Andrew Hampp over at Ad Age wrote a comprehensive post about the rise of branded digital entertainment and the creative approaches brands are taking to use web video as a vehicle for making meaningful connections with consumers.  Unsurprisingly, I chimed in with a lengthy comment that I wanted to share here as well:

The branded entertainment market faces many challenges for brands and content creators in developing media experiences that are both entertaining and effective. But the biggest hurdle among them is reach in rising above the clutter in a highly saturated online space to get a series in front of the right audience who will a) be pre-disposed to the message, b) engage with the content, c) take some sort of brand action (as defined by marketing objectives) and d) share it.

To bring viewers along that continuum, it's critical to first identify the target audience and then craft compelling stories that will resonate specifically with that group (a la Break.com's vigilant focus on male-centric content). You can't make a personal connection with viewers unless the content is personally relevant to them.

So the content must be compelling enough that consumers identify with it and want to interact beyond just one episode. But creating branded content that piques interest is only half the battle; you need to put pull-through tactics in place to maintain interest and build the relationships and emotional affinity needed to drive some measurable value back to the sponsor brand.

An example of finely targeted branded content is McAfee's Stop H* Commerce that effectively generated increased downloads and purchase of their anti-virus software by setting up a need for their product in an entertaining (unbranded) way, and leading viewers to a buying conclusion right at the point of consumption after being emotionally impacted by the content.

The Old Spice commercial, 'The Man Your Man Could Smell Like,' has been making the rounds on Twitter and other social networks since the Super Bowl, and is largely accompanied by reprises of 'I'm on a horse' -- always a crowd favorite.  In fact, that line is now synonymous with the ad, a powerful statement about the effect digital can have on brand consumption and recall.

The ad has already spawned a slew of blog posts from industry professionals to consumers and lots of chatter (and excellent market insights) on the Facebook fan page. Even celebrities are chiming in like Rain Wilson, who tweeted that the "I'm on a horse!" guy (Isaiah Mustafa) should have his own show, and Leo Laporte was so enamored with the ad that he invited the creators from Wieden + Kennedy (Craig Allen, Eric Kallman) to TWiT.tv for a behind-the-scenes interview of how the commercial was conceived and executed. So, I think it's safe to say it's gone viral. And is a big hit.

But what I find even more compelling is how the overwhelmingly positive response has gone beyond just viral sharing to viral creation. Commercial parodies are certainly nothing new, and have been a part of pop culture since Saturday Night Live, but when brand content (and one peddling body wash, no less) makes an impact on consumers to the point that it inspires them to interact with it, and contribute to its message to make it their own, that's when the magic happens. Instead of the ad being disruptive, it becomes inclusive, and the benefactor of a highly personalized experience that is then shared with the creator's friends and family, and carried through into nooks and crannies of the market (and consumer mindshare) that no media buy could ever deliver.

Now more people are talking (and singing!) about Old Spice than ever before, and feel connected to the brand in a uniquely personal way. This is one of the reasons branded entertainment is effective -- because it allows you to generate awareness and affinity for the brand through emotional triggers of those who buy your products rather than overt messaging. (And let's face it, P&G knows that the best way to get men to use scented products is to appeal to the women who are fantasizing about the men in their commercials!) There’s no better way to connect on that level -- and influence behavior -- than through entertainment. That’s why commercials over the years have sought to entertain as much as advertise. Up until the dawn of web video and spreadable media, however, it’s been difficult to execute on both because you ended up serving neither well.  You had ads that didn't entertain and entertainment that didn't sell. And the reason it didn't sell was because there wasn't any pull-through. Consumers saw a fleeting ad and moved on with little memorability since the iconic days of 'Where's the Beef?' or 'Got Milk?'  Now you can immerse consumers in a campaign where they are equipped with tools to share it, adding their imprint -- and endorsement -- to it with every click (or with any ring thanks to the Old Spice whistling ring tone).  But all of which would not be possible without the brand that sparked it all.

Procter & Gamble knows this better than most brands, especially since they're the company who basically began branded entertainment when they realized they could effectively promote their products to the women who were home all day by creating resonant daytime TV programming.  And voilà, 'Guiding Light,' the longest running soap opera in history was born... and millions of dollars worth of detergent and household products were sold over the years.

I also came across one of their older Old Spice commercials, starring Bruce Campbell, that, while lacking the comedic punch of the Isaiah Mustafa spot, demonstrates a legacy of creating memorable content, and makes me wonder how this would've fared if tools like Twitter and Facebook had been around then.

One thing's for certain, they've definitely activated consumers and opened up new pockets of the market where scented body wash may never have gone before, but will the viral impressions create the level of engagement that leads to products flying off the shelves, or just leave people singing ad copy to the tune of John Denver's 'You Fill Up My Senses?'

I'm on a horse.

Since the unveiling of Ben Silverman's new venture in partnership with Yahoo and the newly formed DumbDumb Productions with Jason Bateman and Will Arnett, the web's been abuzz, and my Google Alerts have been blowing up.  Most of the posts have been the same recycled press release, but tonight I happened across ClickZ's post, 'Agencies Ho-Hum on Yahoo's Latest Premium Video Drive' with the agency perspective on it. So, of course, I chimed in, but their pesky character restriction forced me to condense my commentary, so I'm posting it here in full:

It's interesting to see agency reactions to this latest advertiser-funded video venture, and as someone immersed in the branded content space, I encounter more skeptical agencies than I do those embracing digital entertainment as the future of advertising. In its current inception, I can't say I entirely disagree.  Most attempts to date have been a range of clumsily to overtly integrated product placements or storylines that are disconnected from the core traits and positioning of the sponsor brand. And I can't name one that includes any tangible call-to-action in driving measurable viewer engagement.

So, it's not that there are unsuccessful web series out there as a whole (there are dozens of exceptional ones, in fact) so much as ones that lack the strategy needed to reach and motivate an audience toward some actionable end. In an oversaturated space, even the highest quality content is often left undiscovered (most consumers have still not even heard of Dr. Horrible, which made a primetime Emmy appearance, or The Guild, which is backed by Microsoft.)  And attaching notable talent generates initial buzz, but isn't typically enough to sustain an audience long-term. (Though it is critical to rise above the clutter and legitimize the category among a mainstream audience.)

All that said, I do believe that when the brand is brought in at the pre-production stage, and the content is crafted to be emblematic of both the brand -- and the consumers it's trying to  reach -- it can be a very compelling vehicle through which you can generate ongoing, top-of-mind awareness for the brand and drive consumption, affinity and sales. And I have no doubt that the content DumbDumb will develop will be top notch (I am a big fan of Jason Bateman's work and think his style lends itself well to brand parodies), and they are already a step ahead of the game by being able to attract big name advertisers.  

But it will require more than just a funny sketch to become a viable business model. It needs to be fueled by an underlying strategy that a) drives consumers to the content at a sizable enough level to produce a return on the investment (not convinced presence on Yahoo alone will be enough), b) compels viewers to return regularly (most weekly web series drop considerably in views about midway through or never even reach anything near critical mass -- especially if you factor in that the content will leave a brand impression on less than 5% of viewers and even less than that will take any action) and c) offers ongoing, two-way interaction that creates a value exchange for the viewer's time and attention and elicits support for the brand (in the form of brand loyalty/ambassadorship, sales etc).

My company, Space Truffles Entertainment, is focusing significantly on the latter in 2010 with original scripted content designed to drive a specific action, and experimenting with branded transaction-based experiences that unlock bonus content for some desired behavior or engage viewers through multi-platform participatory experiences such as clues toward solving an online mystery. In that manner, while entertainment may be the driving force/benefit, it is still a piece of marketing geared toward a targeted audience and intended to move a measurable objective.  The bottom line is that if you don't have pre-defined metrics in place beyond views alone, even the strongest piece of creative won't translate into quantifiable value back to the brand. And viral trajectory isn't always indicative of brand affinity as even content that spreads via social networks because of humor or shock value doesn't mean those viewers will ever convert to brand.

In any event, I'm eager to see how the Electus/DumbDumb partnership unfolds, and think it could lead to tremendous advancement of the digital entertainment category overall if they are successful.

Gennefer Snowfield

http://www.twitter.com/Gennefer

So, that was a 3,000+ character mouthful, eh? But hopefully, you found some insights valuable, and while I have your attention, here is a video from my favorite piece of branded entertainment for Post's Shredded Wheat, The Palace of Light. While some may describe it as merely a longer form commercial, it humorously -- and memorably -- conveys the brand’s rich history and tradition (and without even realizing it, you’ll see that you take away core brand messages like the fact that shredded wheat hasn’t changed in a 100 years without once feeling like you’re being ’sold'). Enjoy!

I came across this brilliant post by @eskimon, and as someone who is actively trying to create sustainable revenue models for digital experiences, I felt compelled to share it.

Escaping the Spiral

Record companies and newspapers have been the biggest losers, yet demand for the ‘products’ these companies deliver has risen dramatically during the same period.

The two trends seem to be in conflict: how can something experiencing increased demand simultaneously lose its value?

Has classical economic theory come totally undone?

Let’s take a closer look.

All-consuming

As recently as the 1990s, a music collection of  100 albums (about 1,500 songs) was something to be admired, taking pride of place across a whole wall of the living room.

Today, even cash-strapped teenagers carry that much music in their pocket everywhere they go.

But still we crave more.

Numerous new services attempt to satisfy our insatiable appetite for a fresh and varied playlist – Pandora and Spotify are obvious examples.

Yet almost none of these seem to be making much money.

It’s the same story for news.

As technology has advanced, instantaneous, ubiquitous news updates have become the norm, and we’ve become so used to these ‘info fixes’ that we even experience symptoms of withdrawal if they’re taken away.

Demand for news hasn’t just grown; it’s exploded.

So why are news agencies disappearing at an inversely proportionate rate?

What's going on?

From the outside, the reason appears very simple: these industries have become too caught up in what they think people are buying; not what those people actually want.

The music industry is still obsessed with selling albums, because that’s been their core offering for decades.

Of course, at the time of their inception, albums were a highly efficient (and profitable) distribution medium.

The same goes for newspapers.

But, as Dave Trott points out, people don’t buy the media.

They buy the content that those media carry.

And if they can find that content more efficiently (and cheaper) elsewhere…

 A false equilibrium

Despite initial appearances to the contrary, the trend of rising demand and falling profit in these media-based industries is actually in keeping with classical economic theory.

The model suggests that people will tend towards the most efficient satisfaction of their needs: that they try to maximise the benefits they receive, while simultaneously minimising the associated cost (in terms of money, time, effort, etc.)

As Adam Smith posited in 1776,

“…what every thing really costs… is the toil and trouble of acquiring it.”

He went on to assert,

“What every thing is really worth to the man who has acquired it… is the toil and trouble which it can save to himself.”

Let’s look at those two statements in context:

1. From the consumer’s perspective, the cost of acquiring music and news content is not a pure price consideration: factors such as the effort needed to acquire and consume the product, as well as opportunity cost, are equally important;
2. The worth, or value, these products deliver is hard to measure, because the benefits they deliver are usually intangible (except where unique access to news provides a financial benefit to the consumer).

The key issue in these industries is that people suddenly have access toidentical value at a much lower cost.

So what changed?

What are people buying?

People don’t buy media; they pay for access to content.

But if that content is available for free, why would they choose to pay for it?

Free access to music has been around for years via radio; the main issue has been a lack of listener control in the playlist.

The only legal alternative has been to pay for the privilege to listen to what you want, where you want, when you want, by buying albums and singles.

But given the costs involved in this alternative, another popular solution has been to acquire an illegal copy.

Piracy is nothing new; it has affected the music business since it began.

However, until recently, the quality of an ‘original’ was always noticeably better than that of a cost-effective copy.

The advent of digital formats like MP3 changed all that. Today, people can quickly and easily create a copy that is identical to that which they would get if they bought it from the original source.

The problem for the record companies is that there is literally no difference in the quality of pirated content.

Furthermore, the industry’s continued protectionist approach to ’selling’ music means that it’s often actually easier to find pirated copies than it is to find the original*.

Returning Adam Smith’s concept of ‘real cost’, this means that people have fewer and fewer reasons to pay the cost associated with original content; the only remaining motivator is conscientiousness.

Meanwhile, the situation with news is even starker: the industry itself has trained us to believe that news should be free, through ad-supported models such as CNN or freesheets.

When people have been so used to legal access to free news content, it’s easy to understand their current reluctance to move to services requiring payment – particularly when services like the BBC continue to offer free access.

Benefits for purpose

The only sustainable hope for these industries is to rethink what they’re actually offering.

The process is actually very simple:

What do people really want?

Where is it most relevant to them?

How can we deliver it to them and make a profit?

The critical step is to move away from thinking about how to improve the existing product, and to focus instead on identifying and understanding the benefits people seek.

New news

Why do people crave news?

It might be for a variety of reasons:

It provides information that helps us make decisions about our own lives (Will it rain tomorrow? Is there a crazed gunman on th e run downtown?);

It offers a common topic we can talk about with others;

It shares opinion and that stimulates our minds and provokes further thought of our own;

It entertains and stirs emotion;

Perversely, it helps us put our lives in perspective, reminding us that “there is always someone worse off than yourself” (this is the only reason I can find for our continued obsession with ‘bad’ news).

However, none of these things belong to conventional news channels.

Indeed, most of those channels exist because they provide an audience for advertisers, and, arguably, they’ve never been truly focused on the audiences themselves.

Where would these benefits be most relevant?

What could we do to deliver it to them then… at a profit?

Change the tune

The task with music is a little more difficult, because it’s intangible and transient.

What exactly is music, and why do we love it so much?

What benefit does it provide?

It’s a question that has many different answers, because music means different things to different people in different contexts:

Sometimes it’s an all-consuming experience, like a concert;

Often, it’s something we use to define our personalities;

Sometimes it’s a means of escapism (like ‘cocooning’ on a crowded subway);

Sometimes it provides a reassuring background distraction;

Like fashion, it’s something that’s constantly evolving and fresh, providing us with something to talk about, and offering us things to look forward to.

I’m sure you can think of many more benefits (why not share them in the comments?).

Deliverance

It’s safe to assume that people’s desire for new music and fresh news will continue to grow.

As such, musicians and journalists are not – contrary to media scaremongering – on the verge of extinction.

The only thing that’s likely to disappear is the existing media model.

So how will we access these benefits in the future?

Much as I hate to inflate an already over-hyped solution, I believe the answer is ’something social’.

Services where people already go to seek similar benefits – to talk to people, to find out what’s new in their world, to seek emotional stimulation – are the most obvious places for them to seek music and news benefits too.

I believe we’ll see an increasing number of social services combine these offers in their bid to become our ‘one-stop shops’ for all such content.

I wouldn’t be surprised if they didn’t include TV and movies too.

Services such as Facebook have a great opportunity to became the de facto source for news and new music, although I suspect it will be a new, as-yet unheard of successor, who’ll bring about this next step in the web’s evolution.

So what's new?

I suspect that, although you’ve nodded your head a few times during this post, you don’t feel there’s anything revolutionary in its content.

But that’s possibly because, in this simple format, it all seems obvious.

And I think that’s the problem: perhaps it’s so obvious, we’ve been missing the forest for the trees.

But, the good news is, the solution is very simple.

If we focus on the benefits that people seek – the real value that they perceive in the things they consume – then we have a chance of delivering it to them at a profit.

Sadly for some, it may be too late to save the mass media model, but the rest of us have a real opportunity to learn from their mistakes.

Thanks to Willsh for setting this thought process off with these lovely posts: one,two.