August 20th, 2007

Building Buzz for Ellis Island -- and Shirts

By Stephanie Kang and Suzanne Vranica
Wall Street Journal

PVH's Arrow Launches Social-Networking Site Full of Immigrant Tales

If you build it, will they come? And will they want to buy shirts?

Phillips-Van Heusen, the New York apparel company, is about to find out. Like many other marketers that have taken note of the wild popularity of Facebook and MySpace, PVH wants to get into social networking.

For Arrow, one of its oldest brands and best known for men’s shirts, the company has created its own social-networking site. Its efforts will become part of a continuing Madison Avenue debate about social media’s usefulness to advertisers.

In a new $20 million print, TV and Web ad campaign, Arrow will play up its American roots by sharing stories of immigrants coming to the U.S. through Ellis Island. Celebrities such as “American Idol” singer Katharine McPhee and former cast members of HBO’s “The Sopranos” provide the stories, along with noncelebrities. Arrow, which was founded 156 years ago, uses the brand tagline “Authentic American Style.”

But the linchpin of the campaign is a social-networking site dubbed weareellisisland.org, where users can find immigrant stories, as well as post their own videos about Ellis Island.

Rather than try to get consumers to talk about shirts and ties, PVH said it launched the social network as a way to create buzz for nonprofit groups that are trying to save decaying buildings on Ellis Island.

“Emotion, customization and building a community—you need those three to be successful today,” says Michael Kelly, PVH executive vice president for marketing.

Advertising on social networks has exploded over the past year as marketers increasingly seek new ways to reach consumers who are spending more time online. Advertisers such as Procter & Gamble, Nike and General Motors have jumped on the bandwagon, with varying degrees of success.

Because of the onslaught, ad experts are starting to question the approach. “Just because everyone is doing it, doesn’t mean it’s a good idea,” says Greg Smith, chief operating officer of the North American operation of Neo@Ogilvy, an interactive ad agency owned by WPP Group’s Ogilvy & Mather.

Marketers are forecast to spend $900 million in the U.S. on social-network advertising this year, almost three times what they spent in 2006, according to market-research firm eMarketer. By 2011, eMarketer says it expects spending will more than double to $2.5 billion from this year.

In the past, marketers experimenting with social networking have focused on MySpace and Facebook, creating profiles for their brands or widgets around their products that users can send on to others as virtual “word of mouth.” The idea was to tap into the sites with the greatest number of users.

But a growing number of tools have made it easier for companies to create their own social networks, even as some ad experts caution consumers might have “social-network fatigue.”

“The last thing the Internet needs is another social network, unless you build a very specific social network for a community that’s underserved,” says Chad Stoller, executive director of emerging platforms for Organic, a digital-marketing unit of Omnicom.

PVH’s Mr. Kelly acknowledges that the glut of social-networking sites makes it a challenge to get users to come to Arrow’s site. But he says the site’s anecdotes about real-life people will grab the attention of a portion of the roughly 100 million Americans who can trace their roots to Ellis Island. “If you’ve got good content, people come,” he says.

Driving traffic to the site won’t be easy. Companies need to invest real money in ads for their sites to be noticed. As a result, many marketers have opted to hook up with ad portals such as Google or Yahoo because they already have high traffic levels. Earlier this year, when Procter & Gamble set up a social-networking site for women to discuss subjects such as weight loss and pregnancy, it decided to create the site on a section of Yahoo to take advantage of the Web portal’s high traffic volume.

Others think that social-networking sites, executed correctly, can help a company maintain a long-term conversation with its most ardent fans.

“You’re not looking for massive impressions, you want to go deeper with a smaller set of people,” says Peter Friedman, chairman of LiveWorld, which has created social-networking sites for clients such as Dove and BMW.

“The same kind of talents in judgment that we apply in other things in marketing applies to this as well,” says Baba Shetty, director of media and digital at Hill Holliday, a unit of Interpublic Group. “You do not say, ‘Yep, check, I’ve got social networking.’ You have to think: ‘How are we going to do it?’”

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