Crowdsourcing, viral Internet campaigns, product placements and guerilla promotions are quickly consigning tradition magazine ads and TV commercials to the annals of history, according to Seethu Seetharaman, Professor of Marketing at Olin Business School.
"Traditional expensive advertising is no longer effective given all the clutter, as well as the emergence of technologies, like digital video recorders, that block the ads from even being viewed, much less absorbed, by consumers," he says.
Instead, he argues, the future of advertising lies in low-cost, high-impact promotional campaigns as well as an increase in product placements where consumers have no choice but to take in the brand being advertised.
"One of those few opportunities is being stuck in a dark auditorium, consuming entertainment, having no choice of whitening out a brand on screen, or using a DVR to fast-forward," Seetharaman says.
"In fact, product placements are also on the rise in sitcoms, video games and other media for the same reason. Pre-movie advertising interspersed between movie trailers will increase as well."
But it is social media that really holds the key to the future, he argues, both in product development as well as advertising. Crowdsourcing will enable customers to take active charge of the new product development process, rather than reacting to product concepts developed by firms.
"This product development model has already moved to information markets like the Huffington Post, and is now moving to high-ticket products such as furniture and cars, albeit for limited target markets for now," Seetharaman says.
As far as advertising goes, the explosion of smartphones means that viral and "grassroots" campaigns will quickly become more effective than traditional advertising.
"With, these grassroots campaigns are swiftly recorded by people and then posted on YouTube in short order, which then makes these guerilla campaigns go viral in a big way," Seetharaman says.
"This 'guerrilla promotion' style of advertising will blossom in 2012 and beyond."
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