Next-Tech

Verizon Wireless got a great date for the Oscars. Access Hollywood met Million Dollar Baby star Hilary Swank on the red carpet and showed her a Verizon videophone with clips from her early work. Swank swooned — in front of the cameras. It was a million-dollar cameo for Verizon, timed perfectly to its February launch of its V Cast service that lets Verizon subscribers get streaming video on their phones.

New gadget, new angle — and like most innovations these days, it marries marketing with entertainment.

Hollywood, coupled with Madison Avenue, will put the U.S. ahead of Europe and Asia in finding marketing applications for new technology. Sure, Asians and Europeans are five years and three product-generations ahead of the U.S. on texting, cashless payments via phone and broadband. Tech innovation is a global patchwork of leading edges — the best broadband is in Korea, best service in Japan, best technology in Scandinavia. But the global game of hopscotch will soon land hard in the U.S., with content and marketing at the fore.

“The strong content community in the U.S., coupled with its strong marketing and advertising community, means the cutting edge is about to move to the U.S.,” says Dan Steinbock, author of The Mobile Revolution, published by Kogan Page this month.

“The U.S. needs adequate penetration of SMS users and more sophisticated networks and devices, but that infrastructure could be in place in the next year or two.”

For now, marketers are watching how teenage girls in Tokyo use their phones to predict what trends will hit the U.S. in a few years. But not every trend translates, Steinbock warns: “So many markets are developing differently that you can mistakenly ignore (or take too seriously) some developments happening elsewhere in the world.”

The trick in adopting new technology is timing — with clients, consumers and regulators. Catch consumers while a gadget is hot, but not so new that few people have it or know how to use it. Then balance consumers’ learning curve with regulators’ oversite, which evolves erratically, sometimes to marketers’ advantage. For example, the Federal Communications Commission doesn’t regulate podcasting (yet) — audio files posted on the Internet for downloading onto iPod and MP3 players. But it’s mulling the Broadcast Decency Enforcement Act of 2005 to toughen fines against radio and TV broadcasters for indecency. That crackdown on broadcast radio content, coupled with the quick growth of podcasting — a sort of free-form audio blog — makes podcasts ripe for edgy marketing messages.

The third part, of course, is getting clients to back new ideas. Tobacco and spirits marketers are most open-minded, since marketing restrictions force them to look beyond traditional media.

“Restrictions forced them to find new ways to get consumers’ attention [with] different P-O-P, underground events, value-added packaging,” says Victor Mazzeo, chief creative officer at J. Brown Agency, Stamford, CT. “Plus, they often have the budget to spend if they see something different — and they’re often international, to boot.”

Now that the hurdles are clear, here’s a glimpse at what’s new.

Podcasting

Call it TiVo for radio, or blogs for iPods. Listeners download audio files from the Internet directly into their MP3 players. Content ranges from National Public Radio podcasts to homemade shows (akin to old ham radio operators). Podcasts have earned a cult following the last eight to 12 months among the 22 million consumers who own MP3 players; 29%, about six million consumers, have downloaded a podcast, per non-profit researcher Pew Internet & American Life Project. “People are directly downloading content,” says Seismicom CMO Bill Carmody. “How can marketers use this, even though it’s not measured media?”

Condom maker Durex began running product-placement spots in April on the raunchy “Dawn & Drew Show.” The self-proclaimed “married bestest buddies” weave Durex into their conversation and sample — even taste — its condoms and lubricants.

General Motors fielded its own podcast in February: It was GM North America President Gary Cowger launching luxury sedans Cadillac DTS and Buick Lucerne at the Chicago Auto Show. Reactions on GM’s own blog page, dubbed Fastlane, was mostly criticism (too corporate) mixed with a smidgen of praise for trying something new. Listeners like the grassroots nature of podcasts and may shun marketers’ efforts at their own brand-driven podcasts. But brand placement in independent podcasts — check out Podcastalley.com’s list of voters’ faves — could fly.

And watch the FCC as it watches podcasting. The commission has taken no action, but is mulling whether (and how) to regulate podcasts.

Blogging

Blogging keeps getting more popular — and more organized. Fully 27% of Web users read blogs, and 25% of blog readers bypass Web sites entirely, subscribing instead to Real Simple Syndication (RSS) feeds, according to Pew. “Real Simple Syndication, the backbone of blogs, is helping to revolutionize one-to-one marketing,” says Bill Rosen, chief creative officer-North America for Arc Worldwide. Users set up a My Yahoo page and sign up for RSS feeds using key words that trigger feeds (like article abstracts, with links to original sites) directly to the My Yahoo page. “It’s an effective way to send information to an engaged audience,” Rosen says.

Arc created the first mobile blogging competition and online reality show for SingTel, a telecommunications company in Singapore. The campaign let SingTel customers pick their dream couple and follow their lives through a moblog.

Text messaging

Of the 134 million U.S. adults with cell phones, about 36 million send text messages, per Pew. Another eight to 15 million kids text, too, Steinbock estimates. U.S. cell phones carry about 2.5 billion text messages each month, according to the Mobile Marketing Association.

Still, we’re lagging behind Asians and Europeans, who “wonder how Americans are so backward and still aren’t using SMS,” says Steinbock, a Finn. Two reasons: U.S. consumers have more media alternatives, and pay per-message (Asians and Europeans don’t).

McDonald’s ran a promo in Europe last year tied to Pixar’s The Incredibles. Drink cups carried codes that let diners text in to win film-related prizes: ring tones, movie soundbites, games. Mobile marketing shop12Snap, Munich, handled. (The agency opens a New York office this summer.)

Meanwhile, McDonald’s ran its first two U.S. sweeps with SMS entries. The Big Mac House of Blues sweeps (and the separate NBA Finals promo for Quarter Pounder with Cheese) let diners enter on-pack codes online or via SMS — ”that way, you could enter the sweepstakes right in the restaurant. You could participate in 15 seconds,” said Mark Watson, senior VP-client services for The Marketing Store Worldwide, which handled the sweeps for McD. Fully 45% of the two sweeps’ entries came via texting; Watson credits that, in part, to the target audience: young adults, mostly men.

Responsive P-O-P

Picture this: Video projected onto a flat surface moves when viewers wave a hand or step over the surface. A bottle of Pepsi wavers underwater; a model’s T-shirt changes color. Reactrix Systems has done displays for Sam Goody (shoppers step on a floor ad to set movie characters in motion), MGM Grand’s Tabu Lounge (reservation for an animated table: $1,200 a night) and McDonald’s (animated tables for its 50th anniversary restaurant in Chicago). Sam Goody parent Musicland is putting Reactrix’s system in more stores to hype new releases; AMC Theatres adopted Reactrix P-O-P in theaters in 12 markets earlier this year. Redwood City, CA-based Reactrix signed an exclusive deal with News America Marketing to pilot responsive P-O-P at retail this summer; News America will use the technology with its SmartSource vehicles.

TiVo coupons

The plan: Overlay a promotional offer to an ad on TiVo Showcase. A viewer accepts the offer (via remote), which shows up as a credit on the card the viewer has on file to pay his TiVo subscription. The credit is applied when the viewer uses the same card to purchase the promoted product in-store; viewers get an e-mail or text message to confirm the transaction. TiVo is talking with a few retailers, and could field a pilot program in three or four months, says Seismicom’s Carmody. The system is best suited to retail traffic-drivers; a manufacturer’s coupon would be tougher to verify purchase (and justify cost).

Retail TV

In-store TV reaches at least 180 million shoppers each month, says Mark Mitchell, exec VP for Premier Retail Networks. Viewing duration jumped 44% last year, and brand recall averages 65% for ads on The Wal-Mart Television Network, per Premiere.

In-store TV grows as flat-screen panels and satellite feeds get cheaper. AOL runs monthly concerts via AOL Broadband Rocks, premiering new music in Wal-Mart stores first. Frito-Lay tapped its Star Wars tie-in with ads showing film footage and driving shoppers to its display. Walmart.com runs ads for its music downloads, sending shoppers to displays of supporting brands Frito-Lay and Gillette to get codes for free downloads at the site.

Premiere is rolling out Checkout Network, now in 575 grocery stores and set for 3,000 stores by the end of 2006. Racks under the monitors hold DVDs that are promoted on-screen; local advertisers can target specific neighborhoods. Retailers get some airtime for their own use.

New twists, old tech

Last fall, Verizon Wireless was way off its goal of getting 500,000 subscribers to opt in to its database; in 11 months, it had captured only 17,000 names. To get the other 483,000 in one month, The Marketing Store created a Build Your Own Rocket online campaign dangling a grand-prize Honda Civic (and $8,000 to trick it out), and smaller prizes including games, music and gadgets. E-mail and banner ads targeted men 18-25; cost-per-opt-in pricing kept the ad budget in line, and daily reports on click-through rates let Verizon tweak offers or load up on high-traffic sites. Bill inserts and direct-mail reached six million subscribers. The effort brought nearly 550,000 opt-ins (a 81% e-mail response rate) and resulted in $7 million in incremental revenue.

Want more? Make friends with geeks — ideally, marketing experts at high-tech companies. “It’s important to know people who market high-tech products who can bridge the gap between tech speak and marketing speak,” Carmody says. “Anything in the technology space will have marketing implications. It’s just a question of whether you find out about it from experts in high-tech, or from your competitors.”

Treasure Hunt

Where agency experts look for gizmos, and what they’re eyeing now

BILL CARMODY, CMO, Seismicom

Where: Wi-fi and marketing newsletters. I ask my “panel of experts” — mostly marketing people at high-tech companies — about ideas there, and we brainstorm marketing applications together.

What: New channels in broadband; wireless is poised to replace broadcast. Memory cards [such as client SanDisk’s] transfer data between devices. Coupons via TiVo — it’s coming. Convergence of lifestyle and media, such as high-end cars that put your cell phone calls through your car speakers.

VICTOR MAZZEO, Chief Creative Officer, J. Brown Agency

Where: Engadget.com, macpulse.com.

What: 3D hologram P-O-P; iTunes’ easy-to-download podcasts that let anyone create or listen to a podcast, even your mom. That means big potential for marketer-created content.

GEOFF MILLER, interactive marketing director, The Marketing Store Worldwide

Where: This global agency shares information between offices — especially Asia and Europe, now on the fifth generation of SMS. We’ve been sitting on text messaging in the U.S. for five years.

What: SMS applications spotted in Singapore this spring: Coke vending machines take payment via SMS. McDonald’s diners pay by transit card, and earn rewards.

BRAD NIERENBERG, CEO, RedPeg Marketing

Where: Fast Company, Wired, gizmodo.com, i4u.com, maccentral.com, MacWorld expo.

What: Mac Mini. We use wireless barcode scanners for instant-win contests, and cell phone credit card scanning to sell products at events. Our field teams use kiosk equipment (like airport check-ins) to ask survey questions as consumers enter a sweepstakes.

BILL ROSEN, chief creative officer-North America, Arc Worldwide

Where: Industry contacts and an internal team that unearths new technologies.

What: RSS/blogging and podcasting: Nestle Purina PetCare talks to pet owners via RSS. Software: We helped Kellogg (with an assist from DNA Digital Media Group) develop voice-activated software that lets kids tell Kellogg characters like Tony the Tiger and Toucan Sam what to do on their computer — open a program, access the Internet, get e-mail. We put CDs with the software in cereal boxes.