Stuck In Chicago

I’ve been on the road for the past week – first to Arizona for a friend’s wedding, then a brief stop off in Minneapolis to collect my mail, re-pack my bags, and off to Chicago for the Word of Mouth Marketing Association Summit, (which was fantastic… more on that coming soon).

It’s the night after the last day of the WOMMA Summit, it’s raining like hell - hailing in fact - and my flight is grounded until further notice. Exhausted and board, I’ve scoured every piece of reading material in my carryon bag and stumbled across an interesting piece from last Tuesday’s New York Times by Stuart Elliot on “branded entertainment.” According to Elliot, brand managers are struggling to regain consumer attention in the face of DVRs, satellite radio, and digital jukeboxes. Self-selected, splintered and on-demand, consumer taste for obtrusive messaging is definitely on the wane.

So what are people doing? Many have turned to product placement in mass media channels and entertainment programming. This translates into mega bucks. One study by PQ Media quoted in the Elliot’s article reports that companies will spend $4.25 billion on product placement, up 23 percent from last year’s $3.46 billion.

What is the return on investment for these campaigns? What do cups of Coca Cola in the hands of American Idle judges do for the brand? I bet, not a lot. A big chunk of advertisers are coming to the same conclusion. In another study mentioned in the article, the Association of National Advertisers reports that 26 percent of survey respondents did not, and will not, use product placement. Why? 59 percent say they are either put off by the lack of measurable results, or they think it’s just too expensive.

While I think the mega spends in mainstream channels for product placement are probably on the way out, I don’t want to write it off completely. The new media landscape will increasingly allow producers and distributors to fine tune the end user experience around specific interests, needs, wants, values, reference groups, etc. In the context of personalization – think TiVo pushing ads based on prior viewing behavior – product placement may become more effective. And, dare I say, measurable.

In the meantime, dollars that would have been spent on product placement will inevitably begin to shift towards word-of-mouth marketing and niche targeting. In today’s New York Times, Elliot has another good piece on GM and their brand dilemma. GM’s very disparate brand offerings just don’t have the same traction they used to – they just doesn’t inspire compared to the competition. Elliot quotes marketing consultant, Joseph Jaffe, who explains the turn around strategy: “GM must accelerate a shift from its traditional ‘mass-market, one-size-fits-all approach’… as epitomized by broad-based television commercials and print advertising.” (see NYT, 3/ 30/05, p.C8).

Tactics? Producing and running ads in video games – yuck – and, customer created ads and marketing messages – yes! It’s all needed – just seems like a long road back. And expensive. First step, in my mind, should be some long conversations with the most enthusiastic loyalists out there, and have them help build tactics to kick start a new marketing program based on the core values that resonate with the GM consumer. I think co-creation will probably be the key to survival for this old American mainstay.