Xbox, Hulu Are Latest to Let Sponsors Liberate Paid Content

Digital sponsorships are growing gradually, and it seems more and more of them involve providing otherwise premium content for free. Among the more recent examples is beef jerky brand Jack Link’s sponsorship of Hulu Plus on Xbox Live.

This week, Xbox Live gold and silver members can view TV shows including “30 Rock” and “The Daily Show with Jon Stewart” for free on the Hulu Plus service on Xbox thanks to the sponsorship. The sponsorship involves a sweepstakes with prizes such as a resort trip and an Xbox 360 4GB Console with Kinect. Xbox users can also view Jack Link’s ads from the brand’s “Messin’ With Sasquatch” campaign, and download Jack Link’s branded themes for their Xbox.

“This is something we do pretty regularly,” said Ginny Musante, director of marketing for Microsoft’s Xbox Live Advertising Business Group. “We give them something of value in exchange for their time and attention.”

Last year, for example, American Express allowed gold card members to upgrade and earn Microsoft points towards movie and content downloads. Also, A&E recently enabled Xbox members to access all content on the platform through a sponsorship promoting its show “Breakout Kings.”

The Jack Link’s campaign seeks to attract young males to the meat snack brand. However, other premium digital content sponsorships are targeted to a decidedly more sophisticated audience. For instance, a select group of NYTimes.com readers was recently awarded free access to the site in 2011 thanks to a sponsorship by Ford Motor Company’s luxury Lincoln brand.

Also, the latest edition of Wired’s paid iPad application is free through an Adobe sponsorship.

In 2010, digital media sponsorships accounted for 3 percent of the $26 billion digital ad market – or $718 million – compared to 2 percent in 2009, according to the Interactive Advertising Bureau.

While such sponsorships are primarily the domain of deep-pocketed brands, they could be signs of more to come. “I would expect that in a couple of years there will be more sponsorship of premium content,” suggested Adam Cahill, EVP co-media director at Hill Holliday.

A key driver of advertiser interest in such sponsorships could be value-exchange, said Cahill. For instance, many brand advertisers run 30-second TV spots alongside short 2 to 3 minute video content; however, Cahill suggested that with that type of format, “The value exchange is completely off” and “actually has a negative impact on the brand.”

In contrast, sponsoring content that otherwise would cost the consumer may look more appealing to advertisers. “The idea of something that’s a better value exchange starts to look pretty interesting,” said Cahill.

“The concept that you reward the consumer for their attention is a concept that’s getting a lot of play in marketing,” added Musante.