Brands 2.0: Branded Utility

September 24, 2006

This year’s Advertising Week is rolling around and the big topic is engagement. We hear a lot about what brands are doing to engage audiences online, whether it’s a “viral” clip for a deodorant that gets released on youtube, or a custom myspace profile for a car. On occasion, it’s interesting and entertaining, but for the most part, it’s a joke. This so-called “consumer-participation” is fake. It’s shallow. It’s getting consumers to participate for the sake of reinforcing an advertising message.

Like this:

Seriously? “Who would you give a Volvo to?” …give me a break.

These companies and agencies are creating brand ephemera. It’s not meant to last. It’s an “online component” that’s meant to extend a traditional ad campaign. When the time rolls around, it’s yet another campaign and a new “interactive” website. “Interactive” is a word that’s been slapped onto any flash site with no real value.

Why is this happening? For the most part, big brands and agencies are still trying to apply old-school formulas to the Web. Even though brand and agencies claim to understand the social power of the Web, at the end of the day they’re still only creating one thing: entertainment.

But the Web is about more than just entertainment. We rely on it for knowledge; we rely on it for tools that improve our daily lives; we rely on it to interact and connect with others.

I’m not saying that brands and agencies should stop creating entertainment online. There will always be a place for that, just like there’s a place for great commercials on TV. What I’m saying is that entertainment is only a piece of the whole pie. Given the nature of the Web and how we use it, brands could be doing so much more! Brands could be creating things that are actually useful.

In a recent AdAge article entitled “Consumers to Brands: Make Yourselves Useful”, The Barbarian Group’s Ben Palmer hits the nail on the head:

“I believe the next stage of brand advertising is going to be in the realm of ‘branded utility,”‘ says Palmer. (He co-credits Anomaly partner Johnny Vulkan with coining the phrase.)

Creating something that people need, not aping existing applications because you can, is key, says Palmer. “For the same budget and energy as we expend on current forms of advertising, we could be making something more tangible, useful and reusable that plays a more integral part in the consumer’s life. This is ‘interactive,’ which is not synonymous with ‘online,’ by the way.”

(I met with Johnny for coffee a couple weeks ago and this was the big topic of conversation. That’s when he first mentioned the article and the term “branded utility”)

How to be Useful

Let’s take Nikon for example. Instead of building it’s own mediocre proprietary photo-sharing gallery like Kodak did (which pales in comparison to flickr) what if Nikon built a set of tools that played nicely with existing photo sites like flickr? It could be a simple app that lets your take pictures from flickr and other different photo services, create a slide show, and then spits out a snippet of code for you to drop into your website, blog, or myspace page. Actually, this service already exists. It’s called slide.com:

With slide, I set this up in two minutes:

The point is that this nifty little tool is not just something that catches people’s attention… it’s something they can actually use in their daily lives, and Nikon could’ve built this.

These applications can come in all shapes and sizes. Here are a few more hypotheticals:

• What if Volvo built a desktop widget that pulls information about local traffic and road conditions? That way they could promote safety by actually helping people avoid hazards.
• What if Staples built Backpack before the 37signals guys did? What better way for an office supply store to champion organization and productivity than to build a tool that makes us more organized and productive?
• What if Citibank pioneered 43things, a site dedicated to wish and goal fulfillment and connecting people with similar goals? It brings home the “there’s more to life than money” tagline so much better than any 30-second spot could.

Web 2.0

There’s another fascinating element in this equation. It’s a movement called Web 2.0. Although it has many definitions, from a business perspective it’s characterized by a return to the optimism of the pre-dotcom-crash days. I think Paul Graham captures it perfectly when he says, “build something people want” and worry about the business model later. A big part of Web 2.0 is the reliance on existing services: the idea is that there are now all kinds of services that provide chunks of data for anyone to mash up and use. Because of this, developers don’t have to build everything themselves. Need to add mapping? Just use Google maps’ API. As a result, startup costs now are much smaller than the old days, and new ventures are popping up left and right.

However, the biggest criticism of Web 2.0 and the if-you-build-it-they-will-come mentality is that building cool apps and giving them away for free still isn’t the best way of starting a profitable business. Sure it’s easier than ever to get started, but it’s not quite as easy to stay financially viable. This 24-minute video of interviews with a number of startup CEOs gives an excellent overview of Web 2.0 and all its meanings and criticisms.

The State We’re In

So, on one hand, brands and their agencies are struggling to engage people and make themselves relevant and useful. On the other hand, small startup teams are building cool and useful applications but still struggling to find a viable business model. Hmmm…

2+2

Right now brands have a tremendous opportunity, because they can build these applications and give them away for free! Or… they can step in and support a cool existing application (one that might not be able to generate is own profit) and even make it more widely available to the public. Web 2.0 is still on the fringes of mass culture, yet brands can tip web 2.0 into the mainstream. The cost to these brands could be as little as a fraction of their multi-million-dollar marketing budgets.

There are also certain applications that only big brands can build. I’ve written about the brilliance of Nike+iPod, and I think it’s going to be a poster-child for the era of branded utility. The total integration between the shoes, devices, and offline/online activity is something that only companies with Nike and Apple’s global reach and product lines could’ve pulled off. For the past few years, R/GA’s Bob Greenberg has been a strong proponent of what he calls pull vs. push advertising. The premise is that traditional advertising tries to push a message onto its audience, whereas with ‘pull’, you’re creating something that people actually want. Branded utility is ‘pull’ at its very best.

The Elevator Pitch

You can spend millions on a flashy ‘interactive’ campaign that people try to ignore or you can put that money towards building something that could actually improve their lives; something that they could use and interact with every single day; something that they’d actually seek out. At a time when people are constantly asking “what’s in it for me?”, isn’t it blatantly obvious that the best way to engage someone is to be useful to them?

What now?

Embracing branded utility requires a fundamental shift in the role of agencies. Agencies have to stop thinking like they’re purely in the entertainment business and start thinking like they’re also in the product development business. Agencies also need to bring in people who understand the Web and its capabilities. Designing a web application is closer to architecting a building than it is to laying out a print ad; the creators have to understand how people interact with and navigate the space, how they interpret the signs, and even what happens when they’re outside of the space you’ve set up for them. That’s why shops like R/GA, which actively brings technologists and programmers into project teams, will be leading this revolution.

As Ben says in the previously mentioned interview,

If we do this right, we can actually have a good relationship with ’the consumer’ for once. How nice would that be?

Related Links and Discussion:

Consumers to Brands: Make Yourselves Useful (via AdAge, subscription required).
Advertising’s New Idea: Don’t Push the Product; Pull the Consumer Instead (Washington Post)

There have been a few discussions related to branded utility in the blogosphere:

• chroma: “Branded Utility”
• Big Picture Advertising: Branded Utility
• Talent imitates, genius steals: Zero Sum Communications

As always, Technorati is a good way to monitor further discussion.

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