Bud.TV: Logging Troubles


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Case Details:

Case Code : MKTG170
Case Length : 16 Pages
Period : 2005-07
Pub Date : 2007
Teaching Note :Not Available
Organization : Anheuser-Busch Companies Inc., Bud.TV
Industry : Dotcom, Internet Portal
Countries : US

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"The reason that YouTube and MySpace work is that they have an open environment where you can share, That's what draws masses of eyeballs. The Bud.TV content may be fantastic, but if they can't attract audience it doesn't do much for them."1

- Michael Hayes, Senior VP-Managing Director at Initiative Interactive, in 2007.

"Bud.TV is ambitious in its effort to create a whole mini cable network online because that requires a more significant commitment to content production and relationships like the deal with Sony to stream Afterworld. That means more overhead has to be assigned, which means more costs to recuperate. With that high risk, one wonders if it wouldn't be just as valuable to have put the resources into producing or sponsoring clips intended for distribution primarily on other video sites that already have an audience."2

- James McQuivey, Analyst, Forrester Research3, in 2007.

Introduction

In the first week of March 2007, comScore Media Metrix4 announced that Bud.TV, the digital entertainment network launched by Anheuser-Busch Companies Inc.5 (Anheuser-Busch), had averaged 253,000 unique visitors in February 2007, its first month online. Bud.TV was launched after an advertising campaign during Super Bowl XLI6. According to Anheuser-Busch's projections, Bud.TV would attract about 3 million unique visitors per month by the end of 2007.

Launched on February 04, 2007, Bud.TV featured seven channels offering a wide range of programs. The launch was supported by both electronic billboards that were displayed during the Super Bowl, and advertisements on major websites.

The US$ 30 million initiative was said to pioneer the direct-to-consumer approach to advertising by bringing promotional content directly to the targeted consumers.

Through direct-to-consumer initiatives, marketers would have more control over the message they were delivering to their consumers, as compared to relying on traditional TV. Bud.TV was closely watched to determine if major television marketers like Anheuser-Busch, who spent millions of dollars every year on advertising, would shift a part of their marketing budgets to the Internet, to reach the target audience more effectively. According to Hilmi Ozguc, CEO of Maven Networks7, "This changes the whole concept of broadcasting out to consumers. Typically, media companies have done that. With the Internet, we blow out that old model and enable advertisers to reach consumers directly without having the media companies sell the ad space."8

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1] Matthew Creamer, "Bud's Walled Beer Garden: A Review of Bud.TV," http://adage.com, February 12, 2007.

2] Gavin O'Malley, "Bud.TV Sputters after Launch: Experts Assess Why," http://pubilcations.mediapost.com, March 16, 2007.

3] Forrester Research is a US based technology and market research company that provides its clients with advice about technology's impact on business and consumers.

4] comScore Media Metrix is the audience measurement division of comScore Inc. The division measures online media usage for work, home, and university audiences. comScore is an Internet marketing research company providing marketing data and services to several Internet companies.

5] St.Louis, Missouri-based Anheuser-Busch Inc. is the third largest brewing company in the world and the largest brewing company in the US. Some of the popular brands from the company are Budweiser, Michelob, and Busch. The company also produces specialty beers, non-alcoholic brews, malt beverages, and malt liquors.

6] The 41st Super Bowl was played on February 04, 2007. Super Bowl refers to the Annual National Football League championship game and was the third most watched US television broadcast of all time.

7] Cambridge, Massachusetts-based Maven Networks is involved in creating, distributing, and managing Internet delivered rich media programming and direct-to-consumer broadband video channels.

8] Joe Mandese, "King of Beers Becomes King of Content, User Super Bowl to Launch Direct-to-Consumer Channel," Media Daily News, February 02, 2006.

 

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