MediaFile

Perrier wants to tell you where to go out tonight

By James Ledbetter
The views expressed are his own.

Last year on a drizzly Seattle morning I visited the corporate headquarters of Starbucks to talk about social media. At the time, Starbucks had about 2 million of what were then called “fans” on its Facebook page. That audience was both large and engaged enough, a company representative said, that Starbucks had recently been approached by another firm that wanted to advertise specifically on the Starbucks Facebook page. Starbucks declined the offer, but only after serious consideration. “We had to decide if we really wanted to be on that side of the publishing business,” the representative told me.

It’s a striking reminder that in the Twitter-and-tablet age, not only can anyone become a publisher, but for big consumer-facing companies, the real question is: how much of a publisher do you want to be? The question carries an added weight when you consider how many traditional publishers these days are trying to exit that business.

Non-publishers becoming publishers is not new. For twenty years, the Italian clothing retailer Benetton has put out a magazine called Colors. Richard Branson had a buzzy launch for his “Project” magazine/app last year. One of the more ambitious and technologically sophisticated efforts of recent years has been American Express’s Open Forum which — in addition to aggregating (usually small-business-related) content published elsewhere — has commissioned videos from traditional media outlets and then distributed them through a Web ad platform. (I made a few such videos at a previous job.) The advantages are obvious: unlike an ad placed in a magazine or on TV, the company gets to control how much or little integration with the content it wants to have, or even control the content altogether.

Yet even with such precedents, it’s rare to see something as sweeping as the Web site Société Perrier, which describes itself as “a global source for everything interesting in art, music, fashion, travel, nightlife and cocktail culture.” If you want to know who’s playing this weekend in Dubai, or how to get into a “secret bar” in Moscow, you can find out from this site, which is 100% produced by the company that’s sold fizzy water for more than a century (and in 1992 became part of Nestlé). At least half a dozen staff editors run the site from New York, L.A. and London, and dozens of others contribute on a freelance basis.

To hear the company tell it, Société Perrier is an urgently needed solution to an image problem. Perrier has to “recover its iconic status,” Jorge Torres, marketing group manager for premium brands at Nestle Waters, told me. “It’s a little bit old, and a little bit dusty.” The answer to that problem is usually the same — engage the younger consumer — but if everyone knew how to quench that thirst, Perrier wouldn’t be in this position today. Within the United States, the challenge is even larger, because our tastes are increasingly domestic. While the U.S. continues to be the world’s biggest market by volume for bottled water — and Nestlé the biggest player in it — U.S. sales of imported water are down 44% from their peak in 2004, according to the Beverage Marketing Corporation.

Confused about media and ad technologies? There’s a Lab for that.

Between the bazillion ad technology companies all claiming to revolutionize online advertising and an explosion of devices and services that promise to deliver  movies straight from the Internet to the TV, it’s  a full time job keeping tabs on what can do what.

That’s why Interpublic Group’s Mediabrands launched Media Lab last Thursday, a 5,000 square foot space dedicated to learning and figuring out which end is up with various technologies available to marketers.

IPG vets technology before it can even make it to the front door of the Lab — meaning just because it’s out there doesn’t mean it makes the cut for testing. More than 500 companies are in its database and the Lab keeps in radio contact with venture capital firms and emerging media and tech related companies both large and small to stay on top of trends.

Are kids wringing out SpongeBob?

Back in September, right before the quarter ended, Viacom trimmed  its advertising revenue outlook to high single digit growth from double digit growth. One of only a few media conglomerates to take that step–News Corp, Time Warner, and CBS were much more upbeat–the move prompted some concern among media watchers that advertisers were beginning to slash their budgets on macro-economic concerns.

But that wasn’t the case. It turns out the problem was Viacom specific. As the Sumner Redstone-controlled company disclosed during its fiscal fourth quarter results Thursday, domestic advertising revenue growth slowed in part because of a mid-September ratings plunge kids network Nickelodeon. Total domestic ad revenue across Viacom’s cable networks, which also includes MTV, VH1, and Comedy Central, for FQ4 was up 7 percent versus the third quarter’s climb of 12 percent.

What’s more is that Viacom CEO Philippe Dauman threw audience measurement company Nielsen Co under the bus on Thursday’s earnings call, saying the  ratings drop at Nickelodeon was “inexplicable.” He said Nielsen’s data did not match Viacom’s own set top box data for viewers. The company is currently in discussions with Nielsen– the dominant company that tracks TV ratings that determine ad rates — and the watchdog organization Media Ratings Council to resolve the situation.

Washington Post: the latest example of print ad plunge

Just when you think things can’t possibly get any worse for newspapers, it somehow manages to get even bleaker. Today’s example is provided by the Washington Post Co and its flagship paper (and the online site Slate). The company reported third quarter earnings including results from its newspaper division today.

Print advertising revenue fell 20 percent to $57.6 million — quite a stunning plunge even  as newspapers across the U.S. manage to post quarter after quarter of print ad revenue declines. Even more disturbing is that online revenue, which includes washingtonpost.com and Slate, plunged 14 percent to $23.3 million. Display online ad revenue dropped 17 percent.

The Washington Post is one of those curious oddities in the industry that manages to be extremely local — it’s market penetration of the D.C. area has always been one of the highest in the U.S. — and also draws the interest of a large national audience. So while it may compete with the “nationals” i.e. New York Times, the Wall Street Journal and USA Today, on the news front,  it is very dependent on local advertising. The NYT, USAT and WSJ get a hefty portion of their advertising revenue through national advertisers.

At CBS Sports, the good times are rolling

Many of us are looking forward to Saturday night’s prime-time match-up between Louisiana State and Alabama, the top two teams in college football. For a few hours, we get to set aside the craziness of conference realignment, forget about our own dismal teams (Boston College, this means you) and watch a good old-fashioned brawl between two storied programs.

But nobody may be as pumped up about Saturday’s game as Les Moonves, the CBS Corp Chief Executive who, it must be said, gets pumped up about a lot of stuff (ask him about NCIS sometime). Who can blame him — CBS Sports is bound to draw a blockbuster audience for the Southeastern Conference showdown.

“This weekend on our air we essentially have this year’s college football championship when number one LSU plays number two Alabama in prime time,” he said yesterday on an earnings conference call. “You don’t have to wait for the BCS in January this year to find out who the best team in the country is.”

How to generate media value: Fire your CEO

Some outfit called General Sentiment has set about the task of evaluating the media value of top global brands and then ranking those companies accordingly. Some brands made their way up the list because they ousted their head honcho.

To compile the rankings General Sentiment monitors the news, blogs, tweets and other social media for a brand’s “buzz” — negative or positive — to calculate the estimated cost to generate the same media exposure through traditional advertising.

For the latest list, Google claims the spot as the “top brand” with $917 million worth of media value during the third quarter ahead of Apple

MTV lays off staff; Viacom chief cuts outlook

Philippe Dauman Viacom CEO (R) with rapper/mogul Sean Combs

As Viacom Chief Executive Philippe Dauman was managing investors expectations speaking downtown at the Goldman Sachs Communicopia conference, back at  its midtown Times Square HQ, staffers at flagship unit MTV Networks were fretting as pink slips were being handed out. There was widespread concern internally, according to a source. (AdWeek reported it last night).

Dauman was his usual deadpan self as he lowered outlook, saying advertising sales would still be up but by “high single digits” percentage growth rather than the double digits growth he had promised as recently the third quarter call just last month.

Viacom shares tanked by some 9 percent on Thursday, more than a wider market downturn, as investors read Dauman’s cutback as an early sign of worse to come. The worry on everyone’s minds is of another major 2008-like ad recession may be round the corner. Shares are off another 3  percent on Friday morning.  It’s worth noting CBS, whose revenue is 70 percent advertising, dropped by 7 percent despite bullish comments by CEO Les Moonves a day earlier. It shows how jumpy everyone is right now.

Advertising weak? Quit worrying so much already

Viacom Inc’s not sweating it, Time Warner Inc. isn’t all that concerned. Why, CBS Corp and Discovery Communications Inc. are cool as cucumbers. Disney certainly sounds confident, as does Scripps Networks Interactive.

So why are investors and analysts — those Nervous Nellies of the financial world — so worried about the advertising market? Besides, you know, the fact that the stock market is getting smacked around, the job picture is just ridiculous, and the U.S. housing market is a wreck. Besides Europe’s debt crisis, which seems to have no resolution in sight. Besides the memories of 2009, when U.S. advertising spending dropped by 16 percent to $163 billion.

It may simply be that advertisers haven’t yet made the decision the cut budgets. But listening to all the top media executives at the Goldman Sachs Communicopia Conference this week left one with the impression that they are feeling pretty upbeat about advertising — and don’t expect any cuts in the near future.

File under acceptance: CBS knows it must pay up for the NFL

This time of year, it seems everybody loves football. The players, the fans, and, of course, the TV executives. And what’s not to like about football if you’re running a TV network, provided you have a deal with the NFL? Check it out, a total of 107 million viewers tuned into games between Thursday and Sunday on CBS, ESPN, Fox and NBC.

So it should come as no surprise that CBS Chief Executive Les Moonves, while speaking at today’s Bank of America conference, said he intended to renew the contract with the NFL when it expires in three years. “No surprise there,” he said. Indeed. The bigger question is what will CBS end up paying? Just last week, ESPN signed a new contract with the NFL at $1.9 billion a year. Repeat: $1.9 billion. That is about 73 percent more than ESPN previously paid the NFL.

As The New York Post’s Claire Atkinson points out in a story today, the ESPN deal has come under some heavy fire, particularly from the pay-TV industry, worried that it’s going to jack up rates.

WSJ pushes further into video with free app

The Wall Street Journal has launched a new video application “WSJ Live” that pulls from the content from its stable of live programming.

WSJ Live is another push from the Journal into video programming — which represents some of its most valuable advertising inventory, said Alisa Bowen, general manager of the Wall Street Journal Digital Network. Ad inventory on the video network has been sold out and WSJ Live is free to watch on WSJ.com. That is part of the reason that the Journal plans to keep WSJ Live free of charge, unlike some of its other content, but that could change in the future, Bowen said.

Six advertisers have signed up for the sponsorship of the app: Aetna, AT&T, Citi Simplicity, Cognizant, FedEx, and Fidelity.