The psychology of accessing media channels is being replaced from a linear, community experience (sitting down to watch TV) with a multi-channel and ever-more personalized world. Increasingly rich media marketing campaigns are being fueled by the interaction element, whether it is about games or membership clubs or coupons.

Mobile TV and other mobile media is changing our consumption of programmes and accelerating the blurring of the lines between adverts and programming.

There is the blurring of ads with programmes and the blurring of games, with branding and with the programmes themselves. Mobile advertising is widely regarded to be inevitable given the ubiquity of the device and its ability to deliver on all of the four 'Ps' of traditional marketing parameters. Smartphones have plenty of processing power to handle the types of rich media content and displays required for quality advertising. Consequently, this ‘third screen’ is being established as a viable choice for advertisers wanting to create advertisements of the quality that are available on other digital media.

Although the free-to-air TV culture still dominates, in the future services will be more interactive with many facilities for voting during TV shows, for indexing channels or even programming the home media player direct from the smartphone.

The advertising bundles being offered by operators like EE, Vodafone, TIM and 3 Italia in Italy can come in two different flavours: instream advertising as in traditional broadcast TV, but it will increasingly come in the form of more profiled advertising, and sponsorship around the browser tool, with sophisticated activities like voting or gaming built into the content.

Blurring of reality

To get to the fundamentals of this shift, we should remember that the blurring of entertainment and persuasion, is not just a new concept confined to the online world. The first soap operas were in fact TV shows that were geared toward housewives, given the fact that they were home during the day. What did housewives do in those days? Housework and laundry. Thus, the soap companies attached themselves to these programmes and were usually the primary sponsors, sometimes even getting recognition in the show titles, along the lines of 'Palmolive presents All My Children'. 

Reality TV shows are another parallel trend, leaving behind an even bigger impact on consumers than that of regular television. Research into this area shows that people tend to exaggerate the negative effects of this blurring of the lines on other people, while they feel themselves to be relatively little affected.

With the growth of the Internet, advergames have meanwhile proliferated, often becoming the most visited aspect of brand websites and becoming an integrated part of brand media planning in an increasingly fractured media environment. Advergames theoretically promote repeated traffic to websites and reinforce brands. Users choosing to register to be eligible for prizes can help marketers collect customer data. Gamers may also invite their friends to participate, which could assist promotion by word of mouth, or viral marketing.

One is certain: the blurring phenomenon is growing. Fans of 'American Idol' for example are bombarded with over 100 product placements for each episode.  'American Idol' exceeded expectations, averaging 12.7 million viewers in its first season back in 2002. The show brought initial sponsor Coca Cola to viewers young and old alike, as 'Idol' at the time had a younger-than-average median age for prime time TV and was one of the few shows that truly crossed generations.

Product placement for British TV was only approved in 2011, allowing for example the placement of Coca Cola drinking glasses for use by the X Factor judges. This change is bringing in around £100m (US$160m) of extra funds for commercial broadcasters, although not for the BBC. 

In the US, paid product placement is at around £3.4bn (US$5.5 bn), with TV accounting for 75% of the total and movies 25%.

Media blurring is intended from the marketer’s point of view to overcome the problem with advertising, which is that it creates a 'reality' that is not real, in that it creates an unrealistic set of norms of what it means to be beautiful and have an affluent material lifestyle. 

Adapting advertising, and even personalizing it down digitally to the level of the individual, allows the marketer to speak directly to the culture and values of the audience.

The opponents say the hijacking of content by marketers makes a mockery of TV ad limits, threatens public health, and undermines parents' ability to monitor media and marketing influence.

Today mobile TV consumption is converging with the goal of agencies, which is to create more control, flexibility and metrics for their campaigns. This is such that nowadays with mobile TV, very little is talked about passive advertising or banners, and it is much more about integrating a campaign with the programming and using pay-per view. The mobile video technology choices are being driven by the need to connect with this new group of content providers and aggregators, in an increasingly complex media world. Mobile firms are increasingly morphing into content firms and vice versa. So, what makes for a successful rich media campaign in mobile? Why is stealth advertising so effective?

Professor LJ Schrum, Head of Department of Marketing at the HEC Paris is an expert on consumer socialization, brand communities and the interaction of media and society. He is also author of an interesting book on the subject, 'The Psychology of Entertainment Media: Blurring the Lines Between Entertainment and Persuasion'.

"In product placement, the marketer putting the product in the programme is trying to blur the lines, for example with programming created for a specific proposal," says Professor Schrum.

"My work originated from a focus on how people digest information. When we view a TV programme, we lower our resistance. We reduce our protection to counter-argue the programme and we tend not to process cautiously."

In his book Professor Schrum details the role of television in the construction of consumer reality. He says that in cases of relatively high levels of TV consumption, the viewers rate the programming as being rather closer to real life compared to occasional viewers. He wants future research to examine the relationship between the viewers' perception of reality and reality TV programming by using different methods of testing the viewers’ reality perception to see if the effects remain constant.

"It becomes pretty insidious at the point that companies pay ordinary users to engage in viral marketing, or pay customers to go into a bar and recommend a certain brand," he adds.

"Marketers are in danger of taking a nice viral [opportunity] and ruining it."

Advergaming up, advertising down

"The reasons behind this development are rather simple, but critical to a media industry undergoing rapid change in an era of ad-skipping technologies and accelerating audience fragmentation," says Patrick Quinn, President of PQ Media, a New York firm which publishes research on the size of the product placement market.

"Technological advances and continued audience fragmentation, due to the growing popularity of new media like the Internet and video games, have led major marketers who are already skeptical of their return on investment in traditional advertising to become even more dispirited with the old means of reaching target audiences," he adds.

As a result, advertisers are more than ever questioning the relevance of the 30-second TV spot, as their messages become scattered in the increasing advertising clutter or omitted altogether by a more empowered consumer who can skip them with the touch of a button.

To compensate for this perception of diminished advertising returns, marketers have substantially ratcheted up the role of product placement in their buying strategies. In short, product placement—the seamless integration of products into media—is becoming an integral part of a larger marketing package for many advertisers that includes traditional advertising and alternative marketing such as product placement.

The advergame industry generates an estimated US£1bn a year in revenues through platforms like FarmVille by Zynga, according to a report by eMarketer.

Facebook games based around advertising now achieve over 1 million monthly active users, with many of these coming through mobile usage. Whether its referred to as advergaming, ad-funded gaming or casual games, the advergaming industry revenues are rising fast on mobile, iPhone, social networks platforms. Targeted user information continues to emerge about who plays games, spurring interest on the part of advertising agencies who can use games to reach specific markets. 

Broadening of interest has meant that gamers are not just teenage males, but men through to 35 years and beyond as well as women between the ages of 35 and 55. 

Most consumers attempt to ignore banal advertising on the web, so why does advergaming work? 

As marketing communication expert, Lee Ann Obringer, says, "as long as the game delivers a fun pay off, consumers consider it a relevant and valid cultural experience. In recent brand-impact studies, associating a brand with the fun of gaming is known to lift brand metrics such as brand awareness, message association and purchase intent. After playing a game, consumers are more likely to remember not just the brand or product itself, but to associate specific attributes with it."

Insights and opportunities

Notwithstanding the obvious hype and potential, there is a tangible sense of trepidation as to how to introduce mobile advertising to subscribers in a way that is not perceived as intrusive. This is where a more viral approach works.

The mobile phone is a highly personal device characterized by ‘always with’ and ‘always on’. Therefore insensitive exploitation of the medium with mobile spam will lead to a backlash. Stakeholders of all shapes and sizes (web portals, operators, handset vendors, content creators) are therefore advocating a very soft touch to mobile advertising with two golden rules.

Mobile advertising must be valuable. Whether as a redeemable electronic coupon or a location specific SMS message, the advertisement must match the expectations and desires of the end user otherwise it is an unwarranted intrusion.

Mobile advertising must be optional. Subscribers need to be able to choose the type of advertising and the frequency of delivery, with controls placed firmly in the hands of the recipient.

So for agencies the implications are clear: getting consumers to use and play with content, and to get involved or vote, make the brand message more memorable. This new world of multi-platform TV and mobile viewing will only accelerate this change to more viral and interactive advertising.

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Today, when a big company buys a little one, it hopes that nobody notices. The aim is to keep the indie feel of the niche brand, while applying the distribution and marketing advantages of the big acquiring firm.

The marketing behind niche brand experiments like the Absolut Vodka 'Cities' series designed by local artists, or the McDonalds 'Quarter Pounder' stores in Japan or the Adidas Originals raises interesting questions about how brands can go into their consumer sub-groups for new connections.

Part of a limited-time promotion, two McDonald's stores in fashionable Tokyo neighbourhoods were remodeled and reopened as unbranded Quarter Pounder shops as part of the fast food chains expansion in Japan. The minimal black and red shops (pictured) featured Le Corbusier sofas and only two menu items:  the Quarter Pounder with cheese meal or Double Quarter Pounder with cheese meal. Extending the motif, all food was served in solid red packaging with black block lettering.

Similarly, car companies are also taking niche input onboard and individual customers are joining the experts in new product design for the first time. 

Microsoft and Dodge for example teamed up to get people excited about the Dodge Challenger R/T by commissioning an online design competition where contenders could customize a Dodge Challenger to their own liking. Dubbed 'Dream Design Drive Challenge', the 300,000 entrants were able to use a variety of tools to customize the car's paint scheme, layout and detailing to make the car as unique as possible.

Other examples of some niche brand activations include mass-volume brands partnering with high-end designers to create limited-edition products or capsule ranges, such as Adidas and Stella McCartney, H&M and Alexander Wang, and Diet Coke's multiple-year strategy of partnering with Karl Lagerfeld, Jean Paul Gaultier and Marc Jacobs.

Indeed, one of the most interesting branding trends as we look ahead is the relationship between the society of tomorrow and business. Brands are fundamentally changing in a world where the consumer is overloaded with information. Customers are being turned off by the white noise of advertising, meaning that brands will be forced to become bolder, sharper and more inventive to stay relevant. In an age of globalization and access to brands on a massive scale, consumers want to feel individual and special again.

Part of this change is the ‘Long Tail’ and the effect of the digital economy which is bringing economies of scale to ever-more obscure and niche products, and bringing them to market in a way that wasn’t possible before. More on the Long Tail later.

Niche activations in action

The goal for the brand owner to stay connected is to take a broad category (whether computers, vodka, burgers, shoes or cars) into a niche and to make it work. Can something generic be made to appeal to specific age, gender, ethnic or lifestyle group (micro niches) whilst also existing as a single mass entity?

The Food Channel website in the US manages to appeal to a wide range of people through targeted niche programming. Through its multimedia programming, The Food Channel manages to specifically define shows that appeal to just about every conceivable age group, gender, ethnic group, cooking style, type of food, consumer interest. 

 To understand how to define your own niche, just look at some of their niches in foods: older women and those who love comfort food (Ree Drummond); home bakers (Anna Olson); Asians (Ching-He Huang); African Americans (Siba Mtongana); manly men (Guy Fieri); food nerds (Alton Brown); and back in the day, the young and laid-back (Jamie Oliver).

The company has been incredibly innovative at taking a broad general category, that could be boring or routine, and turning it into much more by carving out narrow niches.

A niche by definition is narrow. It will not appeal to everyone. But if a brand has captured a niche properly, those in the niche will instantly recognize it. Possibly the one unifying concept of The Food Channel that makes it so successful is that it could probably serve as the template on how to use all multimedia elements successfully in bringing niche information to different groups.

Nike doesn't mention that Converse is a subsidiary and Converse marketing doesn't mention Nike. If people knew that Converse was a division of Nike it wouldn't be as cool.

BMW goes to great lengths to keep the Mini identity as a very separate personality. One alternative would have been to reposition Mini as the BMW 0-Series and yet by its positioning Mini is one of the few marques to be successful in the premium, small car niche. Much of Mini’s marketability is wrapped up in its history and image. Minis are cheeky, while BMWs are teutonically not cheeky.  Moreover, the Mini brand – under guidance from Interbrand – is being expanded, so the number of units sold is continuing to rise.

When small meant cheap, Mini and BMW set about defining the niche of compact luxury.

Dell has enabled customers to customize a laptop cover with their own design and with their own embossed sticker. New technology enables customers to see their design before purchasing it. The world’s number three PC maker says this two-way relationship gives Dell strong consumer input which is critical to the company’s ethos of personalization.

According to Dell, its customers are less interested in the exact technical description of their PC – although they have plenty of options here too – but they are very interested in the feeling of being able to customize and being given personal attention. 

The 130-year-old Eastman Kodak - now Kodak Alaris for personalized imaging and document imaging -  has also made big strides evolving into new niches. It has been very successful in using its brand name as a base to move wholeheartedly into the digital space coupled with aggressive marketing into new product areas. Since its core photographic film business faded, the former corporate icon has been remaking itself into a digital-photo and printing company, selling consumer ink-jet printers and high-speed commercial presses.

The US group has been seeking out a new, hipper image, through effective use of social media and it now has over 70 employees who regularly blog (including international bloggers). 

A spokesperson says the blogs give Kodak a human face and allow customers to get the 'who', not the 'what', and that human face is really what people want to hear and see.

Kodak Alaris has its own production studio, so doing podcasts became a natural extension of its marketing efforts. Just this month Kodak Alaris has relaunched the Kodak Moments app with a new focus on photographic storytelling. 

Also think of burger bling and the US$200 burger from Burger King that was trialed a while back as ‘The Burger’, raising funds for the Help a London Child charity. You could call it brand dis-synergy.

Using information tunnels

“We are seeing everyone going toward niches and customization and this makes the product accessible. People feel they want to be different,” comments futurist, author and CEO of The Futures Agency, Gerd Leonhard.

Referring to the Dodge design example, Leonhard predicts that cars will increasingly become social objects, whether owned or time-shared and self-driven, onto which we can apply our own personality. He believes that with the new personalized media world, niche items can be more successful in the marketplace, and this is a change that applies not only to digital products (non tangible goods like music, media or financial services) but also physical products.

Judging from his work for leading brands such as Nokia and Sony, Leonhard – also author of 'The Future of Music' and a new book ‘Friction is Friction: The Future of Content, Media & Business’ - says that companies need to embrace this aspect of social design and the connectivity the web brings into every aspect of our daily lives.

Through emerging technologies such as cloud computing and the Internet of Things, in the next five years 75% of the whole world will be connected.

"There are many great things about this, and there are many challenges about this," he says. "Our world is going to change more in the next 20 years than the previous 300 years."

By 2030, roughly 40% to 60% of all jobs will be completed by machines and aided by some form of robotics or automation, from financial advice to serving drinks.  

Areas such as finance, real estate, medicine, energy and food are still to be "disrupted" in the way other industries, such as media, telecommunications and transportation, have in recent years, he says.

He talks about a future where blogs will be record labels and bloggers will be the new music moguls. To an increasing degree brands will be able, through technology, to address us as niche groups and down to the level of the individual.

Completely targeted and personalized advertising, delivered largely on totally customized mobile computing and communication devices, will turn the US$1 trillion advertising and marketing services economy upside down.

"Behavioural targeting and user-controlled advertising will, of course, become an even hotter potato and a much discussed challenge," says Leonhard. But he says the old deal for consumers of 'I give you attention and personal data and you give me content' will become even more pronounced on the web.

In fact, some are predicting that mass advertising as we knew it is already more or less outmoded and will, during the next few years, be completely reinvented.

Using information tunnels effectively, means that a brand can divide all recipients of content into ever-smaller groups - but these don't have to be socio-based or demographically based. Leonhard says that dividing people by age or income, or voting pattern, is less important. It's why they interact with you, their intention as individuals, that counts.

The success of Kodak is a case study on using social networking to maximize and apply marketing into new niches. Different marketing tactics operate at different points in the cultivation of customers, building up goodwill and the brand's reputation in the minds of its customers. To change people's brand beliefs and have greatest impact on their digital camera purchase decision, Kodak had to do a different kind of marketing than when it simply was trying to raise brand awareness.

Kodak Moments has over 700,000 fans on Facebook and 140,000 followers on its Kodak Alaris (Kodak Moments)Twitter handle. It offers a Facebook application that allows users to create photo albums, send messages and share pictures. Such ‘social shopping’ was recently identified as one of the hottest trends on Facebook

The increased transparency and the wave of information coming at us from the online world means that increasingly marketers have to ‘tunnel’ information and give us packets of information that are suitable for our personal niche.

Some brands react by trying to send us even more products and even more information, so that each one has a ‘scatter-gun’-ish opportunity to reach a target audience. But increasingly there is evidence that our brains work best when our own individual needs are satisfied and information is channeled to us personally. The research shows that most people feel overloaded with information online when they are presented with just ten choices.

Focused information often uses information tunnels. Communication is focused when it's precisely adjusted to a certain group of recipients. When a transmitter adjusts a certain message to several groups of recipients, and allow the individual recipient to choose which group she belongs to, the transmitter has created an information tunnel

The Long Tail and the real economy

In his book ‘The Long Tail’, Chris Anderson, entrepreneur and curator of the TED Talks, shows how “our culture and economy is increasingly shifting away from a focus on a relatively small number of ‘hits’ (mainstream products and markets) at the head of the demand curve and toward a huge number of niches in the tail.”

In the theory of the Long Tail according to Anderson, as the costs of production and distribution fall, especially online, there is now less need to lump products and consumers into one-size-fits-all containers. In an era without the constraints of physical shelf space and other bottlenecks of distribution, narrowly-targeted goods and services can be as economically attractive as mainstream concepts.

When we look at niche examples like the Quarter Pounder store and limited edition cars, vodka or sneakers, are they about personalization? Or is it part of a wider trend of brands spinning off into subsets of themselves? Why do niche brands win? Is this about consumers frantically searching for authenticity? Why are niche brands hot at the moment?

Some people would say that all strong brands are niche brands. But increasingly big brands are hoping some of the variety, assortment and the offbeat nature of small brands will rub off on them. History also dictates that brands will broaden and then contract, broaden and then retract, and so on, over and over again.

Gerd Leonhard says that essentially what is happening is that everyone wants to get closer to the customers, or as some would say "people formerly known as consumers."

Niche initiatives give a lot of momentum to the mainstream product. We are living in the era of science and technology, new research, applications, software, and discovery. And everyone wants to keep updated on these things. Therefore, every consumer remains in search of the 'new' and latest ideas.

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