Sequoia Capital partner Mark Kvamme, citing examples from campaigns run on Funny or Die and AdMob, told an audience of marketers at OMMA Global in San Francisco today, “If you can harness social media marketing, you don’t have to pay for advertising any more.”
Kvamme, whose experience in advertising dates back to the 1980s, when he led advertising agency CKS Group, justified his argument using Neil Borden’s “Marketing Mix” theory. He said Borden’s elements of promotion — advertising, direct marketing, PR, point of sale and word of mouth — are still valid for marketers today, just in different ways.
The biggest difference can be found in the word of mouth category, said Kvamme, who subsequently called it a tremendous — and cheap — opportunity. “If you take what’s going on on Facebook, on LinkedIn, on Twitter, on Digg, the masses are starting to make their own media, and it’s basically free,” he noted. “So if you can figure out how to work in this world, you can get your message out very quickly.”
Funny or Die’s (one of Kvamme’s Sequoia investments) recent Presidential Reunion, which brought together actors who’d portrayed U.S. presidents throughout the years on “Saturday Night Live” at a cost of $20,000 (primarily flying all the participants in), according to Kvamme, yielded some 3 million views.
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Presidential Reunion was a bit of a passion project for Funny or Die co-founder Will Ferrell, but Kvamme also pointed to last summer’s relatively unsuccessful movie “The Goods” starring Jeremy Piven (and produced by Funny or Die co-founder Adam McKay), the expected box office returns for which were lifted 15 percent through a Funny or Die campaign including prizes for retweets on Twitter (which led to the movie becoming a Twitter trending topic), featuring on the front page of Funny or Die and its Facebook fan page, two appearances on the front-page of Digg for custom Funny or Die content, live-tweeting from the premiere and a live conversation with McKay on Ustream. It generated “several million dollars in sales for something [the studio] probably didn’t pay Funny or Die enough for,” said Kvamme.
But the next big opportunity is in mobile, said Kvamme, using AdMob to illustrate (again, another Sequoia company, but at least one that’s had a successful exit, with Google beating out Apple to buy it for $750 million). With more than twice the global penetration of the Internet, mobile — especially smartphones — represent an opportunity to harken back to that “Marketing Mix” theory, because they can encapsulate all the elements of promotion from one single screen that’s attached to its owner at all times. An AdMob campaign for the movie “Wolfman” had ads on mobile media sites ad within applications that users could click on in order to get more information, share it with their friends, buy tickets directly and set up a mobile calendar alert.
Sure, Kvamme is pitching his own investments here, but to his credit he said that one of his favorite and most-visited sites is search.twitter.com, for keeping up with what people are talking about online. He also talked about Facebook’s opportunity to become the new mass media — with half its 400 million users logging in every day, “that’s almost like what broadcast television was 20 or 30 years ago” — and to dominate and grow the market if it ever does launch its own payment platform inside its trusted environment, just as PayPal revolutionized eBay.
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