This summer, as Telus prepared to open a new cellphone store, it did all the usual things retailers do to hype a new outlet: promotions and announcements in the local media. On the Aug. 24 opening day, it held a launch event that included giving away T-shirts to customers. It worked. In its first four days the Telus store sold 100 cellphones including popular models like the Motorola Razr and the Samsung A950.
But Telus didn’t make any money off those sales. That’s because this new store is in Second Life, the fast-growing virtual reality world in which players create characters called avatars and shop for stuff using mystical-sounding money called Linden dollars.
Three months after opening, Telus says its store is a success, mainly because of the buzz it generated-in both worlds.
In the real world, Telus didn’t issue a press release about the store, but coverage from bloggers and newspapers like the Montreal Gazette drove awareness, which helped to further brand Telus as a technologically advanced company, says Bernard Szederkenyi, director of direct and experiential marketing at Telus in Montreal. Plus, Canadians in Second Life (which Szederkenyi estimates number around 120,000 of the total 1.2-million person population) are Telus’ core customers. “These people are hip, technology savvy, and, of course, our intent as a telecommunications company is to unleash the power of the Internet and show the client what we can do in the realm of their choice.”
That realm is increasingly online social media, whether it be Second Life, MySpace, YouTube or blogs. “For the first time we’re hearing clients say, ‘Wow, we should take a look at social networking sites and use them in our plans.’ We didn’t hear that a year ago,” says Jeff Roach, managing director, youth marketing at Youthography in Toronto. Youthography did its first corporate MySpace page in January for the Alliance Atlantis BBC Kids launch, and has since done a site for Katimavik as well as placed a video ad on YouTube for Bubblicious Bursts.
Robert Jenkyn, vice-president of on-demand media at Media Experts in Toronto, describes marketers as “very gingerly” looking at buying ad space on social media sites. Since the sites are open forums, advertisers don’t have much control over content. Still he notes that WestJet ads have appeared on MySpace and other sites and Telus has promoted its Spark phone and back-to-school offers on MySpace Music.
In September, Corus Entertainment and its agency, Zig, launched a campaign using YouTube for its Scream TV channel’s triple-bill of horror, thriller and suspense movies. Zig started by projecting a holographic image of a girl in the window of a downtown Toronto home under renovation. About 10 days later, it placed two documentary-style videos on YouTube which featured the ghost and told people the location of the house. That sparked talk about the house in chat rooms and online, before the hoax was revealed three weeks later with the girl in the window holding up a sign that said “Get scared more often,” a tag line that was also used in transit and cinema ads.
The YouTube component was a great way to launch the campaign, says Susan Schaefer, VP marketing at Corus Television. But it was also a way for Corus to test online viral marketing. “Part of it was a learning experience,” she says, noting that the video has since been posted by someone else on Google Video where it has nearly 100,000 views.
Two of the most high-profile attempts to market in the social media universe also came this fall: one a surprising success, the other a spectacular failure. “Dove Evolution” a viral video by Ogilvy & Mather in Toronto showing how an average looking woman can be turned into a supermodel, scored 1.7 million views on YouTube and was an ideal social media tie-in for Dove’s “Campaign for Real Beauty.” On the flip side, Wal-Mart and its PR agency Edelman were raked over the coals when it was revealed in October that a blog called “Wal-Marting Across America”- which had been supposedly launched by two average Americans chronicling their cross-country trip in an RV-had been created by Edelman and the trip paid for by Wal-Mart.
Marketers’ sudden interest in online social media is not surprising since it’s only been in the last year that most consumers have become aware of it. But are the sites like YouTube or MySpace a good investment for marketers? And how do you calculate the ROI from dropping a 30-second spot on YouTube or opening a virtual store in Second Life?
Proponents of online social media admit those aren’t easy questions to answer. With Second Life, Telus spent almost nothing to create the virtual store but “they got tons of media out of it,” says Mitch Joel, president of Twist Image, a Montreal-based marketing agency.
Where marketers get it wrong, Joel says, is when they launch a blog because “everyone else has one” or do a YouTube video because their kids told them it’s a good idea. Each social network has its own unique audience, Joel adds, so marketers should identify “which of these channels really resonates with your tribe-the type of people who really feel that what you do is part of who they are.”
But social media is still in its infancy and new players are emerging, which is making it tough for marketers to decide where to go. Take MySpace as an example. Will it still be cool with the kids this time next year? Maybe not, according to recent reports suggesting more adults are signing on, and more kids signing off. According to comScore Media Metrix in the U.S., 12 to 17 year olds comprised just 11.9% of MySpace’s total unique visitors this August, down from 24.7% a year earlier. MySpace’s audience is now primarily over 35 with those 35 to 54 making up 40.6%. “As social networking sites have become mainstream, the demographic composition of MySpace has changed,” stated comScore in an October report.
Even so, MySpace is still the most heavily trafficked social networking site when compared to rivals like Facebook, Friendster and Xanga in the U.S., according to comScore, but the same may not be true in Canada anymore. Youthography’s Fall 2006 Ping survey found that 41% of 9- to 29-year olds who social network have a MySpace account, but that the site is fast being eclipsed by Hi5.com, which has 40% of Canadian youth on board. “Hi5 will probably surpass MySpace in the next couple of weeks in terms of popularity with Canadian youth,” says Roach.
Marketers need not just look at one of these sites, though, he adds. As social networking increases, there are more options available. “Saying ‘let’s do social networking’ is like saying ‘let’s do TV’ and then just picking one channel to run your ads on,” Roach says. “There’s lots of channels and lots of eyeballs in different places, so it’s important to look at it that way.”
In terms of marketing to youth, Roach mentions several that are gaining traction. MSN Live Spaces, which launched in August is one. It’s technically the most popular such site with youth in Canada with 57% saying they are members (the caveat being that MSN and Hotmail create pages automatically for their users). Another is Facebook, the U.S. site that was initially opened only to college and high school students as a way to connect with one another, but which in September abandoned its student-only policy. Now 10% of 9- to 29-year-old social networking Canadians are members. According to Youthography, Facebook is the seventh most popular social network site with Canadian youth, behind Live Spaces, MySpace, Hi5, Classmates (21%) Wayn (17%) and Piczo (14%), but ahead of Nexopia (the only Canadian site on Youthography’s top 10 list), Friendster and Livejournal, which each have 8%.
But social media marketing isn’t all about location, location, location. Since the creative often becomes content, it has to be really good to cut through. For example, those cellphones Telus is selling in Second Life are more than fashion accessories for avatars. They come with a busy mode feature so that when a Second Life user is busy in the real world, her phone sends a text message to other avatars with a Telus phone telling them she can’t be reached at the moment. “We wanted to create a tool that actually enhanced the experience online,” says Stacey Masson, senior manager, media relations at Telus.
Nowhere perhaps is the creative more important than on a site like YouTube, where 30-second spots compete with everything from dogs on skateboards, to a gripping recital of the “Cremation of Sam McGee” (don’t laugh, it’s had 390,000 views). One marketer that got it right is Coke with its “Video Game” spot by Wieden + Kennedy, which mimics Grand Theft Auto in its look and plot line-except the mad-driving main character does good deeds instead of bad ones.
The ad ran on TV and in movie theatres in the U.S. this summer as part of “The Coke side of life” campaign, but has since been posted on YouTube, where it was viewed widely. Joel points out that ad creative on YouTube gives marketers an immediate answer as to whether their ads are any good. “Because at a certain point you have to be able to say if nobody views it, this ad is a total failure.”
Back in Second Life, Telus plans to take the link between real world marketing and virtual reality marketing one step further. In the next six weeks it wants to start giving Second Life residents who purchase a virtual cellphone a special offer for a real Telus phone. “That’s the next step, to connect the two worlds and develop cross-promotions,” says Szederkenyi.
