Lexus is continuing its up-shift to a more masculine, performance-oriented proposition with a highly, um, anatomical sponsorship of Sports Illustrated Swimsuit Launch Week. Lexus is using the campaign, which comprises ads and video assets pertaining to a competitive driving course vaguely shaped like a supine woman, to spotlight the 2013 GS, the sport sedan featured in its Super Bowl ad. The theme of the campaign around the partnership is that the GS can handle all kinds of curves. All kinds. The campaign called TORI 500 involves a racetrack that is intended as an elaboration of the body lines of Tori Praver, one of the models featured in the swimsuit issue. The online video at Lexus.com/tori500 or youtube.com/lexus has two pro drivers, racer Scott Pruett and stunt driver Greg Tracy, competing on the TORI 500 track to see which of them gets to take Praver on a test drive around her body. There is also a four-page spread in the Feb. 14 Sports Illustrated Swimsuit issue and custom tablet integrations on iPad, Samsung Galaxy, Xoom and Nook. Ads, which show Praver in a bikini walking away from the car, say: "From this car forward, there's no going back." The company is also promoting an iPhone app called Supermodeled that lets people insert photos of Praver into pictures they shoot. The automaker will also be part of the issue's events in New York and Las Vegas, the latter called "SI Swimsuit On Location" and "Club SI Swimsuit." Lexus also serves as presenting sponsor of the inaugural, two-day "Beauties & Beats Music Festival" on Feb. 15 and 16 at The Cosmopolitan of Las Vegas. Sports Illustrated says the 47-year-old SI Swimsuit Issue program, including the events around it, reach more than 70 million people per year and more 18- to 34-year-old men than the Super Bowl. There are, according to the publisher, some 20 product extensions in digital/social, broadcast, publishing, mobile and consumer products. The campaign is part of one of Lexus' largest efforts to date. Via El Segundo, Calif.-based TeamOne, it promotes the Lexus lineup as more design forward, more aggressive, and sporty, with the new GS as the poster car. Lexus also touted the GS sedan in the Super Bowl with a spot via San Francisco-based Attik.
In its first quarterly report since going public in December, social games powerhouse Zynga posted a net loss for the fourth quarter, but beat analyst estimates for its adjusted earnings. The company had a net loss of $435 million, or $1.22 a share. Excluding certain costs, it would have earned $37. 2 million, or 5 cents a share. Revenue increased 59% to $311.2 million. Analysts had forecast adjusted earnings of 3 cents a share on revenue of $302 million for the quarter ending in December. Zynga, creator of popular games such as FarmVille and Mafia Wars, pointed to continued gains in usage in the fourth quarter. It said daily active users (DAUs) increased 13% to 54 million from a year ago, while monthly active users (MAUs) rose 23% to 240 million. Average daily bookings (or revenue) per daily user rose 11% to 61 cents. It also reported a new metric -- monthly unique payers -- which was up 13% to $2.9 million in the fourth quarter from $2.6 million in the third quarter. Zynga’s $1 billion IPO late last year didn’t live up to the hype as its price slipped below the $10 offering price on the first day of trading. On Tuesday, however, the stock hit an all-time high of $14.55 before closing at $14.33, on rising investor sentiment. Still, the company needs to convince Wall Street that it can expand beyond Facebook, which accounts for nearly all of its revenue and takes a 30% cut of sales it earns from the platform. Building up its mobile business is a key to Zynga’s strategy to drive growth independent of Facebook. In that vein, the company said mobile titles Dream Zoo, Words with Friends and Zynga Poker showed strong uptake during the quarter. They were among the top 10 grossing games on iOS devices duirng the quarter, and are among the first of what are expected to be many more mobile titles from Zynga. JP Morgan analyst Doug Anmuth expects Zynga to publish up to 15 games this year, 10 of which may be for smartphones. The company launched 12 games in 2011, including eight for mobile devices and four for the desktop Web. In recent months, Zynga has also has acquired several mobile gaming start-ups, including the Germany-based Gamedoctors and Page44 Studios in San Francisco. In its IPO filing last year, the company had stated, "our growth prospects will suffer if we are unable to develop successful games for mobile platforms." Looking ahead, the company projected bookings to be in the range of $1.35 billion to $1.45 billion for 2012, with stronger growth coming in the second half of the year. Adjusted net income will fall between $390 million and $440 million. Analysts are forecasting earnings of 4 cents per share on revenue of $319 million for the current quarter ending in March. In a research note Tuesday, Anmuth said he expects strong growth at Zynga in the first quarter on the strength of newer releases, including CastleVille and Hidden Chronicles. Zynga shares were down about 7% in after-hours trading to $13.35 on Nasdaq.
When it comes to watching entertainment programming, it turns out size doesn’t matter as much as people previously thought (or hoped). According to a new study conducted by Chadwick Martin Bailey (CMB), consumers are using their tablets and smartphones to stream video programming at an increasing rate, and they’re doing it in their homes, where televisions are available. According to the survey of nearly 1,500 consumers, 58% of people who viewed programming on a tablet did so in their homes -- and of these, 63% did so even though the program they were watching was available on their televisions. “The big media companies have been comforted in this notion that the biggest available screen is always going to win in any situation,” Peter Fondulas, founder of Fondulas Strategic Research, which worked on the project with CMB, tells Marketing Daily. “That may have been true a while ago, but people have become more open to devices and may even prefer [smaller screens] in some situations.” The survey found significant members of all demographics have watched video programming through a device other than their televisions. While 74% of consumers ages 16-29 had watched programming online, 39% of consumers 50-75 had also watched a television program or movie online. And their preferred method of watching such programming is either through a network Web site (27%) or Netflix (24%). Only 12% of consumers said they watched through their TV provider’s Web portal (such as Comcast’s Xfinity.com). Such findings could have serious repercussions as the cable and satellite industries work to continue their business models in the new era of Internet-connected television. According to the study, 43% of consumers said they’re likely to cut back on cable spending in the next year. However, the companies’ greatest fear (consumers cutting the cord entirely and opting for an Internet-only model) is less likely. Only 3% said they’d cut their cable entirely. More likely, consumers will be looking to “shave” services, such as cutting premium and non-premium channels, removing HD boxes and cutting down the number of boxes in their houses. “The people that we see shaving their pay TV service are in essence creating their own a la carte plan,” Jon Giegengack, a director at CMB, tells Marketing Daily. “My own hunch is that pay TV will have to switch to a model more like that. as there’s more attrition.” With the inevitability that more people will look to the Internet to watch television and movie programming (particularly with more Internet-connected televisions in the home), the opportunity is wide open for a company to come in with a different model that appeals to consumers’ individual tastes, Giegengack says. “One of the barriers we found [to cord shaving] was the ambiguity of what the options are and the services [consumers] have,” he says. “There’s this increasing group of people who are on deck and know that there are better of options available, but haven’t yet cut the service.” The company that does succeed will likely have to be strong on the three fronts that consumers said were important to them: streamable content (as opposed to owned content), a wide variety of programming available and, most of all, ease of use. “Lots of companies are working hard at this, and it’s only a matter of time before someone does,” Fondulas says.
The post-PC era is upon us, Apple CEO Tim Cook reiterated yesterday (Feb. 14) in a keynote for a Goldman Sachs conference. He reported that the iPad and iPad 2 have sold more than 55 million units to date -- “something no one would have guessed.” Cook explained that sales of the device have been “off the charts” and that people are quickly integrating tablets into more of their everyday digital media consumption. “But I strongly believe the tablet market will surpass the unit sale of the PC market, and it’s just a matter of the rate and speed and time that that happens,” Cook said. Cook’s quotes come from a transcript of the talk published by CNNMoney. BI Intelligence lent some support to Cook’s prediction in its new report claiming that tablet sales will reach 500 million a year worldwide by 2015. Including e-readers in their analysis, BI expects a compound annual growth rate of 50% for the category of devices for the next five years. Lower prices and growth in the sub-$500 segment will help drive the market, as will increasing adoption in enterprise and education. Cheaper tablets will also have a strong appeal in emerging markets, giving more people a lower barrier to digital entry. Cook even noted that there has been some cannibalization of Mac sales by the iPad. But when it comes to cannibalizing sales, he said, “we prefer we do it than have somebody else do it.” Still, he believes tablets will eat more into Windows PC sales than into Macs. Addressing directly the issue of pricing and Amazon specifically, Cook acknowledged that its rival’s $199 Kindle Fire entry into the market showed “different strengths” from the iPad. “Amazon is a different kind of competitor,” he said. “They’ll sell a lot of units -- I think they have and they will. But the customers that we’re designing our products for are not going to be satisfied with a limited function kind of product,” he added. According to many reports, Apple is set to reveal its third-generation iPad in early March, complete with a substantially upgraded display and faster processing. Cook also addressed a range of issues that have been reported around the Apple brand in recent weeks. Controversy over working conditions across the Apple supply chain internationally has sparked investigations. Cook says Apple tries to educate managers and workers throughout the supply chain about their rights and working conditions. He said that eliminating underage labor in the supply chain is a priority, as well as imposing a code of conduct across suppliers that includes a 60-hour work-week cap. As a result of violations, he claims that Apple is beginning to micromanage work hours, and claims 84% compliance. Cook also reported that 37 million iPhones had been sold in the last quarter. He notes that China represents one of the largest growth opportunities for Apple. The newly launched iCloud storage service that synchronizes apps and content across devices will have a profound effect on the company, he said. Since October over 100 million people have signed in using the iCloud. “It’s a strategy for the next decade or more,” he added. On the topic of entering the TV business Cook remained as obtuse as ever. He reported that Apple TV sold 1.4 million units last quarter, showing a growth trajectory. Despite widespread reports that the company is working on an Apple-branded TV system, Cook maintained the long tease. “We’ve always thought there was something there,” he said, although reiterating Steve Jobs’ famous characterization of Apple TV as a “hobby.” “And that if we kept following our intuition and kept pulling the string, then we might find something that was larger.”
The full media court press that is the Valentine’s Day drop of Sports Illustrated’s legendary swimsuit issue has had mobile extensions for years. Calendar apps, model apps, enhanced magazine editions -- all have been in the portfolio of digital releases. Part of the franchise’s larger marketing role is to demonstrate the sports brand’s mastery of cutting-edge media. And this year is no different. Bikini and bodypaint lovers will see their favorite models in apps across iOS and Android devices this week. This year SI introduces a new way to leverage mobile interactions with print. A dedicated Swimsuit Viewer app for iOS and Android recognizes models in the magazine and serves up additional content. Employing Digimarc watermarking technology, the app uses the device camera on select pages to trigger 19 relevant videos in the app. The effort was done in partnership with mobile marketing company Nellymoser and sponsored by DirecTV. The companies say this is the first time that a top 100 magazine has used watermarking technology to promote video content. While 2D codes in magazines are not new by any means, the implementation here denotes two trends in mobile code use in magazines. First, while the use of QR codes and other coding systems has become rife in magazines, both magazine designers and many advertisers recoil at the intrusion of these codes in otherwise sculpted visual design. Watermarking hides the visual cues and lets the underlying artwork fill a page unimpeded. And unlike other uses of 2D codes, which require some third-party scanning app, the SI project maintains a branded experience. The SI branded app gives the publisher the opportunity to create a scanning environment that is its own and can even be sold to a sponsor like DirecTV. And this being the wall-to-wall affair the Swimsuit issue tends to be, the Viewer is not the only app to include models. The freemium SI Swimsuit 2012 strips the franchise down to its g-string essentials -- photographs. In this year’s version of the app, however, developers have included a 360-degree view of the three bodypainted athletes that is available only in the smartphone versions of the franchise. The Swimsuit app employs in-app purchases to get beyond image sampling. A $6.99 upgrade (free for SI subscribers) unlocks the full trove of content.
Don’t just know your audience. Know where they’re watching your videos and your video ads. Because video viewing habits — from completion rate to engagement — vary widely depending on the device in front of a consumer’s eyes when an ad appears. That’s the conclusion of online video technology provider Ooyala’s latest quarterly report, released today, that analyzes video ad viewing habits across connected TVs, computers, tablets and mobile phones. Specifically, Ooyala found that viewers are more than twice as likely to complete a video when watching on a tablet or connected TV compared to a desktop. The completion rates for connected TV ads makes sense intuitively — connected TVs are lean-back devices and viewers are less inclined to skip an ad or switch to another site, app or show. Similarly, iPads and tablets offer fewer distractions so viewers may opt to watch ads more. “Engagement is strongly influenced by the type of device used to watch a video,” said Bismarck Lepe, Co-Founder and President of Products at Ooyala. “Our data shows that videos over 10 minutes in length have 45% higher engagement on tablets than either desktops or mobile devices.” Viewers on connected TVs and gaming consoles are most likely to watch a video all the way through — at a rate of 47%, with tablet owners completing videos 38% of the time. Mobile viewers had the lowest completion rates. Even with the range of completion rates, viewership across non-desktops skyrocketed, suggesting consumers are indeed watching videos across many devices. The share of non-desktop views more than doubled in the fourth quarter. So what lessons can media planners and buyers learn from these findings? As video ad viewing and buying becomes more multi-platform, marketers need to evaluate each medium on its own merits, look closely at the specific results of each campaign on each platform, and determine then where it’s best to spend their money. Because the data is available to show where ads are working and where they aren’t working. The Ooyala research comes from a cross section of Ooyala’s more than 100 million unique viewers watching Ooyala-powered videos across various sites.
Trying to convince a brand to spend millions -- even thousands -- to build a campaign with an emerging technology isn't always an easy sell. Traditional marketers may not understand the benefits behind using virtual reality, or short-wave radio frequencies to serve up ads on a smartphone running the Android operating system (OS) Ice Cream Sandwich. At first glance, it might not be apparent why Apple would want to purchase a semiconductor manufacturer, or Google a smartphone maker. So under construction at the Googleplex in Mountain View, Calif. sits a 120,000-square-foot center dubbed the Google Experience Center, a private museum that demonstrates emerging technologies to Google's important clients. Think of it as the expansion of research and development business units. It follows moves by tech giants like Microsoft, IBM, Intel, AMD and others that built out facilities to show off their wares. "Just as we continuously work to improve our products, it's important to iterate on our workspace to keep us productive," said a Google spokesperson. "That's why we are adding additional meeting and work space to our campus in Mountain View." Showing always works better than telling -- especially when the story includes technology that clients really don't understand. Even ad agencies like IPG Media Lab began building facilities last year to showcase emerging technologies. Sometimes having the ability to experience the technology becomes necessary before it gains traction and acceptance. That could be the case as the online ad industry relies more strongly on technology. While most marketers only care that emerging technology works, others want to know how and why it works before sinking money into the project. Here's a bit of trivia for those who want to know how Apple's iPhone eventually captured the attention of U.S. marketers. It turns out that Steve Jobs finally approved the project to build the iPhone after Apple engineers assured him the ARM11-powered processors could handle the convergence of voice, data, music and video, according to EE Times. To make it work, Apple acquired PA Semiconductor in 2008 during the early days of the iPhone and the conception of the iPad. While Google makes the majority of its revenue from advertising, the company's model was built on an emerging technology -- the World Wide Web. First and foremost, Google produces innovative applications from emerging technologies. Even as students, Sergey Brin and Larry Page put emerging technologies first when building their "large-scale hypertextual Web search engine." The school paper explains the prototype. Showcasing the possibilities, the Google Experience Center will become even more critical since the E.U. and U.S. Department of Justice have approved Google's Motorola Mobility acquisition. The company will rely on the model that brings in hardware devices supporting advertising based on content delivery and sales across mobile, desktop and TV.