Last week, Anheuser-Busch announced its foray into content creation with the upcoming launch of Bud.TV. I spoke with Tony Ponturo, vice president, global media and sports marketing, and Jim Schumacker, vice president, digital marketing and brand entertainment, about the endeavor.
Brad Berens: We are here to talk about Bud.TV. It is an exciting thing for a huge brand and marketer like Anheuser-Busch to get into actual content creation, rather than the sponsoring of content. So, why don't the two of you give us the quick overview of what Bud.TV is all about?
Tony Ponturo: Okay. First of all, what we have announced is that on February 5, 2007 we will launch an online entertainment network called Bud.TV. We wanted to go into this sort of new world because of what we are seeing, and what our research suggests, that adults 21 to 27 are using the internet minimally six hours a week, and obviously that's growing. So, we needed to continue to move more of our marketing, and specifically media resources, as we try to reach the consumer, into the digital space.
We have been looking at the whole internet world in a three-pronged sort of way. First of all, in 2006, we have been advertising in close to 40 different third-party websites, obviously bringing our brand messaging into anything from Yahoo! to AOL to ESPN.com, et cetera. We also have developed 20 brand websites -- from Budweiser.com to BudLight.com, et cetera -- which are there to really provide brand messaging, information about the brand, and be a communication device to the consumers about the individual brands.
And then, we thought it was important to create this Bud.TV, which is really not going to be overt with our advertising. In fact, it is likely you will never see a 30-second promotional, other than maybe showcasing our Super Bowl spots. It will be using the internet in a way that 21- to 27-year-old consumers will appreciate. There will be many consumer user components; our brands will be more integrated into the programming and the site, almost in the form of product placement versus the traditional 30-second commercial.
Jim will take you through the site. There are going to be seven, maybe eight, channels as we get started with different themes. Obviously, it is 24/7. It will be refreshed, probably every 10 days to two weeks. Although, there will be a component of a unique "4:55 Happy Hour," that will be there everyday, which we think could be fun to have people come on the site and get something either funny, or different, or interesting that they can take on to their after-hours sort of gathering.
It is our way to extend the expertise that we have had in the commercial messaging where we have done a pretty good job based on our beer sales of connecting to a 21- to 24-year-old consumer, and connecting and adding imagery and entertainment that they have found interesting.
We have created icons-- sometimes by accident, sometimes by design: Ted Ferguson, more by design…going back in the history of Leon, Yes I am, Wassup, and I Love You Man were maybe a little bit by design. But, the explosion of them cutting across the American culture, I think, were bigger than we anticipated.
So, we found that we understand that world, and now can we bring that to the entertainment side. And clearly, the website gives us a forum to present content in an affordable way; and, ultimately create an image of using a space that, this millennial generation coming through is obviously very intrigued with.
And then, just to recap my overview, ultimately, as we are learning more and more about this technology world -- that is really the television, and online, and the cell phone all collapsing into one -- we are headed towards interpersonal television, and are not too far away from our selection on the big screen, whether it is Bud.TV coming out of the web, or NBC… all basically being received on the same screen in your home.
I will let Jim talk about the site and its content, and why we think it will be intriguing to that target audience.
Jim Schumacker: Right now we have seven channels. The first is called: TV Shows, and we have two shows on this channel that are in production, right now. One is called "Replaced by a Chimp," where you grab a profession, such as a waiter, or a bartender or a trial attorney and replace those people with a chimp, and film the reaction of the consumers who happen to be in the same environment as the chimp. And then, at the end of the show, the consumer will vote on whether the chimp should stay and continue on the job, or that person who was the professional.
There's another show called "Truly Famous." We all know that people love celebrities and the paparazzi. And so, we are hiring a female and a male that will be celebrity-types, at least in look-- they will not actually be celebrities. And, we are hiring paparazzi to follow them around town and get reactions of consumers. So, if they go into a restaurant, as a celebrity, they would like to have their dinner comped; and, the engagement of conversation in that regard should be entertaining, and we are filming that and the consumer's response to that situation.
We have a channel called: BudTube, which was brought to us by one of our agencies in San Francisco, Goodby and Silverstein. The idea is that consumers will produce their own Anheuser-Busch ads. So, he gave the assignment to his creatives to see what they would come up with, and it was to replicate Ted Ferguson ads. Our first initiation on BudTube will have consumers produce their own Ted Ferguson ads. (He is one of our characters on BudLite who has been on the air for about a year.)
And then, Tony had mentioned the "4:55 Show," which we are calling "Happy Hour" and will be refreshed every day.
We have a Reality Channel with two shows in production.
We have a Comedy Channel, whereby, you know, our first initiation is going to be working with Vince Vaughn. He had a Wild West Comedy tour last year where he did 30 cities in 30 nights. He actually rode from city to city and had two buses with the comedians. He filmed a documentary where we have product placements with Bud and Bud Light. He is premiering this documentary at the Toronto Film Festival this Friday; and, we are sponsoring his party. So, we will have film assets from the comedy tour, as well as the behind the scenes, and footage from the documentary.
One of the comedians who is involved in the tour, the Wild West Comedy tour, is named Sebastian -- he's a good guy, does a great job from the stand-up standpoint -- and, he is an up-and-comer comedian. He is developing a show that will be in Detroit, in November. And, Bud.TV will go there and film the show with three cameras, and then either develop a two-hour special that can be seen on Bud.TV, or we will break the segments up as we see fit.
We have a Sports Channel that will have unique programming from more traditional sports, but we will also be dealing with more extreme sports. One example I can give you is, August 25, the Major Lacrosse League had the semi-finals, and on BudLight.com ran a webcast of the semi-final game. So, it will be unique programming. Hopefully, there will be some snowboarding, surfing, something that will have visual impact while coming onto Bud.TV.
We have a Hollywood Channel. And, we are involved with Kevin Spacey and TriggerStreet.com; and, Kevin will give us two to three short films. We're also partnering with LivePlanet with Matt Damon and Ben Affleck and they are producing a show called, "Tell the Story," where a director will shoot the beginning and end of a short film, and then consumers will fill in the middle by filming with their cell phones.
Berens: So far, it sounds to me like Bud.TV is a destination site; like, all of the content that you are creating, people will have to go to Bud.TV to get. Is that true?
Schumacker: Yes, that is true. The content we develop and what airs on Bud.TV will be proprietary; unless you download it and stream it to a buddy, you will not be able to see our content on any other site.
Berens: And, the reason for this is because of the Beer Institute's rather strict marketing guidelines about when and where you guys can appear in public?
Schumacker: No, not at all. It is strictly a creative situation where we feel we want to keep our creative proprietary. Now, say that one of the TV Shows, "Replaced By a Chimp" airs for three weeks, and we move one of our shows to archives and somebody else, like say, YouTube wants it on their site… somebody may put it up on YouTube anyway, or on MySpace, if they have their own page.
Berens: So, people will be able to download it and put it on their video iPods, or on their other mobile devices?
Berens: And, Tony had talked about wanting people to be able to see this on their telephones, on their mobile phones, in the age of convergence. So, it sounds like there is a push component to this, rather than a pull component.
Berens: Okay. Well, that is very exciting. Now, it sounds like all of the content is pitched at people of drinking age.
Schumacker: Yes. When you come onto the site, we will have a profile page you need to fill out-- not only just asking your birth date, but gender, likes, dislikes, et cetera so we can -- if you so choose, and opt to -- develop a customized page for Bud.TV. Say, you like our "Happy Hour Show," the "Comedy Show" and "Hollywood," and that is all you want to see when it is refreshed. You can opt in, put it on your desktop, and when it is refreshed there will be a ding, or a sound, that you know you have refreshed content on the site.
Berens: So, is there any plan to syndicate your content to some of the other places where Anheuser-Busch is famous for marketing? Tony, you are well known for saying that one of the best places to market is sports because that is where people do not skip the ads. There are all sorts of sports sites. There is ESPN. Do you think that some of the Bud.TV content might make its way out into other publication venues? Or, is it going to be strictly either downloadable, or achievable, through the desktop?
Ponturo: Conversations in the future will take on a broader sort of scope and we will be looking for unique content for Bud.TV. We may find that there is interesting, barter/sponsorship arrangements where we could be negotiating with ESPN.com for just our general advertising on their website, but want some content that maybe could be provided that is unique for Bud.TV, and incorporate that as part of a negotiation.
If we do this right, and we have a very attractive adult 21- to 24-year-old audience, that other sites and/or sports could be interested in any cross promotion that would make sense. Part of the Trigger Street partnership, in a way, is getting free content from their website, which are these short films that Kevin Spacey has provided the opportunity for. But really, their site is pretty much for the industry, and they would look for broader consumer exposure, which we could provide. We have had some conversations with NBC Universal about where there is the unique situation where they are obviously creating content with a studio called Universal. They are developing their internet sites. They obviously have cable and broadcast television. So again, what kind of arrangements can be made to be unique across the board that benefit both companies?
The sports angle is sort of interesting because although in many respects we are covered in the sense of live sports and team sponsorships, we still think that there is a place for sports on the site, in a sense of unique background, whether it is up close and personal with Dale Jr.; whether it is maybe programming; or, we can get behind the scenes of teams, or interviews, or training camps, or something that would need to be negotiated. But again, the trade off of driving people back to their sites. I will not mention anyone today, but we have already gotten a lot of interesting emails from third parties very interested to sit down and see if some of their content would be interesting to us; and then, how there could be cooperative efforts.
So, to Jim's point, we want a sense of propriety. We want a sense of: You have to go to Bud.TV, because they are delivering an expectation that is well received. But, in the same breath, the viral nature of the internet, and getting what we are doing out to as many people is going to be important as well.
Berens: We will be eager to hear what other alliances you guys might be creating. I wanted to ask about… we used to talk about "the last mile," back in the last phase of the internet. And it is really, it is the last 10 feet now, as we are going from the computer onto the television. And Tony, you had mentioned IPTV (Internet Protocol or InterPersonal Television) a little while ago. So, I am curious, is there a plan afoot, or are you open to getting the Bud.TV content onto people's televisions through VOD, or some kind of video podcasting, or some agreement with the cable carriers?
Schumacker: Actually, we have had some initial discussions with @radical.media out of New York, and they feel it is a great idea for us to go on Video on Demand. We would like to get the site up and running and see if there is consumer excitement. We feel there will be; and then, we will keep those options open.
Ponturo: Yeah, one thing to add to that, Brad, is, we are anxious about our announcement, but are still five months away from launch, and there's still a lot to be done. But, we really see that, maybe in the case of Bud.TV, we have just gone the first 10 feet, and we have a mile yet to go before this is all played out. We have said, "Let's not judge ourselves necessarily in the first 90 days-- on February 5, 2009, how do we look?"
Getting the right content on is key. And then, that we have people coming to the site. And then, I think, we are going to be wide open to where it connects, from a technology standpoint, as all of this develops. We are in what, maybe year 12 of the whole internet world? And, we are probably in, not barely year two of reasonably developed broadband capabilities. So, to us, this is still very much in its infancy and there is a long way to go here.
Going back, when it went from three television networks to a 100 channels, and then Pay-Per-View, and everything else… ultimately, the consumer drives themselves to content, and in the same way even with a 1,000-plus websites, those that are getting the hits are those that provide an interesting asset to the consumer. So, at the end of the day, if we do not have the content, then we are going to have an unattractive site. If we have the content, then we think we will have something.
And, the thing that is nice -- not that we all do not feel a lot of pressure on this -- but, at the end of the day, there is not a profit responsibility; there is not a bottom line responsibility. There is, making a good marketing expense responsibility, and hopefully the consumer rewards you, that ultimately, you see your beer sales grow. And that is going to be not that we can have a solid line to just one property; but -- this will be one of the important elements -- that we can hopefully grow our market share in the future.
The other thing, not to digress on you Brad, but then obviously the international and global capability, and the interest in this site around the world, particularly in key countries for us like Canada, the UK, Ireland, China where we have websites for Budweiser.com, and how we drive people and the awareness of Bud.TV around the world is another very huge opportunity as well.
Berens: You mentioned user-generated content in the form of BudTube, and particularly with the user-generated Ted Ferguson ads. The user-generated content, or what Henry Jenkins called "participatory culture"… these are really big deals in the online arena. I am curious what kinds of community, or social media, opportunities are going to be there for the consumers? How will consumers be connecting with each other? Through the "4:55 Show?" Is there going to be online commenting? Are you going to be inviting people to be blogging on Bud.TV? What other places for people who do not necessarily have digital video cameras and the ability to go out and create a short film? What else is there?
Schumacker: I am not at liberty to discuss what program it is, but we will have a program where there will be casting calls in bars for four to six weeks. We will shoot the show in a bar, but also, if you want to be part of the show, you can also put your photo and a bio up on the website, and then consumers can interact with each other, as well.
Berens: Any plans or possibilities of you guys working with some already established social network? I think that MySpace skews a little young for brewers, but there are plenty of other ones.
Schumacker: There are. And, we have had meetings with Fox Interactive and are in discussion, right now. We have talked about potentially having a page with one of our characters on MySpace-- MySpace is actually getting older.
Berens: Tony, you glossed on this briefly when we mentioned ESPN… I am aware that you guys are in communication with other media entities, now that Anheuser-Busch, (in addition to being one of the world's largest marketers) now is a media property in and of itself. But, what about opportunities for other brands, and other advertisers with Bud.TV? You said there were not going to be pre-rolls, except maybe the Super Bowl spots. What sort of co-branding, or simple advertisements, do you expect there to be, if any?
Ponturo: Within our existing accounts, you mean? Or, outside Anheuser-Busch?
Berens: Both, really. I would be surprised if there was nothing for Michelob on Bud.TV. But, if Nike, for example, which is another big sports marketer, wanted to do something with you guys, is that possible? And, I understand that we are months away, I am just trying to figure out what your plans are.
Ponturo: Right. We have debated this a little bit; but, we have come to the conclusion that our focus should be somewhat, I will say, "simple," in the beginning, and focus on the marketing of our brand. But, yes, you will see more than just the Bud family on Bud.TV. We named it the Bud.TV -- just real quickly -- because it had immediate name recognition, and an expectation of what would be on the site, rather than come up with a third-party name that you would spend a little bit of time trying to explain what it was. So, we went for that. But, that said, it not only is for Budweiser, for Bud Light, Budweiser Select, but as you say, the Michelob family, and some of our new, innovative brands that we are working with, as well.
As far as the third party, we are going to sit still for a little while. We want to make sure that we are only accountable to ourselves, we are only accountable to our own brand imaging, and that we make sure we do the first job right, which is: sell beer. Now, 12 or 18 months from now, if we find out that we have a pretty strong base of unique visitors, and we have content that Nike, or iPod, or an automotive brand would be interested in, we will think about it. Obviously, that could be a revenue source. It could help with programming costs. If we went that way, it would be -- at least initially -- very limited. But, the short answer is: Certainly for the first year, we are going to stay focused on our brand.
Berens: Let me ask a question about budget. In the Wall Street Journal, someone from Anheuser-Busch was quoted as saying that the company plans to spend double digit millions of dollars on this online push with some of the money coming from network and cable TV broadcast ad budgets. So, I just want to talk about the budgeting question, for a moment, which is: can you confirm that you will be shifting money from network and cable TV into online? Or, is that something that you are not willing to comment on?
Ponturo: We are willing to say that, in the broad, digital space, which is made up of our third-party website advertising, our internal websites and Bud.TV, that we will be spending 10 percent of our media budget, which was the approximation in the Wall Street Journal article.
Berens: That approximation was…that was $606.7 million, as stated in the Journal, according to TNS Media Intelligence.
Ponturo: That is correct. What was the second part of your question?
Berens: Oh, the second part of the question was just whether it's true that you will be shifting money from network and cable TV into online.
Ponturo: Since this is, if you will, national entertainment reaching the consumer across the country (and, as I mentioned earlier, on a global basis), it is more likely to come from prime and late night, both network and cable television.
We have stated that live sports is still very important to us. We have already extended our Super Bowl exclusivities for the next six years. Obviously that came with a lot of support of other sports with the networks, so live sports we still see very viable and very much of interest to the 21- to 24-year-old. We still keep a base of prime and late night; but, in general -- and it is a broad statement -- the networks are not particularly focused on really the male 21- to 27-year-old. So, we are more interested in taking some of that, call it national entertainment dollar, and putting it behind specific programming that we would feel confident is totally skewed to that audience.
Brad Berens is editor in chief for iMedia Communications. Read his full bio.