Branded applications as the new advertising medium

The New York Times is running (hah!) a story about the much touted Nike+ site, one of the best examples out there of what a lot of us have started to call the branded application. The Nike+ site is done all in Flash and is a rich Internet application that brings users together and gives them a great experience around running. It tracks the users runs (distance, time, etc) and let them compare with other people on the site. It brings users back to the web and also encourages them to buy Nike shoes. As the paper notes the combination of lots of shoes out there and the coolness of the site helped generate buzz for Nike. In the process sites like Nike+ are changing the advertising business.

When the mainstream media picks something like this up, I get pretty happy. It is yet another example of how RIAs are totally changing the game in a number of areas. It may sound grandiose or arrogant, but the NYT gives some great numbers. The 25 biggest ad-spending companies cut their spending last year in traditional media by $767 million and in the first half of this year decreased their overall media spending by an additional 3 percent, $446 million. So where is the money going? Nike increased it's nonmedia spending by 33% to $457.9 million, doubling it's media spending of $220.5 over the same period.

Traditional advertising doesn't work. People don't want to be preached at, they want to be engaged, which is exactly what the Nike+ site does. It's the perfect alignment of consumer and marketing interests which is why it's so successful. Other companies can and will follow suit. RIAs present a very, very powerful advertising platform if used correctly.

Phil Butler touches on some of the same topics. It seems like we're all talking the same thing just not using the same language. But there's definitely a big trend here.

Hat tip to RGA, the makers behind the site. You guys rock.