Let's Pay Consumers To Receive The Ads, By Manfred Mareck, Research Marketing Ltd, London
If companies start paying consumers to receive their advertisements who needs expensive research to measure ad exposure?
Get Paid to Receive Ads
More companies could in future be paying consumers to receive their advertisements. Take the business model of New York-based SpiralFrog.com. Backed by music giant Vivendi Universal the company plans to compete head on with Apple by offering its subscribers ‘free’ music downloads. The company will charge advertisers for their commercials but reward subscribers with free downloads as long as they first listen to the ads. Given the huge popularity of music downloads to PCs, iPods, MP3 players or other mobile devices advertisers will gain access to the large, lucrative and often elusive young ABC1 market combined with guaranteed ad exposure. What’s more, these receiving devices are very much personal items, always used by one and the same person. Advertisers could easily build-up a profile of each owner and know exactly which commercial has been delivered to whom and when. They would also know what music has been downloaded, which may give some indication of the user’s mood at that time – a marketers dream with little need for investing in much further survey research.
The model could also be used by mobile phone companies –sign up and listen to advertising messages before making your call and enjoy free or reduced call charges. Most mobile phone providers, having spent billions when government auctioned off additional frequencies are desperate to re-coup their investment by offering other than just voice functions. So far the take-up of these 3G services has been somewhat disappointing in Europe (the situation in Asian markets is different). Admap recently reported on findings of surveys by TNS and Continental Research which both indicate at best lukewarm interest in additional mobile phone applications and certainly little interested in again being bombarded with commercial messages.
A recent study by Harris Interactive in the US showed that only seven percent of mobile phone users were very/somewhat interested to receive promotional text messages, provided they were relevant (meaning the consumer determines which messages he or she may be willing to receive). In come financial incentives: the willingness to accept commercial content increases to 25% if in return the user gets some free mobile phone applications.
A major brewing company successfully tested this model in the UK a couple of years ago. A panel of young men were signed up to receive SMS advertisements (such as ‘Isn’t it time you bought a last round of Brand X’) half an hour before Pubs’ closing time in return for free minutes on their mobile.
Similarly, a leading TV company offers ‘free’ video clips of major news items via their website but viewers have to watch a commercial first with no facility to skip or fast forward to the actual clip.
Word of mouth marketing also uses the same idea. Companies offer selected consumers their products free of charge to turn them into brand ambassadors who in return will chat, write and blog about these offerings to the wider community. And after the debacle of AOL earlier this year we know that all Internet traffic, chat room activities and searches are recorded and kept, so the data is already there.
Don’t Advertise at All
Of course some very successful brands have gone even further and never much bothered with conventional advertising. There is another worrying lesson: whilst many of the failed dot.com companies of the 1990s invested heavily in (off-line) media advertising (around US$3billion in 1999 in the USA alone if memory serves me right) some of today’s most successful spent very little – hands up who has seen many ads from Google, Amazon, MySpace or ebay in their local newspaper in recent years. No ads – no need to measure anything.
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