Free Downloads and Advertising: A Match Made in Heaven?

Would you consider purchasing a Hyundai if they gave you a free Mp3 download of a song by alternative rock band The Ataris?

That is exactly what Hyundai is hoping with a new Internet advertising campaign where they place banners on websites like Pandora.com, ComedyCentral.com and Billboard.com. When a user clicks on the banner, a 20-second Elantra commercial is screened in a pop-up while a song from the band plays and is simultaneously downloaded onto the user’s computer. Hyundai wants the people who watch the commercial to know that the car company is bringing them something that makes them feel good.

I think this model is revolutionary. Giving away digital media in conjunction with advertising might become the standard for all Internet as well as brick-and-mortar retailers. Free giveaways have always attracted new customers, similar to the way department stores offer their customers 10% off their purchase if they open up a store credit account. People will commit to “relationships” with retailers if they are given an immediate, tangible benefit. Mp3s and other music downloads are very on-demand products and could be used by almost any company as an advertising incentive. This "give, then receive" model is also being tested in the live music realm with the new Ozzfest tour, where tickets will be free with the hope that the concert-goers will spend money on records and merchandise. Why haven’t the record companies and radio groups figured this out? Even Hyundai, an arguably second-rate auto maker, is thinking more outside the box than the music industry.

Ultimately I think this marriage of free music with advertising will not bring Hyundai itself any major additional revenue. To be perfectly honest, I do not like The Ataris and I doubt that the majority of the targeted 18- through 49-year old audience do. For this to benefit auto makers or any retailer in general, the scope must be much greater. Users need options. Users need variety. Users need further incentive to form a relationship with the retailer. Offering songs by one band and failing to follow-up on the commercial will leave Hyundai in the same place they stand today, except with a limited relationship with online music retailers. However, according to this article on Adweek.com, Hyundai ran an earlier campaign with Music Interactive and had their users fill out a registration form. 35% of those who clicked on the banner filled out the form. That is not a high figure but higher than one would expect.

In the end, people do not like commercials but will watch them if they get something in return. Music was, is, and will always be a commodity for any retailer to use as an incentive. Hyundai has the right idea; now we are just waiting for the company that will perfect the model.