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News You Could Do Without

by Joseph Weisenthal

Tue, May 15th 2007 12:11am





What's Next, Ad-Supported Coffee? Actually, Yes

from the daily-fix dept

Ad-supported business models have been popular for a long time, but people still seem confused about when they make sense. For things like content or services with little marginal cost, the ad-supported model can be a good fit. On the other hand, it doesn't really work for physical goods, like computers, despite many attempts at pulling this off. Now a company in Japan is experimenting with an ad-supported coffee vending machine. If the buyer is willing to watch a 30-second ad, they can get a free cup of coffee. The cup will have an ad as well. The problem is that advertisers aren't likely to get much value out of this 30-second spot, such that it's worth subsidizing someone's java fix. It'd be pretty easy for a customer to just ignore the ad while waiting for their fill up. The one context where it might make sense is in an office where the employer already subsidizes its employees' coffee, and is looking to defray some of the costs by selling ads. Still, this might just annoy workers, and the lost productivity from spending time in front of the vending machine would probably cancel out any advertising revenue. Perhaps instead of an ad, the machine could use the time to play a daily motivational speech from the company's boss.

17 Comments | Leave a Comment..


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  1.  
    identicon
    Nick, May 15th, 2007 @ 1:36am

    "When you take this cup of coffe, you take everything my great grandfather, my grandfather, and my father helped to build. All of their hopes and dreams poured in to a cup. So show them respect and go out there and do the best you can."

    ugh i would hate to hear that everyday

    [ reply to this | link to this | view in thread ]

  2.  

    Enforce Ad

    identicon
    Roy, May 15th, 2007 @ 1:36am

    They can always ask a quick multiple choice question at the end of the ad to make sure the person was watching...

    [ reply to this | link to this | view in thread ]

  3.  

    You are silly

    identicon
    Shohat, May 15th, 2007 @ 2:08am

    You don't know much about anything, do you
    Coffee ingredients cost very little (we are talking vending machine quality), electricity is somewhat of a problem, but this can be actually dumped on the person that wants the vending machine there such -as a hotel, or a supermarket... (you pay for coffee ,they pay for the electricity)
    A free coffee vending machine which plays 30 second ads and has branded cups (sponsored by the advertiser, no cost here) that is stationed in the street/busy lobby is worth no less than 2000$/month for the advertiser.
    Even though it's small money, 100 such machines can probably be a small successful company.

    [ reply to this | link to this | view in thread ]

  4.  

    Re: Enforce Ad

    identicon
    Leon, May 15th, 2007 @ 2:11am

    That's what Virgin Mobile does. You can watch ads to get free minutes added to your prepaid mobile, but they quiz you after, and you have to get the answers right if you want your free minutes. Some wag in a tech column pointed out that this business model was doomed to bust, since the only people with that much free time on their hands were university students and people who couldn't afford a real mobile. I bought a prepaid just to try it out and I ended up giving it a poor bloke on the pogey who needed a cell for emergencies, and I kept my regular mobile.

    [ reply to this | link to this | view in thread ]

  5.  

    Re: You are silly

    identicon
    The Swiss Cheese Monster, May 15th, 2007 @ 3:52am

    Apparently you don't know much either.

    [ reply to this | link to this | view in thread ]

  6.  

    Re: Re: You are silly

    identicon
    Shohat, May 15th, 2007 @ 4:05am

    I love pseudo-intellectuals.
    You have no absolutely no idea what is right, but you have these neat names and witty comments.

    [ reply to this | link to this | view in thread ]

  7.  

    30 second ads?

    identicon
    Just One Guy, May 15th, 2007 @ 4:09am

    I'd take just about 30 seconds to prepare the cup of coffee anyway, so why not asking the guy to watch the screen instead of looking somewhere else while he's waiting? It's not that in an underground station or at a bus stop there's much around to look at anyway.

    Furthermore, if the ad was interesting and fun, why not answering a quick question at the end? I don't see a problem: you have a captive audience, stationary, bored, waiting for their bus or rain to come in, dying for something else to do than looking at the same bored faces around them, day in day out.

    Furthermore, coffee machines are EXTREMELY localized. You could get feedback on your recent TV ad campaign or localized info: which ad you liked best? What do you think will happen next in the storyline? Which upholstery would you choose with this body color? What would you think if our restaurants in the area (up the stairs, 100 yards down 34t street, to your left!) extended serving breakfast up to 11:30?

    Collect this kind of information, cross it with socio-economic data about the location in which the coffee machine is located, and you have a pretty reasonable neighborhood profiling, bus stop after bus stop, underground station after underground station. At the cost of a few coffee cups.

    Cheap cheap cheap!

    [ reply to this | link to this | view in thread ]

  8.  

    Pavlov's Dogs

    identicon
    comboman, May 15th, 2007 @ 5:45am

    Perhaps instead of an ad, the machine could use the time to play a daily motivational speech from the company's boss.

    I don't know how well it would work in the real world, but it sounds like a good idea for a Dilbert cartoon.

    [ reply to this | link to this | view in thread ]

  9.  

    Re: You are silly

    identicon
    Celes, May 15th, 2007 @ 5:49am

    Unfortunately, this wouldn't be such a good idea in a hotel, or at least none of the ones I've worked in. Most hotels already offer complimentary coffee free of annoyances. And even if it takes a guest more than 30 seconds to make their own cup, the time isn't spent waiting. It sounds ridiculous, I know, but people just don't want to wait anymore. (Doesn't it seem like forever if a web page takes 30 seconds to load?) And the hotel industry is the one place where people never think twice about complaining about things like having to wait a full 30 seconds for a cup of coffee, believe me.

    I do think there are venues where this might be successful, such as the supermarket you suggested, but hotels probably aren't it.

    [ reply to this | link to this | view in thread ]

  10.  

    Question answers

    identicon
    |333173|3|_||3, May 15th, 2007 @ 6:43am

    This could work if put up in the CS labs at at Uni, since then the students would, even if they had to watch a 30-sec ad and answer a question on it, still find that better than walking over to the Union cafe to buy coffee. Students are good at finding shortcuts in computerised test, adn they would be able to beat a coffee machine quickly.

    [ reply to this | link to this | view in thread ]

  11.  

    Sort of Like.....

    identicon
    Jose Cuervo, May 15th, 2007 @ 6:48am

    Watching ads to get a free cup of joe is sort of like having to view ads while you read a blog.


    Oh, wait a minute......

    [ reply to this | link to this | view in thread ]

  12.  

    Ad Support

    identicon
    Marc Cohen, May 15th, 2007 @ 6:50am

    I agree that ad support for physical goods rarely works - except for ad specialties. The next big ad supported medium will be downloaded music. Check out the Ad Supported Music Blog at http://ad-supported-music.blogspot.com/.

    [ reply to this | link to this | view in thread ]

  13.  

    Re: Pavlov's Dogs

    identicon
    dogbert, May 15th, 2007 @ 9:33am

    free coffee, and throw in a foot massage, - i'm in!

    [ reply to this | link to this | view in thread ]

  14.  
    identicon
    Anonymous Coward, May 15th, 2007 @ 9:39am

    Walking into a Starbucks is like standing inside one giant ad (gift card? CD? beans? french press? new frappacrappo?), but it takes five minutes and you still have to pay for your coffee.

    Sign me up for 30 seconds and free.

    [ reply to this | link to this | view in thread ]

  15.  

    Works for me

    identicon
    joe, May 15th, 2007 @ 2:25pm

    I would drink the coffee and probably buy the advertised brand to help ensure my supply of free coffee. Even though then it's not really free.

    [ reply to this | link to this | view in thread ]

  16.  
    identicon
    Daniel, May 15th, 2007 @ 5:44pm

    Heck, right now I just stand in front of the machine and pace back and forth while it brews my coffee. I'd watch an ad just for the entertainment value (as long as they showed a different one each of the cujillion times I get a cup of coffee each day).

    But then, my coffee machines at work are free anyways, so maybe that isn't such a good idea.

    [ reply to this | link to this | view in thread ]

  17.  

    Re: Pavlov's Dogs

    identicon
    Nasty Old Geezer, May 16th, 2007 @ 5:53am

    How about those company announcements via e-mail that nobody reads anyway? Especially the really stupid ones, like where to evacuate in case of fire, who's gotten a promotion and is now uour new boss, or financial results that show your company's about to go under -- trivia like that.

    [ reply to this | link to this | view in thread ]


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