Marketing Machines: Ads Abound on Consumer Electronics

Advertisers are moving beyond computers to spread brand messages on a wide range of devices, including gaming consoles, set-top boxes, and e-book readers

By Douglas MacMillan

NBC Universal tried some new tricks to promote its new action thriller The Wolfman. The studio placed audio ads on Internet radio service Pandora, ran small banner ads on mobile phones, and created a Wolfman application for Boxee, a device for connecting TVs to the Web.

The advertiser's tool chest is getting bigger. Devices due this year—from e-book readers like Hearst's Skiff to set-top boxes such as the Boxee Box, and even tablet computers like the one due from Apple (AAPL)—will give marketers new ways to pitch goods and services. "There seems to be more of a proliferation of new opportunities now than there was 10 years ago," says Doug Neil, senior vice-president for digital marketing at NBC Universal.

Publishers of newspapers and magazines see these electronics as new ways to showcase publications and generate revenue from ads, while device manufacturers in some cases will share part of the bounty.

Sales of mobile-phone ads are expected to pass $1.1 billion in 2012, from $320 million in 2008, according to researcher eMarketer. Spending on ads for newer technologies such as e-readers may increase at a similar pace in the coming years, says eMarketer senior analyst Paul Verna.

Boxee Promotes The Wolfman

For its Wolfman campaign, begun in January, NBC Universal targeted males ages 18 to 34 through tried-and-true sites like Disney's (DIS) ESPN.com and Hulu, the video site owned by Disney, NBC Universal, News Corp. (NWS), and Providence Equity Partners.

It also experimented. Ignited, an agency that creates marketing campaigns, worked with Boxee to create a free Wolfman application that could be downloaded by Boxee's 800,000 users. Ignited media planner Timothy Fleming calls projects like these "test purchases," since they usually cost little and help the agency learn about a new technology. Ignited typically does about 20 test purchases per year. Internet radio service Pandora was once a test purchase for the agency; now it's standard marketing campaign fare.

Boxee volunteered to help create the Wolfman application to demonstrate to other potential advertisers how its service and set-top box could be used to reach customers. "[Marketers] can see how this stuff looks on a big screen, how people will interact, how many ads they're willing to watch," says Boxee CEO Avner Ronen. "It's a new consumer behavior."

E-Reader Potential

Advertisers are also enthused about e-readers. At an early January trade show, magazine publisher Hearst showed off its Skiff Reader and startup Plastic Logic announced its QUE proReader; both manufacturers plan to bring ads to the devices. Hearst says it will share ad revenue with content partners and use it to subsidize the cost of the Skiff Reader. "We are working on [advertising] now, but it's too early for specifics," says Plastic Logic spokeswoman Betty Taylor.

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