10 Companies Whose Customers Do the Advertising for Them
Some companies luck out, finding their buyers are also their marketers.
A decade ago, Nick Woodman, Founder and CEO of GoPro, was just trying to figure out a way to film himself and his friends riding gnarly SoCal waves when he invented the first GoPro prototype. Today, Woodman is a billionaire, with a company that's doubled in revenue every year since 2004. GoPro sells cameras that are light, waterproof, and durable, and can go just about anywhere -- perfect for people who like adventure and extreme sports. The cameras capture video, stills, slow-motion, and time-lapse, and can be strapped to just about anything: ski helmets, surfboards, kayaks, climbing gear, and Formula One race cars. Its simple interface, high-quality image capture, and price point below $400 have made it the number-one selling camera in the world. One of the most recognizable user-generated content campaigns hasn't hurt either.
In a recent interview with Anderson Cooper on 60 Minutes, Woodman explained how the abundance of GoPro videos being uploaded to YouTube (NASDAQ:GOOG) and the Web have created a surplus of user-generated marketing material for the company. When a GoPro-shot video of a fireman resuscitating a kitten went viral, it became "essentially a commercial for GoPro," says Woodman. The CEO employs a team of people constantly searching the Web for videos shot by GoPro's most effective sales force: its customers. "It's a marketer dream," he explains. "And it's all based off of authenticity. It's our customers doing interesting things around the world so stoked they are able to document and share with people the things that they do ...that when they share the video, the often give [GoPro] credit."
In 2008, a joint study by Duke and Waterloo Universities found that exposure to well-known brands can influence a consumer's behavior, prompting a person to mirror those brands' perceived values. The researchers chose to compare reactions people had to Apple's (NASDAQ:AAPL) logo versus IBM's (NYSE:IBM) and found that those exposed to the Apple symbol scored 20-30% better on a simple creativity test than those who saw the IBM logo. As Professor Gavan Fitzsimons of Duke's Fuqua School of Business told NPR in an interview, "People find that when they think about the Apple logo, they think very strongly about associations with creativity. When they think about the IBM logo, they think about a general notion of competence or professional[ism]." Moreover, even when subjects were shown these logos for the ever so brief duration of 30 milliseconds, not long enough to consciously recognize it, they had the same responses.
We can't prove it, but we're willing to bet that the image of a glowing Apple logo on the back of virtually every laptop in urban coffee shops has another effect on consumers: It makes creative people, or people who want to be creative, crave an Apple computer. The net effect of all those logos is an advertisement for the brand that told us to "Think Different." Yeah, we know -- it's ironic.
Facebook (NASDAQ:FB) was first an online haven for college students. Then, in expanding its reach to high-school students, it became a critical element of most American teenagers' daily lives. But when everyone else started flooding in, including teachers, parents, and grandparents, the service lost some of its edge for teenagers -- which was, of course, was the last thing the company wanted. Though reports this summer of teens leaving the social network in droves were a bit hyperbolic (a Pew survey from May 2013 found that a full 94% of teen social media users have a Facebook profile), Facebook certainly has taken the teenage problem to heart. In April 2012, a year before the Pew report was released, Facebook acquired Instagram for $1 billion. The move was considered by many to be an attempt at retaining teenage users.
Instagram launched in October 2010, and by the time it was snatched up by Facebook, it had attracted 100 million active users who were posting photos, editing those photos with custom filters, and commenting or "liking" the edited photos of friends. Users share their photos for their own purposes, to show their friends a beautiful landscape or building, or to play with artfully colored or tinted filters on "selfies." Celebrities are all over Instagram promoting their personal brands. In all cases, the images further the app's popularity, and in turn, Facebook's.
Michael Erb is a man of many obsessions. He likes telescopes, audio speakers, exfoliating facial wipes, and more, all evidenced by his 850-plus product reviews on Amazon.com. Recently featured on NPR's Planet Money, Erb told host Robert Smith that some days he'll spend upwards of 10 hours testing and writing detailed reviews of products -- all without pay. It's this dedication that's earned Erb the number-one rank among reviewers on the site, a position with considerable influence. Smith calls Erb, who lives in Syracuse, New York, a modern-day Don Draper, "someone who can make or break a product with just a few words." And Erb is not alone. There are hundreds of reviewers out there like him, spending countless hours reviewing products for free.
This is a boon for the folks at Amazon (NASDAQ:AMZN), who've noticed a product with user-generated reviews sells better than one without them, even if the reviews are negative. While Amazon doesn't technically pay for the advantage, it is guilty of going to great lengths to keep reviewers engaged. Employing an indiscernible algorithm, it has made the ranking system impossible to game and sparked a sense of competition among reviewers. Once reviewers reach the top ranks, life is good. They get fan letters and, as Smith puts it, a feeling of satisfaction knowing they have the power to change the marketplace. There's also the invite-only Amazon Vine club. Vine members choose products off a biweekly list that Amazon sends to them for free. Erb says he's accumulated thousands of dollars worth of products since he was invited to join. But there's a catch: Amazon still technically owns these products, and when it wants the them back, Erb has to oblige.
What's better than a mobile advertisement that's constantly being moved around New York City by people paying for the privilege? How about 6,000 mobile advertisements constantly being moved around New York City by people paying for the privilege. Launched this summer, NYC's Citi Bike program has been a roaring success, with 10.4 million miles cycled over 5.4 million trips by over 94,000 annual members and pass holders. Citi Bike is the largest bike-share program in the US, with plans to expand to 10,000 bikes in 2014. (This still pales in comparison to the world's two largest bike-share programs, the Wuhan and Hanzhou public bicycle programs in China with 90,000 and 60,000 bicycles, respectively.) Ten thousand branded bikes equals a lot of ad space for Citigroup (NYSE:C), the official sponsor behind the program, whose logo is featured prominently on every bike as well as on each of the 330 docking systems placed across Manhattan and Brooklyn.
The exposure didn't come cheaply. Citigroup paid New York City $41 million to brand the bikes, in turn lifting all cost burdens off New York City taxpayers. From an ad-spend perspective, it might seem pricey. But we're talking about the same company that spent $1 billion on its Live Richly campaign (which ran from 2001 to 2006). And this new venture seems to have already begun to pay off. Bloomberg Businessweek reports that on Citigroup's own scale of the bank's popularity, "favorable impressions of Citi" rose 17 points from the program's launch in May to July. YouGov, an independent brand company that runs brand sentiment polls on a daily basis, showed Citi moved from negative to positive public reception within a month of the Citi Bike program's launch. Seems like the bikes are working.
Many video gamers record their in-game antics to show off their skills on social media sites like YouTube and Facebook. As they demonstrate their talent, these players inadvertently advertise the game. And since these videos often depict unusual or funny ways of playing, they make the game itself seem even more compelling. Essentially, a user-generated video can often show potential consumers a more in-depth glimpse of a game than any television or print ad can.
Take this video, for example, posted by YouTube user "CaptainSparklez" and featuring online, multiplayer gameplay in Minecraft, a game that allows users to build structures and landscapes with Lego-like blocks. The video depicts the game's "Survival" mode, in which players have to gather resources from their pixelated environment in order to stave off digital beasts. These players decided to give their match a Hunger Games theme, inadvertently advertising not only for Minecraft, but also for the Hunger Games book and movie series, the latter of which has made a mint for Lions Gate Entertainment (NYSE:LGF).
Many more Minecraft videos depict virtual structures that players have taken hours of concerted effort to create, like a massive cruise ship created on the Xbox (NASDAQ:MSFT) version and a full-scale model of the USS Enterprise from Star Trek. In the case of the latter, the original creator posted a video to advertise the framework he had begun, essentially recruiting workers to help him finish the mega-project. With over 12 million views, the video has become a recruiting tool for the game as well, demonstrating for potential players how immersive, collaborative, and creative Minecraft can be.
American Girl Dolls
In 2009, John F. Sherry Jr., a professor of marketing at Notre Dame University, published an article entitled "Why Are Themed Brandstores So Powerful? Retail Brand Ideology at American Girl Place." For his research, Sherry and his team spent three years observing the flagship American Girl Place showroom in Chicago, studying how the company shaped its brand and how consumers bought into it. That flagship store is three stories high and populated with dolls, clothes, books, accessories, a theater, a café, a doll hair salon, and lounge areas. Sherry non-ironically referred to the store as a "pilgrimage site for girl consumers," and wrote about how girls their families attach a set of meanings to their dolls and the retail experience, which not only allows for, but encourages interaction with dolls, other shoppers, and the company itself.
Kids visit the store with their dolls, and leave with a strong relationship, so to speak. In this case, the user-generated marketing comes from girls carrying their dolls in public, taking them to school, to birthday parties, to playdates, and to sleepovers. With American Girl dolls, the company has developed an interactive ecosystem in which young consumers can develop a relationship with an inanimate friend who ultimately joins a circle of real friends. And most of those real-life playmates are going to ask mom and dad for an American Girl doll of their own.
Long before emails were being sent from Apple iPhones and Samsung (OTCMKTS:SSNLF) Galaxy smartphones, they were being sent from BlackBerrys. It was a time when the thought of a BlackBerry (NASDAQ:BBRY) buyout -- let alone a collapsed $4.7 billion takeover followed by a plan to shake up management and raise $1 billion in convertible bonds in order to save the struggling firm -- would have been ludicrous. It was a time when BlackBerrys were cool, and, as journalist Matthew Garrahan (an admitted BlackBerry user) puts it in an article for the Financial Times, "loss of cool can be devastating for a brand."
Before the company's devices fell to the wayside, overshadowed by apps, touchscreens, and media capabilities, they were lauded for their physical keyboards, BBM messaging service, and mobile email capabilities. At its height in the early 2000s, what better user-generated marketing could the devicemakers have asked for than to have every single email sent from a BlackBerry phone be appended with the words, "Sent from my BlackBerry"?
Foursquare essentially allows users to advertise their social lives -- or at least, in what places their social lives take place -- by letting them "check in" to businesses and locations. Moreover, the app awards users with badges for completing certain check-in goals. For example, users can win the "School Night" badge by checking in somewhere after 3 a.m. on a school night. Another, the "Brooklyn 4 Life" badge, is unlocked by checking into 25 locations in Brooklyn (see a full list of Foursquare badges here). Moreover, with enough check-ins, a user can become the "Mayor" of an establishment (check-in volume battles for Mayorships are common).
The act of checking in serves to market the app itself, as updates can be posted on Facebook, Twitter (NYSE:TWTR), and other social media. Some companies, like the History Channel, have taken Foursquare marketing even further.
Besides its headquarters on East 45th street in Manhattan, the History Channel does not have physical locations where its fans can check in. What it does have is a wide range of historical landmarks and locations to capitalize on. If users follow the History Channel's page on Foursquare (it currently has 769,779 "likes" on the app), they receive a brief message every time they check in somewhere with any kind of historical significance. For example, if they check in at the Magic Kingdom at Disney World in Orlando, Florida, they receive this message: "The park opened in 1971 and is the world's largest and most visited recreational resort. Walt Disney passed away before he saw his vision of Disney World completed."
We know you've been there, innocently walking down the street when a waft of familiar, pungent aroma smacks you across the face. You turn to your friend beside you and say, "Woah, do you smell that...weed?" Regardless of whether your eyes brighten with childlike giddiness or fall heavy with disapproval, you can't deny marijuana's got one of the best inadvertent marketing tools around: its unmistakable smell.
With marijuana laws liberalizing across the US, one could imagine towns and cities becoming increasingly overwhelmed by skunky aromas. This has already become a problem in Denver, Colorado, where pot was legalized last November. The city has received numerous complaints about the presence of the odor. Now, a newly proposed ordinance would make the possession and sale of pot in parks and other public places illegal, and prohibit the smell of marijuana smoke coming from private residences. This "odor ordinance" would see fines of up to $2,000 doled out to offenders of the olfactory restriction, which is breached when an air sample contains eight parts odor to one part air. That's where licensed smell investigators like Ben Siller make their entrance, reports NPR. Siller uses a device -- reminiscent of the Smell-O-Scope machine created by Professor Farnsworth on the TV series Futurama -- called the Nasal Ranger to detect odorous infractions.
However, Siller recently explained to the Denver Post that it has been 20 years since anyone clocked in above the legal scent limit for weed. As for those still worried they might get fined for lighting up in their own backyards, the drafted ordinance has recently been amended to protect residents smoking pot on private property, CBS 4 Denver reports.
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