Losing mass: new media offers advertisers more than just eyeballs

No longer content to simply tell as many people as possible to ‘Just Do It,' Nike Inc. and many companies like it are finding it's more effective advertising to help people do it, keep track of how often they do it and introduce them to others who are doing it, too. And these companies are turning to the emerging global phenomenon of social networking to make this happen. "The whole idea of just give me a chance to put my products in front of a group of people is going by the wayside," says Bob Reaume, VP of policy & research at the Association of Canadian Advertisers. "The mantra now among advertisers is I need to connect with my customers or potential customers and I have to make a relationship; it's no longer just an opportunity for exposure. That's a huge shift." With the shift in ideology comes a shift in ad budgets. Nike, because of the size of its advertising budget and its history of employing celebrities - Michael Jordan, Spike Lee, Charles Barkley, Tiger Woods - to come on TV and tell us ‘Just ', presents the ultimate example of changing advertising attitudes. Earlier this week the New York Times reported that Nike spent 33% of its $678 US advertising budget on television and traditional media, down from 55% 10 years ago. And while Nike did increase its spending on traditional media in the US 3% to $220.5 million between 2003 and 2006, that figure would be about $150 million more if Nike was still allocating 55% of its budget in that direction. Of course, Nike is not the only advertiser experimenting with new media at the expense of television, and this is not an American phenomenon. "There are dozens of major TV clients who are reducing their spending on television," says Reaume. "I hear clients say ‘three years ago 75% of our budget was on TV, today it's 35%.'" Instead, much of the investment is going into various online ventures. The most obvious initiative beyond banner ads is releasing TV-style commercials directly online, like the two-minute, 46-second clip of Brazilian soccer star Ronaldinho that Nike put directly online in 2005 and the Times reports had more than 17 million views on YouTube. But the endeavours are more creative than that. The Times also reported this week that Procter & Gamble, which pioneered radio soap operas and produces TV's longest running soap Guiding Light, has gone back to its roots to deliver 10, three-minute segments of its new online series Crescent Heights. And it's not alone: Anheuser-Busch has BudTV.com; Unilever has it's I Can't Believe It's Not Butter brand-themed online program Sprays in the City; and American Eagle has released webisodes of its sitcom It's a Mall World. As well, Kraft is paying to advertise in a supermarket in the virtual world Second Life. But all of these initiatives are still very much based around the television advertising idea of mass exposure. They are simply methods of finding more people in a different location. Reaume, however, says "A lot of advertisers are experimenting with how to create social networks with their brands." Again, Nike presents a prime example.The Nike+ service records data from a jogger through a sensor placed in a "Nike+ ready shoe" and a receiver plugged into the jogger's Apple iPod. The iPod plays specific Nike+ workout music and tracks and displays the user's workout status, including distance and pace, on its screen. After the run, users can download their information to the Nike+ website where they can post the details of their run, make friends with other runners around the world and share running routes. Nike+ runners even meet up in the real world to exercise together. Nike+ perfectly illustrates the type of social networking campaigns available to advertisers. As the Internet has become much more than an alternative information and entertainment medium, it enables communication with consumers that just isn't available through the television yet. And the advertising can be more subtle. Nike+ helps consumers stay fit and meet other people. Members aren't limited to Nike running gear - other than the $39 Nike+ sport kit - but they are exposed to the company's website constantly and belong to a community that bears the Nike name. Is it working? The website speaks for itself: members of the Nike+ community, which spans 16 countries/regions worldwide, have logged 36,106 runs in the last 24 hours and, according to the constantly increasing odometer, have run 52,106,063 km to date. Talk about Just Doing It.

Losing mass: new media offers advertisers more than just eyeballs

News | 10/18/2007 1:33 pm EDT

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