Three million dollars to make a 30-second pitch? You might as well sail a Hail Mary pass into the end zone and hope for the best.
But even though Super Bowl 43 takes place against a backdrop darkened by an economic recession and rising unemployment, executives involved with current and previous Super Bowl advertising spots remained convinced that Sunday's game offers a potential payoff that outweighs any attendant risks.
"We wouldn't be doing it if we didn't think it would work," said Warren Adelman, the president and Chief Operating Officer of Internet registrar GoDaddy.com.
Frank Costantini
(Credit: On Ideas)This year marks GoDaddy's fifth Super Bowl appearance, and Adelman is unequivocal about the role he says the advertisements have played in his company's growth.
"We think it helped put GoDaddy on the map," he said.
That may be true, but it's become an increasingly costly map. NBC is charging $3 million for each half minute of air time. Of course, advertisers also know this will be the most-watched television event of the year in the United States.
Frank Costantini was behind the 1994 Lipton Original Ice Tea commercial with multi-sport star Bo Jackson, which still ranks among the all-time great Super Bowl spots, and he maintains that the Super Bowl still is a "bargain."
"I'm one of those ad guys who still believe that there's value in that 30-second television commercial," he said. "And in this venue, I think there's even greater value."
"There's no other time in the world during the year when you have both a captive and a captivated audience," he added. Costantini these days is partner and chief creative officer of On Ideas, an advertising agency in Jacksonville, Fla.
"You're not necessarily going to see the needle move immediately. It may take a month or more. But there's nothing like that moment. Your expectations are piqued. It's the one show where people literally are glued to seeing what's going to happen during the break. So you're focused...it's an audience with major desire."
And an audience of advertisers with perhaps even more desire. A survey released earlier this week by Emarketer found that marketers remain convinced the ads are worth the price. One reason: while general television viewership is in decline, the Super Bowl ratings remain sky high. What's more, an unusually large number of people pay close attention to the commercials during time-outs.
So it is that advertisers are virtually guaranteed a huge lift in Web traffic immediately after the Super Bowl. Of course, translating that initial spike into something more tangible is the tricky part.
Advertising execs caution companies not to delude themselves into believing their prime-time appearances will automatically resolve their product and marketing challenges for the next 12 months. If anything, it's just the start of the relationship with their customers.
Marshall Ross, the chief creative officer of the Cramer-Krasselt advertising agency, oversaw CareerBuilder.com's series of "monkey" Super Bowl ads. His agency also was the brains behind the Master Lock's Super Bowl spot. And he quite frankly acknowledges that from a TV commercial point of view, advertisers are taking a big risk.
"It's a rip-off," Ross said. "It's not really worth it from an advertising television point of view."
That's because any examination of success or failure involves a more nuanced calculus of considerations. For Ross and others, it's the follow-up that determines success and failure. Recalling Master Lock's Super Bowl experience, he said that the company spent half its annual budget advertising during the game. The rest of year was spent leveraging that ad with hardware retailers.
Marshall Ross
(Credit: Cramer-Krasselt)"You need a big program going into the Super Bowl, and a big program going out," Ross said. "Otherwise, you're doing it for the wrong reasons...It's only a dumb thing to do if you think this is all you have to do."
Evan Contorakes, CEO of the Miami-based Ronin Advertising Group, can identify with that comment. During Super Bowl 40, his client, PS Cleaning Solutions, paid for a commercial about cleaning solutions. The spot wasn't a favorite, but the bigger problem was what happened--or more accurately, what did not happen--next.
"They essentially didn't have the back-end budget, so there was a slow churn off the store shelves, he said. "You have to do follow-up media, and couponing, etcetera, in the course of the year...If you don't have the marketing dollars, then the product will just sit."
That experience has left Contorakes more realistic about the expectations companies should have in the lead-up to the big game. Like many colleagues in the profession, Contorakes acknowledges the "great reach" afforded by a Super Bowl appearance. But in a recession, he says there are more cost-effective ways to promote a brand message.
"The cost per thousand (of the Super Bowl) is astronomical, and with all the deals to be had now, there's a thousand better ways to do it," he said.
To be sure, that's a strong argument in a weak economy. Still, if they have the budget, advertisers will want in. And that explains why the networks so covet broadcasting this event each year.
Of course, if the game turns out to be a blowout and your company's advertisement was timed to run in the fourth quarter, it will be a tough office commute the next day to face all those Monday morning quarterbacks. But that's the nature of a Hail Mary.
Steve Ballmer, who just announced to the troops that Microsoft was firing 5,000 employees due to the recession, might be excused for wanting to slam his head against the wall at this point.
After reporting quarterly earnings, Google finished Friday up more than $18. So at this point, at least, it's still Google 1, Recession 0. The cool kids have the upper hand--at least for the time being.
I'm the last to suggest that Google is immune to the drag of an economic slowdown. Everyone these days is obviously tightening their belts, and Google is no exception. The company let go of 100 contractors and recently ordered three projects shut down as cost-savings measures. (How long before more money losers get dumped?)
In the meantime, however, Google's advertising business held up remarkably well in the fourth quarter, all things considered. Even though the economy headed south, Google's paid clicks increased 18 percent in the fourth quarter compared with the same period a year earlier.
But if you're a glass-half-empty type, is this a harbinger of trouble? Revenue growth slowed to an 18 percent annual rate, compared with 31 percent in the third quarter. Listening to Eric Schmidt's team handle Wall Street's questions on the company's conference call Thursday afternoon, you realize that the folks running Google are too experienced to believe they can defy history.
At best, they may be able to slow it down through a combination of managing smartly and prudent cost-cutting. Apropos, here's what Google's CFO, Patrick Pichette, had to say:
Focused. But that's not the same as arguing the keyword search business is recession-proof. With more businesses and consumers reducing spending, how long before advertisers have to lower their keyword bids?"I think the management team is really working with two agendas always. One is, manage our resources prudently. I think Eric was right in saying in some ways the easy part was done in Q4. In that sense, this is a worldwide recession with a lot of visibility about what's going to happen. We just have to be prudent, and therefore, we're focused."
Business was so bad for so many companies in the fourth quarter that many retailers were offering distress sales in a rush to clear inventory. And that affected search patterns during the last couple of months of 2008. Here's what Jonathan Rosenberg, Google's senior vice president of product management, had to say about the anomaly:
"Interestingly, what we saw in November and December was consumers searching much more disproportionately for two-for-one, for sales, for coupons, and advertisers really trying to make sure that they were able to sell the inventory which they purchased when they were anticipating a better economic situation."
"So, one of the things we have to ask ourselves now is how much of that inventory has actually flowed through the system...Obviously, we would be adversely impacted if there were less total commerce moving forward. So that's really the wildcard from a user standpoint that we need to watch."
He's quite right about that. Nobody knows the sort of hand Google's likely to get dealt. Anybody who tells you otherwise is simply a pumper or a dumper. Or maybe they just work for CNBC.
The rap against Google is that it's just a glorified one-trick pony. When I hear that refrain (usually, from Microsoft folks,) I nod and add, "Yeah...and that's still one helluva pony."
But here's the rub: if advertising comes under more pressure during the next 12 months, does Google have the chops to come up with another big idea to compensate for any financial shortfall? Google's page-ranking technology was a breakthrough and a huge moneymaker. Even Google's biggest fans have acknowledged that nothing remotely similar has since made its way off the drawing board.
And who knows? If stuff like Google Scholar is the best that Google can muster, maybe Ballmer won't have to slam his head for much longer. To be continued...
Some marketing genius decided it would be a splendid idea to plaster the subway station I arrive at in the morning with posters promoting Microsoft's "I'm a PC" campaign. So twice a day, five days a week, I'm face to face with one of the worst advertising spots in Madison Avenue's history.
Then when I get home and turn on the television, the same ads--this time in full motion color with sound--are all over the airwaves.
(Credit:
Microsoft)
Get me an ice pick so I can drive it between my eyeballs and get it over with already.
I'm obviously late wading in here, but I wasn't swept up in the first round of harrumphing when the ads first hit in September. Even though I never thought the spots were very interesting, I figured Microsoft would improve upon them. Eventually. After all, this was part of a $300 million ad campaign that Microsoft planned, in part, to counter Apple's successful Mac versus PC series.
Silly me. I think Rory Carlyle's tongue-in-cheek summary says it all: "I'm a PC and my commercials are terrible."
No doubt there's someone high up in the Redmond bureaucracy who believes it's possible to corporately manufacture cool. But it just won't wash. When I was a kid, an advertisement for Bic pens ripped off a popular counterculture phrase of the era with the corny television refrain, "Write on." (Get it? Write on, not "right on." Ugh.)
As contrived as that was, it paled compared with this stinker from IBM for its now-defunct line of PS/2 computers...(How you gonna do it?...You're gonna PS/2 it") Vanilla Ice couldn't have done worse. A friend who worked in Big Blue's marketing department at the time candidly allowed that the jingle would have had better success as a WASP rap ditty.
The production quality of Microsoft's "I'm a PC" spots is higher, but technical excellence alone can't compensate for the core problem: conceptually, the ads fall flat. Maybe it's me but parading a bunch of goofs all declaring that they're "a PC" and I'm thinking it's "Stepford Wives" time. If the idea was to counter the impression fostered by Apple's series of lacerating Mac ads, Microsoft should rethink its original assumption. Now that Steve Ballmer says he's no longer thinking about Yahoo, he should devote a few brain cells to cleaning up this mess.
The ads simply grate. As John Gruber put it in a post a while ago:
"And so what makes Microsoft's new "I'm a PC" commercials so jaw-droppingly bad is that they're not countering Apple's message, but instead they're reinforcing it. That the spots themselves jump between dozens of different people who "are" PCs, that the spots make a point of emphasizing that there are a billion Windows-running PCs worldwide, this only emphasizes that "PC" is not a brand name but a generic."
"Microsoft's new ads emphasize the same message as Apple's: that the Mac is the one and only brand-name computer in the world."
Write on. Err, right on.
HALF MOON BAY, Calif.--What if you organized a conference panel about digital advertising and nobody mentioned Google?
Yeah, duh.
Well, Fortune magazine almost accomplished that feat. During a session at its Brainstorm Tech conference devoted to the state of advertising in a softening economy, the three participants--Tom Bedecarre of AKQA, Lynda Clarizio of AOL, and Microsoft's Brian McAndrews--managed to get through three-fourths of their discussion without uttering the "G word."
Thankfully, one of Fortune's own, the ever-excellent David Kirkpatrick, asked from his seat in the audience whether anyone believed Google's current dominance in online advertising will continue or even might get extended to other forms of advertising.
I didn't expect either Clarizio or McAndrews to take the bait and they didn't disappoint.
"At the end of the day, this industry will be a scale game," Clarizio said. "I think the industry will be well served by competition and competition from several players."
Brian McAndrews, Microsoft senior vice president, Advertiser and Publisher Solutions Group
McAndrews acknowledged that Google had "clearly created a great mousetrap with search" but pointed out that digital search, as important as it has become, does not define the entirety of the advertising market. "If you look across all their assets, we're much stronger in the display space," he said, adding that newcomers will face challenges.
The bigger surprise was a comment from Bedecarre to the effect that Google's new challenge is to reach out to marketers. He suggested that the company's most pressing future struggle would be to convince digital advertisers that there's real value clicking past the home page to the increasingly lengthy list of features and products it offers.
"They're having a real struggle trying to engage advertisers with everything after their home page."
Lynda Clarizio, president of AOL's Platform A
Considering the shape of the U.S. economy, that's probably the kind of struggle most companies in the digital advertising business would happily settle for. Especially in these times.
McAndrews offered a tempered view of the digital ad landscape. He said the economic slowdown in this country has had the expected impact on advertising and forced adjustments in expectations. "To pretend that it has had no impact would be wrong," he said.
One topic that's getting a lot of attention here is the potential for digital advertising in social media. That still remains a work in progress, largely because of the reluctance of advertising to jump into a segment they still don't fully understand. Indeed, Clarizio noted the "very large opportunity" presented by social media, but allowed that several advertisers remain uncomfortable about advertising in social media.
Bedecarre echoed that opinion, pointing out that advertisers haven't caught up to the viral popularity of social networks with choice demographic groups. The problem is the uncertainty and potential loss of control associated with putting up an ad on a social network, he said. "They're uneasy...I'm very bullish about where it's going. But the people who spend the really big bucks have to get used to letting go."
Update at 7:00 a.m. July 19: Typo fixed in the senator's last name.
Illinois Sen. Everett Dirksen is remembered for the quip, "A billion here, a billion there, pretty soon, you're talking real money." (Truth be told, it's unclear whether those were his exact words, but he's got that tagline for posterity.)
I was thinking of the former senator after listening to Microsoft's chief financial officer explain to analysts why the company intends to continue to pour hundreds of millions of dollars into a business which still isn't producing much of a return. But the online advertising business is just too important to Microsoft's future to be penny wise and pound foolish. Of course, it helps when you're the CFO of a company with tens of billions of dollars in cash and marketable securities. For more, check out the conversation I had with my CNET News colleague, Ina Fried, earlier Friday.
Earlier Friday I was speaking with a CIO when the conversation turned to the subject of Microsoft. There's been no small amount of reaction to the publication of Gartner Group's gloomy report on Windows. But this exec was not buying into the notion of a future tech landscape where Web browsers elbow aside client operating systems as the preferred software development platform.
"We're still on XP. I'm not going to move to Vista for a while. We'll let other people be the early adopters," she said, asking to remain unidentified in case Microsoft happens to read her quotes. Still, she added, "I just don't see a world in which Web apps make the OS obsolete anytime soon."
Anytime soon is the operative phrase.
One quote doesn't a trend make--except when the person delivering the lines agrees entirely with me. (Just kidding.) In their quieter moments, I suspect that most of the participants in the bloviation-fest which attended dissemination of the Gartner report conclusions would agree. But the groupthink around this topic is leading to entirely off-the-wall prescriptions--especially when it comes to promoting online advertising as the magic answer to Microsoft's troubles. I'm on record writing that Microsoft CEO Steve Ballmer would only be wasting billions of dollars to buy Yahoo, but enough on that topic for now.
Microsoft has a big challenge figuring out how Windows will thrive in a world where more client apps are operating system-agnostic. But that's not the same as proclaiming the demise of the client OS. I don't know how many people attended the speech or read the report, so consider the following from the report:
"There's lots of discussion on how Web 2.0, Ajax and open-source products will make the client OS unimportant and unseat Microsoft as the dominant desktop software vendor. Some even insist that the client OS already doesn't matter. The client OS may be less important today than it was 10 years ago, but that's a more-accurate description for application developers trying to decide what OS they want their applications to run on. New applications are increasingly OS-agnostic, but legacy applications were very often developed for a specific OS, usually Windows. Legacy applications remain installed and important for years, meaning that for enterprises, the client OS is still a critical choice and will be for years to come."
Gartner is more concerned with the changing definition of an operating system if a virtualization hypervisor takes care of the interface between hardware and application. (Hasn't that been the traditional role of an OS?) The report then geeks out on what Microsoft needs to do to retrofit and rescue Windows from oblivion, etc., etc. But nowhere does it make the silly leap of logic mentioned above.
Microsoft's seemingly getting attacked from all sides these days, but give the company some credit for not being completely clueless about the changes taking place around it. Apropos, ZDNet's Mary Jo Foley offers several good points to consider:
• Windows currently contributes one-third of Microsoft's revenues and two-thirds of its profits, I've heard company officials claim. Windows is installed on more than 90 percent of consumer and business desktops combined. That market share isn't going to disappear overnight, no matter how much Web 2.0 pundits and online-services vendors want that to happen.
• Windows 7, from all accounts, is going to be a minor upgrade to Vista. It is not going to be the start-from-scratch, slimmed-down operating system that many believe Microsoft is building in a back room as a "Plan B." Singularity, the Microsoft Research microkernel OS, also is not that brand new Microsoft operating system. However, I do believe Singularity is the core of what ultimately will become a brand-new distributed OS platform from Microsoft. Unlike Gartner, I'm not going to pick a date out of a hat (by 2011!) and claim that's when such a platform will be announced.
• As has been reported previously, Windows 7 is likely to include a feature that, at least at one point, was called the "Component Delivery System" which is expected to allow users to install the pieces of Windows that they want and need in a more user-configurable way. This may not be identical to the modularized role structure offered in Windows Server 2008, but it is similar in its intention. This should help, to some extent, with Windows' bloat--as should Microsoft's expected move to use Windows Live to deliver non-core pieces of functionality to users.
• Windows 7 also is likely to include some kind of virtualization layer that will help ease backward compatibility, I've heard from various sources. Microsoft isn't likely to a port of Hyper-V to Windows client. But it could take the form of a virtualization service like SoftGrid (Microsoft's application virtualization offering) and/or hosted desktop virtualization (the new name/positioning for Microsoft Terminal Server, I hear).
That's the sort of granular analysis that won't flag much attention on Techmeme. But you know as well as I that headlines often don't tell the full story.
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