The social-networking strategy that took an obscure senator to the doors of the White House.
By David Talbot
Joe Trippi, Howard Dean's 2004 presidential campaign manager and Internet impresario, describes Super Tuesday II--the March 4 primaries in Texas, Ohio, Vermont, and Rhode Island--as the moment Barack Obama used social tech­nology to decisive effect. The day's largest hoard of dele­gates would be contested in Texas, where a strong showing would require exceptional discipline and voter-education efforts. In Texas, Democrats vote first at the polls and then, if they choose, again at caucuses after the polls close. The caucuses award one-third of the Democratic delegates.

Hillary Clinton's camp had about 20,000 volunteers at work in Texas. But in an e-mail, Trippi learned that 104,000 Texans had joined Obama's social-­networking site, www.my.barackobama.com, known as MyBO. MyBO and the main Obama site had already logged their share of achievements, particularly in helping rake in cash. The month before, the freshman senator from Illinois had set a record in American politics by garnering $55 million in donations in a single month. In Texas, MyBO also gave the Obama team the instant capacity to wage fully networked campaign warfare. After seeing the volunteer numbers, Trippi says, "I remember saying, 'Game, match--it's over.'"

The Obama campaign could get marching orders to the Texans registered with MyBO with minimal effort. The MyBO databases could slice and dice lists of volunteers by geographic micro­region and pair people with appropriate tasks, including prepping nearby voters on caucus procedure. "You could go online and download the names, addresses, and phone numbers of 100 people in your neighborhood to get out and vote--or the 40 people on your block who were undecided," Trippi says. "'Here is the leaflet: print it out and get it to them.' It was you, at your computer, in your house, printing and downloading. They did it all very well." Clinton won the Texas primary vote 51 to 47 percent. But Obama's ­people, following their MyBO playbook, so overwhelmed the chaotic, crowded caucuses that he scored an overall victory in the Texas delegate count, 99 to 94. His showing nearly canceled out ­Clinton's win that day in Ohio. Clinton lost her last major opportunity to stop the Obama juggernaut. "In 1992, Carville said, 'It's the economy, stupid,'" Trippi says, recalling the exhortation of Bill Clinton's campaign manager, James Carville. "This year, it was the network, stupid!"

Throughout the political season, the Obama campaign has domi­nated new media, capitalizing on a confluence of trends. Americans are more able to access media-rich content online; 55 percent have broadband Internet connections at home, double the figure for spring 2004. Social-networking technologies have matured, and more Americans are comfortable with them. Although the 2004 Dean campaign broke ground with its online meeting technologies and blogging, "people didn't quite have the facility," says ­Lawrence Lessig, a Stanford law professor who has given the Obama campaign Internet policy advice (Lessig wrote The People Own Ideas! in our May/June 2005 issue). "The world has now caught up with the technology." The Obama campaign, he adds, recognized this early: "The key networking advance in the Obama field operation was really deploying community­-building tools in a smart way from the very beginning."

Of course, many of the 2008 candidates had websites, click-to-donate tools, and social-networking features--even John McCain, who does not personally use e-mail. But the Obama team put such technologies at the center of its campaign--among other things, recruiting 24-year-old Chris Hughes, cofounder of Facebook, to help develop them. And it managed those tools well. Supporters had considerable discretion to use MyBO to organize on their own; the campaign did not micromanage but struck a balance between top-down control and anarchy. In short, Obama, the former Chicago community organizer, created the ultimate online political machine.

The Obama campaign did not provide access or interviews for this story; it only confirmed some details of our reporting and offered written comments. This story is based on interviews with third parties involved in developing Obama's social-networking strategy or who were familiar with it, and on public records.

An Online Nervous System
A row of elegant, renovated 19th-century industrial buildings lines Boston's Congress Street east of Fort Point Channel. On any given day, behind a plain wooden door on the third floor of 374 Congress, 15 to 20 casually clad programmers tap away at computers. On the day I visited, the strains of Creedence Clearwater Revival filled the room; a Ping-Pong table dominated the small kitchen. This is the technology center for Blue State Digital, which means that it is also the nervous system for its two largest clients, the Barack Obama campaign and the Democratic National Committee. Founded by alumni of the Dean campaign, Blue State Digital added interactive elements to Obama's website--including MyBO--and now tends to its daily care and feeding. The site's servers hum away in a Boston suburb and are backed up in the Chicago area.

Jascha Franklin-Hodge, 29, greeted me with a friendly handshake and a gap-toothed grin. He has a deep voice and a hearty laugh; his face is ringed by a narrow beard. Franklin-Hodge dropped out of MIT after his freshman year and spent a few years in online music startups before running the Internet infrastructure for the Dean campaign, which received a then-­unprecedented $27 million in online donations. "When the campaign ended, we thought, 'Howard Dean was not destined to be president, but what we are doing online--this is too big to let go away,'" he says. He and three others cofounded Blue State Digital, where he is chief technology officer. (Another cofounder, Joe Rospars, is now on leave with the Obama campaign as its new-media director.)

The MyBO tools are, in essence, rebuilt and consolidated versions of those created for the Dean campaign. Dean's website allowed supporters to donate money, organize meetings, and distribute media, says Zephyr Teachout, who was Dean's Internet director and is now a visiting law professor at Duke University. "We developed all the tools the Obama campaign is using: SMS [text messaging], phone tools, Web capacity," Teachout recalls. "They [Blue State Digital] did a lot of nice work in taking this crude set of unrelated applications and making a complete suite."

Blue State Digital had nine days to add its tools to Obama's site before the senator announced his candidacy on February 10, 2007, in Springfield, IL. Among other preparations, the team braced for heavy traffic. "We made some projections of traffic levels, contribution amounts, and e-mail levels based on estimates from folks who worked with [John] Kerry and Dean in 2004," recalls Franklin­-Hodge. As Obama's Springfield speech progressed, "we were watching the traffic go up and up, surpassing all our previous records." (He would not provide specific numbers.) It was clear that early assumptions were low. "We blew through all of those [estimates] in February," he says. "So we had to do a lot of work to make sure we kept up with the demand his online success had placed on the system." By July 2008, the campaign had raised more than $200 million from more than a million online donors (Obama had raised $340 million from all sources by the end of June), and MyBO had logged more than a million user accounts and facilitated 75,000 local events, according to Blue State Digital.

MyBO and the main campaign site made it easy to give money--the fuel for any campaign, because it pays for advertising and staff. Visitors could use credit cards to make one-time donations or to sign up for recurring monthly contributions. MyBO also made giving money a social event: supporters could set personal targets, run their own fund-raising efforts, and watch personal fund-­raising thermometers rise. To bring people to the site in the first place, the campaign sought to make Obama a ubiquitous presence on as many new-media platforms as possible.

The viral Internet offered myriad ways to propagate unfiltered Obama messages. The campaign posted the candidate's speeches and linked to multimedia material generated by supporters. A music video set to an Obama speech--"Yes We Can," by the hip-hop artist Will.i.am--has been posted repeatedly on YouTube, but the top two postings alone have been viewed 10 million times. A single YouTube posting of Obama's March 18 speech on race has been viewed more than four million times. Similarly, the campaign regularly sent out text messages (at Obama rallies, speakers frequently asked attendees to text their contact information to his campaign) and made sure that Obama was prominent on other social-networking sites, such as Facebook and MySpace (see "New-Media King" chart above). The campaign even used the micro­blogging service Twitter, garnering about 50,000 Obama "followers" who track his short posts. "The campaign, consciously or unconsciously, became much more of a media operation than simply a presidential campaign, because they recognized that by putting their message out onto these various platforms, their supporters would spread it for them," says Andrew Rasiej, founder of the Personal Democracy Forum, a website covering the intersection of politics and technology (and another Dean alumnus). "We are going from the era of the sound bite to the sound blast."

Money flowed in, augmenting the haul from big-ticket fund-raisers. By the time of the Iowa caucuses on January 3, 2008, the Obama campaign had more than $35 million on hand and was able to use MyBO to organize and instruct caucus-goers. "They have done a great job in being precise in the use of the tools," Teachout says. "In Iowa it was house parties, looking for a highly committed local network. In South Carolina, it was a massive get-out-the-vote effort." MyBO was critical both in the early caucus states, where campaign staff was in place, and in later-­voting states like Texas, Colorado, and Wisconsin, where "we provided the tools, remote training, and opportunity for supporters to build the campaign on their own," the Obama campaign told Technology Review in a written statement. "When the campaign eventually did deploy staff to these states, they supplemented an already-built infrastructure and volunteer network."

Using the Web, the Obama camp turbocharged age-old campaign tools. Take phone banks: through MyBO, the campaign chopped up the task of making calls into thousands of chunks small enough for a supporter to handle in an hour or two. "Millions of phone calls were made to early primary states by people who used the website to reach out and connect with them," Franklin-Hodge says. "On every metric, this campaign has operated on a scale that has exceeded what has been done before. We facilitate actions of every sort: sending e-mails out to millions and millions of people, organizing tens of thousands of events." The key, he says, is tightly integrating online activity with tasks people can perform in the real world. "Yes, there are blogs and Listservs," Franklin-Hodge says. "But the point of the campaign is to get someone to donate money, make calls, write letters, organize a house party. The core of the software is having those links to taking action--to doing something."


Pork Invaders
If the other major candidates had many of the same Web tools, their experiences show that having them isn't enough: you must make them central to the campaign and properly manage the networks of supporters they help organize. Observers say that ­Clinton's campaign deployed good tools but that online social networks and new media weren't as big a part of its strategy; at least in its early months, it relied more on conventional tactics like big fund-raisers. After all, Clinton was at the top of the party establishment. "They [the Obama supporters] are chanting 'Yes we can,' and she's saying 'I don't need you,'" Trippi says. "That is what the top of that campaign said by celebrating Terry McAuliffe [the veteran political operative and former Democratic National Committee chairman] and how many millions he could put together with big, big checks. She doesn't need my $25!" The two campaigns' fund-raising statistics support Trippi's argument: 48 percent of Obama's funds came from donations of less than $200, compared with 33 percent of Clinton's, according to the Center for Responsive Politics.

Clinton's Internet director, Peter Daou, credits the Obama campaign with doing an "amazing job" with its online social network. "If there is a difference in how the two campaigns approached [a Web strategy], a lot of those differences were based on our constituencies," Daou says. "We were reaching a different demographic of supporters and used our tools accordingly." For example, he says, the Clinton campaign established a presence on the baby-boomer social-networking site Eons.com, and Clinton herself often urged listeners to visit www.hillaryclinton.com. But Andrew Rasiej says that the conventional political wisdom questioned the value of the Internet. "As far as major political circles were concerned," he says, "Howard Dean failed, and therefore the Internet didn't work."

While it's hard to tease out how much Clinton's loss was due to her Web strategy--and how much to factors such as her Iraq War vote and the half-generation difference between her and Obama's ages--it seems clear that her campaign deëmphasized Web strategy early on, Trippi says. Even if you "have all the smartest bottom-up, tech-savvy people working for you," he says, "if the candidate and the top of the campaign want to run a top-down campaign, there is nothing you can do. It will sit there and nothing will happen. That's kind of what happened with the Clinton campaign."

Republican Ron Paul had a different problem: Internet anarchy. Where the Obama campaign built one central network and managed it effectively, the Paul campaign decided early on that it would essentially be a hub for whatever networks the organizers were setting up. The results were mixed. On the one hand, volunteers organized successful "money bombs"--one-day online fund-raising frenzies (the one on November 5, 2007, netted Paul $4.3 million). But sometimes the volunteers' energy--and money--was wasted, says Justine Lam, the Paul campaign's Internet director, who is now the online marketing director at Politicker.com. Consider the supporter-driven effort to hire a blimp emblazoned with "Who is Ron Paul? Google Ron Paul" to cruise up and down the East Coast last winter. "We saw all this money funding a blimp, and thought, 'We really need this money for commercials,'" Lam says.

Then there is McCain, who--somewhat ironically--was the big Internet story of 2000. That year, after his New Hampshire primary victory over George W. Bush, he quickly raised $1 million online. And at times last year, he made effective use of the Internet. His staff made videos--such as "Man in the Arena," celebrating his wartime service--that gained popularity on YouTube. But the McCain site is ineffectual for social networking. In late June, when I tried to sign up on McCainSpace--the analogue to MyBO--I got error messages. When I tried again, I was informed that I would soon get a new password in my in-box. It never arrived. "His social-networking site was poorly done, and people found there was nothing to do on it," says Lam. "It was very insular, a walled garden. You don't want to keep people inside your walled garden; you want them to spread the message to new people."

McCain's organization is playing to an older base of supporters. But it seems not to have grasped the breadth of recent shifts in communications technology, says David All, a Republican new-media consultant. "You have an entire generation of folks under age 25 no longer using e-mails, not even using Facebook; a majority are using text messaging," All says. "I get Obama's text messages, and every one is exactly what it should be. It is never pointless, it is always worth reading, and it has an action for you to take. You can have hundreds of recipients on a text message. You have hundreds of people trying to change the world in 160 characters or less. What's the SMS strategy for John McCain? None."


The generational differences between the Obama and McCain campaigns may be best symbolized by the distinctly retro "Pork Invaders," a game on the McCain site (it's also a Facebook application) styled after Space Invaders, the arcade game of the late 1970s. Pork Invaders allows you to fire bullets that say "veto" at slow-moving flying pigs and barrels.

But it's not that the campaign isn't trying to speak to the youth of today, as opposed to the youth of decades ago. Lately McCain has been having his daughter Meghan and two friends write a "bloggette" from the campaign trail. The bloggette site features a silhouette of a fetching woman in red high-heeled shoes. "It gives a hipper, younger perspective on the campaign and makes both of her parents seem hipper and younger," says Julie ­Germany, director of the nonpartisan Institute for Politics, Democracy, and the Internet at George Washington University. The McCain campaign did not reply to several interview requests, but Germany predicts that the campaign will exploit social networking in time to make a difference in November. "What we will see is that the McCain online campaign is using the Internet just as effectively to meet its goals as the Obama campaign," she says. Over the summer, the McCain campaign refreshed its website. But Rasiej, for one, doubts that McCain has enough time to make up lost ground.

A Networked White House?
The obvious next step for MyBO is to serve as a get-out-the-vote engine in November. All campaigns scrutinize public records showing who is registered to vote and whether they have voted in past elections. The Obama campaign will be able to merge this data with MyBO data. All MyBO members' activity will have been chronicled: every house party they attended, each online connection, the date and amount of each donation. Rasiej sees how it might play out: the reliable voters who signed up on MyBO but did little else may be left alone. The most active ones will be deployed to get the unreliable voters--whether MyBO members or not--to the polls. And personalized pitches can be dished up, thanks to the MyBO database. "The more contextual information they can provide the field operation, the better turnout they will have," he says.

If Obama is elected, his Web-oriented campaign strategy could carry over into his presidency. He could encourage his supporters to deluge members of Congress with calls and e-mails, or use the Web to organize collective research on policy questions. The campaign said in one of its prepared statements that "it's certain that the relationships that have been built between Barack Obama and his supporters, and between supporters themselves, will not end on Election Day." But whether or not a President Obama takes MyBO into the West Wing, it's clear that the phenomenon will forever transform campaigning. "We're scratching the surface," Trippi says. "We're all excited because he's got one million people signed up--but we are 300 million people in this country. We are still at the infancy stages of what social-­networking technologies are going to do, not just in our politics but in everything. There won't be any campaign in 2012 that doesn't try to build a social network around it."


Lessig warns that if Obama wins but doesn't govern according to principles of openness and change, as promised, supporters may not be so interested in serving as MyBO foot soldiers in 2012. "The thing they [the Obama camp] don't quite recognize is how much of their enormous support comes from the perception that this is someone different," Lessig says. "If they behave like everyone else, how much will that stanch the passion of his support?"

But for now, it's party time. At the end of June, after ­Clinton suspended her campaign, MyBO put out a call for the faithful to organize house parties under a "Unite for Change" theme. More than 4,000 parties were organized nationwide on June 28; I logged in and picked three parties from about a dozen in the Boston area.


My first stop was a house party in the tony suburb of ­Winchester, where several couples dutifully watched an Obama-supplied campaign video. Host Mary Hart, an art professor in her 50s, said that Obama and his website made her "open my house to strangers and really get something going." She added, "I'm e-mailing people I haven't seen in 20 years. We have this tremendous ability to use this technology to network with people. Why don't we use it?"

Next stop was a lawn party in the Boston neighborhood of Roxbury, whose organizer, Sachielle Samedi, 34, wore a button that said "Hot Chicks Dig Obama." She said that support for the Obama candidacy drew neighbors together. At the party, Wayne Dudley, a retired history professor, met a kindred spirit: Brian Murdoch, a 54-year-old Episcopal priest. The two men buttonholed me for several minutes; Dudley predicted that Obama would bring about "a new world order centered on people of integrity." Murdoch nodded vigorously. It was a fine MyBO moment.

My evening ended at a packed post-collegiate party in a Somerville walk-up apartment. Host Rebecca Herst, a 23-year-old program assistant with the Jewish Organizing Initiative, said that MyBO--unlike Facebook--allowed her to quickly upload her entire Gmail address book, grafting her network onto Obama's. "It will be interesting to see what develops after this party, because now I'm connected to all these people," she shouted over the growing din. Two beery young men, heading for the exits, handed her two checks for $20. Herst tucked the checks into her back pocket.

David Talbot is Technology Review's chief correspondent.

Labels: marketing, politics, Science

CORRECTING and REPLACING 19% of Senior Marketers - or One in Five - Say Their Organizations Have Bought Advertising in Return for a News Story, According to MS&L/PRWeek Survey

NEW YORK, Jul 30, 2008 (BUSINESS WIRE)

A rather sizable number of senior American marketers - 19 percent - say their organizations have bought advertising in return for a news story, despite growing criticism of these "pay-for-play" practices, according to a recent survey conducted on behalf of PRWeek and Manning Selvage & Lee (MS&L) by Millward Brown. The sixth annual Marketing Management Survey polled 252 U.S. chief marketing officers, VPs of marketing and marketing directors and managers about digital media and marketing ethics.

The survey also found that 10 percent of senior marketers said their organizations have had an implicit/non-verbal agreement with a reporter or editor that anticipated favorable coverage of their company or products in exchange for advertising. And 8 percent, or about one in 12, said their organizations paid or provided a gift of value to an editor/producer to place a news story about their company or one of its products.

Questionable marketing practices such as those explored in this survey have generated controversy in recent months, raising questions about the deterioration of news coverage, as well as broader questions about industry ethics.

"Any kind of undisclosed paid placement spells trouble for consumers, the media and the marketing industry," said Mark Hass, worldwide chief executive officer of MS&L. "Without full disclosure and transparency, media lose credibility and their value as an unbiased source of information for consumers. That a substantial number of marketers - about one in every five - engage in 'pay-for-play' year after year is even more troubling, and that much more damaging to the credibility of news media."
The results from this year's survey are consistent with results from previous years: Last year, for example, 17 percent of senior marketers said their organizations bought advertising in return for a news story, 7 percent said their organizations have had an implicit/non-verbal agreement with a reporter or editor that they expected to see favorable coverage of their company or products in exchange for advertising, and 5 percent of marketers said their companies had paid or provided a gift of value to an editor or producer in exchange for a news story about their company or its products.

The issue of paid placements in news media raises serious implications for the marketing industry. Marketers and advertisers often say they view this type of activity as an extension of product placement in entertainment, no different than featuring a car in an action movie or a movie star drinking from a particular brand of soda. But with those programs, the stories are fictional, and their purpose is to entertain. The news media, on the other hand, need to operate by a different set of editorial guidelines, to ensure that trust is at the core of their message delivery.
Marketing efforts in the online world are subject to the same rules of disclosure and transparency that consumers expect with traditional news media. But despite widespread criticism of online ethical breaches such as creating fake blogs and cloaking bloggers' identities, there is little indication that marketers plan to stop trying to engage with consumers in these ways. When asked whether the marketing industry as a whole is following ethical guidelines in new media more than they did a year ago, 53 percent of the survey respondents said no.

"The online world creates a whole new unsettling platform for marketers who are willing to engage unethically," said Hass.

The 2008 PRWeek/MS&L Marketing Management survey was conducted in partnership with PRWeek by Millward Brown. Survey results were collected between May 1 and May 19, 2008. Results are not weighted. Based on the sample size, the results are statistically tested at a confidence level of 90%.

Labels: advertisement, marketing, Society

By ETHAN SMITH and JULIE JARGON

Sharp-eared pop-music fans may have noticed a brief reference to an old chewing-gum jingle buried in "Forever," Chris Brown's top-10 hit. "Double your pleasure/double your fun," the R&B singer croons in the chorus.

What listeners don't know -- and what Wm. Wrigley Jr. Co. planned to reveal Tuesday -- is that the song is a commercial.

"Forever" is an extended version of a new Doublemint jingle written by Mr. Brown and scheduled to begin airing next month in 30-second spots for Wrigley's green-packaged chewing gum.

Mr. Brown is one of a trio of pop stars enlisted by ad agency Translation Advertising, a unit of Interpublic Group of Cos., to update the images of three of Wrigley's best-known brands.

The campaign includes spots featuring R&B singer Ne-Yo doing his own take on Big Red's "kiss a little longer" jingle. And "Dancing With the Stars" regular-turned-country-singer Julianne Hough recorded a twangy version of Juicy Fruit's "The taste is gonna move ya."

But Mr. Brown's "Forever" is the most ambitious part of the campaign. Mr. Brown was commissioned to write and sing both the pop song and a new version of the Doublemint jingle, introduced in 1960.

First, Mr. Brown updated the jingle and recorded it with hip-hop producer Polow Da Don. Then, during the same Los Angeles recording sessions in February, paid for by Wrigley, Mr. Brown added new lyrics and made a 4½-minute rendition of the tune, titled "Forever."

In April, Mr. Brown's record label, Jive, released the song to radio stations and digital download services as a single. After the song became a hit, Jive added it to his 2007 album, "Exclusive," and re-released the album in June. "Forever" reached No. 4 on Billboard magazine's Hot 100 chart last week.

All three new Wrigley jingles are scheduled to be unveiled at a news conference Tuesday in New York, with each of them to be performed by the artist involved. Mr. Brown is slated to sing "Forever" and segue into his jingle. New television commercials and radio spots featuring the jingles and print ads showing new packaging for the gum are set to appear in August.

The campaign illustrates a deepening of the ties between pop music and advertising. Rappers frequently mention luxury products like liquor or cars in songs, and occasionally serve as paid spokesmen for the brands. And for McDonald's Corp.'s 2003 "I'm Lovin' It" campaign, the burger chain, with the aid of Translation Chief Executive Steve Stoute, enlisted Justin Timberlake to write and record a song using the slogan as its chorus. But the song was never released on one of his albums.

Tom Carrabba, executive vice president and general manager of Sony BMG's Zomba Label Group, which includes Jive, says label executives initially had qualms about releasing and promoting a song recorded at an advertiser's behest "But the song was so potent and strong. That overruled us being maybe a little hesitant," he adds.

Sony BMG is a joint venture between Bertelsmann AG of Germany and Japan's Sony Corp.

Other than the "double your pleasure" line, the lyrics to the song and the TV jingle are different. But the melody and the music behind it are nearly indistinguishable. A 60-second radio ad scheduled to air starting Friday further blurs the line between the song and the commercial. It starts with a section of "Forever," and moves seamlessly into lyrics promoting the gum. "I'ma take you there, so don't be scared," Mr. Brown sings. "Double your pleasure; double your fun. It's the right one, Doublemint gum."

The campaign was conceived and executed by Mr. Stoute, a former senior executive at Interscope Records who counts rapper Jay-Z as a partner in his business. The idea was to connect the hit song and the jingle in listener's minds. That way, Mr. Stoute says, "by the time the new jingle came out, it was already seeded properly within popular culture."

Mr. Brown said in an email that he wrote "Forever" and the related jingle in about 30 minutes each. "I actually thought it would take longer to write a jingle they would like," he wrote. "But they said it was a perfect fit after the first try."

Paul Chibe, Wrigley's vice president for North American gum marketing, declines to disclose how much Mr. Brown was paid for his role in the campaign.

Wrigley's push to update its older gum brands started earlier this year, when the company began selling them in new slim, envelope-style packages. Some of the gum was reformulated to improve its flavor and make it last longer. Juicy Fruit -- Wrigley's oldest brand, launched in 1893 -- Doublemint, Big Red, Spearmint, Winterfresh and the newer Extra line, represent around 30% of the company's U.S. gum business.

Wrigley chose Mr. Brown to develop the new Doublemint song, in part because the company's consumer research showed that African-American consumers prefer Doublemint to other gum brands. Mr. Chibe calls the move "the future of the brand."

Mr. Chibe added that the mildly suggestive lyrics have never given the company pause. "Everything he's done with 'Forever' represents the brand and it fits our brand personality for Doublemint," Mr. Chibe added.

While Wrigley has had strong sales in emerging markets, it has lost market share in the U.S., where it faces strong competition from Cadbury PLC, maker of Trident, Stride and Dentyne. Last year, the company's North American sales were flat, at $1.75 billion.

During the company's annual meeting in March, Chairman William Wrigley said he was "far from satisfied" with the company's domestic performance in 2007, though results improved in the first quarter of 2008. In April, Wrigley agreed to be acquired by Mars Inc., the closely held maker of M&Ms and Snickers, for about $23 billion.

Labels: advertisement, marketing, Music

Do the brands we buy and the things we own define who we are? Like it or not, two new books say they do.
By Laura Miller

Jun. 03, 2008 |

For a couple of years, I was regularly provoked by a magazine ad for a closet-design company that promised to organize "all the stuff that is your life." "There's more to my life than stuff," I muttered indignantly every time I saw it. I was a classic example of the kind of American who boasts to Rob Walker, author of the canny new book, "Buying In: The Secret Dialogue Between What We Buy and Who We Are," that she's impervious to advertising; I, too, would have proclaimed, "I'm not much of a consumer" -- a statement that Walker, who writes a column called "Consumed" for the New York Times Magazine, hears a lot. I chuckled smugly when Sarah Jessica Parker's character on "Sex in the City" realized that with the money she'd spent on a closet full of overpriced shoes she could have made a down payment on an apartment -- I had 10 modest pairs and a co-op studio. And as for my susceptibility to the sleek, white, expensive gizmos produced by a certain company in Cupertino, well, I told myself that was really all about quality. Right.

Walker, too, once considered himself above the blandishments of Madison Avenue, along with the other 77 percent of Americans who believe themselves to be exceptionally perceptive when it comes to marketing pitches. Then Nike bought Converse, the company that makes those high-top sneakers beloved by "outsider heroes from Joey Ramone to Kurt Cobain." Walker, who'd been wearing Converse's Chuck Taylor All Stars since his teens, was astonished to find himself stricken by the news. His cherished hipster/underground brand had been swallowed by the Nike swoosh, "a symbol for suckers who take its 'Just Do It' bullying at face value." Maybe he was too smart to identify with the "all-style-and-image" Nike, but he'd nevertheless bought into the notion that some significant part of himself -- his "individuality" -- could be proclaimed by a pair of shoes.

"We can talk all we want about being brand-proof," Walker writes, "but our behavior tells a different story." Experimental subjects presented with two identical glasses of Coca-Cola, one labeled as such and the other presented as a mystery rival brand, routinely picked the one they thought was Coke as the better-tasting soda. Citing one cunningly designed study after another, Walker presents ample proof that we are only kidding ourselves if we believe we're impervious to the multibillion-dollar marketing industry. Nevertheless, we are not "obsessed" with consumption, as many critics claim. As Walker sees it, Americans prefer not to ruminate on that particular subject, even as we shop and spend our little hearts out. "To qualify as obsessed we'd have to really think about why we buy what we buy," Walker writes, instead of just telling ourselves that we, unlike the rest of the sheep, purchase things for purely rational, utilitarian reasons like price, quality and convenience.

If we thought about it, maybe we'd also realize that our relationship to brands and marketing campaigns has been undergoing a transformation. Marketers like to talk about the skepticism of the "new consumer," a smart young character fleeing the mainstream and adamantly resistant to all forms of advertising. Walker begs to differ. "The only problem with this theory was that it did not match up particularly well with the realities of the marketplace that I was writing about every week in the Times Magazine," he writes. Instead of being more hostile to what he calls "commercial persuasion," the consumers he observed seem very much involved with brands and products. If traditional advertising has become a less effective way of fostering that involvement, the commercial persuasion industry has in turn been fiendishly resourceful in coming up with alternative methods, infiltrating hitherto unexploited aspects of our lives. The result, as Walker sees it, is a culture in which there is a "secret dialogue between what we buy and who we are," a dialogue that shapes us even as we pretend to be untouched by it.

"Buying In" is an often startling tour of this new cultural terrain, taking in such iconic products as Hello Kitty, Timberland, Pabst Blue Ribbon and Red Bull, as well as Scion, a line of Toyotas that I, apparently, am too uncool to have known about before. Some of these brands, like Timberland and Pabst (or PBR, as the hipsters call it), were established, if small-time, entities before certain consumer subcultures adopted them. The hip-hop world took a liking to a line of boots that had been created for construction workers by a New England family company. Bike messengers in the Pacific Northwest made a Milwaukee beer the brew of choice in the indie-rock scene. In both cases, the manufacturers of those products were disconcerted by their new customers. What they understood to be the cultural meaning of their products -- footwear for working men, and cheap suds for the 45-to-65-year-old Midwestern set -- had been redefined by complete strangers.

This, Walker observes dryly, is what marketing managers mean when they talk of the need to "collaborate" with consumers. The CEO of Timberland became briefly notorious in hip-hop circles for seeming not to welcome the change in his customer base. (They've since patched things up and you can now buy pink versions of the classic work boots.) PBR was more sure-footed: The brewer carefully cultivated its image among the indie crowd by taking great care not to cultivate its image: no ads on local radio, no celebrity endorsements (despite nibbles from Kid Rock) and certainly no TV. PBR's divisional marketing manager, cribbing tactics from Naomi Klein's anti-corporate manifesto, "No Logo" (full of "many good marketing ideas," he told Walker!), worked to make PBR "always look and act the underdog." He was so successful at retaining the brand's cachet (or anti-cachet) that one 28-year-old Oregonian whom Walker interviewed had a foot-square Pabst logo tattooed onto his back. "Pabst is part of my subculture," the kid told the writer, pointing to the absence of Pabst advertising as evidence that "they're not insulting you."

Red Bull, on the other hand, set out to woo this sort of "collaboration" from the very beginning, and thus "became perhaps the quintessential example of how brands become established in the early 21st century." The energy drink (then a relatively new product category) was launched in the U.S. nearly 10 years ago, with "no announcement or even explanation as to what this new stuff was and who was supposed to drink it and why; there was no Big Bang." Instead, the manufacturer sprung for a variety of small events: break-dancing contests, extreme-sports tournaments, computer-gaming competitions, an electronic music workshop and free-sample distribution at gyms and nightclubs. Sponsoring so many of these efforts required what Walker refers to as "real money," yet any given function never came across as glitzy or corporate. "The perception that these events don't cost much to produce is good for us," a Red Bull executive told Walker. "We don't want to be seen as having lots of money to spend." Walker attended a kite-boarding exhibition in Miami (enthusiasts of this new, wind-boarding-like sport were aiming to ride from Key West to Cuba) and found that it looked (very intentionally) like a nonevent: no press releases, no onlookers, no news crews, no free samples. (A videotaped press release about the stunt did get picked up on by 40 local TV stations after the fact.)

Walker calls such tactics "murketing." In contrast to established advertising practices, which strive to communicate one, unified "Big Idea" with as much fanfare as possible, Red Bull's campaign seemed a collection "oddly unfocused and inconsistent" efforts that "never sent a clear message to the masses." And that turns out to be a very clever thing, since Walker has identified "projectability" as the key trait of successful new brands. Instead of telling consumers what the product is all about, the marketers invite many separate slivers of the public to define it for themselves, much as the hip-hop crowd did with Timberland boots. Red Bull "is" an extreme-sports beverage, a bar mixer, a midday pick-me-up, a workout booster, depending on whom you ask. "At worst," Walker observes, "each group simply thinks Red Bull is something for them, partly because they have never been told otherwise."

Younger consumers -- those often referred to as Generation Y and characterized by Walker as "the least rebellious generation since the youth concept was invented" -- have actually embraced the language of brands, so much so that some of them have begun inventing their own. "Streetwear," attitudinous apparel and accessories vaguely descended from the skateboarding culture of 1970s Southern California, is their preferred medium. One of Walker's subjects is a "professional Cool Guy" occasionally consulted on youth culture by corporations and determined to "turn my lifestyle into a business." He concocted a brand called aNYthing ("the only brand that matters"), whose accouterments included T-shirts and caps.

Walker regards such projects as a logical progression from youth cultures past; style has always been an important way of signaling both "individuality" and membership in a particular group. True, skater culture revolved around skateboarding and punk culture around music, but each eventually reached the point where Ramones T-shirts outsold Ramones albums and the demand for skaterly "soft goods" dwarfed the demand for skateboards and helmets. Why not just skip the preliminaries and jump straight to the stuff? "In this instance," Walker writes of the new streetwear product lines, "the symbols, products, and brands aren't an adjunct to the subculture -- they are the subculture."

If this strikes you as absurd, even contemptible, you're surely not alone. Even Walker, who generally gives these kids the benefit of the doubt, finds himself wondering of one "lifestyle" brand, "what, exactly, did the culture or lifestyle actually consist of -- aside from buying products that represent it?" Nevertheless the purveyors see themselves as "rebellious"; they're just communicating their defiance using "the grammar and syntax of commercial persuasion." And, Walker concedes, this is the language that "everyone has, for better or worse, learned to speak." Another young brand-maker he interviewed, the founder of an outfit called Barking Irons, which sells products vaguely connected to the "forgotten" history of New York City, considers his enterprise "a revolution against branding" -- by which he means not the rejection of commercial expression but "the elevation of commercial expression." Instead of big-time corporate logos with nothing to say, he offers boutique designs with a message.

This only makes sense if you argue, as Walker does, that commodities can have real significance. Some objects -- trophies, wedding rings, souvenirs from trips -- patently do stand for important aspects of our lives. (They have what Walker calls "authentic" meaning.) Most people, however, don't want to admit that they believe meaning can also be bought, that Converse sneakers make you a cool outsider or that a MacBook demonstrates one's creativity and unconventionality. Walker thinks we should acknowledge that the things we buy do carry meaning, as long as we also recognize that we're the ones who gave it to them. A wedding ring, for example, only represents the relationship between two people because those two people (along with the society around them) agree that it does. We are the ones who invest these objects with symbolic power, and, furthermore, to do so is a universal human activity. Kidding ourselves that we relate to the objects and products in our lives in a purely rational way (something scientists have disproved over and over again) leaves us open to unconscious manipulation by advertisers.

Sam Gosling, a psychology professor at the University of Texas at Austin, also finds people's possessions revealing. His specialty is going into rooms and offices and drawing conclusions about the people who inhabit them based on their stuff alone. While "Buying In" nimbly walks the line between consumer enlightenment and marketing advice, Gosling's book, "Snoop: What Your Stuff Says About You," presents itself as a helpful guide for honing largely uncalled-for skills. In the book's main experiment, Gosling's grad students conducted a careful study of strangers' dorm rooms to see what they could glean from the contents. The findings are often unimpressive, such as the revelation that women's rooms tend to contain "stuffed animals, candles and flowers" while men's feature more CDs and "substantial stereo equipment," along with "bills, visible laundry baskets and athletic equipment." Besides being obvious to practically everyone, this interpretation would only come in handy if you happened to be investigating the bedroom of someone you've never even met -- in which case, you don't need tips on personality assessment, you need lessons in elementary ethics.

Part of the problem with "Snoop" is that Gosling's adherence to academically quantifiable results makes for fairly broad and therefore uninteresting definitions of personality traits. Gosling uses a standard called "the Big Five," which assesses an individual's levels of openness, conscientiousness, extraversion, agreeableness and neuroticism. Some of his observations are piquant -- people who hang posters with inspirational mottos in their offices, for instance, are probably "neurotic" (that is, anxious) rather than upbeat; the posters are meant to reassure and encourage them despite their fears. You can see past superficial attempts to appear organized (like tidiness) by looking for harder-to-fake "behavioral residue" like unalphabetized bookshelves, neglected filing systems or messes stashed just out of sight. Still, most of this book's insights -- people with lots of family photos in their office value relationships, personal Web sites are full of information about the people who maintain them, etc. -- are self-evident.

"Snoop" could do with more demonstrations of Gosling's remarkable powers (if he indeed has them) and a lot less advice. His skill, such as it is, is more of a parlor trick than a practical tool. About the only occasion in which I can imagine needing to deduce someone's basic character by looking at their home is on a date. And if you can't figure out whether someone is extraverted or neurotic, agreeable or cranky, by the time he invites you back to his apartment and leaves you at leisure to poke around, I suspect that either you're incorrigibly inept at judging personality or you're so drunk you don't care.

On one point, both Walker and Gosling concur: When we speak the language of stuff, our primary audience is ourselves, not the proverbial Joneses we're supposedly trying to keep up with. Gosling notes that while we sometimes attempt to "doctor" our spaces to give a better impression, this impulse is always at war with a countervailing desire "to be seen as we see ourselves, regardless of whether those self-views are positive or negative." For his part, Walker holds up the example of Method dish soap, one of a line of cleaning products that comes in "sensational"-looking bottles and costs more than the average, ugly container of Joy. The people who buy Method, oddly enough, don't seem to care much about the quality of the soap itself, yet they can hardly be accused of showing off their trendiness, either. "The only thing less plausible than paying a premium for high-design dish liquid simply because you want to clean dishes," Walker writes, "is to do so because you think that any more than a tiny handful of people will ever see, notice and be impressed by the bottle." The people who buy Method like the way it looks (or, in my case, the way it smells), but whatever statement the product makes about their taste or affluence is mainly intended for the purchasers themselves.

We go wrong, Walker believes, not when we express ourselves through our possessions, but when we allow our possessions to take precedence. It's all too easy for people, under the influence of the siren songs of marketing (or murketing), to drift into a situation in which they use commodities "not to reflect who they are, but to construct who they are. Not to reflect a self, but to build a self." No object, of course, is meaningful enough to fulfill that role, and an endless cycle of chasing after glittering but ultimately unsatisfying products is likely to ensue. Pretending that the stuff in our life is simply, mutely functional might seem like an antidote to this cycle, but in its own way, it's just as delusional.

Your stuff is always talking about you, behind your back and to your face. To find out whether it's telling the truth, you have to listen.


-- By Laura Miller

Labels: marketing, Media, Sociology

The New Marketing Paradigm: Quotes on the State of the Marketing World
by Erik Hauser, Founder and Creative Director, Swivel Media

On word of mouth…

“Word of mouth marketing does not exist. Word of mouth is an outcome.”

“Word of mouth is that part of the equation that comes after the equal sign. Real word of mouth is a genuine conversation between two or more individuals that benefits the receiving party. The only way to guide this conversation is by putting together a solid program that comes before the equal sign.”

On the death of push-and-interrupt…

“An entire generation of Americans is making it clear that the old advertising models of ‘push’ and ‘interrupt’ marketing are no longer working. The key to successful brand building begins with engaging your audience and holding its interest long enough to create a relationship that will grow.”

“The marketing paradigm has shifted. Dollars that were once slated to go toward traditional media and marketing methodologies are now being allocated for experiential and non-traditional marketing methods.”

On the pitfalls of guerrilla marketing…

“Done poorly, guerrilla marketing can make your company look like a nightmare. Done correctly, it is one of the single most powerful marketing tools.”

“Business-to-business guerilla marketing must be extremely targeted to be successful. You can’t do it across an entire city. It simply won’t work.”

On experience marketing…

“Experience marketing defines the future of marketing. We live in an increasingly consumer controlled marketplace --- from the way people personalize the music they’ll listen to, the type of news they want to receive and the delivery system that brings them that news. The only way to maintain an adequate degree of relevance as a marketer is to provide the consumer an experience in the self-defined and controlled sphere in which he lives.”

“The companies that provide the great experiences will be the companies that capture market share. The deeper and more intricate experiences companies can provide, the more relevant connections they’ll forge with consumers.”

“By designing great experiences that satisfy consumers’ senses, companies will experience marketing bliss and consumers will reward them with their almighty dollars.”

“You can’t put entertainment out there just for entertainment’s sake. It won’t create a lasting impression on the consumer. You’ve got to link it to an experience that will make the consumer immerse himself in that entertainment and the brand that it’s bringing him into intimate contact with. You must provide an experience that connects meaning and relevance to your brand.”

On brand differentiation…

“It’s not enough to express your function. Your message must communicate authenticity, credibility, meaning, relevance, and express your company’s personality in order to connect. It’s essential to find our own personal brand’s voice by uncovering your differentiating strengths and leveraging those to beat your competition.”

On Gen Y buying decision-making…

“We make buying decisions based on both rational and emotional factors…a feeling about something, using our senses of smell, touch, sound, sight. Those feelings are engendered in experiential marketing situations, and that’s particularly true for people in their teens and early 20s. They’ve grown up so bombarded by messages that it’s difficult to get their attention. Experiences that engage their senses and emotions are more apt to get their attention, to break through the message noise and clutter.”

“Kids have tuned out traditional media. These kids don’t want brands shouting at them and telling them what to buy. They consider themselves smart, clever, and they know what they want.”

“You have to reach Gen Y in a way that’s personalized and connects with their emotions and lifestyle. I haven’t named them the Teflon generation for nothing.”

Labels: marketing