Widgets: Online Advertising’s Newest Tactic

Widgets, a word formerly known only to economics professors and business students as the term used to describe any number of unnamed commodities, has taken on new meaning with its emergence into the digital world. Defined as “mini-Web applications (such as the New York Times Reader pictured at left) that are downloaded onto a desktop or transported into personal Web pages, blogs or social-network profiles,” widgets are quickly becoming integrated into marketing campaigns for financial services, automotive products, and consumer durables; even personal care companies are making inroads into widget marketing. Such widespread popularity has caught the attention of the marketing world, which is now leveraging the new technology to reach out to consumers via their most trusted sources of information: other consumers. Through effective use of this medium, marketers can engage with consumers, drive traffic to websites, and now, with the latest technology, measure the success of incorporating widgets into integrated marketing campaigns.

Widgets are fundamentally user-driven programs, meaning that consumers may choose whether or not to engage with them. As I have mentioned in earlier posts, this has its advantages and disadvantages. Fewer people may receive a message, but those who do are much more likely to be attentive and attuned because it stems from widgets they have taken the initiative to include on their own desktops or websites. As Chris Cunningham of Online Media Daily rather bluntly puts it, “That widget isn't there to pay the sales force; it's there because the person whose words or photos we're coming to see every day likes it.” The key to widget marketing is in maintaining a “practical extension of your brand— a microcosm that delivers the same brand promise.” It must be a functional addition to a consumer’s online experience that underscores the key values that the sponsoring company holds while providing extra value. Otherwise, consumers will not make the effort to engage and the widget becomes just another failed advertisement.

When used appropriately however, a widget firmly ensconced on a consumer’s website or desktop can serve as a fantastic reminder ad, keeping a brand or product fresh in the consumer’s mind. Acura’s RDX Traffic widget (seen at right) is one such effective device. It provides real-time traffic updates directly to users' desktops in over thirty cities. The brilliance of this widget is that it is providing a valuable service that will be utilized often, so Acura will be kept in the forefront of the users’ minds, while at the same time it is improving brand image by underscoring the company's efficiency and reliability to (typically) younger, tech-savvy consumers. The next time an RDX Traffic widget user is in the market for a car, Acura will almost certainly be one of the brands that come first to mind.

Once the initial wave of adapters have embedded widgets into their websites, secondary adaptation can increase exponentially. In fact, YouTube, a popular video streaming site with content uploaded by users, owes its explosive success, in large part, to widget technology. According to Deepak Thomas and Vineet Buch of the Start-up Review, “YouTube allowed users to easily embed any hosted videos on web pages or blogs. This turned out to be particularly popular with social-networking websites, especially MySpace. The inbound links from these ‘widgets’ also helped YouTube increase its page rank on Google, thereby driving traffic via natural search.” In addition to natural search, hosted videos also directed interested consumers to the YouTube website, thereby increasing traffic in two ways through a single device installed by choice by consumers. Other companies attempting to dialogue with their consumers have an excellent opportunity to mimic YouTube’s success by encouraging widget sharing among consumer friend groups, first by creating a unique and useful widget, then by making it easy to download to other sites or 'click through' to the product homepage.

Despite such success stories, some companies have been reluctant to utilize widgets. However, recent technological developments in the area of tracking widget campaigns are making this viral and heretofore somewhat mysterious application a legitimate advertising medium. Marketers now have the ability to track views, usage, and uploads of their widgets and can use those data to extrapolate the effectiveness and contribution of widgets to their campaigns. This demystification of the proverbial advertising budget resonates well with C-suite executives. In fact according to Cunningham, “Widgets have rapidly earned a place at media strategy tables ... RFPs are now coming out that expressly include sections on 'Widget Brief' or 'Widget Strategy' ... Advertisers who have worked with widgets in the past are clearly putting a lot of resources into weaving them creatively and effectively into subsequent campaigns.” Hopefully those still on the fence will take note of this growing phenomenon and embrace the accountability it brings to the table. Anything that takes the guesswork out of promotional campaigns is worth at least one try!

Videogames: The New Marketplace

Ten years ago, video games were a way to kick back, relax, and slip away from reality and its demands. Not anymore. Now marketing has moved beyond the bounds of physical reality into the expansive, utterly limitless realm of the virtual world, which has, itself, expanded to include not only traditional games like Mario Brothers, but also interactive imitation-life games such as Sims 2. The question then is “what will marketers have to do to harness this new medium?” The answer: everything they’ve always done, only now with a new twist. The beauty of the virtual world is that it very closely mimics its physical model meaning that marketers are free to use many of the same techniques that have served them so well in the past. Traditional video games provide the opportunity for traditional marketing tactics, whereas modern imitation-life games offer the chance to interact with and learn from consumers. The trick for marketers will be to make use of every unique opportunity the virtual world holds over and above reality.

Product placement in traditional video games, according to USA Today, has been part of the gaming world since the 1980’s when Sega decided to include Marlboro banners in its arcade racing games. Now, however, interactive product placements are part of the mainstream (see picture to the right). “Advertisers are figuring video game advertising into their budgets; money previously spent on TV and print is now being redirected to in-game advertising,” according to About.com. The next step some companies are already taking is placing actual ads in between the levels of traditional games. This choice is being met with a certain amount of unease by some in the industry who fear that by presenting targeted messages, advertisers might alienate the very consumers they hope to attract. A study undertaken by Neilson Entertainment and Activision revealed much more hopeful data. Jason Tuohey of Medill News Service reported in his article, Invasion of the Videogame Ads that 35 percent of male gamers say in-game ads help them decide which product to buy, and that over 50 percent of "heavy gamers" liked having real ads in the games because of the tone of authenticity they lend to the experience.

It is this quest for virtual authenticity that has spawned so many “imitation-life” games whose popularity extend across age and gender lines in an interactive approximation of reality. These are the games that have advertisers so excited, and it is easy to see why. Sims2 and others like it provide a life-like environment through which consumers navigate as they create families and homes, hold jobs, design products of their own for sale within the digital world (see picture to the left), and most importantly, interact with virtual versions of branded, physical products. While some are skeptical of the benefits to be gained through advertising budgets spent in virtual worlds, many are embracing this medium as a means of solidifying brand loyalty and encouraging brand experiences. As the USA Today article “What's in a name: Product placement in games,” states: “Play Crazy Taxi and a lot of your passengers will ask you to take them to Pizza Hut or KFC … Dive into Die Hard: Nakatomi Plaza...and you'll see Zippo lighters and Motorola cell phones…” By placing brands within easy reach of consumers in the virtual world, advertisers provide one more venue through which consumers can view, test, and interact with their products, hopefully leading to increased purchase behavior in the real world.

One thing I was surprised to note while reading through studies and articles exploring the significant prospects this medium offers was that companies seem to be missing out on an important opportunity, namely consumer research. The completely digital nature of virtual worlds would allow marketers to obtain substantial amounts of natural observation data that would be impossible to collect otherwise. The most effective consumer research is obtained through contextual research where company representatives spend time with consumers in their homes and observe how they use particular products. Observations from these sessions can lead to critical insight into the consumer mindset that can eventually culminate in the discovery of a breakthrough product. The downsides to this type of study rest mainly in the substantial cost in time and money as well as the potentially confounding effect of an outsider’s presence. The Observer Effect can lead to changes in behavior that might affect the data collected at the time, but in the virtual world, there is no danger of that. True, there is slightly less depth than comes with face-to-face personal interaction, but far out-weighing this drawback is the sheer quantity of product and brand knowledge, uninhibited by outside influence, and deeper than objective survey data, that is readily available. So far the marketing industry has done a relatively good job of keeping up with technological evolution and the opportunities presented by it. I am sure that in the coming years they will take full advantage of the wealth of information to be gained from casual, interactive gaming sites.

Consumer Engagement: Creating Bonds with Brands

"The heart of engagement is 'turning on' a mind," according to ARF Chief Research Officer Joe Plummer. One of the biggest questions marketers face is how to hold the interest and long-term commitment of new or potential consumers. The answer: consumer engagement; a consumer’s active interaction with a brand or brand idea. Consumers will tell you, though not in so many words, that the brands to which they are most loyal are those with which they have felt a connection. Maybe they are part of a rewards program or they “discovered” the store or product; they might have been asked to give feedback on a product sample, or perhaps they chatted or blogged online with a representative from the company. Whatever the individual story, the common thread lays in the lengthy and involved process marketers are undergoing of engaging consumers in their brand. This week, in an effort to keep up with the constant evolution of the marketing world, I explored the blogoshpere and made two comments, which I have also included below. The first post from the blog, “Beyond Madison Avenue” was written by Danny Nathan, a freelance brand strategist for a wide range of companies in New York and Texas. Nathan discusses the importance of experience-based branding through the lense of a unique clothing store in Japan. The second post from the blog, “Marketing Hipster” was written by Cord Silverstein, a strategic marketing and communications veteran whose 15+ years of experience has led him to the position of Director of Engagement Marketing at Capstrat, a strategic marketing and communications firm in North Carolina. Silverstein weighs the risks of online consumer engagement in a highly litigious society with the rewards to be gained from attempting it.

Post 1: Beyond Madison Avenue: “Don’t create a store, create an experience”

I understand the desire to stand out in a world drowning in advertising clutter, but this retailer seems to be taking that stance a bit far. While I admit the name was intriguing and the clean, modern design of the store (as pictured in your post) was rather refreshing, there comes a point at which the question of identity should be addressed if a business is to thrive. Having read your blog, I went to the website and spent several perplexing minutes trying to decide whether the Center for Cosmic Wonder was, in fact, a clothing store as your post intimated or a combination art gallery and new-age spa. The average consumer will not spend that time to make such a distinction. Clearly, the sleek, “voyeuristic” experience that CCW created for its customers is both innovative and unique, but if new consumers are lost before they can participate in that distinctive experience, the point is moot. The only way to maintain market share in such a competitive industry is to grow. To ensure growth, businesses must engage potential consumers, but that can only be accomplished if consumers first understand the products or services being offered. An effective brand consists of identity and differentiation, but without a clear identity, differentiation merely leads to confusion and a dearth of engaged customers.

Post 2: Marketing Hipster: “Engage Your Customers or Die”

Online consumer engagement is vitally important to all companies, but most especially for those on the larger end of the spectrum. With the slow, but steady demise of mass media strategy, companies have to be creative in the way they reach and secure new customers. Creating individual connections with potential consumers is one of the surest ways of producing that all-important repeat-customer. People are looking for more from businesses in which they invest. Between knock-offs and generic brands, products themselves are becoming more and more like commodities, so the extra things (like personal contact) that companies incorporate really make the difference in customer loyalty. The issue of “how [businesses] go about engaging these online conversations while…protecting their brand and company” is a touchy one. Clearly, misinterpreted or misinformed statements, and their litigious consequences, would be detrimental to a company, but the opportunity cost of allowing consumers to form primary bonds with competitor brands far outweighs the potential risk—especially when that risk can be diminished, as Nathania suggested, through properly trained media and consumer-relations personnel. The concept of employing company spokespeople is not new. Essentially, it just extends public relations to a new medium, and tweaks the structure of the classic press release to accommodate the variation. In terms of “who should respond and how,” again, I propose the PR department working closely with other involved departments. Delegations from the product team or finance department should absolutely be consulted for the necessary factual backbone of the response, but the skills of the PR team are uniquely suited to addressing consumer concerns with minimal negative impact to the company.

Relationship Marketing: The Key to the Gen Y Conundrum

Marketing, as a discipline, has evolved dramatically over time to match each new stage of product innovation and technological advancement. In years past, marketers relied heavily on the “mass marketing” approach designed to hit as many people with as few messages as possible. For a while, that worked. Modern consumers, however, have evolved to appreciate a more diverse view that lends itself more to customization than mass appeal. Thus pull marketing, an approach designed to stimulate grassroots demand, was born, and with it, came a focus on building relationships between consumers and brands. Relationship marketing, with its focus on consumer engagement, improves products and brand loyalty, while allowing increasingly savvy consumers to leverage brand image, leading to a more complex, but also more symbiotic relationship between market and marketer than ever before.

A key impetus to this shift toward relationship-based marketing strategy emerged as “Gen Y,” or the “Millennium Generation” began to reach buying age. This segment is both a dream and nightmare for marketers, who have coined their own descriptive phrase for the 10-25 year old demographic. “The unreachables,” according to USA Today’s Bruce Horovitz, are computer savvy, ethnically diverse, empowered young people who spend roughly $200 billion annually and don’t read or watch TV as much as previous generations. They have grown up competently navigating through cyberspace, finding answers to their own questions and curiosities and being encouraged to contribute to adult discussions. They have friends and family with different ethnicities and backgrounds. And they were born into an environment completely saturated with marketing ploys. Luckily for marketers, this has not spawned a Gen X-like cynicism, but instead, a strategic consumption and absorption of media and advertising. In fact, many Gen Y-ers are now putting marketing/branding efforts to their own personal use as a means of self-expression. They live in a fast-paced environment that demands constant multi-tasking in thought as well as action. Identifying with and displaying brands with distinct meaning can serve as an easy cue to others about who they are and what they believe and also help them identify like-minded people among the multitude with whom they interact on a daily basis.

A study conducted by Saatchi & Saatchi designed to delve a bit deeper into this growing trend found that, “the defining value of this generation is "connexity": the importance of staying connected in order to grow… As a result, for brands to succeed tomorrow, they must forge connections with consumers that go beyond simple product function.” This means that marketers must show a genuine investment in their potential consumers: their likes, dislikes, and, most importantly, personality, in order to appeal to them. As companies try to evolve to better reach their target market, they create products and brand image that better suit consumers’ needs and desires because consumers are often actively involved in the development process. Consequently, companies build brand equity as consumers respond to the ownership they take in the brand. Perhaps the largest shot-in-the-arm for relationship marketing came in the form of networking sites such as myspace and facebook. Originally used for networking among individuals, these sites have opened up a whole new opportunity for marketers seeking to build relationships with their consumers. Companies have created profiles on myspace in order to “friend” loyal customers giving them access to discounts or other perks. In return, they are prominently displayed on the “friend’s” page where the brand is sure to get exposure to like-minded individuals, thus increasing brand permeation in the target population. Marketers utilize facebook “groups,” an application that allows users to create and search for pages devoted to their interests, in much the same way.

Marketing has become a dynamic enterprise. Young, modern consumers demand more from the brands that court their discretionary income, but once they have proven themselves, consumers also give back to the brand. Marketers’ main concern at present is reaching out to their target market in ways that show their sincere interest in each and every consumer and everything about which they care deeply. Bottom line: the more a brand can behave like a friend or facilitate social interaction or self-image, the more successful that brand will be at capturing the elusive Millennium Generation.