Beverage Industry

No Such Thing As a Free Launch

July 1, 2007

No Such Thing As a Free Launch

Sarah Theodore
Editor

To many, the rise of Internet blogs and viral marketing seemed to spell gloom and doom for traditional marketing of consumer packaged goods. But two studies released this month indicate companies shouldn’t scrap the tried and true just yet, and they should be prepared to put money behind their new brands, even if they’re looking for attention through free media.
Nielsen BuzzMetrics reports that the companies that spend the most on traditional media also tend to generate the most Internet buzz. According to the study “The Origin & Impact of CPG New Product Buzz,” the top 10 percent of new products with the most Internet buzz spent nearly $20 million in paid media for the launch. The next 40 percent of products were backed with an average $15 million in marketing spending, and the remainder spent an average of $5 million.
“Splintering media, along with emerging consumer-generated media are challenging one-way, mass-media advertising models,” said Robert Mooth, author of the study, in a statement. “However, our analysis shows that traditional mass media continues to play a critical role for most CPG brands. What has changed is that online buzz and consumer expression have entered the fray, resulting in a complex, yet inseparable relationship within the overall marketing mix for many types of products.”
Bloggers potentially can feature any product, but the report says 85 percent of Internet content came from only 10 percent of products. Edgy brands — as any energy drink maker will tell you — are among the top 10 percent of products discussed on the Web. Everyday items are far less likely to stand out online.
As if on the same wavelength, Information Resources Inc. also released its new Long-term Drivers Consortium study. Among the findings: television advertising and distribution are key drivers of long-term growth. The company measured five years of brand histories across 10 product categories to sort short-term success from long-term, and found TV advertising was the largest driver of success .
In the Web’s defense, the BuzzMetrics study did provide “the first-ever evidence that buzz volume can positively influence sales.” The moral of the story: newer isn’t necessarily better, but it can be very complementary.
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