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Bill Freehling is a business writer for The Free Lance-Star and Fredericksburg.com. This blog is on Fredericksburg-area business. Send an e-mail to Bill Freehling.

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In search of the elusive niche

"BUYING IN," an interesting new book by Rob Walker, reveals the extent to which advertising, marketing and branding have changed in the Internet age.

Walker has a weekly column touching on consumer issues for The New York Times Magazine. He writes about "the secret dialogue between what we buy and who we are."

It used to be much easier for companies to reach consumers through top-down advertising in the mainstream media, Walker writes. The Internet has made media more fragmented, though, and has spawned Web sites with smaller niche audiences. Also, devices such as TiVo have allowed consumers to filter out ads.

Therefore, advertisers and marketers have had to get more creative to reach the consumer and brand their products. Consumers have been enlisted for word-of-mouth advertising efforts, and product placements have been used in television shows and sporting events.

Walker gives a number of examples of this, but one that sticks out is the wildly successful marketing efforts of the energy drink Red Bull, which was created by an Austrian company and came to the U.S. in 1997.

The company organized a number of "extreme" stunts and competitions such as a street luge contest down San Francisco hills, kayaking over a 98-foot waterfall and an 88-mile kiteboarding trip from Key West to Cuba. Red Bull freely distributed the beverage to popular musicians, club hoppers and break-dancers. The company installed displays in trendy nightclubs. Red Bull started advertising on mainstream television only after the drink caught on.

In his book, Walker also shows that consumers now have more control over a brand’s meaning. For example, Timberland boots have long been geared toward construction-worker types who need sturdy, comfortable and waterproof shoes.

But it turns out the boots were also well-suited to urban elements such as concrete and broken glass. In the 1990s, Timberland boots became a part of hip-hop fashion, redefining the brand and helping the company take in $1.6 billion worth of revenue worldwide in 2006. Timberland hadn’t anticipated that change, but later altered its marketing to reflect the new audience of interested consumers.

The Internet has allowed people to reject some mainstream brands, and instead, market products carrying an alternative message. Global behemoths such as Procter & Gamble are paying close attention to these niche audiences and paying millions of dollars for this form of bottom-up marketing.

Walker also addresses why brands are important to us. Although many people claim to reject consumerism, in fact, we tell a lot about ourselves by the clothes we wear, the cars we drive and the food we eat.

Modern marketing is more subtle than in the past when a few newspapers and network television stations had a dominant hold over the marketplace. As that dominance erodes, marketers have been forced to employ more subtle ways to advertise their products and create brand meaning.

Investors would be wise to take note of the companies doing the best job transitioning to this new reality.

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