The new advertising outlet 15 Oct 2007

The New York Times has an interesting report on how large businesses are abandoning television commercials and glossy magazine spreads in favour of creating "interactive experiences" for their customers. Case in point is Nike, a company that spent only 33 percent of its $678m US advertising budget on traditional forms of advertising last year.

Where did the remaining 67 percent go?

On products like Nike+.

In case you've somehow managed to dodge the hype, Nike+ is a collaboration between Nike and Apple that lets amateur athletes track their fitness goals via a sensor installed in their running shoes. This sensor transmits the runners' workout data to their iPod while they train. Upon arriving back at home, they can then hook their iPod up to their PC and upload this information to a dedicated website that allows them to monitor their progress and compare performance with thousands of other runners around the world. The site's community features also allow them to post running routes, find running-mates and post messages of encouragement for one another.

This is the type of "advertising" that the smart companies are now pumping their money into. Rather than attempting to grab consumers' attention while they're trying to do something else - like read a magazine or watch TV - this new form of advertising gets people to engage directly with it. The Nike+ website, for example, is visited three times a week by those who've purchased the gear - and they do so willingly, no coercion is required.

All of this points to a bleak future for the traditional ad agency. "We're not in the business of keeping the media companies alive," Trevor Edwards - Nike's corporate vice president for global brand and category management - told the NYT, "We're in the business of connecting with consumers."