Retailers shift their ad spending from TV, radio and print ads to digital ads.
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Like American Eagle, OfficeMax created video content it has used both on television and online. Last summer it worked with Google, the ABC Family cable network, Capitol Records and DDB Worldwide Communications to create branded video content for a back-to-school campaign targeting teens and tweens. The campaign was a TV and online video program called Schooled, a reality show prank. OfficeMax products were present throughout the show. ABC Family aired the show on television and Google Video disseminated online video on the Internet. Google also placed click-and-play video ads purchased by OfficeMax on its site.
“Running $3 million commercials on TV does not get you anything; it’s like screaming in an empty room. The company’s goal was to achieve strong back to school awareness by using an integrated media and marketing approach,” explains Bob Thacker, senior vice president of marketing and advertising at Office Max. “The audience was middle school, high school and college kids who make their own buying decisions. We really wanted to connect with the kids in their world and on their terms.”
For the show, which was done in cooperation with teachers and parents and featured numerous extras in on the gag, eighth graders at a school in New York were secretly filmed during a lead-up to a test they were told was required for admission into high school, and that if they failed they would be placed in eighth-and-a-half grade for more schooling.
Come test time, the aghast children were gathered in a partitioned area of their gymnasium with hidden cameras aplenty and given a test the size of a telephone book. Questions included mindbenders such as, “If you are driving at the speed of light and turned on your lights, what would you see?” Well into the test, the kids began hearing music from the other side of the partition: It was popular musician and teen heartthrob Jesse McCartney, who then performed a live concert just for the kids. The show was aired on ABC Family without commercial breaks, only small insertions for the OfficeMax Schooled campaign.
“We then sliced and diced the show and included outtakes as well as the Jesse McCartney concert and gave it all to Google, which posted all of the online video clips with links to OfficeMax.com pages,” Thacker explains. “Traditional media advertising is simply not in the realm of this campaign’s ‘sweet spot’ customer: the 14-year-old teenage girl. Going online gave us the opportunity to connect with our customers where they live. From Google Video the clips started popping up on YouTube and MySpace and the whole thing took on a life of its own. It was a viral marketing success.”
From late July when the campaign began through Labor Day, OfficeMax experienced 20% growth in online sales, Thacker says. “It drove traffic and sales, and created a new energy and excitement around OfficeMax. The office category is not inherently exciting, and we want to do things that are exciting and offer more unique and contemporary merchandise. We want the kids to understand that this is a place for them, and so far we’re succeeding.”
Online TV channel
American Eagle and OfficeMax are turning to television networks as partners to help them with online video. Another e-retailer, though, has decided to create its own “TV network.” Last month BabyUniverse.com launched a bare-bones version of BabyTV.com, a 24/7 online video channel and social networking community for new mothers that features live broadcasts and user-generated video content. Later this month the channel launches with its full complement of programming and functions.
“Every e-commerce company of today is the new-media company of tomorrow,” asserts John Textor, chairman and CEO of BabyUniverse.com and co-chairman of special effects house Digital Domain Inc.
BabyUniverse is being aided by its largest shareholder and private equity sponsor, Wyndcrest Holdings, which has invested in a variety of companies-including Digital Domain and Multicast Media Networks LLC, the technology company that is enabling BabyTV.com-of great help to any entity seeking to produce and present creative content.
Multicast Media Networks has built more than 40 online video channels, or “web TV networks,” including ones for retailers The Home Depot, Martha Stewart and The Knot. In the case of BabyTV.com, the retailer pays Multicast a sum (Textor will only say that “it costs less than $300,000 to build out a fairly robust online TV network and social networking community”) for the use of Multicast Media technology and gives the media company a percent of revenue from ads sold on the online network. BabyUniverse profits from the rest of the ad revenue and gains valuable brand awareness and shopping and product tie-ins via the online video channel’s ability to vastly expand the retailer’s online presence.
“Most retailers in e-commerce are not building real, ongoing brand loyalty,” Textor contends. “Successful sites maintain customer loyalty. If BabyTV through informative and entertaining content is seen as a must-have resource for new moms, then we have the ability to routinely place our products in the front-of-mind of consumers.”
Years ago Wyndcrest risked significant capital in powerful technologies like online video, but e-retailers and consumers were not yet ready to accept them, Textor says. “Now every Tom, Dick and Harry with a digital camera can easily figure out how to upload content to the web. We’ve been thinking about BabyTV for two years, and we think the time is now, the customer is ready,” Textor adds. “With rich content, user-generated video, live content, blogs and social networking features, we now have an integrated community on the web. Content creates loyalty, and loyalty can be used as the key driver of e-commerce.”
Anyone can do it
The majority of e-retailers do not have the resources to create an online TV network. But as merchants like Netflix, Ice.com, Bodybuilding.com and others are demonstrating, there are many simpler and less expensive ways Internet retailers can use online video on-site and on video-sharing sites and reap diverse rewards.