Just What Is Experiential Marketing, and How Can It Be Measured?
If social media is to believed, people living in major cities can't leave their homes without bumping into a prank featuring a vomiting baby or an elaborate interactive installation involving celebrities or artists.
This is so-called experiential marketing -- loosely defined as messaging you can touch, feel or view in a physical space. It's on the rise in recent years as marketers of everything from cars to movies aim to make their brands a tangible presence in consumers' lives either in person or digitally through YouTube videos, tweets and Instagrams.
Marketers are spending more on experiential even though return on investment measures are murky. According to the Event Marketing Institute's EventTrack study, marketers spent an estimated 4.7% more last year on event and experiential marketing. The study also indicated that experiential is growing faster for companies with more than $1 billion in total revenue, which hiked their experiential budgets 9.8% in 2012.
Heineken has been a long time real-time event booster. Last year, it unveiled "Departure Roulette," which challenged airport travelers to head to unscheduled destinations, and "Carol Karaoke," which turned a run-of-the-mill crooning session into a chance to sing on screens in Times Square. While the brand doesn't break out how much of its marketing spend goes to experiential, spokeswoman Marnie Kontovraki said "sponsorship, activation and experiential play an important role in fueling the growth of the Heineken brand," adding that experiential campaigns ensure the brand plays "an active part" in consumers' conversations.
That's a mouthful, but what exactly does it mean in practice?
Jeff Benjamin, chief creative officer at JWT North America, said experiential is what brands do in the world that get people "participating." He called it an evolution of what interactive advertising was a few years ago -- anything that pulls people into the brand, digitally or physically. "It just has the gas pedal on it now because of social media and technology."
Michael Ventura, CEO of Sub Rosa, a New York agency that has done experience-design work for GE, Nike and others, defines it as a forum where a brand can "extend a hand" to touch and engage the consumer.
At the end of the day, social media "isn't physical," he said.
Sabina Teshler, CEO at experiential agency SET, sees it in more general terms: any visual environment, including retail. And with social media, it has become possible to justify an investment in an experience knowing that it will pay dividends when people share.
However they define it, most people agree that experiential isn't new -- it's just more prevalent and visible. Both Mr. Ventura and Mr. Benjamin pointed to the anti-smoking "Truth" work from the Legacy Foundation five years ago as an inflection point. that made everyone want to do something similar. Those memorable campaigns included videotaped reactions to a 2007 installation featuring a melting mom made out of ice to physically demonstrate how kids lose their moms to tobacco use. and videotaped reactions of people experiencing the work. "I don't think it's a new thing," said Mr. Benjamin. "It's just because of technology that we notice it more," said Mr. Benjamin.
CAA's sports-consulting arm recently pulled off a live interactive experiential Super Bowl campaign for client Time Warner Cable. The experience was a 60-minute tour "inside" a cable box, with network partners setting up interactive booths. But attendance numbers aren't enough. Greg Luckman, global head of CAA Sports Consulting, said the investment isn't justified without earned media or PR. For the Time Warner campaign, 25,000 customers took tours, and the agency reports 455 PR placements, garnering almost 1.5 billion impressions. "As this channel has grown as a viable marketing arena, so has the need for justification of investment," he said.
That justification can be hard to communicate. Thinkmodo, the "viral video marketing" shop behind some of the most well-known prankvertising, most notably for movie studios, tries not to focus on video "views" as a metric. "What matters to us and to clients is the free media," said co-founder Michael Krivicka. For example, when the shop rigged up a café so a customer's displeasure resulted in some seriously scary telekinesis for the "Carrie" remake, many morning shows picked up the video and showed a trailer for the movie along with it.
"That is priceless," said Mr. Krivicka.
But the jury's out on whether it sells. The "Carrie" prank was viewed 54 million times to date but the Sony Pictures film opened below projections with $17 million over the opening weekend. "Devil Baby Attack," which featured a projectile-vomiting robot baby created for the movie "Devil's Due," was watched 43 million times. But the movie grossed a frighteningly low $8.5 million on a three-day opening weekend.
Proponents of the discipline point to Red Bull, a company whose amazing "Stratos Jump" was just the latest and boldest chapter in a experiential-marketing playbook that includes the "Red Bull Music Academy." The jump's live webcast in October 2012 racked up 52 million views and seemed to pay off: In the six months after the campaign, U.S. sales increased 7% to $1.6 billion, according to research firm IRI. The private company sold 5.3 billion cans worldwide in 2013 -- up from 5.2 billion in 2012.
Mr. Benjamin said he's now fascinated with determining how to measure the success of experiential. It's not just views or earned media metrics but a "cocktail" of factors, he said. "Figuring out how you measure something like that is going to help brands," he said. "It's something we're actively working on."