the Houston trial will show that people are exposed to far more media and advertising than they think, or remember. Some P.P.M. tests in Philadelphia have already indicated that wearers tune into twice as many radio stations on a typical day as they ever note in their diaries. For better or worse, the P.P.M. changes the definition of ''media consumer.'' On the downside, there is of course the question of whether people are actually listening to the stations or watching the television channels registered by their P.P.M.'s; Arbitron's P.P.M. will never be able to measure how intently a viewer concentrated on a televised Gap ad (but neither does Nielsen's People Meter). On the upside, the P.P.M. could reasonably establish that a person left the room during a commercial break, because the coded signal is interrupted when the device is out of earshot.
More significant, the P.P.M. expands the boundaries of media consumption. That's because it passively registers media both inside and outside of the home -- what P.P.M. volunteers are exposed to in bars, airports, health clubs and hotel rooms. This is something that has never been done, according to David Poltrack, the head of research at CBS. ''Ten percent of viewing is now out of the home,'' Poltrack said. ''And for teenagers and young adults it's often as high as 20 percent.'' For a financial news station like CNBC, which probably has a large bloc of unmeasured viewers watching at work during the day, the P.P.M. could produce a significant boost. ''Nielsen does not measure offices,'' Alan Wurtzel, the head of research at NBC Universal, told me. ''Nor do they measure vacation homes. They don't measure hotels. They don't measure hospitals.''
And Arbitron plans for the P.P.M. to do more than establish new standards of measuring television and radio audiences. In Houston, for instance, the P.P.M. will register advertisements that run in theaters before movies; if Arbitron can persuade the entertainment industry to go along, the P.P.M. could also detect the use of everything from DVD's to video games to MP3 music files. (Arbitron has a special P.P.M. attachment to track headphone radio and iPods, though iTunes music and podcasts are not yet encoded.) In addition, Kolessar told me, his bosses recently asked him to experiment with adding Global Positioning System capability to the P.P.M. so that the company could determine when a person drives by a particular billboard or walks by a particular superstore on a given day. And he has been tinkering with radio frequency identification (RFID) so that a P.P.M. could track a reader's interaction with magazines and newspapers. A tiny chip embedded in a page like this one, perhaps the size of a pencil dot, would tell a P.P.M. that a reader picked up or opened the Times magazine. It might even register, with other P.P.M.'s, whether a majority of readers continued to the end of this article or stopped right here. ''We've got all sorts of things we're playing with in preparation for a world that is probably a couple years away,'' Kolessar said. ''But it's going to happen. And it's going to happen because the advertisers are pushing this. It's them. They want to know more.''

The Counting Business
One of the most striking aspects of the P.P.M. has nothing to do with the technology: it's the fact that Arbitron and Nielsen are doing business together. If the P.P.M. proves to be good at quantifying the radio and television audiences in Houston this summer, Nielsen and Arbitron together could introduce the P.P.M. into various local markets across the country. In the view of the two former archrivals, Arbitron brings the P.P.M.'s patented technology to the table, and Nielsen brings its knowledge of the television industry and its expertise in recruitment. A few years ago, Steve Morris, Arbitron's C.E.O., toyed with the idea of using the P.P.M. to challenge Nielsen, but he ultimately decided against it. ''We looked at this and saw that there's a long history of people taking runs at the incumbent,'' Morris told me. ''But there's no halfway here. If we were to go after Nielsen, it would be war, and at the end of the day there would be one person standing. And believe me, there are skeletons littering the trail.''
How the P.P.M. fits into Nielsen's present television ratings system, or how it could change the way Nielsen conducts its business, is a hot topic of speculation in the industry. Over the past decade, Nielsen has maintained its monopoly even as the company itself has changed hands -- evolving from the homespun creation of Arthur C. Nielsen and his son, Arthur Jr., to a hugely profitable business that brings in revenues of close to $700 million a year for its parent company, the Dutch media conglomerate VNU. Nielsen clients -- networks and independent stations, and also a number of advertising agencies and advertisers -- pay the company substantial amounts for a steady stream of viewer data. NBC Universal and Viacom, for instance, probably each pay Nielsen around $50 million a year. In return for a long-term contract, Nielsen will customize viewer data to suit the needs of any client. What a media-buying agency, for example, wants to know about a particular program's audience may differ from what a station executive wants to know; the information national networks need isn't the same as what local stations need (to attract hometown advertising, for example).
In fact, while Nielsen ratings have a knack for anointing the winners and losers in our pop culture -- from Ruben and Clay on ''American Idol'' all the way back to Johnny Carson and Lucille Ball -- Nielsen's role as the arbiter of our cultural democracy happens to be a sideshow. The function of the company is to put a value on time itself, in terms of the commercials that use it. Nielsen's ratings are the single standard, the so-called currency, that allows its clients to characterize a program's audience (its size, age, sex and economic status) and then set a price. Some $60 billion worth of television advertising looks to Nielsen for guidance each year. The company's ratings are really just another way for people in the TV business to talk about money.
According to Nielsen, on a typical weeknight, somewhere between 103 million and 108 million Americans watch prime-time television. The average American household now sees 8 hours 1 minute of TV every day and has access to more than a hundred channels and several different sets -- often tuned to different channels in different rooms. Industry types call this phenomenon audience fragmentation. The days of a family gathering together on the couch are dying out for good. We're in pieces. Or as Steve Morris, the Arbitron C.E.O., put it more gently, ''People are dividing.'' Every age group, every cultural group and every demographic group, Morris added, is in the process of getting media packaged expressly for its members.
In the next few years, this ''personalization'' will become only more and more pronounced. The television industry is in the process of updating its means of distribution by converting to digital signals, a changeover that presents new opportunities for networks to create multiple new lineups and channels (for example ABC, ABC HD, ABC Family) to serve all the new fragments. Within a few years, you should be able to, if you can't already, satisfy any impulse, passion or modest enthusiasm through your television. Meanwhile, that typical Nielsen family that now has a hundred channels to choose from may soon have many hundreds more.
Whatever this transition means for TV viewers, it has different implications for advertisers. In recent months, in fact, a host of executives from big corporations, most notably Jim Stengel of Procter & Gamble, have begun publicly demanding that measurement companies like Nielsen and Arbitron provide better information about audiences. These advertisers don't mind talking to smaller groups of Americans. In fact, companies like fragments. The more specific an audience, the more confident they can be of reaching out to and persuading its constituents. Specifying like this makes it easier to justify advertising expenditures. ''What we're looking for is not just ratings but the receptivity to the message,'' Beth Uyenco, the U.S. director of strategic research at OMD, one of the big media-buying agencies, said. To Uyenco, HGTV is an ideal place for home products, for instance, just as ''Queer Eye for the Straight Guy'' on Bravo offers a good place for grooming products. ''Fragmentation can be a challenge,'' Uyenco added, ''but if you have a very niche brand, it can be a blessing.''
Yet to receive that blessing, an advertiser has to understand any fragment of television viewers -- understand it, that is, in all its mind-numbing, granular detail. Much like a poll that measures the popularity of presidential candidates, Nielsen currently uses representative samples of Americans (all ages, incomes, races, regions) to stand in for the enormous audience that watches television each night; it is almost certainly among the most sophisticated companies in the world at figuring out whom to contact for a reliable sample and getting those people to participate. For the moment, many Nielsen families in these samples use the company's set-top People Meter, which registers viewership regardless of whether a family has cable, satellite or rabbit ears on their television sets.
Nielsen has endured plenty of criticism during the past year over whether it works hard enough to include minorities among its People Meter families -- charges that are almost certainly unfair. The more legitimate concern is whether Nielsen's samples can measure a country, and a medium, that has become so fragmented. Nielsen's nightly group of national viewers is about 8,000 households; in about a year that will expand to about 10,000 households. In the local New York market, Nielsen's nightly viewers number about 800 households. Getting an accurate reading from these Nielsen families on a dominant program like the Super Bowl or the Academy Awards isn't so hard. It's those programs or channels where a slice, or a sliver, of Americans are tuning in. In other words, how do you draw meaningful conclusions if only a few Nielsen households watched Court TV or the Food Network or Telemundo late one night? What percentage were single African-American women older than 49? What percentage were young white men? What percentage were Hispanic teenage girls? The marketers -- the people who want to make sure they're reaching the right fragment with the right ad -- would love to know. But it's been getting hard to say. And as the number of channels grows, and the number of sets in every home increases, and the number of devices that can carry television signals multiplies, it's going to get even harder.

Where the Data Go
Late last year, the Nielsen company moved into a dazzling corporate campus 20 minutes northwest of Tampa in Oldsmar, Fla., a place that seems less like a town than a hasty arrangement of strip malls, office parks and juvenile palm trees set between the Tampa Bay Downs racetrack at one end of town and a dense patch of swampland on the other. The Nielsen Media Research Global Technology and Information Center, as it's called, is an impressive pile of glass next to the swamp. Nielsen spent $123 million in Oldsmar on three interconnected buildings, which is far less interesting than the way they constructed them: with redundant electrical circuitry, high security barriers and warning bells on top of warning bells. The point was to create a fortress so that no computer virus or sparking wire would compromise its ratings system. Ditto for any possible competitor. ''This particular part of the campus is capable of withstanding winds of over 150 miles per hour,'' Alan Donnelly, who runs day-to-day operations in the main data building, told me in February as we walked through the computer room. ''It's built to sustain a Category 5 hurricane.'' There were also fuel tanks and backup generators on the ground floor, Donnelly pointed out, that could power things for several days just in case. Donnelly took me through a security door and into the main control center.
It is a strange, and somewhat disorienting experience, to observe the Nielsen process at work -- to watch the people who watch America watching television. Nielsen still measures a large number of regional markets with written diaries. But the data from the 8,000-home national People Meter panel are tabulated in the Oldsmar control center, where a half-dozen employees face a 22-foot-wide screen that can tune in to any channel in the country at any time. The process is similar to what will happen soon with the P.P.M. in Houston, except the scale (and the implications) will be exponentially larger. At night, while Nielsen families around the country sleep, the data from the People Meters on their televisions are sent here automatically, over telephone lines, beginning at about 3 a.m. The technicians in Oldsmar collect the details about the shows the Nielsen families watched. They check it; they slice and dice it -- by demographics and geography and any criteria their clients would like. By late morning, they publish their list of the top shows for television executives in New York and L.A.
Fragmentation isn't Nielsen's only headache in all this. As its recent battles with Fox in New York show, putting new technology into old markets stirs up an industry that abhors any kind of volatility. ''We're being simultaneously told to speed up the change to electronic measurement, and to slow down,'' Susan Whiting, Nielsen's C.E.O., told me. There's certainly some truth to this. And yet in the course of my interviewing nearly a dozen advertising and television executives, almost all of them faulted Nielsen for languor rather than aggression. Virtually every network and cable company I spoke with voiced frustration with Nielsen's tardiness in measuring ''time-shifting'' -- which happens when viewers rely on video-on-demand or TiVo-like devices (also known as digital video recorders, or DVR's) to ''shift'' the times at which they watch their chosen programs. If a Nielsen family watches ''Dateline'' from its DVR three days after its broadcast, in other words, those viewers aren't counted, and NBC gets no credit. Which may seem like a minor thing, except 6.5 million Americans already have these devices, according to Forrester Research, and 17 million might have them by the end of next year. Nielsen has announced that it intends to track time-shifting starting next January, supplementing the People Meter with the Active/Passive Meter, which uses sound encoding much like what Arbitron uses for the P.P.M. (Each company has patented its own version.) Next year, prime-time shows will receive three national scores: ''Dateline,'' say, would get a rating for viewers who watch it during its normal time slot, a second rating that includes viewers who see it later the same evening and a third rating of total viewers over the course of a week.
Nielsen is no slouch when it comes to technology. Its problem seems to come from implementing that technology in timely fashion. One advertising-side media executive, asking that I not name the firm because it frequently negotiates with Nielsen, put it this way: ''They're very good at stifling innovation and managing the environment. They slow the pace of change down. And they're very good at making sure that their monopoly will continue.'' In this regard, some players in the television industry fear that Nielsen has agreed to support the P.P.M. only because it allows the company to slow down or squelch its acceptance. Susan Whiting told me that the issues are wholly technical, and that she won't be able to know whether Nielsen can proceed with a joint venture with Arbitron until the P.P.M.'s Houston test shows results that Nielsen feels comfortable with.
In the meantime, Nielsen continues to pursue other alternatives. One morning in Oldsmar, Bob Luff, the company's chief technology officer, led me through a tour of a different possible future for measurement, one with voice-recognition and face-recognition meters that the company is testing along with other devices. Luff then took me into his engineering department, a matrix of cubicles where a small army of Nielsen technicians take apart the newest televisions on the market, so that the company understands the circuitry well enough to attach a People Meter in the event that a prospective Nielsen family has a new model in its house. The Nielsen offices in Florida actually have storerooms full of brand new TV's and DVR's and video-game consoles for no other purpose than research and deconstruction. Luff and I paused by a desk where one of his engineers had pulled the bowels out of a huge new flat-screen television. ''He'll reverse-engineer this,'' Luff explained to me, ''and he'll figure out where we can connect. He might also take close-up digital photographs for the field technician to use on his laptop.'' Nielsen, Luff added, has blueprints and plans of some 10,000 televisions on file.
You have to wonder if this is a losing battle -- whether keeping up with the technology curve has perhaps left Nielsen with little time or inclination to get ahead of it. There is, moreover, an aroma of sweaty exertion to the Nielsen process. And that comes not just from the ripping apart of new televisions. The company also puts prodigious efforts, and tens of millions of dollars a year, into maintaining its representative sample of Americans. Hundreds of field reps knock on hundreds of doors every month to invite them into the Nielsen sample. Then those same reps monitor the volunteer households, which entails maintaining intimate, day-to-day oversight, often for several years, to ensure each Nielsen family complies with its rules and pushes the correct buttons on the People Meters.
Whether this can continue depends, in large part, on economics. The more America fragments, the bigger the sample you need to represent the country. And the bigger the sample you need to represent America, the harder and more expensive it is to maintain in a door-to-door, labor-intensive manner like this. ''I wouldn't predict that Nielsen is going out of business,'' said Richard Fielding, the head of research at Starcom Media Worldwide, one of the big media buying agencies. ''But they are at a crossroads. And it's almost as if their business model is evaporating overnight.''

You Are What Your Cable Box Says You Are
At some moments, trying to discern the business of companies like Nielsen and Arbitron gives way to the question of whether America is becoming weightless, an agglomeration of data about who we are and how we behave that seems to have more substance (and certainly more financial value) than our actual selves. It was hard to avoid this thought early one evening last winter as I drove over the Sunshine Skyway Bridge over Tampa Bay toward Bradenton, about 60 miles south of Nielsen's Global Technology Center, on my way to ErinMedia. Several years ago, a few computer geeks and new-economy types started this company in pursuit of something no measurement company has yet pulled off: tapping into cable set-top data to get a complete picture -- not a sample -- of what viewers in a particular city or region are tuned in to at any second of any day.
Though known to media planners and many broadcast and cable executives, ErinMedia does not seek attention; in a business sense, it's pretty much off the grid. When I turned into its nearly vacant parking lot, fronting a mostly empty office building set amid empty fields and dark stretches of forest along Route 301, the company seemed to exist not only on the edge of Bradenton, but on the very edge of reality. ErinMedia has no People Meters, no P.P.M.'s, no gadgets, no embedded codes. A few dozen employees, a couple of computer servers and a number of patents pending in Washington, that's all. The business is less a conventional company than a pure expression of mathematics.
Digital cable set-top boxes are already connected to sets in the homes of 25 million Americans (a number expected to nearly double by 2010). When you get your television signal through one, you receive programs, or ''downstream'' data, from your cable company. But the cable companies can also get a transmission back from you; they can find out what you watch. And they can also find out when you watch it. Federal privacy laws and various technological challenges (especially with older, analog set-top boxes) have made the cable companies reluctant to use that information so far. But some third parties have tried to come in and calculate, through some very complicated software applications, whether viewer information can be tabulated while still protecting privacy. ''We figured out how to get the data and how to figure it out demographically without knowing who you are,'' Frank Foster, the president of ErinMedia, said as we sat down in a conference room in the company's office building. Foster maintained that his company can offer its clients -- cable operators, television stations and media buyers -- a detailed breakdown of a regional television audience at any given time. If a city's digital cable company allows ErinMedia access to its data, in other words, ErinMedia could deconstruct the audience for any show, Foster said. He could tell a producer that 44,312 sets were tuned to the first 4 minutes 7 seconds of the local news. Or that 11,812 cable households surfed channels during the commercial break in the N.C.A.A. semifinals. He could track the viewers as they tuned in and out and precisely where they came from and where they turned to. A few weeks after 9/11, ErinMedia tested some data from Comcast to see what its television audience did that day and in the weeks afterward, compared with viewing patterns in the weeks before. The company charted precisely how many households tuned in and when. It found out what caught viewers' eyes.
Foster was sitting across the table from Frank Maggio, the company chairman. When Maggio chimed in, he pointed out that a second-by-second census of actual viewers might even do more than what Foster described. It could tell the producer of a local news show that the audience preferred the sportscaster on a competing channel -- and ErinMedia could prove it by showing how many viewers switched channels at the relevant time. Perhaps most important, ErinMedia could use set-top data to register small numbers. The chief of a future microchannel, in other words, could tell advertisers exactly who is in its tiny but enthusiastic audience. If only 300 households tuned in out of 300,000, they would still be counted. And if an advertiser suddenly wanted to show an ad for Wolf stoves or Volkswagen Passats specifically tailored to those 300 homes (and be assured, that day is coming soon), it would be able to. ErinMedia, both men said, could give a programmer or cable company a detailed picture of an audience within 24 hours.
Maggio, a young entrepreneur, says he firmly believes that Nielsen is the relic of a simpler time, an era of three networks and a less diverse America. He ascribes no bad intentions to the company. But he relishes the potential for an outfit like ErinMedia to destroy it. ''I believe I could go into Nielsen and quadruple their profits,'' he told me. ''It's so much more efficient to use our technology.'' Then Maggio said he was willing to keep his company going as long as necessary with millions of dollars from his real-estate projects. ''We can pick up where Nielsen leaves off, but we can do more than that,'' he said -- the implication being that ErinMedia could not only give cable operators, stations and advertisers detailed insights into their audience, but even, under the right circumstances, also help establish a new ratings currency in place of Nielsen's old one. To many people in the industry, this would seem preposterous. But Maggio had a counter: ''I'm kind of brash,'' he said. After a short pause, he shrugged. ''Actually, I'm a maverick.''
To be sure, Nielsen has already seen the light on set-top data, even as it publicly defends the aging technology of its People Meters and the methodology of its samples. In fact, both Nielsen and Nielsen's biggest global competitor, a European company called TNS, have been in discussions for some time with various U.S. cable operators about using set-top information. It may eventually come down to what the cable operators decide is in their best interests. They're the ones with the data -- our data -- which is tantamount to saying that they're the ones sitting over the diamond mine. ''It's a fairly simple process to take set-top boxes and capture anonymous viewing information,'' Steve Burke, the chief operating officer of Comcast, the country's largest cable system, told me. ''But it's not what we do. If you're a cable company, you don't get up in the morning and think: how can I create a competitor to Nielsen? You get up and think: we'd like to get V.O.D.-rated and grow our business and wonder when Nielsen is going to hurry up and get off the dime.'' Nevertheless, Burke admitted, it wouldn't take much at this point for those on the cable side to force a drastic change. ''The obvious consortium would be you get some cable companies, a satellite company and a couple big advertisers together to start a Nielsen competitor,'' Burke mused. I asked him if they were near to doing that yet. He let out a frustrated laugh. ''We're getting closer,'' he replied.
Whether a cable consortium ends up choosing a partner like ErinMedia, or whether cable companies get together and then choose an established partner like Nielsen, probably matters less than the net effect of changing the way viewers get counted. When the music industry's charts switched from surveys to actual sales data in 1991, they shook up longstanding assumptions (country and rap were more popular than realized, for example). And to be sure, a change like that can't happen overnight: any new way of counting, put suddenly into effect, would wreak havoc on TV-industry finances by elevating the value of air time on some shows and deflating others, thus forcing stations and networks to offer advertisers ''make good'' ads when audience sizes don't meet their expectations. (When Nielsen introduced People Meters in the New York region, for instance, the size of the audience for ''The Simpsons,'' on Fox, turned out to be 30 percent smaller, while Comedy Central's audience increased by 225 percent.) Frank Maggio at ErinMedia makes a persuasive case that the set-top data is bound to come into play sooner or later, even if it turns things upside down in the process. ''What America is paying for advertising now,'' Maggio said, ''is based upon people who are going to come into your house and take apart your TV.''
As Maggio see it, ratings have to come as close to the full truth as technology allows, and the fact that Nielsen uses samples to represent him is, he said, ''infuriating.'' Of course, such fury happens to suit his company's best interests; Maggio clearly seemed to understand that in making his point, he had located Nielsen's sore spot. ''It's the American way,'' he said, comparing the use of set-top data with Nielsen's methods. ''We only accept elections that represent all our votes. Why is this different? We don't have to do it Nielsen's way anymore. And we really shouldn't do it that way anymore.''

All About the Advertising
In the view of television executives like David Poltrack, the head of research at CBS, there is no one-size-fits-all way to get true ratings. The P.P.M., for instance, is portable enough to capture any television that can be heard in an increasingly portable world -- but it still relies on a representative sample of Americans to wear it. And while set-top data can give nearly complete insights into what a vast number of household televisions are tuned to, it cannot capture media outside the home or even data from households that lack set-top boxes, and it cannot yet register whether it's the grandmother or the young mom (or both) in front of the television. ''I believe that the P.P.M. is a part of the measurement system of the future,'' Poltrack told me one day in his office at CBS, ''but it isn't necessarily the entire measurement system of the future. I can envision a system where you've got one database of hundreds of thousands or even millions of homes with set-top boxes feeding information into a measurement system. You also have these people carrying P.P.M.'s, feeding information into that measurement system. And you may have a traditional Nielsen household sample feeding information, too.'' As Poltrack sees it, the end result would be a ratings system that comes razor close to reflecting what the country now actually watches. It would also, in effect, be a mass cultural election, every day and night.
I discovered that Poltrack's vision seems to be a fairly popular one in the industry, regardless of which side you're on -- advertising, programming or measurement. ''I go to bed at night feeling very good,'' said David Verklin, the C.E.O. of Carat Americas, one of the biggest media-buying agencies. ''I feel the world is coming our way. The world of digital television, the P.P.M., the set-top boxes will give us the data we want.''
The worlds that executives like Poltrack and Verklin ultimately want, however, are quite divergent. Both desire better ratings. But Verklin wants them for more than just television. His clients, the companies that pay for ads, want to know everything about how we use every medium. They don't think of television as the future. Programs are the future. Joseph Turow, a professor at the Annenberg School at the University of Pennsylvania who's probably the reigning academic expert on media fragmentation, takes a similar view. ''Television has to be thought of not as a box anymore but as a social role, and I think that advertisers have begun to see it that way,'' he explained. Turow said he now sees little difference between television and the Internet. Nor do his students at Penn. They watch ''The O.C.'' wherever and whenever -- on their laptops, at home on TiVo and by swapping the show (perhaps illegally) through a Web-based file-sharing program called BitTorrent. The coming generation is accustomed to the idea of watching or listening to anything on any device that's nearby, Turow said. In the meantime, his generation (he's in his 50's) ''still thinks of media in these compartmentalized ways.''
The P.P.M., of course, ignores those compartments. The endless tinkering at Arbitron is creating something to measure any piece of media, whatever form it takes. That's what Carat's Verklin wants. But that's not all he wants. People in Verklin's camp don't necessarily spend their days worrying about who is watching what. They worry about who is watching their clients' commercials, especially now that fast-forwarding or clicking past them is so easy. So for Verklin, the evolution in measurement can't stop with improved ratings. The next step, and the more lofty ambition, is to measure advertising's impact.
There is a dream within the counting industry that has been around for decades, called single-source measurement, but it has never been successfully realized. Recently, thanks to the P.P.M., this goal has been resurrected under the name Project Apollo, which is a joint effort between Arbitron and VNU (Nielsen's parent company). ''Apollo is basically something that's been the holy grail of measurement since people were drawing woolly mammoths on the side of caves,'' David Verklin said. It's a closed-loop system that will measure the media people absorb -- and then what they buy.
To this end, Apollo will track 70,000 people across the country who wear the P.P.M. all day. But not for the sake of ratings. The advertisements and messages these 70,000 people see, hear, read, encounter will be matched to the purchases they make. You could say it's a massive scientific trial of cause (marketing) and effect (buying). Or you could say with some trepidation that it's about creating a more perfect, more efficient consumer society. Linda Dupree, who is in charge of Apollo at Arbitron, put it to me this way: ''For those who have worked in advertising a long time, we think advertising works, we just don't know how.'' Apollo (the name came from someone in the project enamored of the history of early NASA launchings) should settle that.
At the moment, representatives of Arbitron and VNU are making presentations around the country to encourage big companies to sign up for the service, which should be available sometime next year. The price is high (up to $1 million per company), and many businesses are reluctant to invest in an untested product. So Arbitron and VNU are trying to stress the practical appeal: Apollo should allow companies to understand which advertisements get consumers to buy their products, but could also offer insights into the connection between their tactical approach to advertising and the urge to buy. Moreover, Apollo could give advertisers a clearer understanding of whether radio, TV or even the Web (the Internet usage of those 70,000 people will be monitored) gives them the best rate of return on their ad dollars. For instance, if Apollo demonstrates that advertisements for lemonade have a higher success rate on radio than television -- that is, the radio advertisements seem more successful at getting Apollo volunteers to buy the lemonade -- it would help companies figure out how to reallocate their marketing dollars.
So far, only Procter & Gamble has made a public commitment. But many people in the measurement industry told me they regard the ultimate success of Apollo, or some variation of Apollo, as inevitable. ''What we're talking about with using the P.P.M. for ratings is a significant change, along a fairly predictable continuum, going back 10 or 20 years,'' Steve Morris, Arbitron's C.E.O., told me. ''You want to talk about something that's discontinuous? Apollo is discontinuous. That will change the way people think about how we buy. Not right away. It will take time. But I believe that it will.''
Since Morris's company would benefit from the success of Apollo, with the P.P.M. as an essential element in the project, he has good reason to talk up its potential. Still, Morris, a soft-spoken and studious man, is hardly the sweet-talking salesman, and I found his logic airtight. ''Discontinuous, disruptive things do come along,'' Morris said, ''and you don't have a choice whether you follow them or not. They're driven by need. I think if you talk to advertisers, Apollo is exactly what they want. And the advertiser is the top of our food chain. So if that's something they want, and the technology will allow us to produce it, then you have to assume that's going to be a big part of the future.''
What Morris couldn't say -- indeed, what all of the advertisers, measurers and programmers couldn't say -- is what this means for the other parts of the food chain. Marketers often make the point that the consumer is king; one consultant for Procter & Gamble told me that that company's chairman, A.G. Lafley, never hesitates to say that the consumer, and only the consumer, is in charge. Apollo and all the other measurement services might give credence to that contention: corporations that are serious about selling products to a fragmented nation barraged by media messages will come to us for a deeper kind of understanding and approval. You could, however, see Apollo, along with the P.P.M. and encoded signals and set-top data, as a stealthy realignment in the marketplace.
What we did in the evenings, what we bought, what we desired -- wasn't that always a riddle to be guessed at by advertisers and programmers? The window-shopper, the TV watcher, the radio listener, the Web surfer -- we were all so unpredictable, so capricious and terribly human. We were king because we were somehow mysterious. Who will wear the crown now?

Mass Transit Becomes Mass Media, Boston Launches Subway TV System

2005-04-10T11:22:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
Mass Transit Becomes Mass Media, Boston Launches Subway TV System
by David Kaplan, Thursday, Mar 31, 2005 8:00 AM EST
THE DIALOGUE ON THE MASSACHUSETTS Bay Transportation Authority's subway system could go from "Do you mind if I sit down?" to "Do you mind if I change the channel?" as the Boston public transit agency is considering a plan that would put TV consoles on the trains and station platforms. The MBTA hopes that the ad revenue from having a closed-circuit system--the kind currently running in some office elevators and mall kiosks--would help stave off fare increases and service cuts amid diminishing state and local aid, a spokesman for the authority said.

"The estimates are that installing televisions on The T [as the Boston subway system is known] could generate $3.5 million in advertising revenues a year," an MBTA spokesman said. "We're currently looking for a network that would offer general newscasts in addition to advertisements. The kind of system we're looking for would be silent, with closed captioning and audio available on FM radio or FM-accessible cell phones. A plan is being submitted to the transportation system's board, and if it's approved, we would hope to have the TVs in place within a year."

The MBTA is currently facing staggering debt payments as well as a $10 million deficit in the fiscal year that begins July 1. Furthermore, MBTA officials are expecting a steep decline in revenues from the system's more traditional advertising, such as bus shelters, in stations, and on electronic message boards.

Atlanta is currently the first train system installing such a network, where the subway and commuter trains are being fitted with five 15-inch flat-screen televisions per car. The televisions on the Metropolitan Atlanta Rapid Transit Authority, or MARTA, will carry a 30-minute loop consisting of 20 minutes of local news from an ABC affiliate there and 9.5 minutes of advertising. The programming is updated throughout the day.

The Atlanta system is expected to generate $2.3 million in revenue annually, the Atlanta-Journal Constitution has reported.

Academics Field Largest Direct Observation Of Media Consumers

2005-04-09T07:50:00.000-07:00

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Academics Field Largest Direct Observation Of Media Consumers

by Joe Mandese, Monday, Apr 4, 2005 8:00 AM EST

A YEAR AFTER IT RELEASED a breakthrough study indicating that consumers spend far more time with media than conventional media industry research has suggested, Ball State University is going back into the field with a much larger and far more ambitious second phase. The new phase, which is scheduled for the next six weeks, will be the largest and most detailed direct observation of how people actually use media. More than 400 people are being recruited as participants in this phase of the so-called "Middletown" studies, in which academic researchers were assigned to follow people throughout their media day, directly observing all of their media consumption. The first phase, which was released in February 2004 and was based on a sample of 101 people, surprised many media researchers--especially those on Madison Avenue--when it showed that mail- and telephone-based surveys significantly underestimate the amount of time people spend with media (see previous study's findings, below). But because of its relatively low sample base, some researchers sniffed at the projectability of the findings.

In addition to providing a far more representative sample base, the next phase of the study will also specifically look at how people multitask media, especially newer digital media.

"We need current research to study the impact of the new interactive, digital, and wireless media, as well as traditional newspapers, radio, and television that are dominating our lives," said Michael Bloxham, director of testing and assessment for Ball State's Center for Media Design. "In the end, our research should have an impact on not only how we understand media usage, but it should also have ramifications for media-related industries and education."

In the upcoming study, researchers will spend the day observing participants to review how they interact with media. Researchers will not rely on telephone surveys and personal diaries, because such information collection methods fail to completely capture how much media Americans use in their daily lives, Bloxham said.

"Our previous study found that we can better gauge media use by observing a person from the time they get up until the time they go to bed," he said. "Unfortunately, when telephone surveys or personal diaries are used, people tend to seriously underestimate how much they use the media."

Two renowned industry researchers, Jim Spaeth and Bill Moult, founders of Sequent Partners, have also joined the project.

Daily Time Attributed To Media Via Each Method

Phone Written Direct Phone Survey Vs.
Survey Diary Observation Direct Observation
Computer* 21 52 64 +205%
Online 29 57 78 +169%
Television 121 278 319 +164%
Books 18 17 36 +100%
Magazines 8 10 14 +75%
Radio 74 132 129 +74%
Newspapers 15 26 17 +13%

Source: Ball State University, Center for Media Design. *Home computer.

Political Camps Use Search Engines To Run New Kind Of Negative Ad

2005-04-09T07:23:00.000-07:00

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Political Camps Use Search Engines To Run New Kind Of Negative Ad
by Shankar Gupta and Wendy Davis, Friday, Apr 8, 2005 7:00 AM EST

WHILE SEARCH MARKETING IS RESPONSIBLE for much of the resurgence of online advertising, politicians have been relatively slow to purchase sponsored search links. But activity on Google this week indicates that search engines might play a more significant role in political races in the future. Earlier this week, the 2006 gubernatorial campaign of New York State Attorney General Eliot Spitzer placed an ad on Google that appeared as a sponsored link on the keyword "AIG," an insurance group Spitzer is investigating. The 31 cent-per-click ad was taken down the next day, with Spitzer's spokesman, Darren Dopp, calling the purchase a mistake.

"He's got a carefully guarded reputation for always doing the right thing and this could undercut that," Dopp said, adding that Spitzer learned of the ad only after receiving calls from the press Wednesday afternoon.

By Thursday, the backlash had already begun, with at least two anti-Spitzer ads appearing as sponsored results for AIG on Google. One, visible on the site Wednesday evening and posted on the blog of search engine watcher John Battelle, had text condemning both Google and Spitzer for "overstepping their boundaries for political and monetary gain" and contained a link to the URL, "www.short-google.com." A second ad criticized Google in its text and then contained a link to the URL "beconsistentspitzer.COM."

Neither URL worked, at least as of Thursday morning; by the afternoon, both ads had been removed from Google's search results pages for AIG. Google declined to identify the advertiser or advertisers, and declined to state whether it had taken down the ads. But Google's AdWords policy requires that sponsored links lead to a landing page with content relevant to the keyword that triggered the ad. A Google spokesperson said the company monitors and reviews ads, but there is sometimes a delay before violations are noticed.

Some say that the week's developments, while relatively small in scale, might signal that political campaigns increasingly recognize a potential in search engine marketing. In last year's elections--the first time major political campaigns made widespread use of the Internet--nearly all of the Web advertising was banner ads, with search ads representing a "very incremental" part of the budget, said John Durham, president of the Republican consulting firm Pericles Consulting.

Democratic political consultant Michael Bassik agreed that search was not a central part of the 2004 presidential campaigns' strategies, but said there was at least one occasion when someone--whose identity remains unknown--used a search engine to run a negative Kerry ad. The advertiser bought the keyword "waffle" to trigger a link to the John Kerry 2004 campaign site, poking fun at the Massachusetts senator's alleged propensity to change his mind.

As with the anti-Spitzer ads, the purpose of the keyword purchase was unrelated to driving traffic to a Web site; rather, the goal apparently was to convey a negative image of a political candidate via search engine. This week, the anti-Spitzer ads went even further, because they didn't even contain working links; rather, the aim was to get lines of politically charged text in front of searchers.

While Google doesn't intend for AdWords to be used in this fashion --a search buyer would have a hard time arguing that "waffle" relates to the landing page of a Kerry campaign site--some political consultants like search advertising precisely because a creative use of keyword buys allows them to respond nearly instantaneously to a wide variety of issues. "The Internet is great, especially as a rapid response mechanism, to really respond in real time to news and events that are happening," Bassik said. "Based on Google's nature as a real time advertising mechanism, it's no surprise that someone would've purchased this term and pointed it to an error site," he added in reference to the anti-Spitzer buy.

Bassik also said that search buys in general are becoming more commonplace among politicians, citing the Virginia 2005 gubernatorial race. If a Google user searches for Republican contender Jerry Kilgore, a sponsored link to Democrat Tim Kaine's election site pops up in addition to the Republican's ad.

Republican consultant Durham added that the Spitzer campaign's purchase of AIG was "brilliant," despite the chance that Spitzer's detractors might argue the ad casts doubt on the Attorney General's motives for high-profile investigations of companies like AIG. "Just as it's brilliant," he said, "it's also controversial."

Online Media Buyers: 'We Buy Just-In-Time'

2005-04-09T07:17:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
Online Media Buyers: 'We Buy Just-In-Time'
by Wendy Davis, Friday, Apr 8, 2005 8:04 AM EST

THE SURGE IN BROADBAND VIDEO ads may be making the Internet look akin to the TV advertising marketplace, but research conducted by MediaPost and Deutsche Bank (see "Online Ad Spending Up In First Quarter," ) reveals there are some important media buying differences, especially timing. While TV buyers typically buy time well in advance of their air dates -- in the case of the upfront, as much as a year ahead of time -- online media buyers say they buy just in time for their campaigns to run.

Nearly three out of four--70 percent--of the 108 media buyers and planners surveyed reported that they commit to inventory purchases only three months or less in advance. "The commitment, relative to TV, is still considered spot," said Jeetil Patel, a Deutsche Bank senior analyst.

Overall, 50 percent the respondents reported purchasing online media less than two months in advance of a campaign, while 20 percent purchased Internet inventory two to three months prior to the campaign. An additional 22 percent reported making online buys three to six months in advance, and 7 percent said they bought Web media more than six months in the future.

One reason for the short lead times, proposed Deutsche Bank, is that publishers are reluctant to sell inventory in advance if there's a chance that ad prices will rise in the future.

The duration of online campaigns remained flat from the fourth quarter of last year through the first three months of this year, according to the survey. Sixty percent of respondents said their clients' campaigns were of the same [duration]. Twenty-six percent reported that campaigns ran for longer, while 14 percent reported shorter terms.

The survey was conducted online by InsightExpress using members of the MediaPost advisory panel.

Media Buyers: Online Ad Spending Continues To Surge

2005-04-06T17:57:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
Media Buyers: Online Ad Spending Continues To Surge
by Wendy Davis, Wednesday, Apr 6, 2005 7:30 AM EST
ONLINE AD SPENDING CONTINUED TO grow at a robust pace in the first quarter, according to a new study conducted by Deutsche Bank in conjunction with MediaPost. The report, released today, shows that marketers spent more on Internet advertising in the first quarter of this year than the last quarter of 2004.
For the report, 108 media executives were questioned in March about their clients' experiences with Internet advertising in the first quarter, and expectations for the second quarter. This survey, which was conducted online by InsightExpress using members of the MediaPost advisory panel, is the second of an ongoing series of quarterly studies of media professionals by MediaPost and Deutsche Bank.

More than two out of three--71 percent--of executives surveyed said that their clients' spending increased from the last quarter of 2004, while an additional 16 percent reported that budgets were flat. Almost half of all survey respondents (44 percent) said marketers increased spending by at least 11 percent--including 7 percent who reported increases of more than 30 percent.

The strong results indicate that online advertising continues to experience a resurgence, despite recent declines in the stock prices of companies including Yahoo! and Google. "All things really do point to a very healthy industry, notwithstanding what we tend to watch--which is the stock prices," said Jeetil Patel, a Deutsche Bank senior analyst.

Deutsche Bank calculated that respondents reported a total quarter-over-quarter ad spend increase of 11 percent, based on the weighted dollar amount of spending managed by each respondent. But, Patel said, the industry-wide online ad spend might have increased at a different rate, because most of the survey respondents' ad budgets--57 percent--went to display advertising, while just 20 percent of the budgets were allocated to search.

Survey results might show a rosier picture than the one that emerged after some Internet companies reported fourth-quarter earnings. For instance, after fourth-quarter results were published earlier this year, Deutsche Bank estimated a 7 percent quarter-over-quarter decline in Yahoo!'s branded ad business and a 7 percent decline in iVillage's online ad business.

Deutsche Bank also found that publishers still have the edge in setting prices for display ads, especially for premium sites--with 73 percent of executives saying that impressions on home pages, vertical channels, and rich media cost more in the first three months of this year than the last quarter of 2004. Almost half of the respondents--49 percent--said that prices for premium inventory increased between 1 and 10 percent; 16 percent of respondents reported an increase of between 11 and 20 percent; 7 percent of executives said prices went up between 21 and 30 percent; and 1 percent of respondents reported an increase of greater than 30 percent.

Most respondents--55 percent--also saw cost increases for run-of-network inventory--although, according to Deutsche Bank, as much as 50 percent of inventory on large networks, such as Yahoo!, either goes for as little as $1 to $3 per thousand impressions, or remains unsold.

Overall, Deutsche Bank concluded that the cost of premium inventory was about 7 percent more in the first quarter of this year than the last quarter of 2004, while run-of-network inventory was about 4 percent more expensive.

The largest proportion of branding dollars--35 percent--went to niche sites such as iVillage and Marketwatch. Twenty-one percent went to the three largest portals, with Yahoo! capturing 11 percent--as much as MSN and America Online combined (MSN had 6 percent and America Online had 5 percent.)An additional 13 percent went to Web sites of local media, while 11 percent went to ad networks. The remaining 20 percent went to various other sites, including Web sites of local media.

The vast majority of respondents--69 percent--also reported spending more to buy sponsored listings on search engines. Thirty-five percent of executives said cost-per-click had increased between 1 and 10 percent, while 25 percent reported a price increase of 11 to 20 percent; 9 percent of respondents said paid search was now at least 21 percent more expensive than in the last quarter of 2004.

Which search engines did they use? Not surprisingly, Google and Yahoo!'s Overture captured the lion's share of search dollars, with Google accounting for 53 percent of search budgets and Overture accounting for 28 percent. An additional 4 percent of search dollars went to Findwhat and 4 percent went to MSN--which, although it hasn't launched wide-scale sponsored listings, has long offered advertisers limited opportunities to appear as paid links on search results pages.

Jupiter Analyst: Nielsen Research Confirms Users Delete Cookies

2005-04-05T16:54:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
Jupiter Analyst: Nielsen Research Confirms Users Delete Cookies
by Gavin O'Malley, Tuesday, Apr 5, 2005 8:00 AM EST
A RECENT JUPITER RESEARCH STUDY concluding that four out of 10 Internet users delete cookies at least once a month has been met by the Web analytics industry with everything from skepticism to outright disbelief. On Monday, Eric Peterson, the Jupiter analyst who authored the controversial study, responded via blog, offering doubters a combination of survey and direct panel measurement data from Nielsen//NetRatings that support his findings. According to Peterson, two Nielsen executives--Michael Saxon, vice president of products, and Richard Goosey, vice president of research and development--provided him with the data sometime last week.

Critically, one Nielsen survey found that 43.7 percent of 9,492 respondents surveyed said that they had deleted cookies in the last 30 days. "We found that only 39 percent of people were deleting cookies," Peterson commented in a phone interview.

Nielsen's Michael Saxon Monday confirmed the accuracy of the data that Peterson cites on his blog, adding that Nielsen first presented the information last year. "I think it's a very good summary of our findings," said Saxon.

Peterson's study--the first Jupiter study to examine how Internet users react to the cookies that wind up on their personal computers--rebuffed a generally accepted belief that Web surfers leave cookies alone. "It was commonly assumed, before this study, that users didn't have the sense or the inclination to fool with cookies," Peterson said upon the initial release, "so advertisers and marketers didn't factor the possibility into their tracking and targeting measurements."

When Nielsen compared visitor retention rates between its Web analytic application--SiteCensus, formerly known as RedSherriff--and their NetView measurement panel, Nielsen determined that the cookie-based retention metric reported half the number of returning visitors as the measurement panel on five-out-of-six sites.

What's more, when Nielsen leveraged their measurement panel--a direct measurement from participant desktops, able to report back when cookies are being set--to examine seven different portal and publishing Web sites, Nielsen reported one-month unique cookie deletion rates that ranged from 7 to nearly 50 percent for both at-home and at-work audiences.

Peterson qualified Nielsen's findings by noting that the company has a "vested interest in this data coming to light (they recommend an integrated solution using census and panel-based data for Web analytics to resolve these issues of reach and frequency.)"

All the same, when Nielsen looked at Google.com in July 2004, it found that nearly 25 percent of its measurement panel received a new google.com cookie during the study, and nearly 15 percent of that group received multiple cookies, resulting in a 55 percent overestimate of unique cookie counts, according to Peterson.

Peterson wrote in response to the Google study and what it could mean for analytics accuracy: "Of all of the members of [Nielsen//NetRatings]'s panel ... only one quarter are deleting and blocking their cookies. And this activity is only resulting in a 55 percent inflation of unique cookie counts, which, depending on which analytics application you use, would potentially increase your monthly unique visitor count by 55 percent while potentially reducing the accuracy in your retention metrics by 25 percent."

Internet Usage Ebbs As DVRs Gain In Popularity

2005-04-05T16:50:00.000-07:00

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
Internet Usage Ebbs As DVRs Gain In Popularity
Tuesday, Apr 5, 2005 8:00 AM EST
AS U.S. CONSUMERS FOUND WAYS to amuse themselves with DVD players, digital video recorders, and digital cameras last year, they also spent slightly less time surfing the Web at home, research firm eMarketer reported Monday, based on recent data from Nielsen//NetRatings and research company CENTRIS (Communications, Entertainment, and Technology Research and Information Service). Time spent online at home shrank among U.S. users to 13 hours and 44 minutes in February--down 2 percent from February 2004, according to Nielsen//NetRatings. That's less time than in Hong Kong, where users spend an average of 21 hours at home online each month; but more than Germany (12 hours, 31 minutes), the United Kingdom (11 hours, 20 minutes), and Italy (8 hours). While Internet usage at home waned in the United States, the number of homes with digital video recorders grew to 6.5 million in 2004--an increase of 119 percent from 2003; households with digital cameras grew to 33 million--a 44 percent increase; and homes with DVD players grew to 80.8 million--an increase of 19 percent, according to CENTRIS. Nearly one in four households (23 percent) had broadband access in 2004--a 31 percent increase from 2003. eMarketer theorized that one reason for the slight decline in Web surfing time was that broadband enabled users to use the Internet more efficiently. -- Wendy Davis

Intégrent and TACODA Partner

2005-03-16T04:51:00.000-08:00

iMediaConnection: Intégrent and TACODA Partner
Intégrent and TACODA Partner
Tuesday, March 15, 2005
By Roger Park, Associate Editor

Behavioral targeting company TACODA has selected Intégrent to sell brand advertising and represent TACODA's online ad network to Midwest clients and agencies.

"By partnering with Intégrent, it gives us a fully capable and experienced team of sales professionals to help generate immediate revenue for Audience Networks and its participating websites that will deliver massive, quality reach in premium environments that's easily bought by advertisers," says Dave Morgan, chief executive officer, TACODA.

"The new partnership gives Integrent's clients the opportunity to reach mass consumers with quality content. Working with TACODA ensures how to use behavioral targeting on premium sites," says Shawn Riegsecker, president, Intégrent.

Intégrent's media services partners include several online newspapers entities such as Boston.com, The Chicago Sun Times and Dallas News.

"The majority of the online publishers and sites we work with have implemented TACODA’s technology and this new audience-centric ad network allows us to help brand advertisers with their online strategies, and bring additional clients and greater revenue to our current publishing affiliates," adds Riegsecker.

Advertising: Pepsi One Goes on a Television-Free, Celebrity-Free Commercial Diet

2005-03-16T04:38:00.000-08:00

The New York Times > Business > Media & Advertising > Advertising: Pepsi One Goes on a Television-Free, Celebrity-Free Commercial Diet
Pepsi One Goes on a Television-Free, Celebrity-Free Commercial Diet
By STUART ELLIOTT
BIG campaign to reintroduce Pepsi One diet cola will be different in one big way from the campaigns that came before, as well as from typical campaigns for Pepsi-Cola soft drinks: no television commercials.

The Pepsi-Cola Company, long famous for elaborate, expensive spots stuffed with celebrities, music and special effects, is forgoing them for the multimillion-dollar Pepsi One campaign, now getting under way.

The TV commercials that helped introduce Pepsi One, which ran from 1998 to 2001 during high-profile programs like the Super Bowl and featured stars like Cuba Gooding Jr. and Kim Cattrall, are being replaced. In their stead are offbeat alternatives that include promotional events, online films, posters put up on construction sites, even trading cards.

"It's a change to have a campaign that lives outside TV," said Katie Lacey, vice president for carbonated beverages at Pepsi-Cola's North American division in Purchase, N.Y., part of PepsiCo.

"The opportunity to use different media to create more meaning, more connection, with the consumer is something we'll be looking to do more and more," Ms. Lacey added.

The goal of the humorous campaign is to reintroduce Pepsi One in a reformulated version using the sweetener Splenda, and broaden its appeal to include younger consumers and men, who often shun diet drinks. The campaign, by the Playa del Rey, Calif., office of TBWA/Chiat/Day, a division of TBWA Worldwide, is part of a blitz by Pepsi-Cola and the other soft drink giants to capitalize on growing demand for reduced-calorie sodas, which are far outpacing sales gains for their sugared counterparts.

The media strategy of forsaking television, so unconventional for Pepsi-Cola, is emblematic of efforts by major marketers to seek nontraditional methods of reaching increasingly elusive audiences. These approaches are often used to appeal to young consumers, who are as likely to be playing video games, sitting at PC's or sending text messages on their cellphones as they are to be staring at TV sets.

The campaign is "a smart thing for Pepsi to do," especially in trying to "capture more male consumers, because the big diet colas, Diet Pepsi and Diet Coke, definitely skew somewhat female," said John D. Sicher, editor and publisher of Beverage Digest, an industry newsletter based in Bedford Hills, N.Y.

Pepsi One sales peaked in 1999, a year after its introduction, at 83.7 million cases, according to Beverage Digest data, and have fallen steadily since, to 24.3 million cases in 2003 and 19.2 million last year. At the same time, Mr. Sicher said, the market share for diet sodas as a percentage of all carbonated soft drinks has been rising, to 29.1 percent in 2004 from 27.4 percent in 2003.

A desire to take advantage of the increasing interest in nonsugared sodas among younger, and younger male, consumers is behind the push to revive Pepsi One.

"One of the biggest issues males in their 20's have in coming into the category is the imagery of diet soft drinks and the word 'diet,' " Ms. Lacey said, "but with Pepsi One, it has never been there."

"And a different approach to the marketing should overcome the imagery resistance."

So "rather than launching a 30-second spot on the Super Bowl," Ms. Lacey said, there are elements like a Web site dedicated to Pepsi One (oneify.com), separate from the Pepsi-Cola Web site (pepsi.com); oversized billboards; trading cards, which appear in magazines; print ads, in publications atypical for Pepsi like Blender, Details, Giant, Stuff and Sync; and promotional events that will be planned to resemble art shows. The Tequila division of TBWA Worldwide is handling the interactive elements of the campaign.

The campaign features oddball characters created by Geoff McFet- ridge, a Southern California graphic designer who has worked for ESPN X Games, Nike and the young directors Sofia Coppola and Spike Jonze.

Its theme, "Oneify," is intended to bounce off the brand name as well as address seemingly contradictory trends in the youth market signaled by the word "one." Twenty-somethings often say they want to be perceived as individuals but also identify collectively with their peers.

"Kids are so smart, they'll call you out on overt marketing in a minute," said Lee Clow, chairman and chief creative officer at TBWA Worldwide, owned by the Omnicom Group. "So telling them a 'one-calorie, great taste' story is so ho-hum to them."

"If you engage them in unorthodox ways, with a bit of grace, charm, whimsy, fun and discovery," he added, "you can actually ask them to buy something."

TBWA Worldwide has been developing ideas for other clients that are also intended to go beyond the television commercial. For instance, there was a digital radio station that broadcast online, for the French Connection United Kingdom apparel brand, and an oversized billboard in Tokyo on which two-man soccer games were played, for the Adidas footwear brand.

The Pepsi One campaign is the first product work from TBWA/Chiat/Day for Pepsi-Cola; its previous campaigns have been for the iTunes promotions with Apple Computer as co-sponsor.

BBDO Worldwide in New York, also owned by Omnicom, creates campaigns for brands like Pepsi-Cola, Mountain Dew and Sierra Mist, and a third Omnicom agency, DDB Worldwide in New York, recently began creating campaigns for Diet Pepsi.

Blogads: reader survey for blog advertising.

2005-03-12T04:51:00.000-08:00

Blogads: reader survey for blog advertising.
I was happily surprised by last year's blog reader survey. This year's survey continues the trajectory of happy surprises.

Last year, we got 17,159 responses. This year, 30,079 blog readers responded.

Last year, 61% of responding blog readers were over 30 years old. This year, 75% are over 30 years old.

Last year, 40% had family incomes greater than $90,000. This year, 43% exceed that figure.

Year over year, some figures are remarkably stable. One reader in five is a blogger. As was the case last year, exactly 1.7% are CEOs. Almost the same number (44%) spend more than $500 for air tickets. 86% purchased music online, last year and this. Last year, 79% were men. This year, 75% are men.

The most interesting news comes in section 8. Aficionados of PR-speak will recognize these questions as benchmark tests to identify who is an opinion maker, a member of the ten percent of Americans who are believed to set the agenda and steer the opinions of the other 90%. To qualify as an official "influential," RoperASW, the leading firm consulting in the field, you have to answer 3 of those questions (excluding a petition) in the affirmative. Clearly the blogosphere is crawling with certified grade A opinion makers. (When we can get SurveyMonkey's filtering software to behave properly, we'll be able to tell you exactly how many.)

How much credence should you give this survey? The survey was designed as much to provoke as to prove. I'll paraphrase what I wrote last year: the survey's responses are a fragment of a sample of a subset. There are millions of bloggers. Last week I e-mailed roughly 100 of them -- some of the biggest bloggers, many of whom focus on politics and/or sell blogads -- suggesting they link to they survey. Some of the bloggers I wrote to (and some I didn't) linked to the survey; some of their readers clicked; some were offended by questions written mostly for Americans; some aspiring respondents were unable to complete Surveymonkey's sometimes buggy forms. So wield a salt shaker as you munch on this data.

But remember also that the blogosphere is all about biases and conversations and boot-strapping and not waiting for some authority-- a newspaper editor or university dean or foundation officer or venture capitalist or government agent -- to tell you something but figuring it out yourself, and, finally, about sharing fragments of imperfect data with peers to arrive at some useful collective knowledge.

As Trent Lott and Howell Raines learned, the blogosphere's numerous voices can capture and amplify ideas that are too complex or contrary for traditional organizations to see or speak. (This year, we can add Howard Dean, Dan Rather, George Bush, Eason Jordan and Jeff Gannon to the list of public figures rerouted by bloggers.)

Soon bloggers who directed readers to the survey will get their own breakouts to use or share. And more survey results -- breakouts by party affiliation and other metrics -- coming next week.