April 29th, 2008

New to the TV Lineup: A Flat-Panel Teaser

By Suzanne Vranica
The Wall Street Journal

On Monday night, about 500 people planned to gather at the Pacific Design Center in Hollywood for a swanky screening of “Scarlet,” a new TV series from director David Nutter that stars Natassia Malthe.

It looked like a standard new-show screening, right down to the 32-foot-long red carpet and Wolfgang Puck catering. But the event, part of a $100 million global advertising and marketing campaign for LG Electronics, was actually an elaborate ruse. Attendees were expecting a screening of a new TV series called “Scarlet,” but “Scarlet” was in fact “a new series of TVs” with a red back panel.

The marketing hoax is an attempt by the South Korean electronics company to overcome the commoditization of the television business. TV manufacturers are under the gun to develop brands that stand for something, as a way to avoid consumers choosing their flat panels based on who has the lowest price.

“It’s a big challenge for TV makers,” said Kwan-Sup Lee, vice president of brand marketing at LG Electronics. “This is a high-tech product but the retail price is going down, and for TV makers there is little chance to make profit in this business.” Sony recently has sparked a TV price war in the U.S.

Making matters worse is advertising in the TV category is a sea of sameness, branding experts said, with most flat-panel makers claiming the best picture quality with ads that spout a slew of technology jargon.

Mr. Lee said the hardest part of the campaign was selling it internally. LG is in many ways a traditional Korean company, he said, and doing something this outrageous wasn’t part of its DNA. The effort is a contrast to LG’s last campaign, which relied largely on run-of-the-mill in-store sales and promotions that played up picture quality. The “Scarlet” ads are LG’s largest-ever campaign for a single product, Mr. Lee said.

LG’s premiere-like event was the culmination of a three-month global viral-marketing effort to promote the fake TV show. For the past few weeks, a teaser commercial for “Scarlet” has been running on TV and online, with no mention of LG. The action-packed trailer features Ms. Malthe, a slinky brunette, in several action scenes, including one in which she crashes through a plate-glass window and uses her karate skills against four masked men. “Things aren’t always what they seem,” a voice-over chimes in at the end of the ad.

As part of the public-relations plan for the show, LG has had Ms. Malthe drum up publicity by attending red-carpet events, including Fashion Week in New York, the Bafta awards in London (the British equivalent of the Oscars), and several film premieres in Los Angeles. The result: plenty of online, TV and magazine stories about “Scarlet.”

A story in the City Times in Kuwait carried the headline: “Sexy Natasha Malthe to star as title role in renowned Hollywood director David Nutter’s new project titled: Scarlet.” Even IMDb, the Internet movie-database site, includes a mention of “Scarlet,” a “TV miniseries,” under Mr. Nutter’s bio.

The clues have left many people scouring the Web and replaying the trailer to find clues about the show—and some have figured out the joke. Pulling a fast one on the public can be a dangerous move, some ad experts said. “People are going to be p--- off,” said Alan Siegel, chairman and chief executive of Siegel + Gale, a New York branding firm. Some consumers already are expressing anger. “If this is true, LG screwed up because I will be so mad that I would never buy their TV,” wrote someone who identifies herself as “Amanda” on a Yahoo Answers message board.

Still, LG said it is worth taking the chance. “I’m taking this risk to be different,” said Mr. Lee at LG. “If you go to Best Buy, you can’t tell the difference between any of the TVs; even to me, I cannot tell which is LG. They all look the same.”

LG, the third-largest flat-panel maker behind Samsung Electronics and Sony, needs to get more bang for its ad buck because its rivals have been spending far more on marketing. “We can’t go head to head with Sony on media spending so we need to amplify our spend,” said Chan Suh, chief executive of Agency.com, the Omnicom Group-owned firm that helped craft the ad effort.

Sony Electronics shelled out $80.9 million for ad time in the U.S. last year, while Samsung topped $130 million, according to TNS Media Intelligence. By contrast, LG Electronics spent $58 million. And LG doesn’t have nearly the brand recognition that its rivals have.

Beginning Tuesday, LG will air a new version of its ad from Mr. Nutter, which reveals that Scarlet is a new line of TVs.

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