April 13, 2010
 

The Significance of UGC on Madison Avenue

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Hey Official Madison Avenue (if you're reading this, that means you!), is your EBITDA going EBITdown?

The MadAve Journal has been a proponent of UGC for quite some time, beginning formally last year when we launched our "Commercial Worthy" column. It invites people in our business to vote and comment on UGC videos our editors select from YouTube and other communities which they believe would make great ads!

But when we saw Budget's "FlipForBudget.com" contest, we were completely knocked out and approached them with the idea that they should expand their invitation to accept submissions from creative people on Madison Avenue. After all, one would assume that people in our industry could do as well, if not a better job than the videographers who've already submitted videos to the contest.

They were really cool about it. In fact we found out they were way ahead of us. It turns out they have accepted as an entry a "ringer", defined as someone who probably has a demonstrable background for front-running contests like these, due to their knowledge of how the game is played. They have already won contests such as these by submitting UGC content for other promotions online.

Mind you, Budget is not favoring any of the contestants. They actually see this contest as an excellent, almost altruistic way of helping people become smarter this summer; if and when consumers can scrounge up enough cash to take a trip.

Getting back to the contest, somewhere in between an agency that produces TV content professionally and someone on the other side of the video spectrum (who has never even entered a video contest) lays Michael Beaudoin. There's no question that Michael is among the top UGC'ers in the business.

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He makes no secret about it. Last year he won Snicker's video contest. Some might think that is unfair. Budget felt different. To them it is all about sharing the best ideas to help their customers determine how best to travel on a budget.

They didn't see any harm in the fact that Michael has an ability to make people smile. They didn't even have to do any smiling-based research. Michael's video just made them smile and laugh. Since then, the submissions are now coming in fast and furious. The heat is on.

Budget has been offering quality value products at deep discounts longer than most people can remember. They didn't create the economic environment with which we find ourselves in today. But they are sure not let it pass them by to let people know that they are the smartest choice for services like a car rental.

That goes for agency hot shots on MadAve as well. If your EBITDA is going EDITDown, read on. Aside from the practical reasons to take an interest in this opportunity, there's no denying that anyone who has the smarts to create a video on "How to travel on budget" is going to have fun doing it. It goes without saying that the cost of petrol (gasoline) is over $4.00 a gallon,

Budget is pleased that people in our business think that this promotion is similar to a PSA, though they can't admit to being as high-minded. They simply did it for the fun it. If people get some learning from the cool ideas that the videographers have put on tape, then, "What the heck!" Budget did their good deed for the day!

As an advertising trade e-zine, we immediately saw a connection between FlipForBudget.com and the air-leak in agency financial tires all over town.

Going against the trend of many "amateur-based-only" UGC-based invitations, Budget is also offering a $25,000 purse to creative types on MadAve who can beat Michael's front-runner work. Will it be difficult? Yes and no.

First, they have to beat the authentic and natural quality that Beaudoin's work possesses. Someone we know, using poetic license, called it "A song about cents and sensibility.

Second, the cumulative groups of people who've been entering, viewing and commenting are no less sophisticated than any American Idol judge panel.

And third (this is the easy one) if they stick to their own sense of cents-ability, they will, without question give Mr. Beaudoin a run for his money. All they have to do is effectively and entertainingly answers the question "How to travel on a budget!' on video that is so great that their mother will adore it and tell all her friends to vote for it. Confidential; we know others have and it's working!!

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UGC vs. AGC

Considering how far $25,000 will go today, it's hard the resist how many problems that winning this contest would solve at the agency:

Option 1: Cover almost one full month's cost of one floor of a 25-floor ad agency office (just in NY) office real estate rent on Madison Avenue;
Option 2: 100% of two-month's electricity cost for a medium-sized agency;
Option 3: 10 hours of a senior-level creative director on a clients' business- like wow!!
Option 4: Two months+ billable fee (400+hours of $60.00@50 hours a week) of a media strategist's billable time; hired exclusively to traverse the internet for quality-based and relevant "amateur" UGC , which would make excellent fodder for a brand 2008/09 campaign.

Editors Choice: Option 4! Using extremely conservative estimates, Option 4 would turn up 10 threshold+ quality videos, worthy of fitting into a brand/agency mindset to generate actionable ideas that could be used in one form or another.

One added benefit never mentioned is that 95% of all videos posted on video-file sharing sites already have viewer feedback, or "uncontaminated" feedback as it's called by any focus-group panel, before the brand has spent one dime. Voila! The level of comfort that the agency and client should have should be infinitely boosted if the comments skew positively.

We joke in the photos depicted here (and will continue to do so in articles later this week and next) and about the confusion and resistance MadAve has about popular consumer UGC, yet there is no doubt that some of MadAve's reservations are warranted.

However, the dirty little secret that everyone on MadAve chooses to ignore is that conversely, there is also a lot of confusion and resistance which consumers have about expensive AGC (Agency Generated Content) which the industry indiscriminately accepts.

Why doesn't the advertising community have a vocal resistance to well-produced $6-figure commercials/content that have as much selling power as "SpeedRacer?" It's just the opposite. They brush them under the rug.

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Advertising Weak: In an event that's stranger than fiction, a week or so after Labor Day, the industry nauseatingly parades itself up and down the street with the most idiotic spectacle of cartoon characters and branded icons from various ad campaigns. It's called Advertising Week. Together they possess the same amount of authenticity that a costumed-Goofy Disney character has in the Magic Kingdom. In essence no one other than a 3-year old buys into it!

Talk about a ego-centricity run amok, the next thing you know you'll have a velvet runway with stars like Maurice Levy, Martin Sorrell, the ever-talented Lee Garfinkle, Andy Berlin, Bob Greenberg, Matt Freeman and David Verklin all marching past hungry photographers from Gawker and AdAge's new celebrity magazine (rumored to be in the works) titled, "AdverStarsing". Everyone from Scott Donaton and Joseph Jaffe to Jack Myers will be interviewing them about what branded media tchockes t-shirt they're wearing, what type of PDA they use and who follows them on twitter.

Comparatively, "UGC Week" is every week! It's everyday! The 70+ file-sharing sites receive 50,000+ video downloads or more on a 24/7 basis. If just 10,000th of 1% of them were considered "commercial worthy" that would add up to over 2,000 commercials a year; roughly twice number of brand spots that run on national TV networks in a single year.

Startlingly, less than a year ago, guys like Bob Iger, President and CEO, The Walt Disney Company, Steve Ballmer, Chief Executive Officer, Microsoft Corporation, Peter Chernin, President and COO, Fox Entertainment Group, Philippe Dauman, President and CEO, Viacom Inc., Chris DeWolfe, CEO and co-founder, MySpace, Steve Mitgang, CEO of Veoh Networks, Leslie Moonves, President and CEO, CBS Corporation, Mark Zaleski, Executive Chairman, DailyMotion, Jeff Zucker, President and CEO, NBC Universal and a number of other cholesterol filled poor circulation individuals came together with the worlds' most paranoid and self-justifying counsel, to announce a new initiative, the "Principles to Foster Online Innovation While Protecting Copyrights," which was motivated by what they said were purely altruistic reasons.

Believe it or not, they said it was based on the belief that UGC "stifles both technological innovation and artistic creation in ways that ultimately will hurt the consumer and hinder the digital economy."

Yeah, sure.

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Other than straining to ignore the self-interest that clearly triggered these "principles," which could otherwise be interpreted as threats, there are several issues that should be raised:

1: Content is Content: What's the difference between PR and UGC that uses copyrighted materials?

2: Support Capitalism: Why not outright buy the content that's produced by UGC'ers instead of suing them, which stifles the first amendment which these companies have effectively taken hostage of.

3: Behavioral Targeting: UGC would actually "spur" the economy not hurt it, since 9 out of 10 times it's addressed to a sliver of the general population (otherwise known as a "niche") which traditional broad-based advertising is incapable of doing. If the brand selects the right mix of UGC spots, each would speak specifically with the buzzzzzz word of the moment: "relevance" to each niche-group. Therefore they would work to increase consumer interest and trial.

4: Paranoia versus Reality: Would UGC put agencies out of business? Of course not. Agencies are still pretty good, if not excellent sometimes. That said, we do believe the old axiom of the late, great Jay Chiat about watching how big agencies can get before they suck!

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5: Real vs. Fake Research: Frankly it would reduce the absurdity level that account planners must go through, when they have to scrounge for research such as MRI -- the lamest database on Madison Avenue -- or even worse, be humiliatingly instructed to traverse the net to find some research that justifies what the creative team wants to recommend.

6: Proof of Concept: On average, each "Commercial Worthy" article we've published video took anywhere from 30 minutes to 3 hours to find, going through the litany of stuff out there.

7: Fast Follower: "Wassup" was originally produced as an independent film. Anheuser-Busch saw that it worked and took it to a new level. Brands such Frito-Lay, Coca-Cola, Chevy and Snickers and other brands whose future is almost entirely dependent contemporary culture have made UGC a staple of their communications strategy, as much as "social" media, CRM and other mechanisms that measure the Zeitgeist du jour, if not the hour.

8:. Idiot Proofing: Donny Deutsch had clearly left the building when Deutsch/LA produced one of the dumbest commercials of all time for GM, which ran on the Superbowl. We're referring to the "Robot" commercial which bewilderingly used a Suicide-based theme to sell GM cars. Counter-intuitive for sure, the general research-proven tactic to sell autos is their ability to prevent "you know what."

9: Truth well told: You have to hand it to Blue-blooded Elitist William F. Buckley (1926-2008), who commented in a dry manner back in the 1960's that he'd rather "be governed by the first 2,000 names in the Boston telephone book than by the 2,000 members of the Harvard faculty!" We'll leave it up to you to determine if this has any application to AGC versus UGC.

10: It's an idea whose time has come.

Stay tuned for Michael Beaudoin.

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(Please click on this photo to review Michael Beaudoin's video.)

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