If it costs nothing to promote a brand on social networking sites, how can advertising agencies make a living from free media?
Commercial interests became involved in the internet in 1995, shortly after a US computer science student called Marc Andreessen developed Mosaic, the first graphical browser. Since then the dominant question has been how to make money using the new medium, and there’s no sign that the question is going to be any less important, or any closer to a definitive answer, this year. But in terms of who is making money and who isn’t, one the most interesting trends for the next 12 months is going to be the rise of free media.
One of the most dramatic effects of interactive media has been the degree of control it has given people over their media experience. Not only can you look at whatever website you want whenever you want to, but increasingly you can treat any other media content in which you’re interested in exactly the same way.
And what’s true of content is equally true of advertising. If you give people the tools with which to manage their media experience, then one of the first things they reject is interruptive advertising. The rows over pop-up ads online and the rise of spam filters were just early examples of interactive tools being turned on interruptive advertising.
What we’ve seen in the past couple of years, with the rise of blogging and the growth of social networks such as MySpace and Facebook, is control being exerted on a much greater scale. These emerging media properties, which attract huge global audiences, are not entirely friendly territory for advertisers. Research carried out by YouGov last year found that only 14% of social network users liked having ads placed on their personal pages. The rest were either neutral about it, or objected to the idea. Brands seeking to advertise to these new audiences, and media owners attempting to make money out of them, have found it harder going than they expected.
But further research has discovered that people feel much more positive about advertising on their personal pages if they have some involvement in who the advertisers are, if the relationship is more like them recommending the product or service. This is where it gets interesting.
One of the other things that the internet has turned out to be very good at is allowing people with shared interests to find and communicate with each other. As a result news about companies and their products and services travels fast, whether it’s good or bad.
At the same time, research into the nature of online communities always throws up much the same findings – each one consists of a few key leaders, a larger group who build on their thoughts, and a vast majority who read but don’t contribute. Anyone who’s read Malcolm Gladwell’s The Tipping Point knows what happens next. You find those few key opinion formers, target them with the message you want to spread to your community of interest, and let the network do the rest. What matters is that, while there needs to be a PR budget for that sort of activity, and while you may also need to build a supporting website or two, the media cost is exactly nothing.
This approach sidesteps the objection that only cool brands can advertise on social networks. That may be true but, as Jon Bains, founder of digital agency Lateral, said at Marketing Week’s Online Marketing Show last year, every brand should be looking into social media because every brand is the subject of a conversation somewhere on the internet.
Another benefit of this approach is that, in these authenticity-obsessed times, it acts as a hype filter. Integrity and authenticity are the qualities most prized by the blogosphere, so anything that makes its way through is assumed to be trustworthy. Of course, the flipside is that anyone caught trying to game the system is outed and spectacularly vilified.
In recent months there has been a string of campaigns that have used this approach. One that stuck in my mind was a Royal Navy recruitment campaign put together by online media agency i-Level. Research conducted by the agency found that the most powerful influencers on whether people applied to join the Navy were people who were in the Navy themselves. This, of course, is a difficult approach to scale. So the agency created a Bebo page for a Navy helicopter pilot allowing him to talk about his experiences. It was extremely successful and, once again, the media cost was zero.
But for advertisers that get excited about the possibility of free media, there are two vital questions. If media agencies are creating successful campaigns where there is no media buy, how do they get paid? And if the most powerful advertising elements of the emerging social media can be had for nothing, how can the creators of those media properties make money?
Michael Nutley is editor-in-chief of New Media Age