The Hyperfactory

MUJI IPAD APPS
The minimalist Japanese retailer launched a series of iPad apps that transferred its characteristic style in clothing and home goods -- spare, clean and functional -- into digital products. Calendar (free) helps organize appointments and syncs with Google calendar, Notebook ($3.99) is a product to sketch and jot and Muji to Go (free) is a tool for travelers with a world clock and calculator.

WEBER'S ON THE GRILL IPAD APP
This iPad app has a meat timer. If that weren't enough, the app cookbook from the outdoor grill company also contains recipes, how-to videos and grocery lists. The app is just the latest in cookbooks from Weber, which reported at Ad Age's ME Conference in November that it sold more than 1 million cookbooks.

BIG FORK, LITTLE FORK IPAD APP
This iPad app from Kraft Foods is a tool for parents to teach their kids healthful habits. While Kraft achieved app fame with its iFood Assistant, it's recipe app for iPhone, the marketer did not just make that success bigger for the tablet platform. Instead, it looked to mobile agency Hyperfactory and the editorial prowess of its magazine-publisher parent, Meredith Corp., to craft the editorial app -- interlaced with lots of Kraft products of course -- aimed at parents.

STARBUCKS CARD MOBILE APP
While the coffee-chain launched this mobile payments app last September, it added in a loyalty program and expanding the mobile payments program from test stores in its hometown Seattle, Northern California and 1,000 Target stores to 300 more locations in New York City and Long Island this year. The app, available for iPhone, iPod Touch and BlackBerry, still remains one of the biggest mobile payments programs in the U.S. to date.

TIFFANY ENGAGEMENT RING FINDER IPHONE APP
Not only does the app contain all the shapes, sizes and designs for Tiffany engagement rings, it also has a sizing tool where a clueless bachelor can put an existing ring on the touch screen to compare her size to the standard ring sizes.

GE MOOD CAM IPHONE APP
To find your perfect lighting scheme, this app lets you take a picture of a room, adjust the lighting to what you're after and then constructs a shopping list of GE products to achieve those ideal levels.

BEST BUY MOVIE MODE APP
The electronics retailer created a mobile app on iPhone, Android and Blackberry, meant to be used in the theater for the movie "Despicable Me." While the film is playing, the app dims the phone's screen and silences the ringer, but during the end credits it translates what the cartoon characters are saying in their strange language.

DISNEY TICKETS TOGETHER FACEBOOK APP
For the "Toy Story 3" release this summer, Disney created an app where fans could buy tickets to the film right on the social network and also invite friends to do the same. When a Facebook user buys a ticket, it publishes the purchase to his or her news feed and invites others to do the same. Disney has since used the tool for later releases, like the most recent "Tangled" movie.

DELTA TICKET WINDOW FACEBOOK APP
The Facebook tab on Delta's fan page lets users search, book and share flights within the social network. Built by Alvenda, the app is a first for the airline industry -- the transaction is completed within the social network, while an earlier tool for European budget airline Easy Jet started the process on Facebook but jumped to its own website to complete the sale.

WALMART'S CROWDSAVER FACEBOOK APP
Following the lead of rule-the-headlines-startup Groupon, digital agency R/GA built the world's-largest retailer a group-buying app on Facebook called Crowdsaver. The first deal flipped on nearly 20% off a plasma TV with 5,000 likes. Walmart has since launched other deals, such as $6 off the "Back to the Future" DVD trilogy.

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Each year for the next ten years Hyperfactory founders Derek and Geoff Handley will fund and host a ten-day US road trip for one marketer to visit the best of breed in digital marketing.

“The scholarship aims to create a powerful alumni of leading lights in the future of marketing and give them unprecedented access to the conversations of the smartest marketers at huge global brands like L’Oreal, Kraft, Nestle and InBev, in a global setting,” Derek Handley told the audience of 100-plus marketing glitterati.

He says the next ten years “will totally transform marketing, consumer behaviour and branding as we know it, far more so than in the past 100 years combined.”

Handley laments the state of New Zealand digital marketing—from the shameful speeds and costs of access, to the paucity of online innovations in marketing.

“We have a number of challenges across our broadband and mobile networks in New Zealand, which limit us from persuading Kiwi consumers to engage at this level. But within these challenges await significant opportunities, and our future marketing leaders need to be best equipped so they can find these solutions. The scholarship is designed to empower that skill base.”

Scholarship recipients will get to meet leading marketers and game changing companies at both ends of spectrum, from corporate to start-up.  In addition to understanding how the leading brands engage with their consumers, recipients will be able to ‘take a look under the hood’ at some  of the world’s leading marketing, content and digital enablers like Apple, Google, Time Warner and Facebook.

The scholarship will commence in early 2011.  To be eligible, those nominated must be brand marketers, under the age of 35 and visionaries for the future. Interested parties will be able to go to www.thehyperfactory.com from January 2011 to find details on how to apply.

After announcing the scholarship the guests clapped enthusiastically, several women threw themselves at the handsome speaker and at least one marketer stood on the table with his underpants on his head.

“We applaud Hyperfactory’s generous scholarship and encourage all marketers to apply for the scholarship. In no way can we condone the table thing,” says Marketing Association chief executive Sue McCarty.

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The US-based awards, which are now in their sixth year, recognise top companies and their campaigns across different regions for spearheading the adoption of the mobile channel for marketing purposes.

The Hyperfactory, which the Handley brothers Derek and Geoffrey recently sold to US marketing beast Meredith (they still work there, of course), were acknowledged in Best Use of Mobile Marketing – Product/Services Launch for Clinique’s 3-Step Product Launch & Sampling Campaign, Best Use of Mobile Marketing – Product/Services Launch for Trojan – Fire & Ice, and twice in the Innovation categories for Intel Work Smarter in UK and the US.

Tui Blond (recently awarded New Zealand’s best lager at Brew NZ 2010, don’t you know) is up for Best Use of Mobile Marketing – Direct Response – Asia Pacific. It was entered into the awards by Todd Wackrow of PocketVOUCHERS.com, who worked on a consumer sampling campaign for the brand through mobile phones, which drove foot traffic into on-premise outlets with close to 20,000 consumers trialling the new beverage.

Tui marketing manager, Jarrod Bear says making it to the finals of the international caps off a great year for the brand. “It’s an awesome achievement considering the campaign is benchmarked on a global standard.”

The winners of the awards will be announced in Los Angeles at the Annual Global Awards dinner and ceremony on November 17. And Wakerow, who will be on his honeymoon at the time, hopes to attend the awards on behalf of Tui Blond and bring back more gold than just his wedding ring.

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Purse Strings Tied to Apron Strings
While women dominate household spending, they still bear the brunt of getting food on the table and taking care of kids, handling 91 percent of the household chores, according to Boston Consulting Group. She'd love to lure her husband into the kitchen to help plan and cook family meals, and maybe Big Fork, Little Fork will help. The iPad app from Kraft Foods combines recipes, nutrition tips, and cooking how-to videos with a very soft brand message.

Created in conjunction with Meredith Integrated Marketing and Hyperfactory, it was designed to help parents instill smart eating habits and a foodie sensibility into kids 6- to 12-years-old. "There are 37 million online searches per year on kids' food, but not a dominant source for that type of information," says Ed Kaczmarek, director of innovation in Kraft's consumer experiences department. "So we saw an opportunity to become a source for parents in the food challenges they're facing - getting their children to try new foods, learn smart eating habits, and making meal-time more enjoyable."

Despite the limited number of iPads in consumers' hands, says Kaczmarek, "We think the iPad is an incredibly interactive device that will be used not only in [the] kitchen but around the whole home."

Recipes would be the obvious thing to do, but Hyperfactory, a mobile marketing agency recently acquired by Meredith, tried to reinvent the experience, according to Hyperfactory CEO Derek Handley. "This isn't a magazine or a Web site, it's an interactive experience that uses a new surface that's great for games, great for swiping through big rich images, and a surface that can delight the consumer with little surprises." For example, tapping on an image of an egg will cause it to crack; tapping a tomato makes it go splat.

"You can definitely pack in a lot more content on the iPad; the bigger screen has more room for inspirational imagery," says Handley. The large screen is also better for sharing and, because the app is downloaded, it can be used offline.

Big Fork, Little Fork is expandable, too. After the initial $1.99 download from iTunes, creative moms will be able to go back for additional free and premium content, including chef-branded content packs from the likes of Top Chef Masters winner Marcus Samuelsson.

We only hope that it doesn't end up with Mom doing all the cooking while Dad and the kids play with the iPad.

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Trojan tapped its agency of record, Meredith’s The Hyperfactory, to use the mobile channel to generate awareness for its Fire & Ice product among sexually active men and women ages 18-34, and connect the product to this target audience in a positive, relevant and fun manner. Rhythm NewMedia, Jumptap and 4th Screen Advertising also participated in the multifaceted rich-media mobile ad campaign.

“Our task was to engage Trojan’s target audience both physically and emotionally with the Fire & Ice product and mobile campaign in an innovative manner,” said Geoffrey Handley, cofounder of The Hyperfactory, New York. “We wanted to make the most of what mobile has to offer to really deliver on the product positives.

Trojan tapped its agency of record, Meredith’s The Hyperfactory, to use the mobile channel to generate awareness for its Fire & Ice product among sexually active men and women ages 18-34, and connect the product to this target audience in a positive, relevant and fun manner. Rhythm NewMedia, Jumptap and 4th Screen Advertising also participated in the multifaceted rich-media mobile ad campaign.

“Our task was to engage Trojan’s target audience both physically and emotionally with the Fire & Ice product and mobile campaign in an innovative manner,” said Geoffrey Handley, cofounder of The Hyperfactory, New York. “We wanted to make the most of what mobile has to offer to really deliver on the product positives.

“With a unique, fun product that brings couples together, combined with the hype surrounding the iAd, we identified an opportunity for Trojan to make a splash and deliver something truly innovative, un-restricted—that is, wider than Apple—and relevantly enjoyable,” he said.

“The result was the Trojan Fire & Ice rich-media campaign, which is the best example of an insight-led mobile media strategy centered on contextually relevant engaging rich-media mobile ad units and 100 percent aligned brand sponsorship.”

Trojan is a brand name of condoms manufactured by the Church & Dwight Co. The company claims that more than 70 percent of condoms purchased in United States drugstores are Trojan contraceptives.

Trojan target
Trojan’s target demographic is consumers ages 18-34 who are experienced condom users in a “relationship mindset” that are using their mobile device to make their relationship adventurous and exciting, per The Hyperfactory.

Mr. Handley said that these are sexually active "guys’ guys" and "real women" who believe that while “Jersey Shore” is entertaining, they are responsible and open with sexual safety.

The target audience over-indexes in all mobile usage categories, including consumption of relevant mobile Web content destinations (MTV, Jersey Shore, Jumptap, Cosmo and BET), applications and streaming audio (Pandora and Shazam) and location-based services (Foursquare).

Mobile strategy
The Hyperfactory’s formulated a strategic mobile media plan to effectively reach Trojan’s target audience and use rich media and publisher integrations to cut through the clutter. At the most basic level, the objective of the mobile campaign was to instill deep consumer engagement with the Trojan brand.

“We wanted to wow the audience and connect Trojan Fire & Ice to pleasure, innovation and safe fun, as well as connect with the audience with relevance,” Mr. Handley said. “We decided to leverage highly-relevant mobile properties, targeting options and contextual messaging to reach couples as they actively search for educational and relationship enhancing information.

“The plan was to ensure a constant mobile media presence with a heavier presence at core purchase day parts so that when a consumer needs a condom or wants to spice things up, they think of Trojan Fire & Ice,” he said. “From the outset of the rich-media ad unit, we wanted to engage consumers through various relevant integrated programs.

“We tried to balance utility and entertainment to provide fun tools for a safe and exciting relationship to entertain them and educate them.”

Execution
The Trojan Fire & Ice campaign included mobile search, Mobile Marketing Association standard mobile banners, rich-media expandable in-browser units, rich-media expandable in-application units and both pre- and post-roll mobile video.

The campaign involved custom content creation, functionality development and integration with publishers.

Trojan rich-media in-browser units were deployed across the Jumptap mobile Web network, including Esquire, MTV, Jersey Shore, Cosmo, BET, G4, NBA, LimeLife and E!’s mobile sites.

Trojan’s integration with the Pandora iPhone application, which was a perfect fit with the its target, featured time-sensitive “Plan Your Date” and “On Your Date” personalized tools incorporating "mood music" and location-based "How Steamy Do You & Your Partner Like It?" functionality.

MTV’s Jersey Shore was also deemed a perfect content fit with Trojan’s audience.Trojan developed custom editorial content with Jersey Shore cast members, including "Go On A Date Jersey Shore Style," and "Jersey Shore Dating Tips" from cast members. In addition, Trojan expanded the Jersey Shore integration to Foursquare, with real-time Jersey Shore cast member check-ins and date venue tips.Trojan targeted Shazam’s 75 million monthly users with day-part, time-sensitive targeting focusing on night time and weekends only.

There was mood-related integration of rich-media units to love songs and music related to "getting it on" from artists such as Barry White and Lady Gaga.

The Hyperfactory developed a custom ad banner for Shazam that shows up on the tagging recognition of a love song: “Stop Tagging and Get it On.”

The banner on the Shazam tag results screen takes users directly to the new Fire & Ice mobile site.

“Trojan was looking to target both couples and singles, 18-34 years in a ‘relationship mindset’ who put time and energy into making their relationships adventurous and exciting,” said Jonathan Symons, executive vice president of business development at Shazam Entertainment, Portsmouth, Britian.

“Tagging songs is becoming a simple and easy way to discover more about music, thanks to Shazam, and there is an obvious link between romantic or sexy music and Trojan’s product range,” he said. “Shazam was able to demonstrate its tremendously high tagging rates on nights and weekends, when people are in clubs and bars and generally socializing with music in the background.

“That, combined with the unique ability to target particular music genres and deliver Trojan ads when users selected love songs was core to the campaign strategy.”

Trojan pre-roll rich media and interactive video powered by Rhythm NewMedia featured social integration to Facebook and Twitter.

The Google-powered mobile search component consisted of a branded and non-branded behavioral search strategy targeting users while at drug stores, during night time and in adult-related-activity contexts.

“The key to the creativity is of course the actual rich media units—Fire & Ice, hot and cold, naughty and nice,” The Hyperfactory’s Mr. Handley said.

“The rich-media units are 100 percent on message, tactical and with all the hype surrounding the iAd, our innovative and entertaining really rich-media ad units enable all of the target audience to engage, without the limitations of the iAd and proving the scale of a much wider audience base than simply iPhone users,” he said.

Results
Trojan and The Hyperfactory tapped Insight Express to conduct a mobile brand study to measure the effect of the mobile channel on brand awareness, persuasion, favorability and purchase intent. Since the Trojan Fire & Ice rich-media mobile campaign only went live at the end of August, the brand said it is unable to share any detailed campaign results. In hard number terms, as of the first week, Trojan was on track with its rich-media in-browser units proving to be 300 percent more effective than traditional mobile banner units.

Mr. Handley claims consumer feedback and results from the pre-go-live research study have been overwhelmingly positive, with online and mobile video postings and social commentary increasing every day.

“For many years now in mobile we have judged what is creative by the actual output—the mobile site, the ad unit, the app,” Mr. Handley said.

“However, as our industry becomes more mature and mobile media becomes a more complicated discipline, creativity in mobile media planning is going to become increasingly important, especially as we lift our industry from a gimmicky add-on to mainstream,” he said.

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Commenting on Galloway's appointment, Geoffrey Handley said: "Australia is a strategic beachhead for The Hyperfactory's global business and it's vital that our operations here be lead by someone who has a passion for and technical understanding of the mobile space and the right leadership credentials. From the outset, I knew John was the guy to whom I should hand the reins."

Handley added that one of The Hyperfactory's key priorities for 2010/11 was to build up its local mobile media planning and buying team - a role which will sit well with Galloway's 20 plus years of experience in media sales, including senior management positions with companies such as Vodafone Australia, MediaMe, News Limited, Fairfax Online (F2), Sensis and AAP.

"I am extremely excited to be part of The Hyperfactory. We are unique in the Australian market as we are the only truly international mobile company, which means our clients can benefit from our international experience and findings. This is a huge competitive advantage for us," said Galloway.

Galloway sees 2010 to be the year that marketers and brands realize that they cant afford to ignore mobile: "Mobile is the fastest growing media in Australia. There are over 300 million mobile Internet page impressions a month, growing at a rate of 100% year on year. No longer is it regarded as a nice to have component. It's being seen as the glue that hold digital strategies together," said Galloway.

"We are now seeing the interest in mobile marketing and strategy reach pre- GFC levels with existing and prospective customers looking to significantly increase their mobile budgets," added Galloway.

Galloway's appointment comes as The Hyperfactory continues its rapid expansion over the last 12 months. With a blue-chip client base of leading brands including Coca-Cola, Kraft, L'Oreal, Disney, Blackberry and Vodafone, the company has carved an enviable position in the US, recently being named by Entrepreneur Magazine in its annual 100 brilliant ideas list as one of the mobile market's most important trailblazers, alongside companies such as FourSquare and Bump Technologies. In July 2010, US publishing giant Meredith Media acquired The Hyperfactory for an undisclosed sum, after taking a 20% stake in the company one year ago.

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On Sunday, Kraft Foods will begin a campaign to promote its sponsorship of what used to be known as the Emerald Bowl, to be played in San Francisco on Jan. 9. The game, which will feature teams from the Western Athletic Conference and the Pacific-10 Conference, is being renamed the Kraft Fight Hunger Bowl.

Kraft plans for the day the game is played to serve as the climax of the campaign, which seeks to donate the monetary equivalent of 20 million meals to the organization known as Feeding America. (The fine print explains that a dollar equals seven meals “secured by Feeding America on behalf of local food banks,” making the goal of the campaign almost $2.86 million.)

The campaign is being designated by Kraft as the Huddle to Fight Hunger. Kraft is calling the effort, which is being handled by seven agencies, its largest integrated campaign to date — that is, one that is composed of ads in outlets like traditional media, digital media and social media.

“We’ve done smaller” campaigns to help fight hunger, said Lisa Mann, vice president for consumer experiences at the Glenview, Ill., office of Kraft. “This is about going big.”

The kickoff for the campaign will be a coupon insert that Kraft will sponsor in newspapers on Sunday and follow up with another on Sunday, Sept. 26. There will be 44 million copies of the insert to be distributed on Sunday by the News America unit of the News Corporation.

There will also be a microsite, or special Web site, to accompany the campaign, at HuddletoFightHunger.com; the site is to go live on Sunday.

The insert will feature the celebrity TV chefs Patrick and Gina Neely along with Kraft brands like Kraft Singles, Maxwell House and Oscar Mayer. Other brands involved in the campaign include Kool-Aid, Kraft Macaroni and Cheese, Kraft Mayonnaise, Miracle Whip, Oreo, Planters and Ritz.

Kraft has purchased the rights to the bowl game for three years, Ms. Mann said, adding that the IMG agency helped with that along with the celebrity and sports marketing aspects of the campaign. Other celebrities to take part will include the former football star Joe Montana and Erin Andrews of ESPN.

The campaign also includes commercials to run on television and in movie theaters, print ads, promotions in stores, mobile ads and a public relations effort. More than 40 major retailers have already agreed to take part in the campaign, through steps like in-store displays.

In addition to IMG, the agencies working on the campaign are HMT Associates, for the initiatives involving retailers; Hyperfactory, part of the Meredith Corporation, for the mobile ads; McGarryBowen, part of Dentsu, for the commercials and print ads; 360i, for the digital and social media ads; Upshot, for retail marketing; and Weber Shandwick, part of the Interpublic Group of Companies, for public relations.

Kraft has been intensifying its marketing and advertising efforts in recent months to take advantage of economic trends that include Americans eating more at home and eating more often together as families or groups. There have been new campaigns for many Kraft brands, both in traditional and new media, among them Kraft Macaroni and Cheese, Kraft Singles, Miracle Whip, Oreo and Wheat Thins.

The campaign is also meant to reflect other trends, Ms. Mann said, like how consumers increasingly “want to be part of something big,” especially in terms of helping others, and how they are returning to “simple pleasures,” including “getting together over a football game or a game night.”

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Panelists talked about the effectiveness of mobile advertising that Intel ran and gave best practices based on what they learned from the campaign. The Intel executive revealed that in-browser banner interaction rates (94 percent) were higher than those for in-application ads (17 percent).

“The reason [the Intel] campaign was so successful is that it was thought of as a campaign, not a mobile campaign,” said Jeff Arbour, senior vice president North America at The Hyperfactory, New York. “It was just a campaign that happend to be executed in mobile channel. “It is really time for brands to look at how to execute mobile from a long-term perspective and not just as a bunch of one-time runoffs,” he said. The panelists stressed that crafting a successful mobile advertising campaign means having firm objectives, clear metrics for success and tactics consistent with the overall marketing strategy.

Intel's program
The campaign was centered around promoting Intel’s 2010 Core processor family. Hyperfactory was hired to devise a strategy for media, campaign, design and execution. Intel used display and rich-media ads, which users could expand, drag and interact with to find the right processor for them. It also used basic banner ads that ran on mobile Web sites and in applications.

Advertisements ran on a number of mobile Web sites, including CNN and CBS. The campaign also used search engine marketing to drive traffic to Intel’s mobile Web site. Additionally, The Hyperfactory leveraged its relationship with Pandora to create an Intel promotion within the Internet radio service.

Effectiveness of mobile ads
Intel was able to compare the results from the different channels of its advertising campaign and discover which tactics were most effective. The campaign saw lower bounce rates on mobile than with traditional Web advertising, possibly because mobile users are using their phones and searching for information with greater purpose than users on regular desktops. Apparently, search engine marketing saw 67 percent bounce rates verses 89 percent for display advertising. And, it saw the lowest bounce rates on iPhones (85 percent), Android (64 percent) and BlackBerry (71 percent) phones.

Intel took these results as a sign that more effort should be made to target the Android and BlackBerry platforms. Behavioral targeting also proved an effective tactic for garnering high click-through rates. When discussing the efficacy of search engine marketing, the presenters said that mobile search was growing and would constitute an important advertising tool in the future. “Search volume is low, but trending up,” said Beth Lubov Butrymowicz, global media manager for Intel, Santa Clara, CA.

Results
Measurement for mobile advertising campaigns needs to be dictated by the objectives determined at the initiative’s outset. For example, because Intel used expandable, rich-media ad units as well as traditional ad banners and in-application advertising to promote Core processors, it was interested in understanding how consumers were interacting with those different ads. For that reason, Intel gauged reaction to the rich-media display units by looking at interaction and completion rates. The interaction rate examined how many users expanded the ad and dragged at least one element within it, and showed that consumers were interacting far more with in-browser ad units than in-application ad units. Apparently, consumers that clicked on the ad and dragged at least one item was higher for in-browser advertising: 94 percent verses 17 percent for in-application ads. The completion rates measured the number of consumers who worked through the entire ad, answering a series of questions intended to match them to the best-fit Intel processor. Completion rates were much higher for rich-media units (10 percent) than standard units (3 percent). In summing up the results of the campaign, the presenters emphasized that advertisers need to be cognizant of the costs associated with different ad units. Expandable units are significantly more expensive than standard units.

The right mobile mix
There is no one answer for mobile advertising globally, because of fragmentation of devices, usage models, advertising inventory and measurement tools. Advertisers need to devise campaigns in the context of the regions they are targeting. For example, when Intel was promoting its processors in Indonesia, it focused on feature phones, because the vast majority of consumers use feature phones, rather than more advanced mobile technology. Basic marketing rules still apply, according to Ms. Butrymowicz.

Summing up the lessons of the discussion, the presenters urged advertisers not to go mobile just for mobile’s sake, but instead only if it made sense in the context of their promotional strategy. Advertisers should be very clear about their objectives, and work closely with partners to set parameters for the campaigns and optimize over time. Finally, advertisers should not be afraid of sub-par results. “It’s OK to fail,” Ms. Butrymowicz said. “If you go out and do mobile, and learn it doesn’t work for your target audience, it could be that they’re not on mobile, or perhaps execution wasn’t working for them. “You can definitely learn from the experience,” she said.

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NEW YORK (AdAge.com) -- Meredith Corp. has acquired mobile hotshop The Hyperfactory after taking an initial stake in the agency responsible for the much-loved Kraft iFood Assistant app one year ago. Since the agency's opening in 2001 by two brothers in New Zealand, The Hyperfactory remains one of the most-distinguished mobile creative agencies to date, having worked with Coca-Cola, L'Oreal and, of course Kraft on its first iPad app.

From those beginnings, it's grown to an operation of more than 100 people with offices in Auckland, Los Angeles, New York, Chicago, Hong Kong, Sydney and Hyderabad, India.For a buyer that's made its name in broadcast and publishing, this is just the latest piece to add to its marketing services arm, Meredith Integrated Marketing. Since 2006, Meredith has acquired interactive shops O'Grady Meyers and Genex; viral-marketing shop New Media Strategies; health-care marketing agency Big Communications; and database and analytics shop Directive.

Ad Age checked in with Hyperfactory founders Derek and Geoffrey Handley and Meredith Integrated Marketing President Martin Reidy about the acquisition and how the mobile agency with roots in Auckland found a home with a publisher headquartered in Des Moines, Iowa. (There are no plans to move; The Hyperfactory will continue be headquartered in New York and Auckland.)

Ad Age: Why does The Hyperfactory make sense for Meredith Integrated Marketing?

Martin Reidy: As mobile started really picking up, a lot of people pretended that they were in the business and, typically with agencies, and this goes back even to traditional, you add some people on and declare suddenly that you're in the mobile business. Hyperfactory is really, really focused on the mobile world, which is really the model we have. Look at the agencies we have. They're specialists in that area; they don't cross over. There are interdependencies across agencies and there's incentive to bring our image forward so that there isn't a land grab on one particular client by any one agency. ... [The Hyperfactory] fits very well with the Meredith culture. We will retain the name Hyperfactory. It's very important that the culture stay intact. I think the people here have that particular technical expertise and that will only continue to grow. We will foster a family feel, but definitely it will retain that ability to be Hyperfactory.

Ad Age: So Derek and Geoff, tell me why having Meredith as a parent makes sense for your business. What does Meredith as a parent bring you?

Derek Handley: Going back a couple years ago, we started looking for a partner. The obvious choices were holding companies, and companies of that sort that we just hadn't had the best feedback from, people that we knew and other entrepreneurs that had partnered with those companies or sold their businesses to them, which made us nervous. We did want someone larger, to be able to bring the business to the next level, and that was one of the reasons we wanted to partner with Meredith. The other issue that we were struggling with back then was we were still viewed as a boutique hotshop, highly creative and perhaps weaker on strategic thinking. We were thought to not have a full understanding of the mass-market consumer because all we cared about were shiny objects and winning awards. To counter that, there's nothing more perfect than a company like Meredith that really does understand America and has for more than 100 years. That was one thing. The other is that the first five years of this industry in the U.S. has been driven by the male mobile user and it has been about automotive and technology clients. We believe that in the next three or four years, the mobile woman and her content are going to be more and more important, so the timing is great to have really a strong position in that market. Meredith is a really interesting partner to have there. We can win new clients that we previously may have been discounted by and we should be able to create new innovation and territory around the mobile woman. Kraft is now our biggest client. We would have struggled to get them before.

Ad Age: The Kraft work is a marriage of mobile, which is Hyperfactory's heritage, and of content, which is Meredith's heritage. Tell me how the company envisions that partnership of mobile and content expertise?

Mr. Reidy: Meredith is the king and queen of content and has access to the best writers in any particular area. You consider the full-time staff of writers within marketing at Meredith and that's what's happening more in digital. Content has to get out there. Brands spend a lot of time and money on the construction of websites, but the content has to improve. There's going to be a further rethinking of how we access the content and how it can come in more interactive ways.

Geoffrey Handley: Since the beginning, we often see, and still do today, people when they decide to build a mobile site and basically shrink a website. They take content from a website and just squash it to make a mobile stream that's cut down in size and waste. Context has always been a really important thing for us. If you look at all the best work we've ever done, it's very content heavy, but that content has been produced specifically for the mobile experience. So finding a partner in Meredith, which is known for print content and its ability to realize content in a mobile context, just puts us miles ahead of the game.

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Created by New Zealand brothers Derek and Geoffrey Handley in 2001, The Hyperfactory specializes in powering businesses and brands through the mobile medium with award winning, innovative and strategically creative initiatives.  

Leading US research company, Berg Insight, forecasts the global mobile advertising market to grow at an annual compound growth rate of 43% to $8.7b Euros by 2014, reinforcing the importance of this strategic alignment for both organisations.

“The completion of this deal is further evidence of the ability New Zealand entrepreneurs have to make it on the world stage, in the most competitive and fast-paced industries,” says Derek Handley, Co-founder & CEO, The Hyperfactory.  

“Globally, Kiwi companies are at the cutting edge of the use of new technology, and by having the courage to take our ideas and capabilities off shore, we are able to become a significant powerhouse within some of the world’s leading corporations. Pivotal to The Hyperfactory’s success was our determination to dual headquarter our offices in both New York and Auckland to support our expansion domestically in these countries, and into other international markets.”

“The completion of our acquisition of Hyperfactory is consistent with Meredith’s commitment to excellence in marketing services for our clients,” says Meredith Integrated Marketing President Martin Reidy. “Mobile is a critical part of the marketing portfolio and its importance is growing at an incredibly rapid rate.  As with our past acquisitions, like New Media Strategies in the Social Media space, we focus our investments only on the leaders in the respective marketing disciplines. Hyperfactory is the clear leader in the mobile marketing arena and we are proud to have them as part of our arsenal.”

Handley says the relationship presents significant opportunity for the company’s multiple offices around the world.  “Key to our definition of success on this sale has been our ability to retain leadership at the helm. It’s important to us to be able to continue the tremendous flow of creativity across our client base, and into all the opportunities Meredith Corporation provides.

“Our company is a global industry leader because of more than 100 mobile technology and marketing experts who support and deliver to clients like Coca-Cola, BlackBerry, L'Oreal, Vodafone and Disney globally through offices in Auckland, Los Angeles, New York, Chicago, Hong Kong, Sydney and Hyderabad, India.

“They are why we have a history of winning more industry accolades than any mobile agency worldwide. This partnership is designed to entrench that leadership in every market we operate, including New Zealand, and creates opportunities to compete for a whole new tier of clients.”    

The completion of the remaining 80 percent investment was always part of the Handley brothers’ vision for the company.  At just 32 and 35, Derek and Geoffrey Handley respectively join an exclusive club of young kiwi entrepreneurs determined to put New Zealand on the world stage, and raise the bar on the value of ‘kiwi ingenuity’ while doing so.  

While terms of The Hyperfactory acquisition were not disclosed by Meredith Corporation, Derek Handley says it is comparable to recent leading technology deals for Kiwi companies, and “sets a significant benchmark for the sale of a New Zealand business in the emerging technologies sector”.
For Meredith Corporation, the acquisition further enhances the capabilities of Meredith Integrated Marketing, the company’s business-to-business unit that provides leading corporations and brands with custom marketing solutions.  

In the past year, as the demand for mobile marketing solutions has rapidly increased, the two companies have joined forces to offer leading companies and brands such as Kraft, Nestle and Honda cutting-edge mobile marketing solutions. Additionally, The Hyperfactory helped to accelerate Meredith’s consumer brand efforts in the mobile space by developing the mobile platforms for the Better Homes and Gardens, Parents and Fitness brands.

“Our clients and consumers have responded well to these initiatives, and we look forward to increasing our presence in the mobile space with The Hyperfactory as a full member of the Meredith portfolio,” said Meredith National Media Group President Jack Griffin.  “The Hyperfactory's capabilities fall directly in line with our strategic goals and present significant opportunities for our business-to-business engagements.”

About Meredith Corporation

Meredith Corporation (NYSE:MDP: www.meredith.com) is the leading media and marketing company serving American women. Meredith combines well-known national brands - including Better Homes and Gardens, Parents, Ladies' Home Journal, Family Circle, American Baby, Fitness and More - with local television brands in fast-growing markets. Meredith is the industry leader in creating content in key consumer interest areas such as home, family, health and wellness and self-development. Meredith then uses multiple distribution platforms - including print, television, online, mobile and video - to give consumers content they desire and to deliver the messages of its marketing partners. Additionally, Meredith uses its many assets to create powerful custom marketing solutions for many of the nation's top brands and companies.

About Meredith Integrated Marketing

Meredith Integrated Marketing offers a full spectrum of resources and expertise enabling brands to break through the clutter to grow customer relationships. Meredith Integrated Marketing maximizes results by providing strategic solutions and smart content to personalize the brand experience through meaningful multi-platform custom communications programs.

About The Hyperfactory

The Hyperfactory (www.thehyperfactory.com) powers businesses and brands through the mobile medium. As the most- awarded and most established specialist, it is consistently setting new standards of excellence through two divisions:
+    Agency: Powering brands through integrated mobile strategy, creative, media and innovation.
+   Technology: Powering businesses through planning, integration and deployment of mobile technology, regardless of the platform, protocol or device.

Founded in 2001 by New Zealand brothers Geoffrey and Derek Handley, The Hyperfactory is a wholly owned subsidiary of Meredith Corporation, the leading media and marketing company serving American women. Recently recognized in Entrepreneur Magazine’s Annual 100 Brilliant Ideas & Companies issue and with a history of winning more industry accolades and recognition than any agency worldwide, clients include Coca-Cola, BlackBerry, L’Oreal, Vodafone, Disney and Kraft. It employs over 100 of the world’s best mobile technology and marketing experts and supports and delivers globally through its network of offices in Auckland, Los Angeles, New York, Chicago, Hong Kong, Sydney and Hyderabad, India.

A handful of noble efforts had real traction, however. Among them was Kraft's iFood assistant, a genuinely useful recipe and cooking how-to resource that also served the brand well. While many others were trying desperately to be aligned with the coolness of the iPhone itself, Kraft was smart enough to lean on a tradition of branded content, from decades of recipe books to on-air cooking demos during its sponsored programming. The hard-information, soft-brand sell works if you really have the content to back it up.

Kraft has moved headlong into the next level of utility with the newly launched big fork, little fork for the iPad. This family-oriented resource is aimed at teaching both parents and kids how to enjoy cooking together.

The 300 recipes are only the beginning. There are how-to videos, basic kitchen safety tips, detailed run-downs of the age-appropriateness of every recipe, etc. And it is all done with a magnificently efficient interface that pops up a universal nav ring from anywhere in the app. Not only one of the best branded apps out there, this one is one of the best iPad apps i have seen overall.
The print publishers who are tripping over themselves to reinvent the magazine/newspaper for a touch screen, might want to take a look at this generally superior use of the touch interface. The lessons are clear:

Super-serve 'em. Kraft and development partner hyperfactory have simply piled it on. There is no question of value here. Recipes, videos, tips, nutritional basics, etc. And there is the promise of more. The app is dynamic and can pull more content in. Kraft is also planning add-on modules that will be downloadable for additional incremental fees. The app itself is only $1.99, half the price of most of the digital magazines that have appeared already for the platform. This is an ongoing publishing project.

Pick your damned touch metaphor. Too many apps don't know whether they are having you float in space or just flip pages or zigzag across x and y axes. Usually, they have you do all at once. One of the strengths of this app is that its organization is made clear in a physical and abstract way. It all takes place on a kitchen table, where you paw across the surface and discover something akin to the familiar recipe box and hand-drawn notes. There is also the pop-up nav ring that allows lateral navigation to any spot by pressing on an open area of the screen.  There are only a couple of clear and clean nav approaches -- and as deep as the content gets, you are never lost.

Cross-referencing. Each recipe is cross-linked to notes on nutrition, age-appropriateness of the recipe, related recipes, shopping lists and instructions. Each piece of content answers the natural questions the user might have. Too many early iPad apps take the print metaphor too seriously and forget the opportunity for dynamic linking that digital allows.

Subtlety mixed with service wins. The Kraft brands are not in your face throughout this experience. In fact, if anything the brand presence may be too subtle. This app is truly "sponsored by" Kraft in that the actual brand messages come during loading, in two logos that let you click into full-page ads. Other than that, Kraft products are mentioned in recipes but not in a heavy-handed way. They are going for the wide halo effect here.

Be fun. There are kids in the room -- and this app knows it. In addition to the two decent games included in the package, the adventurous kid (or kid in us all) will discover that the designers have remembered what it was like to be involved in kitchen projects. Press that tomato on the table top long enough, and it squashes. And, yes, you can draw your name in the spilled pile of flour. Tap the egg once and it cracks; twice, it spills its yolk. Fortune cookies crack open to reveal cooking tips that click through to more content. These are no-brainer added touches that engage us and let us fall into the app. You can envision a parent and child exploring the app together and tapping and prodding different buttons and objects.

Time will tell if this app has the kind of traction that the iFood assistant had. Weber's on the grill app for iPad takes a similar utilitarian approach, and is already among the top 30 paid apps or the platform. Both Kraft and Weber have considered the use cases for the ipad and created content and tools that speak to the kitchen and the grill-side. Weber has a grill timer that is actually linked to the various grilling items in the recipes. The video library in this app is especially impressive here. Again, the idea is to super-serve the user and build around the at-home portability of the iPad.

But the depth and quality of big fork, little fork reminds us that the iPad raises the bar for branded content. Simple news feeds or pleasant mobile toys are not appropriate for this platform, and a mobilized Web site is not likely to cut it either. Other brands should take these early good entries as both inspiration and fair warning.

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Targeting parents in their 20s and 30s, the Big Fork Little Fork application offers users about 300 recipes, tips via in-depth articles, videos and games. Kraft brands are built into the experience, which is also meant to help families, eat, cook and live well together.

“We’re excited with the launch of our new iPad app, Big Fork Little Fork," said Ed Kaczmarek, director of innovation and consumer experiences at Kraft, Glenview, IL. "We truly believe it will transform the way families approach cooking and eating together.

"The launch of this brand new platform reinforces our commitment to engage with consumers in innovative ways and demonstrates our ability to leverage technology in making consumers’ lives easier and more delicious,” he said.

Kraft Foods is one of the largest food and beverage companies in the world. It is home to brands such as Nabisco and Philadelphia and it markets many brands in more than 155 countries.

According to a recent study, last year alone, 37 million Web searches were conducted for family and kids’ food-related resources.

However, no dominant source exists for this type of information, per Kraft.

The "Big Fork Little Fork" application is meant to make mealtimes a teaching occasion, a fun experience and a bonding moment while keeping kids engaged and entertained.

Big Fork Little Fork builds on Kraft's relationship with Meredith Integrated Marketing (MIM), Meredith Corp.’s business-to-business unit that provides the brand with custom marketing services and helped in the development of this application.

Meredith tapped in-house mobile marketing agency The Hyperfactory for this application.

The Big Fork Little Fork iPad application costs $1.99 to download from the Apple App Store versus 99 cents for Kraft's iFood Assistant that was launched in November 2008 to much acclaim.

“Big Fork Little Fork is another example of  Kraft’s commitment to their customers," said Martin Reidy, president of Meredith Integrated Marketing, New York. "Through this app, Kraft is using emerging technology to accelerate its promise to reach families and teach them how to prepare food and eat more sensibly through an engaging tool.”

The recipes section of the “Big Fork Little Fork” application is filled with pleasers for picky eaters. It includes nutritious recipes, desserts for special occasions, food ideas with kid-friendly directions, videos and food photography.

Kraft also packs the application with tips and information on nutrition and healthy habits, along with tricks for kids such as using lemon juice to make invisible ink.

The instructional “How-to” videos show parents step-by-step instructions for teaching kids to crack an egg, measure liquids or dry ingredients and learn about stove safety.

Also, recipe videos teach users to cook.

The games in the application let kids blast off into outer space to learn about the U.S. Department of Agriculture's food pyramid or join in the action at Berwyn's Deli, exploring math skills to measure ingredients for hungry customers.

“Kraft is a brand with extremely valuable content and they’ve done a tremendous job leveraging that content to reach their target audiences,” said Julie Nielsen, senior director of partner development at appssavvy, New York.

Appssavvy did not create the Kraft application. The company provided feedback because of its expertise in the application market.

Ms. Nielsen pointed out that often times brands have a difficult time convincing people to use their applications.

However, Kraft has had tremendous success with its iPhone application, which is still to this day one of the most successful brand-dedicated iPhone applications on the market.

“They continue to innovate to reach their audience where they are spending their time,” Ms. Nielsen said. “It’s a pretty advanced strategy.

“They offer a significant amount of resources to their consumers that actually provide utility and benefit and it’s clearly paid off,” she said. “Lastly, it’s really nice to see big brands leverage new platforms – and quickly.

“They moved fast, and as we have all learned, being first to market can often be more valuable than the experience itself.”

Advertising in disguise
The application does not outwardly market anything, but instead smartly incorporates Kraft brands into the experience, marrying the content with a form of non-intrusive advertising. It really is the future of mobile advertising for branding purposes.

“Many brands are probably scratching their heads at trying to figure out what the iPad means or could mean for them right now," said Derek Handley, cofounder/CEO of The Hyperfactory, New York.

"Everyone involved with Big Fork Little Fork truly believes that it’s really setting the bar and Kraft as a client have been bold enough to buy into a strikingly unique vision which we have helped them realize,” he said.

This is not Kraft’s first foray into mobile marketing. The company launched its very first mobile application in December 2008 (see story).

Called the iFood Assistant, the application can be downloaded from the Apple App Store for installation on any iPhone or iPod touch. The application targets consumers on the go looking for recipes.

The iFood Assistant includes more than 7,000 tested, searchable recipes with detailed instructions and video demonstrations and an alternative horizontal view to follow along while cooking.

Application users can review comments posted on the recipes and share with others.

Consumers can also create shopping lists with nearby store recommendations and add custom ingredients.

Finally, the app offers tips and shortcuts such as "Dinner Tonight" and "Recipe of the Day" that feature daily recipes.

“The thing I like about this app concept, particularly with the iPad, is that the device seems at home lying around the kitchen, where families tend to hang-out, which is of course perfect for Kraft,” said Brennan Hayden, vice president of WDA Mobile Marketing, East Lansing, MI.

“It’s hard to imagine a more effective proximity marketing tool for a food brand, at least per user,"he said. "I remember several years ago, NCR was laughed at for a prototype Microwave oven with a built-in Web-browser. Today, I think it is a head-scratcher why a personal computing device of some sort isn’t built into every kitchen.

“Obviously, the iPad is portable, so the use of the Kraft app isn’t limited to the kitchen at all, but I think having the option is just brilliant.

Final Take
Here is a demo of the application

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The app, which went live on Friday, is called Big Fork Little Fork, and is aimed at parents in their 20s and 30s with young children. The app includes more than 300 recipes, video clips and games.

The iPad app costs $1.99 and is available at the Apple iTunes App Store at itunes.com.

The app comes after Kraft brought out an app for the iPhone, called the iFood Assistant, in November 2008, which cost 99 cents. There have been subsequent variations and refinements, which include versions for Android and BlackBerry.

That neither the iPad app nor its predecessor carries the Kraft brand name is no accident. The goal is to play up the utilitarian aspects rather than the commercial aspects, said Ed Kaczmarek, director of innovation in consumer experiences at the Glenview, Ill., office of Kraft, in order to “engage the consumer in a more meaningful way.”

“Within the recipes, it will specify, in some instances, a Kraft product,” he said, but the iPad app “doesn’t have Kraft branding front and center.”

The interaction between Kraft and consumers with iPads is going to be “a lot more robust” than what took place in the days when consumers “would send away for recipe cards” after listening to or watching radio or TV shows like “Kraft Music Hall,” Mr. Kaczmarek said.

(It would be interesting to compare any of those recipe cards that still exist with the recipes on the app.)

Kraft brands like Oreo and Wheat Thins have been expanding their presence recently in social media like Facebook and Twitter. The recipes contained in the iPad app can be shared through Facebook, Mr. Kaczmarek said, or through e-mail messages.

Kraft, unlike advertisers like Nissan, is not working with the Apple iAd platform for the Big Fork Little Fork app.

The Kraft iPad app was developed by Meredith Integrated Marketing, part of the Meredith Corporation, the publisher of magazines like Better Homes and Gardens, and by a mobile marketing agency named the Hyperfactory.

Although the channel is still in its infancy, initial trials show that it is both effective and engaging. Two executives from The Hyperfactory talked about augmented reality and their experiences with these types of campaigns.

“Augmented reality has been around for many years but it was ultimately a big budget initiative,” said Howard Hunt, vice president of new business at The Hyperfactory, New York. “Now brands are entering the stage." First a consumer sees a black and white marker, which is a point of reference,” he said. “The phone scans and detects a 3D image in proportion to the marker. "Augmented reality rapidly increases the type of things that can be done in the mobile space.”

Mr. Arbor gave an example of an online augmented reality campaign. General Electric ran one where users had to hold up their marker to Web camera to unlock this whole 3D image of wind turbines and greenery. Consumers could blow into their PC’s microphone to turn the turbines. Now brands are adding mobile to the mix because mobile does not tie you to the desk, you are free to move around and this unlocks even more possibilities. It is a whole new level of interaction.

Nike ran a mobile campaign using augmented reality technology to target teens in Hong Kong to promote the launch of the sportswear giant's T90 soccer shoe. The campaign, which The Hyperfactory created with ad agency McCann Erickson, started with a series of hidden codes all throughout Hong Kong in Nike flagship stores and at MTR subway stations. Consumers had to find the markers and point their camera phone at them, which summoned an image of a Nike soccer shoe and ball on their screen and revealed a special code unique to that location. Once consumers got the next location, they then were able to text in these special codes to find out the next secret destination. Texts also counted as a sweepstakes entry to win Nike merchandise. The codes invite users to download a mobile application that allows them to view the T90 shoe from every angle in 3D on their mobile screens. The more codes that consumers collect, the more chances they have to win Nike gear. The aim for Nike was launching the new boot and letting people see its features from every angle. Hong Kong is footwear-crazy and the fact that this happened around the time of the Olympics and Euro 2008 Tournament means everyone was in sports mode. The results for this campaign were astounding. Thousands of interactions were achieved and 60 percent of those who texted-in downloaded the application.

Jeff Arbor, senior vice president of North America at The Hyperfactory talked about Coca-Cola Fanta’s use of augmented reality. Coca-Cola Europe targeted tech-savvy consumers mostly in their 20s with a new mobile application created to push its Fanta soft drink. The application launched across Europe in January 2009, supported by print and online ads, on-pack promotions, point-of-sale material, viral marketing and public relations. The application is called Fanta Virtual Tennis. Players take their position on either side of a printed game board available for download at http://www.fanta.eu.

Once in position, the 3D augmented technology recognizes the game board and lets players see what looks like a full-size tennis court on their mobile-phone screens. Players can use their mobile devices as tennis racquets to hit a virtual ball whose movement is determined by the angle and position of the phone. Fanta Virtual Tennis offers a two-player mode and a single-player practice mode where the player hits the ball off a wall. The game was tested in New York's Times Square. “Augmented reality for mobile is mostly found in applications right now,” Mr. Arbor said. “But browsers are next.” “There are augmented reality apps that let consumers identify monuments and land marks,” he said. “Others let users point a phone to the street ID and see what stores are around. “It is like Foursquare on steroids.”

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Over the past few years, the magazine publisher has bought up a series of digital-ad agencies to create a full-service marketing shop. Called Meredith Integrated Marketing, the operation has created custom publishing, email, social media and mobile campaigns for major marketers, including Kraft Foods, Chrysler and Wells Fargo. It recently recruited digital-ad veteran Martin Reidy to lead its marketing arm, and says it is on the prowl for more acquisitions.

Meredith increasingly competes head to head for business with big advertising companies, which also have been pouring resources into developing digital marketing and consumer-research capabilities. Chrysler, for instance, recently picked Meredith to solicit prospective consumers via direct mail, email marketing and social media. Omnicom Group's BBDO previously handled that work. Such business has provided new streams of revenue for Meredith, and is proving to be something of a lifeline amid the industrywide decline in print-advertising revenues. As its magazine-ad revenue plunged 15% from a year earlier to $530.2 million in the year ended June 30, revenue tied to Meredith's integrated-marketing business rose 13%. The unit has revenue of roughly $175 million, according to a person familiar with the matter.

"Look at the marketing and media landscape today, you are seeing a dramatic reshaping," says Jack Griffin, president of Meredith's National Media Group. "I don't think there is any way around the fact that companies like ours that are media-and-marketing companies have to be proficient in and capable at this craft." "Meredith is pretty far ahead of everybody else," says Linda Gridley, chief executive of New York investment bank Gridley & Co., which specializes in mergers and acquisitions in the marketing and Internet industries. "It's an area that multiple media companies are now looking at."

Magazine publishers including Advance Publications' Condé Nast Publications and Lagardere's Hachette Filipacchi Media U.S. have bought small ad-technology firms and formed teams to build digital-ad campaigns for marketers.Hearst, which publishes Cosmopolitan, Good Housekeeping and Esquire, made an unsolicited bid late last year to acquire independent digital-marketing firm iCrossing, according to a person familiar with the situation, who said the offer was deemed to low.

Some ad executives say they don't see Meredith's buildup as a new competitive threat, since the marketing agencies it has acquired already existed and Meredith still needs to prove that it can make them more successful. Moreover, Meredith's foray into marketing hasn't been without challenges. The company has faced perceptions of conflicts of interest. Traditionally, there has been a clear line dividing media outlets, such as newspapers, magazines and TV stations, which sell ad time or space, and ad agencies, which design and place ads on behalf of advertisers. Conflicts can occur if an agency owned by a media company is seen to be unfairly directing ads to that outlet. Meredith says for that reason it doesn't offer media-buying services.

In addition, Meredith's marketing business has stumbled as advertisers have slashed costs amid the uncertain economy. The unit's revenue, which grew 50% in the fiscal year ended June 30, 2008 and 13% in the following fiscal year, dropped slightly during the most recent quarter because of cutbacks by clients. Meredith says it is seeing new-business activity, pointing to its recent win of the Chrysler business.

The publisher embarked on its transformation in the mid-1990s, creating magazines and Web-related publications for companies, including Charming Shoppes, Carnival Cruise Lines and Century 21. These publications acted as marketing tools and relied in large part on Meredith's decades-old consumer database, which includes 85 million names.

By 2005, marketers had started shifting more ad dollars to the Web, and the print-ad market was growing increasingly choppy. Meredith executives then made a "deliberate decision" to expand its marketing services group, Mr. Griffin says. During the next five years, Meredith acquired a series of marketing agencies, including specialists in digital, word-of-mouth, database marketing and health care. Last summer, it made an investment in the Hyper Factory, a mobile-marketing agency.

The buildup of Meredith's marketing business largely has happened behind the scenes, marketing executives say. "Almost in the darkness of night, they have been assembling all these assets and resources and people to build up an empire," says, Russel Wohlwerth, a principal at Ark Advisors, a consulting firm that matches ad and marketing agencies with advertisers. He adds, "It's a great model for the future."

Several marketers have increased their work with Meredith as it has expanded its offerings. Kraft started working with Meredith in 2007 to publish its Kraft Food & Family and Spanish-language Comida y Familia print magazines. Meredith now designs Kraft's Web site and coordinates a weekly email blast that features recipe ideas. Meredith also built Kraft's iFood Assistant, an application for mobile devices that includes more than 7,000 recipes, how-to videos and shopping lists. "Through their acquisitions, Meredith was instrumental in helping us expand digitally and into mobile," says Kelley Woodland, Kraft's senior director of consumer-relationship marketing.

Meredith's strategy taps into another trend: marketers are spending less on buying ads in traditional media, like print and TV, in favor of creating marketing promotions that often don't require buying ads, such as email messages and games and tools for social media and mobile. "Conversations are happening with consumers more organically," Kraft's Ms. Woodland says. "It is about being a part of the conversation, not an interruptive ad that the manufacturer is forcing out."

Meredith plans to continue expanding its marketing arm, says Mr. Reidy, who most recently was CEO at digital-ad agency Publicis Modem, a unit of Publicis Groupe , and previously was CEO of Interpublic Group's R/GA Interactive. Likely acquisition targets include search marketing firms, which help advertisers buy search ads and design their Web sites to appear prominently in search rankings, and ad agencies that will help Meredith expand its geographic footprint both domestically and internationally.

Loreen Babcock, chief executive of Unit7, a customer-relationship marketing agency owned by Omnicom whose clients include Bristol-Myers Squibb, Pfizer and AstraZeneca, says she doesn't see Meredith as a direct rival but rather as a new service offering from a media company. "That's how I'm seeing the landscape now," she adds. "Maybe it plays out differently."

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In fact, beauty products are the products women purchase most frequently based on advice of a blogger or social networks, some 69% more than apparel (at 39%) or home furnishings (18%). The beauty industry has started to catch on — hosting fragrance-launch parties on MySpace, direct-marketing to bloggers, tweeting from backstage at fashion shows. What’s next? We asked two pioneers in social media and mobile to tell us what to expect—and how to succeed—in 2010.

How can beauty brands effectively use social media and mobile?

pete snyder: Keeping up with trends is essen- tial. Social media is rapidly evolving especially in the beauty category. We help clients keep up with what’s being said about their products. Whether it’s Face- book or Twitter or the hundreds of influential blogs, it’s essential that beauty companies know what’s being said about them. Social media is honest and transparent, beauty companies need to know who they are while having mystery and allure and know- ing what the competition is up to.

derek handley: You need a social media strategy that includes mobile. This year, forecasters say half the market will be on smart phones and we know those people are heavy users of social media on their mobile devices because people are interested in real time en- gagement. Social media platforms lead people to prod- ucts. Beauty is a category that’s emerging in social me- dia, especially with the good use of mobile marketing campaigns. We’ve had success with Dove and L’Oréal. From interactive outdoor billboards encouraging pass- ers-by to vote, to creating handy on-the-go color selec- tors and easily downloadable skin care matches vis-à-vis Multimedia Messaging Service (MMS), the opportuni- ties for mobile engagement are vast. By sending custom- er alerts, news and offers, the building blocks of a mobile program are in place.

pete snyder: We found in our studies that people who come to a brand from social media are more likely to make a purchase, use a coupon or engage in other meaningful ways with the brand. We find higher brand affinity and stronger loyalty among customers and, on top of that, companies can have a two-way dialogue with customers about their brands.

What are some recent mobile innovations in the beauty industry?

derek handley: In mobile, we’re moving from simple texting and voting programs to richer and deeper engagement with customers through video and iphone applications. We’ve worked on iphone apps for makeup lines that provide handy, on-the- go color selectors or skin-shade matchers, as well as programs that alert customers with news and special offers. We’re looking at a number of browsing tools; there are a lot of opportunities for scrapbooking, where customers create a wish list of items selected from magazines or stores and keep their personal scrapbook on their mobile device. And mobile can respond to other media, so if you are running a print ad, your ad could contain a code that readers will text in and they’ll receive a message or a coupon for a product.

How can mobile extend traditional media?

derek handley: Mobile is the one channel that interacts with all other channels. It’s not a simple extension of a website, but rather an opportunity to respond to and integrate with other media. For example, if you’re running print or television ads, they can be activated to carry text messages, re- sponse codes and/or send a message with a call to action or to download content, watch a video or to deliver a coupon. In addition, any content that’s created for any medium, can be leveraged and distributed in the mobile space and extended to handsets. For certain brands, beauty in particu- lar, where there is repeat buying, mobile can also enable the consumer to actually buy the product from their device.

What are the three best practices for expanding brand awareness on social media platforms?

pete snyder: 1. Make sure you are listening to and not just monitoring, conversations about your brand. Understand everything you can about your brand online and place value on what you learn. If you’re paying attention in the right places you can move the needle on sales. And if you don’t like what you’re hearing, take concrete steps to change those perceptions. 2. Be authentic. In or- der to make a real connection you must be honest and transparent. 3. Make sure you have something valuable to say. Don’t just join to join. Be meaning- ful and relevant.