Most Recent Articles In Financial
Latest Financial Articles
- Hong Kong Retail Sales Plunge as Chinese Visitor Arrivals Slow
- Stage Feels Weather, But Not Oil, Pressure
- JD.com Announces 73% Increase in Revenues
More Articles By
If you want to talk to young consumers these days, you’d better be on YouTube. And you’d better be funny.
Brands ranging from Gap to Victoria’s Secret, Ralph Lauren, Calvin Klein, Nike and Adidas are increasingly finding a home on YouTube, MySpace and similar sites, where their videos, commercials, behind-the-scenes footage and fashion shows are posted for free. These sites have the potential to transform the way fashion brands reach their current and future customers since hundreds of thousands of people can view a single spot — with humorous ones scoring the most hits.
“You’ve got to fish where the fish are,” said David Verklin, chief executive officer of Carat North America, the largest independent media services company. “We’ve always had a hard time reaching young men and women on TV, except for MTV. Particularly teenagers — they’re not doing a ton of reading. The younger market was a bit diffused. They’re spending enormous amounts of time online.
“If you catch a young consumer, it goes out virally into the community at speeds and sizes that boggle the imagination,” said Verklin.
Traditional media such as TV, print and radio still dominate the advertising world, but there’s a growing movement toward online ads, as evidenced by the recent deals by Google, Microsoft, Yahoo and AOL to scoop up online advertising companies. Online ads account for 5.8 percent of the $285.1 billion spent on advertising in the U.S. last year, according to eMarketer, a research firm, and the online share is expected to rise to 10.2 percent of the estimated $315.5 billion to be spent on advertising in 2010.
The sheer fact that young people can decide for themselves what videos they want to watch and can share it with their friends helps drive YouTube’s popularity.
“YouTube is the new TV because it’s on demand,” said Marc Gobé, chairman and ceo of Desgrippes Gobé, a brand design group, and author of “Brand Jam.” “It’s the future of communication. People don’t want to be told what to watch, and they want ideas to be shared. They want to pick and choose and not be forced to watch things. YouTube becomes a campfire where everybody wants to hear stories, find out stories and share stories. It attracts millions.”
According to comScore Media Metrix, YouTube had 160.8 million unique visitors worldwide in March, a sixfold increase from 22.3 million visitors worldwide in March 2006.
So far, marketers say they’re not diverting money from their TV and print ad budgets to such sites since it’s free to post their spots. But if YouTube and others ever start charging to upload videos (although right now it has no plans to), it could allow the Web to eat further into traditional media ad spending. That is, if brands are willing to pay.
“Part of its popularity is that it’s free and freedom of expression,” said Charles DeCaro, partner in Laspata/DeCaro, an ad agency in New York. “Once you start charging, it’s a whole different thing. Anything you put a dollar sign in front of, people want to see results and that it’s hitting the right people. Kids are one thing, clients are another. Clients would scrutinize it a bit more.”
However, Verklin doesn’t think charging for video content would be a barrier to YouTube’s growth.
“I don’t think charging will slow down YouTube from becoming an effective competitor at all,” said Verklin. “In the future, we see use of a technique that some of us are calling ‘corralling.’ Simply put, this involves using a short message in a mass media channel [such as a 10-second TV spot] to drive [or corral] an audience from mass media to a specific on-demand, digital location. ‘Click here to see the new BMW video brochure.’ Or, ‘Go to YouTube to see the new DKNY fall line.'”
In the months ahead, Verklin said companies will use mass media to drive people to specific digital locations. “Advertisers will love this because, although the audience sizes will be smaller, the entire audience will be interested in the message,” he said.
“YouTube is merely a distribution vehicle in this model. MySpace, etc., can serve the same purpose,” he added. “Rake out of the mass media and direct it to another digital location where we can capture data on who they are. YouTube will be a serious contender in this approach for some demographics. In other cases, we’ll merely post a bunch of new, hot content on something like YouTube or FaceBook.”
Desgrippes’ Gobé believes it’s only a matter of time before YouTube starts charging to view some of its content. He feels it could evolve into a layered system, where more specialized content could be fee-based. He equated it to American Express, which has a sliding scale for its Black, Platinum, Gold and Green credit cards. “You pay for a good movie, or $1 to download good music. I don’t see why you shouldn’t be able to pay for exciting content,” he said.
Julie Supan, a YouTube spokeswoman, said there are no plans to charge people to upload videos. “We want YouTube to be available for everyone. We want to keep barriers for entry really low,” she said. She pointed out that there are ways for marketers to monetize opportunities, such as deals YouTube has with its standard partners, such as Ford Models. Although she can’t disclose terms of the arrangement, marketers are able to monetize by revenue-sharing in advertising that appears on these highly trafficked areas on the site.
But, while an increasing number of fashion companies have gravitated to YouTube to upload videos, advertising hasn’t been as forthcoming.
“We haven’t seen a lot of fashion marketers advertise on the site. We’re feeding the site with content. It’s in its infancy,” admitted Supan about the two-year-old site. “The opportunity is there for hundreds of thousands of views. Right now we’re building a community and reaching critical mass. There’s opportunity for marketers and fashion companies. We’re truly seeing a lot of interest in this content. It’s a rising area on the site.”
Carat’s Verklin believes sites such as YouTube and MySpace can do more to virally propel a fashion brand than other consumer durables. “We’re going from a time where brand advertising in fashion told the best stories and showed the best pictures. YouTube and MySpace are changing that paradigm. The most successful is where the consumer is telling a story about the brand. It’s completely flipped it around,” said Verklin.
He said sites such as YouTube and MySpace are changing the way a fashion brand becomes hot.
“In a sense, MySpace and YouTube feed into that in hyper speed. It’s the momentum effect. It talks to this idea of how people see something, or an event or a brand, and spread it through MySpace at viral speed. A fashion brand can emerge faster and deeper than anything I’ve ever seen before,” said Verklin.
His agency created a site on MySpace called My Adidas, which has had 600,000 visitors since it was created. Sixty thousand people have added it to their “friends” lists, and 35,000 people downloaded creative elements from the site for their wallpapers and skins. “We’ve estimated that we’ve touched 21.5 million people,” said Verklin.
According to comScore Media Metrix, MySpace had 106.9 million unique visitors worldwide in March, more than double its 49.2 million unique visitors in March 2006.
Verklin feels these sites are having an impact on traditional media: “Without a doubt. The power is in the multiplicity of touch points,” he said, noting the key is reaching consumers multiple times through many different media.
IMG Media has been posting videos of shows from New York Fashion Week on YouTube for the last two seasons, and added Los Angeles Fashion Week last season. But it isn’t the only one. Many amateur and professional videographers post their footage from the fashion shows, or lift it from elsewhere. Nearly every designer’s fashion show — from Giorgio Armani to Ralph Lauren to Versace — can be found on YouTube, as well as clips from interviews with designers, videos from “Full Frontal Fashion” and the assorted backstage pandemonium.
And they’re finding an audience. Marc Jacobs’ fall 2007 fashion show (posted by Fashionindie.com) received four stars and has had 14,088 views, while Zac Posen’s fall show (posted by IMGVideoClips) got three stars and 118,197 views. Web surfers also can find fashion commercials that were once banned from the airwaves, such as the voyeuristic CK Jeans ads from the early Nineties that were filmed in a basement with teenagers being interviewed by an older man who’s offstage (76,491 views). Hundreds of thousands of videos are being uploaded every day on YouTube, which was acquired in October by Google for $1.65 billion. The site’s users range from 18 to 55 years old, although there are plenty of older and younger users, said Supan.
In January, Ford Models created a partnership with YouTube under which it developed its own channel on the site and posts thousands of short-form videos on topics ranging from fitness tips and yoga poses to creating a quick updo and shaping one’s eyebrows, as well as videos from Ford’s Supermodel of the World contest. One video, “Changing Room Confessions,” shows model Alejandra overcoming some bra and zipper issues, which has garnered 89,698 views.
“With the global penetration of broadband, audiences are looking for new and purpose-built content. The short-form videos are engaging and provide useful information,” said John Caplan, president and chief operating officer of Ford Models. Ford creates thousands of clips, partnering with its fashion models and hair and makeup artists. “The secret of the success is the authenticity of our content,” said Caplan. He said the talent shares in the advertising revenue that appears near the Ford Models’ content. “It’s been financially successful and terrific for our brand,” added Caplan.
“We are creating new opportunities for our talent in a new way that showcases what people are passionate about — fashion and beauty,” he said. Ford also produces these short clips for other sites such as iVillage, MSN, MySpace and FaceBook.
Ad experts say they like the instant feedback they get from their video postings on YouTube.
“The unique things about these types of media is you hear back immediately what connects and what doesn’t,” said Trey Laird, owner of Laird + Partners, a New York ad agency. “[The technology] is emerging quickly and changing quickly. People are on there every day, and you can update it. It’s such a viral community. Your best marketing in that community is word of mouth.”
However, Laird said high-end fashion designers haven’t connected as well to YouTube as mainstream marketers, although many of their fashion shows are posted on the site. “Since it’s a video-sharing site, for people who are print- and outdoor-driven, it limits how you use it. High-fashion designers are still so print-driven. Most of the designers haven’t been able to take advantage of it yet,” said Laird.
YouTube’s Supan said there are some restrictions to posting videos. Videos that are uploaded can be no longer than 10 minutes. Supan said YouTube prohibits illegal content on the site, and those who post the videos have to own the rights to them. If an ad agency sends YouTube a “take down” notice, then the person who posted the video will lose his account. “Hundreds of thousands of videos are being uploaded every day. We have to be made aware of what’s not legitimate,” she said.
Marketers say that when it comes to YouTube, humor typically works best, and word of mouth is the preferred messenger. They believe it’s imperative the message feels authentic and is not being shoved down the consumer’s throat. The consumer needs to feel like she’s discovering something on her own, and will return to the video or the site because she wants to and will tell her friends, especially if something is particularly funny.
Of course, fashion shows don’t usually fall into that category, but often models tripping on the catwalk or some unbelievable athletic feat can gain traction on YouTube. For example, Calvin Klein’s Underwear commercial with Natalia Vodianova in various poses in her bra on YouTube has received five stars and 20,899 views. A video of the model Kamila W holding a watering can and tripping over her shoes at Vivienne Westwood’s spring-summer 2007 fashion show in Paris garnered four stars and 44,916 views. Nike’s video, called “Ronaldinho: Touch of Gold,” showing the soccer player putting on a new pair of Nike cleats and juggling the ball with his knees, among other fancy moves, has garnered four stars and 13,797,014 views (and there are countless versions of the soccer player on the site).
Nike has been at the forefront of digital marketing and has posted many of its commercials and videos on YouTube and other Web sites, creating a huge demand for this content.
“In some cases, we make our TV spots or behind-the-scenes footage available, and in other cases, it just happens organically,” said Stefan Olander, global director of digital media content at Nike. “We give consumers content and the ability to rip it and put it out themselves. We make it simple, easy to use, to set up and share. We want to make it contagious. The opportunities are limitless: We now talk with our consumer around the clock and across the world with instant feedback.”
Getting people to converse about your brand is a key element to inevitably boosting business.
“At Nike, as part of our marketing mix, we connect with consumers in a variety of ways and we make our content readily accessible, giving them the choice to view it on-demand,” said Olander. “In the case of the Ronaldinho video, we’ve had an incredible consumer response from every corner of the world, with the video being seen over 32 million times on nikefootball.com and other platforms like YouTube.com.”
Laird said he’s had success using YouTube for his clients, particularly Gap. Last fall, Gap’s Audrey Hepburn skinny black pants commercial was posted on YouTube, and it took off.
“It got posted before we posted it,” said Laird. “People would act it out in their living rooms and post their own versions of it. Jay Leno and Jimmy Kimmel did parodies and they got it posted, and it started circulating around. It took on a life of its own,” said Laird. Leno’s parody, which had his head superimposed on Hepburn’s body, has garnered 19,799 page views. It carried the slogan, “The Fat-Ass Black Pant.”
Some advertising executives say they use YouTube for consumer research.
Barry Lowenthal, president of Media Kitchen, a division of Kirshenbaum, Bond & Partners, said, “I love to use YouTube from a trend standpoint. I see what Americans are watching and what the cultural perspective is. When you’re doing new business and research, you try to figure out consumer patterns.” He noted that if someone will watch a video on YouTube “it’s an engaged audience.”
Trend watchers think YouTube allows a brand to get different exposure that it might not get through print and TV media.
“We know trendsetters are all over these sites and use them. If it’s a cool commercial, it gets pushed through via word of mouth. It has to be viral,” said Barbara Bylenga, president of Outlaw Consulting, a San Francisco-based consulting firm. She pointed out that Wes Anderson’s American Express commercial and the Smirnoff Tea Party, “which was not an ad, more like an ‘SNL’ skit, went crazy on YouTube.”
“It’s a good way to get the brand name out there. It created awareness for the brand in a viral way, where they feel they’re in control. They watch it because they want to watch it. It’s a pull strategy,” she said.
Acknowledging the advantages of posting on YouTube, David Lipman, creative director of Lipman, the ad agency, said, “I think there’s a benefit. You get the message out longer. [Consumers] come to it in an organic way. You’re discovering the world, instead of it being forced upon you.”
Lipman created three-minute mini films for BCBG, which were shot for multipurposes. BCBG placed it on YouTube. “It’s different than buying print or TV. All it takes is one set of eyeballs to find it. They might find something really cool, like the music. It’s a sense of free discovery,” he said.
But does it help the client’s business?
“It’s hard to say. Everybody’s just discovering it right now. We’re not that sophisticated, we’re not mass marketers now. It’s a form of communication. Nothing will be free forever.
“Five years from now, it’ll be so big. [Kids] are growing up with it. In five years’ time, we won’t survive without it.”