By Samuel Greengard

185 mph. Doesn’t seem like the best speed at which to view an ad, does it? But when that ad is in the form of a logo-laden NASCAR entrant, the formula certainly belongs in the winner’s circle.

It was a cutting-edge move when auto racing unlocked the benefits of on-car advertising in the 1960s. It wasn’t just a clever advertising ploy, however.

“Because it’s so expensive, sponsors are part of the sport’s DNA,” says Andrew Giangola, director of business communications for NASCAR. “Whether it was STP or a local service station, without support, you wouldn’t be able to run. The fans understand that and embrace that—they’re three times more likely to buy products of sponsors. It’s like an investment in the team.”

What began as product logos on the cars as they circled the track has evolved into a marketing juggernaut with the soaring popularity of NASCAR. The drivers themselves have become stars—media savvy, mingling with VIPs in corporate tents before the race and with sponsors’ employees on off days, signing autographs till their hands ache.

For fans, the allegiances run deep, making the difference between a trip to Home Depot (for Tony Stewart fans) and Lowe’s (Jimmie Johnson). According to USA Today, Dale Earnhardt Jr.’s endorsement deals with Anheuser-Busch, Gillette, Wrangler jeans and Drakkar cologne are worth $5 million a year—more than he makes between the flags. For sponsors, it’s about as targeted an ad as money can buy. “If you’re a Dale fan, you’re probably drinking Bud,” Giangola says.

Advertising Ups and Downs

NASCAR isn’t the only company that’s attempting to push consumers’ buying buttons. Blame it on TiVo, the Internet or a general glut of advertising, but today’s marketers are looking for alternative techniques to break through the clutter. While they’re not abandoning television commercials, print ads and product placements in movies, some are now looking to snare customers in elevators, stores, taxis, bus benches, even bathroom stalls.

In the battle for mind share and market share, these guerilla techniques are changing the landscape. Some, like captive advertising, attempt to capitalize on a situation where a person has nowhere else to go or look—such as in a bus or airplane. Others, such as peer-to-peer marketing, rely on trendsetters to spread the word. By handing out products—a mobile phone or new CD, for example—and letting these individuals show them off to friends, it’s possible to take old-fashioned word-of-mouth advertising into the 21st century.

“Companies have recognized that it is possible to market, advertise and pitch products in a lot of non-traditional places,” observes Steve Yastrow, author of Brand Harmony (SelectBooks, 2003) and president of Yastrow Marketing, a Deerfield, Ill., consulting firm. “Every point of contact with a customer or potential customer can either enhance or detract from a brand.”

John Bigay knows all about the ups and downs of the advertising business. And if the marketing programs manager for Westford, Mass.–based Captivate Network has his way, elevators will open the door to a new level of profitability. The company has placed more than 4,200 flat-screen video displays in about 400 premiere U.S. office building elevators. When passengers ride the elevator, they view 10-second ads from the likes of American Airlines, Mercedes-Benz and Gillette.

Elevators and ads are a match made in marketing heaven. “People ride an average of six times a day [Monday through Friday] and the average length of a ride is one minute,” Bigay says. “That translates into two hours per month and 24 hours a year. It’s a tremendous opportunity to pitch products to affluent professionals in a position to make personal and business buying decisions.”

The Space Race

Although elevators, urinals and the exhaust-spewing tail-end of a city bus might not seem as sexy a placement as a race car traveling 185 m.p.h., it’s clear that marketers view almost any empty space as an opportunity to connect with potential buyers. Consumers can’t opt out, and they can’t program a machine to skip the advertisement. “It’s a way to get in people’s faces and make them aware of a product,” Yastrow explains.

Indeed, while ads on television and radio and in newspapers and magazines take a broad approach, captive advertising uses a far narrower focus. It’s possible for smaller companies to tailor and target their messages to a niche group of consumers. A bus bench ad, for example, can promote a local real estate agent; an LCD panel in the bathroom of an office building can display location-specific ads, even target specific groups.

For example, Zoom Media, with offices in New York and Montréal, creates specific advertisements for consumers in the 18-to-49 age group. These ads appear on backlit billboards, LCD displays and paper postcards located in public spaces, including bathrooms, across North America. Already the firm has 35,000 billboard locations at 5,700 venues. If an advertiser wants to target Hispanic male sports fans, it can do so by zapping ads to a bar that caters to that specific crowd. If a company is looking to reach female business travelers, it can send ads to the women’s restrooms at airports.

At Captivate Network, LCD displays in elevators have taken advertising to greater heights. According to Bigay, the ad recall rate for riders is about 45 percent, compared to 15 percent for TV. In fact, 96 percent of riders say they watch the service, which also includes weather reports, stock tickers and news headlines. “It’s a distraction-free environment,” Bigay points out.

Others are extending the concept further. In New York City, video display units in some taxis offer ads along with interactive travel information. Airplanes, trains and buses are increasingly equipped with video units showing infomercials and ads (America West Airlines recently added advertising to tray tables). And supermarkets, which have raised captive advertising to an art form, now offer coupons on store shelves, ads inside shopping carts, ads on the floor, ads on the audio system, even ads at checkout lines, which are increasingly equipped with video displays.

Brand-new Approaches

While consumers are increasingly wary of advertising, they can’t argue with its effectiveness, says Denise Garcia, principal analyst for media and advertising at Gartner Inc., a Stamford, Conn., consulting firm. In fact, consumers often believe that advertising has a minimal effect on their buying decisions, but studies show that this simply isn’t the case. “Branding plays a large role in a product’s success, and new and unfamiliar ways of reaching people get their attention,” she explains.

In the past, most branding has consisted of “brute force” advertising, Yastrow says. “The companies with the biggest budgets won.” But now, with piles of junk mail, hundreds of spam messages and ads glutting the airwaves, getting a person’s attention is no simple task. He says that the typical consumer encounters more than 3,000 promotional messages a day. “It’s a noisy world, and the competition for attention is getting more intense all the time.”

This is leading some to rethink the concept of advertising and create new ways to interact with potential customers. For example, when Ford Motor Company decided to push its Focus, it handed over the keys to new cars to employees of celebrities like Madonna and Adam Sandler. With the cars parked in front of trendy nightclubs, others began to buy the cars. Seeding the vehicles among 120 trendsetters helped Ford sell more than 286,000 cars in the first year.

This peer-to-peer strategy isn’t lost on Streetwise Concepts & Culture, a Los -Angeles firm that creates a buzz through peer-to-peer marketing. The company identifies trendsetters and product evangelists, gives them gear—CDs, clothes, mobile phones, computer games—and unleashes them into their social circle to talk up and show off the goods. “The idea of finding out about a cool product before everyone else is a powerful motivator. Once people are excited, word spreads like wildfire,” says Andrew Leary, a partner at Streetwise.

More than 60,000 people, mostly in their teens and 20s, belong to the Streetwise network. They alone decide which companies participate. An 80 percent approval rating is usually required, and members also have a say in the marketing strategy that’s used by a company. “It is essential that the kids who participate are excited by the products. Although they receive incentives, they are not paid,” Leary explains.

So far, companies such as Coca-Cola, Nokia, Activision and Jack in the Box have opted for the Streetwise approach. In some cases, the agency has delivered a 30 to 40 percent redemption rate on coupons and offers, compared to an industry average of 2 percent. “This is an inexpensive and highly effective way to market a product,” Leary says. “It gets products into the hands of those who influence buying decisions.”

Advertisers are looking for other ways to distinguish their products. Beverage maker Hansen’s is sponsoring the Las Vegas Monorail, which will offer drink samples and ads as passengers shuttle between the airport and various hotels. Outdoor advertisers are creating next-generation billboards that will glean data from passing motorists—including the radio stations they listen to—and customize content. And, in the future, mobile phones and wireless PDAs—which have already begun to serve up advertisements—will offer coupons and other incentives as customers pass by a restaurant or store.

It’s a brave new world of advertising, and there’s seemingly no end in sight. “Everyone is looking to rise above everyone else,” Gartner’s Garcia observes. “And, these days, in order to get noticed, you have to do something different.”

Making Honesty Add Up

As advertising invades almost every corner of society, there’s growing concern over ethics and honesty. One of the key issues, says Gartner Inc. analyst Denise Garcia, surrounds pay-for-placement ads. Although the appearance of brand-name products in movies and TV shows is nothing new, the boundaries are continually expanding.

For example, “reality” television shows increasingly feature pay-for-placement advertising, like the Survivor–Mountain Dew relationship. “In many cases, people aren’t aware that what they are looking at is advertising,” she says.

Children, too, are under assault. Not only are they subjected to an endless barrage of TV ads featuring breakfast cereals and toys, advertising has popped up in schools. Companies that donate products or services plaster their names on everything from book covers to in-class television networks. Some schools also have begun to distribute product samples to kids as young as 10.

All of this is leading some organizations to lobby for change. Industry watchdog Commercial Alert (commercialalert.com) is among those clamoring for tighter restrictions and greater disclosure. “Embedded advertising is now so common that it seems TV networks want to turn television into an infomercial-delivery mechanism,” notes executive director Gary Ruskin. He believes that TV networks and others should be required to “prominently disclose” to viewers that product placements are ads.