Citi Still Spending Money on Marketing; Facebook Will Get a Few Pennies
by Peter Kafka
Posted on November 24, 2008 at 7:47 AM PT
File under “odd timing”: On the same day that Citigroup makes headlines as the beneficiary of a $300 billion bailout/prop-up, the bank begins a new marketing campaign. But don’t worry, U.S. taxpayers–the bank you’re buying a piece of isn’t blowing much dough on this one.
That’s because it’s a Facebook app campaign, which makes it very difficult for its sponsor to blow much dough, no matter how hard it tries. In this case, Citi is sponsoring a “Magnetic Lyrics” app, a takeoff on the refrigerator magnet word games favored by vaguely literate folks. In this case you assemble lyric snippets to your favorite songs by either Nickelback or Mary J. Blige.
Don’t like either act? Me either. But presumably lots of people do, and Citi is doing a broad deal with both of them. In any case, what’s relevant here are the economics, which are small scale.
I don’t have specifics, but I assume that Citi and its vendors–Atmosphere BBDO, a digital agency owned by ad behemoth Omnicom (OMC), and Buddy Media, a start-up that specializes in social media campaigns–are spending a modest amount to actually develop the app. I’m guessing it’s under six figures. And Citi will likely pay a small bounty for each user who plays with it–perhaps $1 per user. So far, that’s about $5,400.
And what does Facebook get out of this? Well, Citi (C) will need to buy some ad space to promote the app, so you can tack on a few bucks more to the campaign. But not much–Facebook has had a notoriously hard time convincing advertisers to pay up for its inventory. And it has a lot of inventory.
The takeaway: Assume Citi continues to exist in some form, it’s going to have to continue to spend money on marketing, and most of that will still be on big-blast campaigns like the ones you’re used to seeing on TV. But small, targeted plays like this could be an effective complement. And if you get a lot of marketers investing a lot of money in these kinds of gimmicks, then Facebook has a real income stream, which it could use.
Comments
Dr. Tantillo did a post on his a marketing blog on Citigroup last week, when its stock was down at $3.77. Since he blogs from a branding angle, he tied their failed management to failed marketing, maintaining that Citigroup (like many other banks) has strayed from its banking roots:
“Leading with marketing rather than deal finance would have shown that the basic natures of a bank and an insurance company are very different, and combining them would only dilute both.”
Full post
Any marketing by Citigroup seems ridiculous at this point, but Tantillo would say that targeted ad buys make much more sense than the ‘big-blast’ campaigns. (He has railed against Super Bowl ads as a waste of money.)
Posted by elo sloane at November 30th, 2008 at 9:29 am