PARIS HILTON RUCKUS EXPANDS CKE MARKETING PLANS

Web Sites Transformed Into Product Placement Entertainment Centers

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CHICAGO -- A racy commercial starring Paris Hilton has stirred up controversy for CKE Restaurants. But the company has bigger plans: It’s capitalizing on the attention generated from the spot to turn the Web sites for its Carl’s Jr. and Hardee’s chains into popular entertainment destinations for young males.
Thanks to the racy Paris Hilton TV ad, CKE has adopted a long-term strategy to make the Internet its primary marketing medium.



And advertisers looking to connect with the lucrative demo are saying, “That’s hot.”

Boy toys fill virtual living room

The newly launched home pages for the burger chains resemble the living room of a bachelor pad, where all things cool among young men are at their fingertips. Products from Motorola are placed within the room, and an Olevia-branded flat screen TV hanging on the wall continuously showcases trailers for upcoming movies from Warner Bros. and New Line Cinema -- not to mention the Paris Hilton commercial -- and video games from game publishers THQ, Namco and Ubisoft. Napster, Vans and Maxim magazine also advertise their wares on the site. A deal with a video-game console maker is in the works.

The site also incorporates interactive features such as a wallet that includes a Club Paris napkin with a phone number that when called spouts funny rejections via gotrejected.com, an online voice-mail service sponsored by Vonage.

Web is long-term marketing plan

The sites are all part of CKE’s long-term strategy to make the Internet its primary marketing medium.

“We wanted to create a lifestyle-oriented site that would put people in an idealized young male consumer’s world,” said Brad Haley, executive vice president and chief marketing officer for both brands.

Interactive design firm Spacedog, Los Angeles, created the sites and negotiated the product placements. So far, the plugs have not been paid placements, and have instead been made in exchange for content or product, typically on an exclusive basis.

Spacedog started building the sites in October, building off of the foundation Carl’s Jr. set toward the young male consumer and sought to bridge the brand to the demo’s electronic lifestyle.

“We knew we didn’t just want to put up a Web site that offered a menu and restaurant locater,” said Dustin Callif, vice president of operations of Spacedog. “We wanted to come up with something that really extended the brand.”

Beyond product placement

The product-placement partnerships go beyond cameo appearances on the site. Several brands will launch cross-promotions with product sweepstakes on a regular basis to keep visitors coming back. In the coming weeks, Carl’s Jr. and Hardee’s will help Motorola launch its A360 flip-top phone, visitors can win an Olevia TV or Vans apparel.

In two weeks, Napster will launch an exclusive offer to try its Napster to Go concept for mobile downloads.

Spacedog is now pursuing deeper promotions that would include tagging on ads, in-store displays and media relations. With films, the agency hopes to tie into premieres with special screenings and tickets.

Other content falls under the “Easter egg” category -- fun time-killers not tied to a specific promotion. One is the free plug for www.gotrejected.com for trying the Paris Hilton phone number in the wallet. Vonage provided the phone line as well as the answering machine linked via a framed photo of the socialite. Several messages were seeded to the machine but some are added from real messages left on the voice mail.

The site will eventually evolve to include streaming video of the guy who owns the living room and his friends via a Webcam. He may also address the viewer.

'Spicy Paris' extended cut

CKE Restaurants used the “Spicy Paris” spot for its Spicy BBQ Six Dollar Burger to drive traffic to its new sites. It also launched a separate destination, SpicyParis.com, that features an extended cut of the commercial, as well as other footage and photos.

Only a month old, the sites are already developing a track record for its partners, with Syntax Groups Corp., the maker of Olevia LCD TVs, enjoying a boost in traffic to its own site through CarlsJr.com.

The sites are also feeding CKE Restaurants’ databases and serves as a mini-market research lab to see which features drive more buzz and more coupon downloads. More important, it’s giving the marketer an experimental playground for nontraditional marketing.

“As anybody in the industry is well-aware now, the traditional broadcast advertising’s days are numbered,” Mr. Haley said. “Certainly in a four- to 10-year time frame the 30-second commercial will be very, very inefficient because of [digital] video recorders. Sometime over that multiyear period Web-based advertising is going to replace traditional broadcast.”

Cost for Web outweighs TV

As part of its marketing strategy, CKE is using Web advertising, but is also relying on creating "carrots" -– like the Paris Hilton spot -– so people come to the brands. The Web is still relatively small as a percent of the company’s overall marketing budget, but the production costs and cost per impression are far less than TV.

“For a fraction of our overall media budget, we can have a sizable Web presence,” Mr. Haley said. “But over the next four to 10 years that production and media budget will shift from traditional to nontraditional, where online advertising and promotion becomes our primary medium.”
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