July 2nd, 2007
Young Surfers Spurn Banner Ads, Embrace 'Widgets'
By Emily Steel
Wall Street Journal
A study of attitudes about online advertising shows that, not surprisingly, preteens and teenagers don’t like banner ads and other interruptions from marketers. But the study found that in the right circumstances kids enjoy playing with ad-related features on their personal pages in social-networking Web sites.
The study is likely to prove useful for marketers trying to reach today’s generation of children. It is likely to fuel a push by digital ad agencies to get marketers to experiment with new ways to advertise on social-networking sites such as Facebook and News Corp.’s MySpace.
In particular, the study’s findings may boost advertisers’ use of “widgets,” which are small, easily downloaded computer programs that allow Web pages to be more sophisticated and interactive, with, say, animated graphics, videos, photo sharing, music or live chats. Media companies are rapidly recognizing the value of offering widgets to young people to make their content available online. And advertisers are starting to sponsor widget-based content as a way of spreading their marketing message or luring people to their Web sites.
Based on responses to an online survey of more than 1,200 children ages 9 to 17 and about 1,000 parents across the country, the study found that children don’t want ads posted on their social-network profiles without their permission, says Samantha Skey, executive vice president of strategic marketing at Alloy Media + Marketing. Alloy based its research on a study conducted by Bethesda, Md., market researcher Grunwald Associates LLC.
“Kids have come to view [social-network profile pages] as their yearbook page. It’s their collage. It’s very personal,” says Ms. Skey.
Children will, however, choose to post logos or promotions from advertisers on their personal pages if marketers give them an incentive, whether it is coupons and giveaways or entertaining tools, such as games, video, and animated characters. The study found that 20% of teens added content from a marketer onto their personal Web sites in the last month.
Widgets don’t give advertisers any control over the type of content they’ll appear alongside. But because they give consumers control, they likely fit what kids are looking for, based on the Grunwald study’s findings. “The concept [of widgets] is simple. We are not going to push something in front of your screen. We are not going to annoy you. You choose what you want to engage with,” says Chris Cunningham, vice president of advertising sales at Freewebs, a Silver Spring, Md.-based company that makes widgets for advertisers.
To promote the film “The Golden Compass,” scheduled to hit theaters in December, New Line Cinema is running a site that lets users create a virtual “daemon”—an animal spirit discussed in the film—to post to their blog or MySpace pages, to add to their instant-message profile or to share with friends. Thus far, 200,000 people have created daemons and four million people interacted with them online, according to New Line Cinema, a Time Warner company.
Widgets have “so much buzz now and every advertiser wants to do a widget,” says Marc Fireman, head of digital media for Reebok, which sponsored a widget six months ago. Widgets can include a link back to the advertiser’s Web site, which adds to their attractiveness for marketers.
Still, popularity of widgets doesn’t always translate into sales. To promote the film “Hoot,” about middle-school students who take on land developers trying to build in an area where owls live, New Line Cinema last year created a program that let people download an animated pet owl to their desktops from the movie’s Web site. Web users downloaded more than a million of the critters, which walk around the desktop screen, but the film was a disappointment at the box office.
“The first thing you want to do is somehow engage a consumer. Does engagement equal conversion? Not necessarily,” says Gordon Paddison, executive vice president of new media marketing at New Line. “But just as with any component of marketing, media promotion, publicity and online strategy you have to find the magic sauce.”
For social-networking sites, widgets have a big downside. Because of the way widgets are used—by consumers posting the applications wherever they want—the social networking sites can miss out on any ad revenue even when the widgets are on the site’s pages. Advertisers pay only the widget maker, usually technology firms.
Indeed, MySpace says it can block widgets from its site for “commercial endeavors except those that are specifically endorsed or approved by MySpace.com.” This includes carrying ads—as well as for other reasons such as infringing copyrights.