Online brands set off on new marketing journey

  • Learn about Withoutabox IMDb’s online reach into the offline world, click here
  • About 53 million people a month visit Yelp’s sites, click here to find out why
  • Read our Q&A with chief commercial officer of Mind Candy (creator of Moshi Monsters), click here
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The biggest-selling children’s print magazine in the UK is an extension of a growing online brand. Moshi Monsters started life as an online game before parent company Mind Candy joined a new media sector trend of going down the road long used by traditional offline business sectors in an attempt to raise brand awareness and open up new business opportunities.

Moshi Monsters magazine has taken just six months to become the biggest selling children’s magazine in the UK, according to August 2011 figures from the Audit Bureau of Circulation (ABC), and Mind Candy chief commercial officer Ed Relf says the title’s circulation is already nearly 40% above the ABC numbers that were published most recently. “The most recent issue sold about 155,000 copies, and the ABC figure was about 114,000,” he claims.

But why does a brand focused on new media move into print? Relf says that Mind Candy wanted to establish a new means of communicating with its audience outside the digital game world. “We still see the value of traditional media, certainly in the children’s market. Magazines are important to children. They engage with children in a slightly different way,” he argues.

The example of Moshi Monsters magazine highlights the first in a series of strategies that online brands are using to plot a route into traditional offline areas. It is an adaptation of a model often used by children’s films and TV programmes, building on the popularity of their characters and stories either to create a separate revenue stream, to increase awareness of the core product or both.

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1. Moving into merchandising

Despite its sales figures, Moshi Monsters magazine is seen as a communications channel, not a commercial venture. Its objectives are to create engagement with children and encourage greater use of the website. The articles preview upcoming online content, while unique codes distributed with the magazine provide access to in-game rewards. Relf calls Moshi Monsters “one of the first true transmedia properties”, with its offline extensions always feeding users back to the website (see Q&A, below).

And Moshi Monsters is not the only online gaming property to extend its brand. Rovio’s Angry Birds and Disney’s Club Penguin have also introduced physical product lines such as toys, books and clothing.

The demand for Club Penguin merchandise is natural, says Disney EMEA vice-president of digital games Jeff Jones, since children do not see the same distinctions between communications channels as marketers might.

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He says: “They want to influence the journeys these characters take and with this kind of connection it is no wonder that they also want to prop them up on their pillow too. Our players are digital naturals who are used to being entertained in a multiplicity of ways and for them there are no boundaries or compartmentalisation of platforms.”

In a more opportunistic example, comparison website Compare the Market could not have predicted the popularity of its meerkat characters that have been used in its TV ads since January 2009, but it has been quick to capitalise on them. Last Christmas, Compare the Market released a fictional autobiography of lead meerkat Aleksandr Orlov and in July started a promotion offering customers who buy car, home or pet insurance via the website a plush toy from a range of six meerkat characters.

2. Directing consumers between platforms

Along with Mind Candy and Disney, another online game publisher, Zynga, has taken a different approach in its expansion into offline products. It makes pre-paid physical game cards, sold in high street shops, which allow purchasers to claim virtual currency when playing its social media games, such as CityVille and FarmVille. The cards address one of the limitations of online-only businesses – that it is not always easy or attractive for players to carry out transactions over the internet.

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According to Zynga senior director of business development Ryan Linton, the cards help to bring new users to the games, while also providing an alternative way for existing players to pay. Buyers often give them as gifts, which can help bring in new users, and this offline presence gives players a direct incentive to go to the online game, Linton says.

“We want to be visible in their daily lives. Having our game cards in major retail outlets or cyber cafés gives us a chance to extend our brand into the physical world and tie it directly back to our games.”

The cards also serve a fundamental strategic marketing purpose for Zynga, which is distributing them across Latin America, Europe, the Middle East and Asia to assist its international expansion.

Linton says: “Zynga game cards provide players with more payment options for purchasing goods, especially in emerging markets where people often do not have or use credit cards. This option is a convenient way for cash-only players to make online purchases.”

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3. Finding a physical form

While online and social gaming brands are enthusiastic exponents of retro extensions, websites covering other sectors are also realising that making themselves more visible to consumers increases brand awareness and engagement. Without a physical presence in the “real world”, the scope for online brands to generate these is otherwise restricted.

Online-only groceries retailer Ocado, for example, has sought offline visibility in response to greater competition from Waitrose. A contractual agreement for the latter not to offer delivery services within London has now expired, meaning that Ocado must set itself apart from the supermarket that supplies most of its produce.

One solution came in the form of a window display that was put up in London’s One New Change shopping centre for five days at the end of August this year. Passers-by were directed to download Ocado’s iPhone app, through which they could scan barcodes under product images on the window display and this would add the product to a virtual shopping basket on the app. It also allows users to scan barcodes on physical products. Online fashion retailer Net-a-Porter has since had similar pop-up displays in London and New York.

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Ocado marketing director Matt Knight told Marketing Week last month: “It is a way of making Ocado physical in an unusual, eye-catching way. We want to be led by our customers and how they feel about it and will look into other ways of using it.”

4. Moving towards community interaction

While the examples of Compare the Market and Ocado are principally intended to maintain their awareness offline, rather than opening up a new range of business channels, other online businesses are following Mind Candy, Rovio and Zynga by making physical products part of their fundamental corporate strategy.

Internet Movie Database moved into providing marketing services to film makers and film festivals at a grassroots level with its acquisition of Withoutabox three years ago, while Yelp – a website where members post comments and ratings for businesses in their local area – organises monthly events for its most active reviewers. In both cases, the initiatives generate additional content for the websites as well as exploiting their brands’ recognition offline (see Case Studies, below).

Bringing online users together for real-world social events, rather than for commercial gain, is not confined to Yelp. Etsy, an online marketplace for handmade arts and crafts, organises ’labs’ in New York and Berlin where those taking part are taught a different skill at each session.

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Spokesman Adam Brown explains: “It was conceived as a community gathering where we can interact with our community in person and since we are a community of makers, teach people and learn ourselves how to make different things. It is very much a social event. There is no commercial component to the labs, it is generally free. They used to charge for materials but now the budget is a little bigger. They are open to the public.”

Not only does Etsy not charge people to join in, it does not even keep track of attendance or measure how those who come use the website. Neither is there any direct link between the labs and products sold through the marketplace. Instead, Brown says, they are purely designed for purposes of gaining knowledge and socialising. If there is a brand focus to the labs, it is simply in emulating the nature of the website.

“Our culture at Etsy is very much do-it-yourself. We build almost all of our software in-house, we do not use a lot of outside tools, we do not use a lot of outside agencies and we do it ourselves from the ground up.”

Etsy’s model is unlike most examples of online brands extending into physical products or events in that the website does not use its labs to capture data or generate revenue.

However, Etsy does share a number of reasons for online brands branching back into more traditional marketing channels. Brand awareness is a big driver, along with the ability to be present in the physical environments where customers spend their days. For many, the offline businesses that act as vehicles for this awareness become commercial enterprises in themselves, allowing online brands to future-proof themselves.

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Case study: IMDb and Withoutabox

Internet Movie Database (IMDb) has become the pre-eminent online source of information for the film industry. Although films are now often distributed and promoted online, there remains a vibrant calendar of film festivals around the world and in recognition of this, IMDb acquired Withoutabox three years ago.

According to festivals director Christian Gaines, Withoutabox mediates in “the tug between a traditional exhibition – a communal celebration of film and everything that means – and the rapidly advancing world of video on demand”.

Withoutabox brings IMDb’s online reach into the offline world of grassroots film festivals and film making by providing a web portal for film makers to upload their work and all supporting materials once, and then to submit these to multiple festivals.

From here, film makers can also promote their work by creating title pages on IMDb.com, where they can upload clips, trailers and images; and on which news feeds appear when a film is mentioned by any of IMDb’s 500 news partners. Withoutabox also helps members self-distribute their films via DVDs and online streaming.

Meanwhile, a festival that signs up to the Withoutabox submissions process is able to market itself through the portal to 300,000 film makers in 200 countries, the company claims. Bringing the recognised IMDb brand name to its service has clearly contributed to Withoutabox’s credibility.

Gaines says that IMDb’s principal objective is to attract a diverse range of films and festivals to the service, adding richness and variation to IMDb’s archives and enhancing the site’s value as a reference source.

“It is very important to make sure that we provide film makers with as wide a selection of film festivals from around the world as possible at different times of the year,” says Gaines. “We make sure that they are using the system to make their discovery of emerging movies and emerging film makers as thorough, authoritative and complete as they can possibly make it.”

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Case study: Yelp

Yelp began in San Francisco in 2004 as an online community where members could share experiences of businesses in their area. Consumers write reviews of all kinds of local providers, from dentists to mechanics.

About 53 million people a month visit Yelp’s sites, according to the company’s June 2011 figures. These sites now serve seven European countries, the US and Canada and more than 20 million reviews have been published.

But Yelp’s communities of users meet up and interact in the real world as well as online. According to UK and Ireland marketing director Kevin Lee, the concept was first proposed in 2005 when the company had not yet expanded beyond its Californian origins.

“We had users who were very active and engaged on the site and our first community manager said to our chief executive: ’We should get together and meet some of these people who are using the site.’ It seemed a crazy idea and our CEO was not thrilled about it. ‘He said, really, they’re weird, why do I want to meet
them?’”

A software engineer by trade, CEO Jeremy Stoppelman’s reaction was perhaps typical of many online businesses whose customers might remain at arm’s length. But Yelp moved past this initial scepticism, finding that these active users – who not only frequent their local hotspots regularly but are also vocal in reviewing them – also tend to be very sociable in person.

Yelp now assembles groups of “elite” members for monthly events in each of the major cities in which it operates. What started as an informal gathering of strangers with wine and nibbles in a San Francisco boutique has since become a regular fixture in each of Yelp’s markets, engendering personal relationships that are then taken back to the online forum.

Lee adds: “All of our community managers, who organise these events all around the world, partner with independent local businesses. There are opportunities almost every month for these businesses to promote themselves to this core group of our consumer base per year.”

Elite members are further encouraged to interact with less regular users and generate greater participation on the site. Yelp also organises open events requiring only that those attending sign up for a free online account. This, argues Lee, is a means of bringing in new users to the brand, as well as providing a showcase for businesses.

A recent example took place at the British Music Experience, an interactive museum within The O2 music venue in London. About 300 Yelp members attended the event, where local food and drink brands such as the Meantime Brewery, Otto Pizza and ice cream shop Gelupo served visitors, receiving reviews on the Yelp site as a result.

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Q&A

Ed Relf, chief commercial officer, Mind Candy (creator of Moshi Monsters)

Marketing Week (MW): How does Moshi Monsters magazine link in with the online game?

Ed Relf (ER): Children’s magazines are an interesting and engaging way to communicate with a young audience. We decided very early on that the magazine was going to become a part of the game experience.

The secret for us has been meshing the virtual world and the magazine itself. That is our strategy and the reason we self-publish the magazine. It is important for us as the publisher that we feature upcoming online content because it is an extension of the game world offline.

MW: How do you ensure the Moshi Monsters magazine fits with the values of the game?

ER: Not only do we have to appeal to children, but also their parents. Moshi Monsters has always been a safe, secure online game that has been built for children. The fact that we do not take advertising on the website and it is an educational game means parents endorse their children playing. The magazine is essentially a replication of that.

MW: What are the commercial objectives of the magazine?

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ER: It is not a commercial venture for us as a business. It is more about us developing a communication channel and a way of telling people about new content in the game world. The key thing for the magazine is that it engages our audience in a slightly different way from the website. We know that players of Moshi Monsters are also watching TV, reading magazines and listening to the radio.

MW: How do you measure the benefits of the magazine for the Moshi Monsters brand?

ER: We measure success by the response from the gaming community. There are in-game items that unlock unique game content, which are bundled with each issue of the magazine. We monitor the redemption of those items, and that fuels increasing levels of engagement with the website itself. That is the objective measure.

MW: With the magazine and other merchandise being so successful, can you see Moshi Monsters ever becoming a primarily offline brand?

ER: Absolutely not. It is completely the reverse. We are an online game publisher, and the primary objective for all the products that we produce, license or self-published is to drive traffic back into the Moshi Monsters intellectual property online. We already have a range of plush toys, trading cards and stickers. All of our toys have some kind of element with unlockable content within the game.

MW: Does starting online makes it easier to establish a brand that can be built offline?

ER: It is a common misconception that by doing something online, it might be cheaper, or that there is a lower barrier of entry. We have been working on the product for four years and spent tens of millions of dollars developing the title. This year alone, the business is spending $20m just on advertising.

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