Where is Media More Digested Than in Super Bowl Commericals?
Before I get into media companies, I want to talk to you about something that’s been on my mind recently. Something that’s swirling all around us, all day long.
But first let’s pan out a bit. I doubt this will come as a surprise to you, but every day a lot people walk through Times Square.
On its busiest days, Times Square sees as many as 480,000 people come through, and, according to its website, “Times Square stays busy late, with over 66,000 pedestrians entering the ‘Bowtie’ between 7 p.m. and 1 a.m.”
Oh, and on New Year’s Eve there are roughly 1,000,000 people crammed into that small space — that does not sound fun to me, but to each their own.
Buying billboard space in Times Square makes a very obvious sort of sense: a lot people means a lot of eyeballs means a huge amount of exposure for whatever it is you’re selling.
According to The Wall Street Journal, it costs between $1.1 million and $4 million a year if you want to buy one of those billboards. That’s not too far off from buying a 30-second spot during the Super Bowl, which has a base price of around $4.5 million and will likely only climb higher for years to come.
Now, 111 million people in the United States alone watch the Super Bowl, and so, again, it makes sense that you’d want to put your clever commercial in front of all those people and hope your cleverness leads to more sales.
But no matter how familiar those towering billboards and ironic commercials are, they’re less and less a part of the future landscape of advertising.
If you’re walking through Times Square or sitting on the couch with your friends watching the big game, odds are you’ve got a smartphone on you. Maybe you snap a photo of the Manhattan skyline and post it to Facebook; maybe you text some friends about a dumb commercial, or even laugh about it on Twitter.
With every thumb twiddle, you’re leaving a digital footprint. Depending on what browser you’re using right now, odds are some company is keeping track of how long you stay on this webpage and where you go from here.
It’s a little creepy, sure, but it’s the new normal.
OK, let’s focus in now.
Have you ever done a little online shopping while at work (it’s OK, I’m not going to tell anyone) and then, while at home, seen an online ad for those shoes or that pair of headphones you were looking at earlier?
What about on Facebook? My feed is littered with ads to random websites I’ve visited at one time or another. I barely notice anymore.
One estimate I found said that around 40 billion devices are going to be connected to the internet by 2020.
And so for marketers and advertisers, of all levels, finding out where these people are and how to advertise to them is the name of the game. Cracking that code — and I mean really, truly cracking it — could mean billions to the right company. There might be one out there already, hidden in plain sight.
Let’s pan out again, though, for a gaze at the bigger, money-making picture.
The Bloomberg Era
You’ve probably heard of Michael Bloomberg, the billionaire former mayor of New York City. What you may not know is how he made his fortune.
Investment and business research, along with journalism and the publishing world writ large, used to be firmly grounded in the world of paper. Computers began helping in the 1960s, ’70s, and ’80s, but it wasn’t until the 21st century that the Internet Age accelerated the marginalization of the printed word and the hegemony of the pixelated word.
For the financial world in particular, the first enduring revolution came with the “Bloomberg Terminal,” a computer software system that keeps track of, in a word, everything.
With an annual subscription, Wall Street wizards and wannabes could get all the information they needed through one powerful machine housed on their desks, obviating the need for legions of interns to scour the web and printed sources of data.
“Everything,” in this context, means precisely that: From headlines in India to what the Venezuelan bolivar trades at in South Africa to every single media mention of a small miner in a remote corner of Australia that’s not even public yet.
Bloomberg met a huge need so well that it grew subscriptions at a dizzying rate. Everyone in the financial world has a Bloomberg terminal or is close to one. There are more than 300,000 subscribers worldwide, and they pay about 20 grand per year. In 2011, the Bloomberg terminal made up more than 85% of the company’s revenue.
Michael Bloomberg is a very, very rich man because he found a solution to a problem no one thought could be solved.
That’s the siren song of the entrepreneur: a practical solution to a hard problem. You probably can see where I’m going with this.
The Hidden Profits I’m Uncovering
My work as a forensic accountant takes me all over the financial map. I pour over data and earnings reports and run my models to find hidden gems in the markets. That might sound a little boring to you, but it’s my passion.
My passion recently brought me to a company deeply entrenched in the world of online marketing and advertising. Before I knew it, my brain was filled with terms like “earned media” and “social software.” If you’re glazing over now, I’m with you.
But I might have found the Bloomberg machine of earned media — in other words, a company that can unlock the door to online advertising and marketing. Its business model is to sell its one-of-a-kind answers is standard for the software industry — long lead times for customer adoption and then recurring revenue from annual subscriptions.
The truism about software is that once you’ve sold a product to a company it’s hard for them to switch. That’s why it takes a long time for the customer to make the decision to buy — it knows it’s committing to a long-term relationship.
Given that every software company is calling on businesses left and right for this pot of gold — and even though this company has and is about to release an even greater solution to every CMO’s attribution need — what confidence would anyone have that management knows what it’s doing and that it can execute?
Consider this. The consulting firm Bain & Company has said that a 5% increase in a software company customer retention leads to a 25% to 95% increase in profits. And I found that this company’s management, which has tended to be non-promotional (read: they’re not blowhards), has said it expects a 600-basis point — six percentage points — increase in retention rate from now to 2021. That’s huge.
To me, this sort of play is hidden in plain sight. When it comes to media companies and their coverage, there’s more than enough attention paid to gaudy billboards and funky commercials and “viral” campaigns that seem to go nowhere fast. The company I found is playing the long game, and I think you’d be really interested in hearing the whole story.
In fact, next Tuesday I’m hosting a special video broadcast that highlights several new profit opportunities just like the one I told you about.
It’s free to attend, and I’m pretty eager myself to share this knowledge with you. You can register to attend his free live event right here.
John Del Vecchio
Editor, Hidden Profits