Mixed bag for brands on net

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More coverage: Bud.tv retools programming

NEW YORK -- Anheuser-Busch's recent flip-flop on the future of its flailing Internet network Bud.TV underscores the challenges advertisers are facing as an increasing number flock to the Internet to create original entertainment content but struggle to find an audience.

Like Bud.TV, more brands are realizing the power of the Internet to reach their target demographics and the many advantages it can hold over branded entertainment projects in film and television.

"As far a creating content for the Web, the Internet has allowed brands to have access to distribution like no other time in history," said Babs Rangaiah, director of media and entertainment for Unilever USA, probably the most aggressive advertiser other than A-B in creating original Web content. "The Internet has leveled both the creating content and the distribution playing field."

Despite traffic on Bud.TV falling from 250,000 visitors in February to 150,000 in March and even farther in April and May -- not to mention it has an estimated $20 million investment at stake -- A-B apparently realizes the Internet is too important a marketing tool to ditch Bud.TV.

A-B CEO August Busch told investors last month that Bud.TV would "fade" during the second half of the year, but the executive in charge of the fledgling network quickly countered that, saying Bud.TV is here to stay, though there will be modifications.

"Anheuser-Busch needs to be in the digital space," said Tony Ponturo, vp global media and sports marketing at the company. "We think it's important to be a part of the media that's being developed on the Internet, not just to buy the media. We need to understand the digital space, and we think we're learning it at warped speed."

Numerous other advertisers have come to the same realization as A-B, albeit at a much lower cost and often with more impressive results, especially when taking their Web expenditures into account.

Just this year, Sprint and Unilever's Suave partnered with MindShare Entertainment to create the Web series "In the Motherhood" starring Leah Remini; American Eagle teamed with Milo Ventimiglia ("Heroes") to direct "It's a Mall World," a Web series set to air this summer; Mini Cooper created a series at HammerandCoop.com that was produced by Moxy Films and helmed by Todd Phillips ("Old School"); Unilever's Caress Body Wash created two fairy tale-like webisodes starring "Grey's Anatomy's" Kate Walsh; and Stouffer's cooked up content at DuringDinner.com.

Last week, Unilever launched an animated Web series for its I Can't Believe It's Not Butter! and Wish-Bone spray brands called "Sprays in the City." The series, starring "Extra's" Mark McGrath, "Project Runway's" Tim Gunn and Fabio, builds upon two "Spraychel" animated Web series for I Can't Believe It's Not Butter! that Unilever ran in the past two summers.

Earlier brand initiatives on the Web include Georgia-Pacific's 2006 series Brawny Academy in which husbands were sent to training camp with the Brawny Man to learn how to be better husbands. Unilever's Dove Calming Night body wash, in collaboration with MindShare, produced webisodes last year directed by Penny Marshall that transported actress Felicity Huffman into the homes of classic TV moms Carol Brady, Lily Munster and June Cleaver. In 2005, Unilever's Axe deodorant teamed with branded entertainment firm Conductor to create a video blog of comedians Evan Mann and Gareth Reynolds as they tried out seduction moves on women.

In partnership with production partner Yahoo Music, Pepsi has been airing its Pepsi Smash series of original music videos, which first aired as a TV show on the WB Network, since June 2005. Pepsi Smash has aired nearly 150 webisodes of original music video content a year on Yahoo Music including exclusive performances by Gwen Stefani and Mariah Carey.

Two of the most successful brand content initiatives on the Web to date were among the first, leading the way for advertisers by demonstrating what a powerful marketing vehicle the Internet could be. In 2001, BMW hired David Fincher, Ridley and Tony Scott, John Frankenheimer, Ang Lee, Guy Ritchie, Wong Kar Wai and John Woo to produce an Internet series of eight films that received more than 100 million views in its 4 1/2 years online. In 2004, American Express had enormous success with webisodes starring Jerry Seinfeld and an animated Superman that had millions of views.

While advertisers say that branded entertainment projects in film and TV still are more effective as a marketing tool, creating original content on the Web does have its advantages: full control over the creative content and no longer depending on Hollywood talent to integrate their brands or portray them in a positive light; no high-priced media buys and integration fees; the ability to track what consumers are watching and adjust programming based on viewer feedback; interaction with consumers and the ability to collect data on audience demos; and the distribution of content on-demand.

"It's getting harder and harder for brands to integrate into established TV shows and movies," said Laura Caraccioli-Davis, executive vp entertainment for Publicis Groupe's Starcom Entertainment. "Most people don't want brands in their shows. Unless you're a car, a cell phone or some type of technology, you're not welcome."

Added Robert Riesenberg, CEO of Omnicom's Full Circle Entertainment: "Advertisers are very much interested in the digital space because it's interactive and it gives them a one-to-one relationship with their consumers. You can tell almost instantaneously whether people are paying attention to your message so you know what works or what doesn't work."

The cost to produce Web content averages tens of thousands of dollars, compared with an estimated $1.5 million-$2 million for a half-hour scripted TV show. "You're not paying fees to a major network into media buys," said Mike Malone, vp at branded entertainment firm Alliance. "You can do more unique things on the Web; there's much more flexibility on format, content and ownability."

Advertisers say they're moving money from their traditional media budgets to the Internet space but aren't taking away funds from branded entertainment initiatives in film or TV. Marketers say that projects that incorporate many platforms are the most effective of all.

Ponturo said the money for Bud.TV came out of traditional media, not Budweiser's budget earmarked for branded entertainment in film and television. Georgia-Pacific used traditional ad dollars to create and promote the Brawny Academy. And American Eagle said the money to produce "Mall World" came from media dollars, not from its TV branded entertainment budget.

"They both have great results and that's why we do both," AE spokeswoman Jani Strand said.

While Bud.TV might have been a bit hamstrung because of its age-verification requirements and its initial failure to allow viewers to virally share content -- some of which has been described as lackluster -- the challenge of finding an audience is a problem shared by all advertisers, especially when they post their content on their own Web sites.

"Bud.TV has aired 2,000 minutes of content in over 100 different episodes of programming," Ponturo said. "I think considering that we are a marketer and not a major entertainment company, it's a pretty big accomplishment. The problem is you still have to get eyeballs there.

"The beauty about advertisers is that when they use their traditional ads to drive people to their sites, they've got some built-in promotion right there. The problem is how many consumers are excited about going to these advertiser sites," Ponturo said.

Some brands post their content on such major portals as Yahoo, AOL and MSN or video-sharing sites like YouTube; those already have huge audiences. Pepsi estimates that Pepsi Smash, on Yahoo Music, has millions of unique visitors per month.

"It makes it easier to get an audience going to a place like Yahoo Music," said John Vail, director of interactive marketing for Pepsi-Cola North America. "It's an advantage and it's why we do things with portals. We don't try to 'build it and they will come.' "

Dovenight.com was a microsite housed at AOL, and IntheMotherhood.com is hosted on MSN.

Attaching stars and top-name producers and directors to Web content is another strategy increasingly being employed. But the most critical element to success is marketing, experts say. "It's very challenging to get people to come to your Internet property, so the marketing of this is going to be crucial and the advertisers are going to play a critical role in that," said Jak Severson, CEO of branded entertainment studio Madison Road Entertainment.

A-B poured lots of money into production with shows from such top talent as Kevin Spacey's Triggerstreet Prods., Matt Damon's LivePlanet Prods and Warner Bros. Television Group's Studio 2.0, but the company did not put a great deal of marketing muscle behind Bud.TV, with no TV media buys to promote it.

"We thought it could be just the content, but we're learning that's not enough. You've got to help people get there," Ponturo said.

Pepsi, which says it gets millions of unique visitors for Pepsi Smash per month, advertises the show across the Yahoo network, on radio and in print and by driving people to Yahoo Music from Pepsi's site. It also uses its database marketing efforts to help support the music show.

Mini Cooper, which ran a trailer or clips of its "Hammer & Coop" Web series in movie theaters in all 80 markets in which it has dealers, interactive banner ads on the Web and print ads in a variety of publications, said HammerandCoop.com has had more than 1.5 million video views since it launched in February. In addition, 4,200 people registered on MiniUSA.com -- leads passed on to Mini dealers -- during the Web series that ran through March, a 60% increase year-over-year.

"I think for a very modest production value this got well worth its weight in production cost," said Trudy Hardy, manager of Mini marketing.

"Motherhood" is being heavily promoted on "The Ellen DeGeneres Show," through online media buys, viral marketing and ads in People magazine. There have been more than 4.3 million views of the first four webisodes and trailer, according to MindShare.

Georgia-Pacific, which ran TV spots promoting "Brawny Academy" and directing viewers to BrawnyAcademy.com, said it considered the series a success despite reports at the time that traffic was not impressive. "Traffic is not the only indicator of whether it was a good vehicle for us because people spent more time on the site," spokeswoman Anna Umphress said. "We actually saw purchase intent go up 15%, and what we were trying to do is get people to view Brawny as a brand that supports women -- and that metric was up 40% against our target consumer."

American Eagle Outfitters, which promotes its content with e-mails to its customers and promotions in its 900 stores and this time will premiere "Mall World" on MTV, said its Web content generally increases traffic to its site, traffic to its stores, brand awareness and overall sales.

While advertisers might be hesitant to follow in A-B's footsteps in creating an entire Web-based network, it is evident that they will be increasingly turning to the Web for their branded entertainment initiatives. "The audience is really there and the numbers are growing," Madison Road's Severson said. "The Internet has truly become an enormously effective way for advertisers to reach people. I think we haven't even scratched the surface of where this is headed."
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