Marketer’s Paradise: Owning the Channel Itself

Budweiser made a significant decision this year with its Super Bowl ads. It clearly got the message that connecting the magic :30 spot with a Web site is a great way to not only leverage the eyeball investment but also move people further down a sales funnel (e.g., by getting demographic or contact information). That was well established last year with Mitsubishi’s “See What Happens” campaign.

But this year, Bud hinted at a major step forward, this time jumping on what could be the most significant new trend in interactive advertising: creating Bud TV, its own channel. Details of this move are still under wraps, but rumors and leaks hint this will be a broadband-based channel featuring not only Bud spots but also actual entertainment offerings.

The background technology will reportedly be supplied by Maven Networks, which has done a few things like this for other brands, but nothing so deep. Other campaigns have been one-time concert or event broadcasts or limited-run series. This promises to be open-ended.

“This changes the whole concept of broadcasting out to consumers,” Hilmi Ozguc, the CEO of Maven, said. “Typically, media companies have done that. With the Internet, we blow out that old model and enable advertisers to reach consumers directly without having the media companies sell the ad space.”

Indeed.

A Media Company Is What Again?

Anheuser-Busch, media company. Well, why not? After Google admitted it was a media company (as opposed to a technology company) all bets were off. In the experience economy, it seems the best thing you can be is a media company. It’s really the only way to take advantage of all those advertising dollars sloshing around the Web these days.

But wait a minute. What are the economics here? Anheuser-Busch becomes a media company, in addition to being a product company, of course. That means it will have to spend to acquire not only content but also traffic. The content acquisition will assumedly come from licensing deals

As broadcast networks know, that can be quite expensive (ever wonder why Yahoo seems so excited about reality TV? It keeps it from spending too much on content creation). That can probably be mitigated by considering the amount the company already spends on creating commercials and running events in general. Let’s say for the sake of argument the money spent on content is a wash: the brewer moves money from one column to another.

Money spent on traffic, though, is another thing entirely. Clearly, Anheuser-Busch now buys traffic/attention through media placements. But the media placed there is selling… get ready for it… beer!

With the launch of Bud TV, Anheuser-Busch will likely place media to sell Bud TV. I suppose the thought is Bud TV sells beer. But as a marketer, I’d be a little hesitant to field a bunch of ads that advertise a bunch of ads. All of a sudden, I’m a step away from actually selling my actual product: the beer.

Unless, Of Course…

Unless, of course, this content is better at selling beer than the original ads were. Or, these ads provide me with another asset the other ads don’t: a direct connection and relationship with my consumer. That’s why this all starts to make sense.

There’s been a lot of talk about the Internet disrupting normal business channels, but much of that discussion has surrounded e-commerce. For manufacturers, the opportunity to disrupt channels takes on great importance. They generally struggle with the channel. Consider a consumer packaged goods (CPG) manufacturer, which has to deal with big-box stores and private labels. The former buys so much of the product it can exert significant influence on production, packaging, and price. The latter squeezes the product off the shelf, often by copying names, ingredients, even packaging colors.

Yeesh. What a mess.

The manufacturer’s best opportunity is to get in front of this situation by forging close, personal, valuable relationships with consumers. If a consumer walks into a store looking only for Bud Light, Anheuser-Busch suddenly has all the leverage in the relationship with the channel.

The question becomes: can a manufacturer effectively establish those relationships with media placement? Let me help you: no. It must have more control. It must to do what Procter & Gamble has done with Home Made Simple: build a database of over 6 million email addresses. It must do what Coca-Cola has done with My Coke: capture teens for upwards of an hour per week remixing music. It must do what Anheuser-Busch is doing: establish a happy breeding ground upon which relationships can grow.

I hope Anheuser-Busch really follows through with this plan, so we can have one more case study to add to the list of brands that own the channel so they can establish the relationship. I’m sure it’s got strong metrics in place on this one, but it should certainly do more than just tell us how many hits it’s got. I’d like to see it place an absolute value on a consumer relationship. If it does that, it can not only very effectively count the value it’s accruing but also see how well it compares with broadcast and (this is key) buy the traffic in efficient, pay-per-action programs such as search.

Not every brand will be able to do this, of course. It’s very possible consumers will invite only the strongest brands to establish relationships. But clearly, this is the path for the best brand marketers out there who will increasingly understand they’re in the relationship business.

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