Quotes of the Day

For decades, the 30-second television spot has been king of the advertising jungle — the surefire way to shift that soap powder or boost that burger chain. But now, although not facing imminent extinction, the format is beginning to look as obsolete as the black-and-white TV set. According to ZenithOptimedia, an advertising buyer and research company, TV's share of the ad market in Western Europe peaked in 2004. Advertisers know all too well that digital TV's hundreds of channels and video-on-demand services have made it impossible for a handful of commercial channels to reach the enormous audiences they once enjoyed. Indeed, digital systems often come with digital video recorders (dvrs) that let viewers skip ads altogether. Meanwhile, video games, iPods, the Internet and other diversions are tempting people away from the tube. Europeans with Internet connections, for instance, spent an average of 10 hours, 15 minutes a week online last year, a 17% increase over 2004. Watching TV, by contrast, grew by only 6%.

Viewing habits may change, but the need to advertise products remains. Thus advertisers are hoping that "one-pipe" convergence will remodel the landscape. That's when a single broadband feed into your home will hook into one device that operates your TV, PC, dvd player, dvr, games console and stereo system. The differences between a TV and a computer, and between a website and a TV channel, will then start evaporating like pixels on a dying screen. Viewers will choose whether to watch ads and which way to watch them. How will brands vie for consumers' attention? For a taste of the future, tap the words Axe Feather into an Internet search engine. Any number of the results will take you to a page featuring an attractive young woman, clad in skimpy red undergarments, lying on a bed. Move the virtual feather with your cursor to tickle various parts of her body to get her to sneeze, giggle or writhe. Created 15 months ago by Dare, a London digital ad agency, for Axe, a line of Unilever grooming products for young men (called Lynx in Britain), the ad has captivated 15 million unique viewers who have each spent, on average, 8 minutes on the site.

So is this the future of advertising? Dare's managing partner Mark Collier boasts that the ad not only increases awareness of the brand, it gets young men to "engage" with it. When millions of people spend minutes, not seconds, with an ad, "that's a long time spent with a brand, and that's very powerful." Collier says digital technology is giving marketers powerful opportunities because it can build brand awareness like TV, let advertisers "talk" directly to consumers on a one-to-one basis, and do hard-nosed selling like direct mail. "It uses every step of the digital channel," says Collier.

And advertisers seem to be voting with their feet. Consultancy PricewaterhouseCoopers estimates that online advertising spending in Europe, the Middle East and Africa will reach $91.7 million in 2009, an 80% jump from 2004 levels. The resurrection of online advertising is a welcome payoff for Dare, a pioneering and cutting-edge agency that Collier, the former head of London ad agency Bartle Bogle Hegarty (BBH), launched in July 2000. Dare survived the dotcom crash and is now reaping the benefits of widespread broadband penetration. And that's making for competition. Not only have other digital-focused small agencies since opened their doors, but most of the large U.S. and European mega-agencies now have digital ad divisions. Dare's top-drawer clients include Vodafone, Sony Ericsson, Unilever and Diageo.

The Feather ad is a classic viral campaign: Dare originally created it as a treat for Axe's 30,000-strong customer database. But it also enabled viewers to e-mail it to friends and link it to or post it on their own websites — and countless numbers of them have done just that. "At the end of the day, it's word-of-mouth marketing," says Bill Brock, managing director of the London office of digital ad agency Tribal DDB. "It works as long as it's cool, relevant, funny, surprising and, perhaps, shocking." But an ad must also tap into a brand's core value, which the Feather ad does. Notes Nick Emmel, Dare's senior planner: "You get to play with a beautiful woman. The inference is, if you use this product, you might get to do the same thing in real life." Dan Huntley, 25, a software engineer in Aberystwyth, Wales, linked the Feather ad to his blog, scatmania.org. Why? The "geek" in him appreciated the ad's technical accomplishments. But he also thought it was "funny, saucy and kind of naughty."

The medium need not be so racy. To promote Sony Ericsson's K750 camera phone, Dare got consumers in on the act. Magnum photographer Martin Parr, best known for his socially revealing studies of vacationers, was given a K750 to carry with him as he traveled the globe. Each week, he posted 10 pictures taken with it onto a website. The public was invited to send in snaps, too, to see if amateurs could take camera-phone pictures as cool as Parr's. Some 200,000 people sent in pics, and the winners' images were also posted. The campaign proved so successful, a second competition is under way.

And even TV-style ads can be adapted to new formats. BBH filmed a cops-and-robbers-type chase sequence for a TV spot for the launch of Sony Ericsson's Walkman mobile phone. Dare put online an extended "director's cut," in which the actors climb out of the film onto the website. Audi is now going beyond sponsoring entertainment to providing it. Last fall, it launched its own digital interactive TV channel via Sky Digital. It's not just beaming out infotainment about Audi; programming includes coverage of Le Mans auto racing, amateur golf tourneys and polo matches. BBH, which developed the Audi Channel, declines to release audience figures, saying its intent is to raise consumer awareness of Audi, not to be a ratings hit. But Charlie Rudd, BBH deputy managing director, claims viewer response has been positive. "Overall, we're ahead of where we expected to be. It's been a positive addition to Audi's communications mix and one we will develop further." Some of the channel's content is also available on Audi's British website, and more is expected to be added. And, Rudd says, it's "definitely possible" that in the future, viewers will access the channel online, as well as via Sky Digital. Meanwhile, Land Rover in April inaugurated a Web TV channel, Go Beyond, which features lifestyle content from mainstream providers, including the Discovery Channel.

Perhaps the fastest-growing segment of new advertising is inside video games. The in-game ad market is now around $56 million a year, but Yankee Group estimates it could hit $732 million by 2010. And that's largely because gamers are an attractive audience to advertisers. The stereotype of the 16-year-old gamer is a myth. In the U.S., for instance, the typical game-player is a 29-year-old male who plays 12 hours a week. Justin Townsend, head of IGA Worldwide, an in-game advertising agency based in London and New York City, says the potential audience is huge. One ad placed in 10 different sports games that each sell around 1 million copies offers a reach that's akin to a hit TV show. Says Townsend: "We are building up gaming to be a mass-market medium that advertisers can use to hit a mass audience. That's the driving force."

British clothing retailer Ben Sherman is rolling out a campaign in June within the new PC and Xbox game Test Drive Unlimited. Not only will players see Ben Sherman billboards scattered throughout the game, they'll be able to visit a virtual store where they can "buy" clothes. In its real shops, the retailer is setting up pods so customers can play the game in the store. Suzanne Egleton, marketing head for Ben Sherman, has worked in the games industry and thinks games are a great way to reach her target audience of men aged 18 to 34. It's an exciting new medium, she says, "and a lot of brands don't understand it. I wanted to be one of the first fashion brands to use it to target my audience."

But while no one disputes the technical prowess of the new generation of ads, that doesn't mean they actually work. In the case of the infamous Feather, as much as Welsh blogger Huntley enjoyed and shared the site, he didn't realize it was an ad for Axe. Are some viral campaigns too cute by half, thus reducing their effectiveness? Perhaps. But as Paul Bates, ad-industry analyst at London brokerage Charles Stanley, notes, all clever advertising, TV commercials included, runs the risk of being too entertaining and burying the sales pitch: "The most effective ads on TV are the ones that really annoy you because you tend to remember what they're about." Moreover, marketers can take some solace in a recent finding by London consultancy Essential Research. In a small study, it found that while all dvr users like to skip ads, they will stop and watch them if they are visually arresting or advertising a brand or service that's relevant to them.

Advocates point out that digital advertising is eminently measurable. Advertisers can count the number of visitors to their site, how long they remain, if they make a purchase and where they go next. But so far there's no agreement as to which things are best to measure. The old days of TV advertising were simpler. Based on the show's ratings, advertisers paid for a certain number of eyeballs viewing their ads. But avoidance technologies — ranging from simple remotes that make it easy for people to channel surf during ad breaks to dvrs — have raised serious questions about that old formula. "You can count eyeballs, but all that's been demonstrated is an audience has been delivered, not that it's paying attention or is tuned in," says Townsend.

Of course, today's highly sophisticated TV commercials evolved from fairly humble origins. The first TV spot in Britain, a commercial for Gibbs SR toothpaste, aired 51 years ago during a variety show. It featured a tube of Gibbs in a block of ice. As a woman brushed her teeth, an announcer exclaimed: "It's tingling fresh. It's fresh as ice. It's Gibbs SR toothpaste." Not exactly scintillating TV. But give ad execs of the '50s a break. They were just starting to grapple with a nascent but potentially powerful medium — one they eventually tamed through trial and error. And that's a challenge and process not unlike the one facing Dare and other trailblazing digital ad agencies of today. It's an apt analogy, Collier says: "We're in the vanguard of a commercial revolution." And when it's completed, the Axe Feather website will likely seem to an audience in 50 years' time less boldly cheeky than quaintly amusing.

• THOMAS K. GROSE
• Traditional TV ad spots are just so yesterday. In a multimedia age, advertisers are finding new ways to catch your attention