ChasNote

Last fall JCPenney worked with FM on the creation of a Fall Shopping Guide site — an aggregate website of ten leading online voices and publications that cater to upscale women. Instead of ad banners driving traffic to a standard marketing site, JCPenney sponsored editorial content, promoted it with banners featuring content headlines, and invited visitors to join the conversation by submitting comments.

The approach delivered strong results. Not just better click-through rates. The sponsorship sparked customer engagement that positively affected JCPenney’s “organic search equity,” the status of the brand among the natural, unpaid results on search engines. As Abbey Klaassen describes it in her Ad Age article on the JCPenney campaign:

“Yes, search equity is all about link love. Creating — or aggregating — compelling content online and letting readers use social-media tools to share the content can goose Google results for brand or related terms. It’s something bloggers have known for years, but marketers are really just beginning to employ.”

Here’s my original write-up at ChasNote.

Talk about stating the obvious! But a glance at the charts in Ad Age’s Annual 2008 report got me thinking that it may not be obvious to some of the biggest players in the industry. For those of you looking at the print edition, I’m on Page 10: The top brands in various categories ranked by ad spend and share of sales in their respective markets.

Advertising among the Detroit automakers in 2007 was, it appears, a defensive operation at best. GM spent $2.2 billion in media as their marketshare slipped to 24.5% from 26.2%. Ford spent $1.7 billion only to see their share decline to 17.5% from 18.6%. Toyota invested $1.2 billion in ads — less than GM or Ford — and grew share to 15.4% from 13.3%. Honda increased share by half a percentage point (9.1% from 8.6%) on an ad budget that was less than $1 billion.

Of course it’s hard to isolate the precise cause from among the many possibilities — product offerings; oil at $100 a barrel; the mix of media spending across print, TV and digital; creative messaging; dealer incentives; etc. Across the categories data-fied in Ad Age’s report, I couldn’t find a consistent correlation between marketing spend alone and sales performance. Both Walmart and JCPenney spent nearly half a billion dollars to hold steady their marketshare (Walmart at 10.6%, JCPenney at 0.8%). Dunkin Donuts spent $108 million to boost share by a tenth of a percent (1.3% from 1.2%), while McDonalds spent $776 million to lose a tenth of a percent (7.7% from 7.8%) in the same category.

Among brands that held 10% or more of their markets in 2005, only Toyota, American Express, and all for big wireless players (AT&T, Verizon, Sprint and T-Mobile) increased share in 2007. It suggests that innovation — which I’m defining here as investments of any kind that pay higher dividends for one company than similar investments by competitors — is most active among the underdogs. Surprise, surprise. But perhaps there’s a lesson for the big dogs: If what you did last year and the year before isn’t working, try something new.

A recent McKinsey report (see Business Week) suggests one thing isn’t working so well: “Traditional TV advertising will be one-third as effective in 2010 as it was in 1990.”

Despite the belated timing for such a proclamation, I appreciate Business Week’s validation of conversational marketing in Ted Shelton’s January 18, 2008, Viewpoint column:

“Dove and a growing number of brands are finding that the kind of marketing the 20th century perfected is becoming less effective in the 21st. A recent McKinsey report predicts that, ‘Traditional TV advertising will be one-third as effective in 2010 as it was in 1990.’ Other advertising media aren’t working as well as they once did either. Not as many people are dialing the 800 number, clicking the banner ad, or remembering the tagline, regardless of whether it’s a radio spot on a CBS broadcast, an ad in The New York Times, or even a banner on Yahoo!. In fact, marketing that seeks to control has become an annoyance in a media environment of virtually unlimited choice. In a 2006 study, researchers found that only 53% of consumers said they believed ads were a good way to learn about new products. That was down from a 78% response in 2002….

Shelton goes on to argue that advertising can and will change (and I agree), but his notion that conversational marketing is limited to consumers, experts and competitors literally talking about brands and commercial services misses the broader implications of the internet — brands need to join their customers in whatever conversation those customers are having, not just the ones about buying stuff.

“Before you entirely discard the notion of advertising, however, it is worth noting that it can and will change. Companies will recognize that there is a conversation going on in the marketplace that they should join, not dominate. Consumers, experts, and competitors are all talking about your company, its products, and the competition’s products. Joining that conversation means providing information, answering questions, and responding to concerns instead of just broadcasting one-way messages. Participating allows a company to correct misinformation, offer insights, develop a reputation, and create a relationship with the most influential people in a given market.

“Once a company has become a part of the conversation, conventional one-way advertising can serve a meaningful purpose. It can draw attention to the conversation and to the company’s participation. It can alert a market to change. It can be a form of information that is valuable again—information about where and when the market is operating and how to engage with it.”

I’ll make sure Shelton gets an invitation to our next Conversational Marketing Summit!

Ford prevented a group of their most loyal customers — Mustang owners who are members of the auto enthusiast group Black Mustang Club — from assembling photos of their cars into a calendar. Full story at Boing Boing. I’m not sure it’s ever a good idea to sue your best customers, but you can sort of (sort of) understand record labels suing their fans when those fans — in their enthusiasm to share music with friends — cuts into record sales. But what is Ford thinking? A calendar of vintage Mustangs is going to divert paying customers??

Ain’t it the truth. Even better than being true, the line now has its own conference, one I hope to attend.

Storage-maker Iomega’s current banners feature flames and copy that reads “Burn, Baby. Burn!” The algorithms of some contextual ad network served the banner alongside the news of a child dying in a house fire. (From AdRants.)

From WSJ:

“The walkout has cost the Los Angeles-area economy $1.4 billion so far, according to the private Los Angeles County Economic Development Corp., including nearly $180 million in wages for writers and $310 million in wages for members of the International Alliance of Theatrical and Stage Employees. But an estimate by the Anderson Forecast at the University of California, Los Angeles argues that losses will be closer to $380 million if the strike ends by March, accounting for extra wages generated by scripts stockpiled before the strike began.”

And that’s not yet counting the Oscars. “The Oscars drew 40 million viewers and $80 million of advertising revenue last year, with an estimated $1.7 million for a 30-second ad.”

Ed Cotton at Influx Branding does a perfect job explaining Toshiba’s latest campaign with FM: Banners that invite notebook users to get tech questions answered, right there in the banner ads. Ed, forgive me for republishing your entire post (bold type added by me)!

“Federated Media has spent some time educating the ad industry on the power and potential of blogs and their authors.

“Recently, they’ve been developing content that goes beyond the banner and utilizes their blog network. An interesting example of this is a recent campaign for Toshiba laptops that’s been running on the FM Network, sites like Boing Boing.

“It’s a simple banner that allows you to ask a laptop question and get a reponse from experts or the community in general. The linkage to the brand’s positioning is through the notion of ‘experts’, Toshiba being the laptop experts.

“Browse around the site and you will find answers to all kinds of laptop questions and importantly, they don’t all ‘plug’ Toshiba laptops.

“It’s an interesting idea and a good example of going beyond the banner to create a branded utility.

“My only criticism of the idea is about its uniqueness. The problem for Toshiba is the web is awash with tips and advice for laptop owners or prospects, it’s a hard area to ‘own’.

“However, the idea of link ad content to expert content is a really smart one and it’s just a matter of time before someone does something amazingly creative and useful by linking the two together.”

A year ago, HP signed on as sponsor to a collection of sites that cater to designers and digital artists, what we call (in FM-speak) the Graphic Arts federation. They took a PBS-style “sponsored by” approach to their messaging, and left the authors and readers of those sites alone to have their haute design conversations without any interference. Pay respect to your core audience, HP figured, and you just might win its affection.

The approach appears to be paying off. Jean Aw, author of “indiellectual” design and aesthetics site NOTCOT, blogged her experience walking the floor of CES: “I must say that i was proud to have our sites sponsored by HP when i walked into this booth… ”

Another powerful data point from JPMorgan’s Nothing But Net report:

“While portals were once dominant, Yahoo!, AOL, and Microsoft only accounted for ~29% of minutes spent online in August 2007, down from 42% in August 2002. Meanwhile, blogs, online gaming, and social networking websites have experienced double to triple digit Y/Y growth rates in page views. This fragmented audience not only makes it more difficult for advertisers to reach their target audience through only a few publishers, but also makes it difficult for publishers to attract advertisers given their limited scale. We believe that companies that can aggregate traffic through the development of ad networks or partnerships will be more successful in driving growth in 2008.”