Skating to where the puck will be - Apple and advertising

I was intrigued to read about Apple proposing to rebuild a mass transit stop in Chicago in exchange for naming rights to the stop, as well as permission to advertise in the stop (Crain's Chicago Business - "Doors will open on the right at Apple stop.")  Most people would ask "why?"  And it's because Apple is moving toward a very different advertising future.

Most people think of advertising as the ads in newspapers and magazines, as well as on the radio, or television, or possibly billboards.  Only we know that newspapers and magazines are failing because fewer people read them every month.  Advertising in print media has limited value if there aren't any readers.

Likewise, people under 30 are watching a LOT less TV than the older generation.  Whereas I grew up with my eyes on the "boob tube," increasingly I watch a lot less TV as I spend more time on the web.  But my web use is nothing compared to people 17 to 34, who have almost abandoned television. They go to the web for entertainment.  And they increasingly only watch TV shows and movies when they can download them - or possibly watch via DVD.

And Apple is at the forefront of killing the radio business.  With iPods and digital music now cheap and plentiful, why listen to somebody else's programming?  When you can program your own music, radio becomes less interesting.  And if you want news there's the iPhone, Blackberry or similar mobile device to access the web - so why listen to talk radio? 

Advertising as it was is gone.  Coke, Pepsi, Procter & Gamble, Kraft, etc. built huge companies via media advertising.  But media usage is declining sharply.  So how do you get the message out to people who increasingly get their entertainment without using most of the traditional media?

And that's where Apple's move makes sense.  By rebuilding a train station, they help promote their brand.  It reminds me of when Hooters offered to fill the potholes in Chicago (a big problem) if they could put their company logo over them.  This week I noticed that in the Newark, NJ airport the jetways had big billboards on the outside.  And the TSA bins (for shoes, coats, laptops, etc.) had ads printed on the bottom.  It's getting harder and harder to reach customers when they don't need traditional media.  

So if you have historically been a big user of traditional media advertising, you'd better be rethinking that strategy.  What worked in the past isn't going to work in 2015. Staying Locked-in to old ad budgets, and approaches, is going to keep producing declining returns.  Traditional advertising won't even maintain current positions - much less work for new product launches.  As ad costs go up, they are less effective.  To reach customers requires shifting with the market.

If your new business plas is to use advertising as a way to grow your business, think again.  While advertising isn't gone - it is a lot less effective than it was when traditional media was widely the source of information and entertainment.  If you want to get people to recognize your brand, you have to start being a lot more clever.  You have to find new ways to get in front of customers.  You have to use your scenarios of the future to help you find the best way to promote your product.  Because the old channels, and the ad firms that used to supply them, increasingly are an ineffective answer.

Comments

[Joseph Joel Sherman]

Adam,
Great post. There is also a value to a company doing good - be it transit stops or filling potholes - in the eyes of consumers. At a time when many companies are sponsoring charities, this is something that will stand out. If Apple builds a great transit stop, people will notice.

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Nice article.The reopening of transit stop is good news and I hope this time,they come with more innovative terms.

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it is a lot less effective than it was when traditional media was widely the source of information and entertainment.