Chip Tarver's Ipod Information - Ads and Video iPod Users

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Marketers Aim New Ads At Video iPod Users

By SUZANNE VRANICA - January 31, 2006

Since Apple Computer Inc.'s video iPod made its debut less than four months ago, users have been able to download their favorite TV shows free from ads. Now, advertisers are scrambling for a way to subvert the sleek device for their own purposes.

Some companies are attaching recycled TV spots to the beginning of video files, or podcasts, that can be downloaded from popular Web sites. Others are creating new, subtler pitches to bracket shows attractive to their target audiences. And still others are creating their own podcasts that blur the line between entertainment and advertisement in hopes of enticing people to watch the commercials for their own sake.

"It's a lot of trial and error," says Liz Vanzura, global marketing director for General Motors Corp.'s Cadillac division.

Video iPods and other hand-held devices such as cell phones have made entertainment portable, with people able to watch episodes of selected programs and other pieces of content at their convenience. The problem is that Apple offers its paid content ad-free on iTunes, including hit TV shows such as "Lost" and "Desperate Housewives," forcing marketers to find new ways to deliver their messages to viewers of other video content available online. Call it advertising on the go.

"It's a real challenge," says Marlene Coulis, vice president for brand management at Anheuser-Busch. On TV and other traditional types of media, ads are jammed into the middle of shows. When it comes to iPod ads, advertisers are being careful not to become so intrusive as to turn off would-be viewers.

Although marketers are eager to experiment, many are struggling to figure out what ad content is appropriate for the iPod. Some companies, such as Nintendo Co., have taken tentative steps. The videogame maker has reused 15-second TV commercials for its "Mario Kart DS" at the beginning of video podcasts on GrindTV.com, a unit of Los Angeles-based PureVideo Inc. The spots appear at the beginning of two-minute short surfing films such as "Triple Crown Big Pipeline" and "Girls of the North Shore."

Tracey Scheppach -- video innovation director at Publicis Groupe SA's Starcom, the media-buying unit responsible for Nintendo's iPod push -- says that over time advertisers will have to move beyond simply repurposing TV campaigns. "Advertisers have to free themselves from the 30-second ad," adds Ms. Scheppach.

GM's Hummer division has appended 15-second ads for the beefy SUV, to the beginning and end of a video podcast that shows what went on backstage at GQ magazine's star-studded party hyping its "Men of the Year" issue. The car maker crafted special 15-second clips, and tried to give them a different feel than television commercials. Opening with the Hummer H3 logo, the clips simply show a vehicle driving on an urban highway and through the mountains. The screen reads: "Hummer like nothing else." There is no mention of sticker price. "It's not about hard-sell on the iPod," says Vanzura, who helped develop the campaign when she was marketing director for Hummer.

Not unlike on the annual orgy of Super Bowl advertising, entertainment could be a key draw.

"The content has to be unique and different," says Ms. Coulis of Anheuser-Busch. The brewer's iPod ad push involves minidocumentaries that go behind the scenes with Ted Ferguson, a wannabe daredevil character from the Bud Light TV campaign who performs stunts in return for the beer.

The comic clips, in which, for example, he scrambles eggs for breakfast and talks about how he comes up with his stunts, can be downloaded at http://www.tedferguson.com/. The spots have been promoted in an online campaign. The character has also traveled the country appearing in bars and even plans to attend the Super Bowl in full regalia to generate buzz. Since mid-December the brewer has reported more than 10,000 downloads.

Ms. Coulis says that even traditional TV commercials can work on iPods so long as they are entertaining enough. Also downloadable is the TV spot in which Mr. Ferguson has lunch with his girlfriend and tries the "stunt" of not looking over at a nearby table of comely women. The brewer also is planning to allow consumers to download its Super Bowl commercials shortly after they air during the big game.

Media executives are still groping for the best approach. "Consumers have agreed to download your messaging -- they are agreeing to transact with you -- you have to be subtle and stop being used-car salesmen," says Greg Smith, engagement specialist at Carat Fusion, a media services firm owned by Aegis Group PLC.

Apple doesn't release sales figures for the video iPod, but market-research firm NPD Group estimates that about 1.8 million of them have sold in the U.S. since they were launched in October.

The devices are so new that not everyone is convinced that people are willing to watch entertainment -- or advertising that might support it -- on a small screen.

In this era of finding alternatives to traditional ads, though, media buyers and marketers say they can't afford to ignore the new device. They point out how MP3-players changed the way people listen to music.

"People can order up entertainment choices like they order up dinner," says Perrin Kaplan, Nintendo's vice president of marketing. "Consumers today have so many choices. It's now about doing surgical marketing."

Write to Suzanne Vranica at suzanne.vranica@wsj.com

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Chip Tarver