Bloggasm

It happens all the time. A company spends millions of dollars advertising a product — creating slogans, musical jingles, product designs– only for it to be bought up by a larger company. That larger company wipes out the name of the original and incorporates it into its own products. All that money spent branding that original product is now useless because it no longer carries the same name.

Or is it wasted? It turns out it may be worth something. How many of you out there can still hum the advertising jingle of a product that’s no longer on the shelf? This is evidence that the brand lives on, and some companies are taking advantage of this.

The NY Times Magazine has a great feature article about how one such company is buying up the intellectual property rights of no-longer-existing products and using their still-remembered brands to kick-off sales.

Many analysts agree that once social networking sites get their shit together that they’ll be prime real-estate for advertisers, primarily because they have so much personal info on their users, which in turn means highly-personalized ads. But other than the controversial Beacon program I haven’t seen much evidence for this until today.

When I logged into my account today I saw this ad in my news feed:

As most of you know, I’m a journalist. It wouldn’t be too hard to ascertain this from my Facebook profile — given that I’m listed as an English major grad and my place of employment is in my workplace info.

Is this just a coincidence or was Facebook able to scan my profile and deliver a targeted ad?

Either way, I did something I rarely do to advertisements on the internet: I clicked on it.

Though there have been countless news stories on the decline of newspaper advertising revenues and the impending doom of the industry, magazine ad sales have remained mostly steady. It seemed for awhile that they would be able to ward off any major competition from the web. Also, magazines often focus on niche topics — and therefore, niche advertising markets — making it much harder to track general trends in the industry.

But now we have word that the decreases in offline record sales are reverberating to music magazine revenues. “Ad pages for the three biggest music magazines slid 26% in the first quarter,” says Crain’s New York. “Jann Wenner’s Rolling Stone, the category’s iconic publication, saw a 33% drop, according to just-released numbers from Publishers Information Bureau.”

Because music listeners are now purchasing songs online, advertisers are migrating to the web. This makes sense for them, really, because online music offers an advantage over print magazines — impulse buys. If I see an album advertisement in a magazine, I have to have the impetus to leave my house or go to my computer to purchase the song. If I see an advertisement online, in a few click-throughs I can not only sample a song but then quickly follow up with a purchase.

Why doesn’t Google Blog Search have keyword advertising next to its search results? Aren’t they missing out on a lot of money by not doing so?

It wasn’t long after Google acquired the advertising company DoubleClick for over $3 billion that it announced that it would be laying off 300 DoubleClick employees.

Now we learn that shortly before laying them off, Google required all DoubleClick employees to sign non-compete contracts, meaning that after leaving the company they couldn’t work for a competitor for a full year.

I really despise non-compete contracts for lower-level employees. If you’re the owner of a company and you get bought out and accept an offer, then I completely agree that the company buying out should have you sign such a contract. But forcing an employee who had no say whatsoever in the buyout process, an employee who has no financial stake in the company (other than the fact that it supplies his pay checks) and didn’t benefit from the buyout at all, to sign one of these contracts? I understand why it’s done but I also think it should be tough shit on the buyer’s part.

With the decline of the newspaper industry I think this is going to become a real problem. Just as those laid off DoubleClick employees won’t be able to take a job within the industry for at least a year, these newspaper reporters are getting screwed out of making legitimate career moves just because their publishers jumped ship.

Not a day goes by when you don’t read an article bemoaning how Craigslist, the free classifieds site, is swiftly wiping out paid advertising in newspapers (it’s poised to bring in $81 million in revenue in 2008). Publishers groan at the realization that consumers will never pay for a product when they can get it for free. In newspaper board rooms the company’s name is no-doubt uttered in lowered, ominous tones.

But more and more we’re also reading articles about the dark side of Craigslist and what happens when you set the bar so low that there’s no cost for entry. Just recently, two hoaxers posted a fake advertisement that resulted in an Oregon man’s home being looted, most of his worldly possession taken away. In 2006, a man named Jason Fortuny posted a fake sex ad on Craigslist pretending to be a woman wanting some BDSM sex. After several men responded, sending their names, email addresses, phone numbers, and even nude pictures, he then placed all their information on the web so that these people were damned to a life of embarrassment and humiliation, their emails forever just a Google search away. That same year I performed my own (now-famous) Craigslist experiment where I created fake no-strings-attached ads for different sexual orientations and found out that straight women receive so many replies to advertisements that it’s virtually impossible for a straight male to get sex through Craigslist.

But these are just the more radical examples. To understand what I mean, look no further than the job listings at the Richmond Virginia Craigslist. If you comb through those listings you’ll find out that only a tiny percentage of them are legitimate. Most don’t even list the name of the company to which you’re applying. That’s because many of the advertisements are placed there by job recruiting agencies, basically urban cockroaches that try to gather resumes and place you in an admin job while scraping away a commission. To test out how easy it was, I just placed a fake job advertisement and it took less than three minutes.

That’s what happens when you offer a service for nothing. You have such an overloading avalanche of those trying to utilize a free service that the more legitimate advertisements are drowned out. Don’t believe me? Try replying to a female-for-male ad in the “no strings attached” section. I guarantee you that you’ll get a response asking you to visit a woman’s webcam or a dating website. In fact I’d be surprised if more than a single female in the “no strings attached” section is posting a legitimate ad.

So what happens when you charge money for the advertising, as is done in newspapers? Suddenly, the cost for placing illegitimate and spammy advertisements is much, much higher. A job recruiter agency can’t go in and place dozens of fake ads in a day because it would cost thousands of dollars. The profit margin for landing a commission quickly heads south, probably into the negatives.

But that’s the cost of free. Even if every advertisement were legitimate on Craigslist, the rush of those trying to cash in on the free service diminishes the effects of each individual advertisement. As classified ads in newspapers lessen, each individual ad becomes more powerful. You get more bang — i.e. more responses — for your buck.

The only question is how long it will take the consumer to realize this. How many lackluster responses does a person need to get before he decides to try the paid route and cash in on the benefits of doing so?

I’ve been on a much-needed mini vacation for the last four days and this is my first time on the internet since Wednesday. If you’ve commented on one of my posts in that time period and the comment got eaten, I apologize. I moderate all comments and whenever I’m gone for an extended period of time I’m unable to gather the motivation to read through 800 spam comments to pick out a few legitimate ones.

Anyway, here are some media-related links

1. This is pretty scary. Someone placed a hoax craigslist ad announcing an everything-must-go giveaway at a house. The only problem? It wasn’t placed by the owner — and he returned to his house to find people literally looting it. And when he tried to stop them from taking his possessions, the people showed him print-outs from the craiglist ad and refused to give anything back. I smell a pending sociological experiment that could come out of this; something based on the effects of advertising and a level of entitlement that accompanies any sort of ad.

2. We’ve seen a number of incidents recently in which some brutal crime or tragedy occurred that involved a social networking site in some way. The most recent example is a teen male who killed his father because his Myspace account had been deleted.

3. The New Yorker has a long feature article about the demise of the print newspaper industry and what its online future may entail. Scarily enough, the reporter picked The Huffington Post as the example of the future of newspapers. Why is this scary? Because The Huffington Post doesn’t pay many of its star writers. I’m not talking about user-generated content, I’m talking about professional writers who write for the site for free while it soaks of millions in advertising dollars.

4. Ever wonder what bloggers who write for Gawker websites pull in for salaries? We’ve known for some time that they’re paid in part based on the number of page views they attract. Now we have some sense of the actual figures in their pay checks.