Take $tock in Mama Mancini’s Meatballs

You may have heard the radio commercials with Dan Mancini touting his homemade meatballs.  But did you hear the one about Mama Mancini’s being a publicly traded company?

Thirty-second spots recently aired on satellite radio during CNBC’s weekly broadcast not only pitching Mama Mancini’s great-tasting meatballs, but alerting potential investors that the company is traded on the OTC (over-the-counter) bulletin board under the ticker symbol MMMB.

Mama Mancin's Meatballs

The ad may seem confusing to the average consumer, although CNBC’s audience is investor savvy.  A steady stream of these “investment” commercials have been hitting the airwaves since the SEC last year loosened its advertising rules for equities and alterative investment vehicles.

Much of this mixing of consumer and investment messaging is a relatively new concept, built on the premise that consumers are investors too, and vice-versa.  It’s not just advertising either.  Some publicly traded restaurant and sporting goods chains have hocked their ticker symbols at checkout.

Making matters worse is if the company is a penny stock or has a low market cap.  This only dilutes the brand, both from consumer and investor perspectives, and creates the perception of a company that is awkwardly trying to find new capital.

Alternative investments like hedge funds as well as some mutual funds got it right, however.  Many of these types of ads appear in print ads and during non-financial television broadcasts.  Consumers warmed up to the idea of investment pitches because pharmaceutical companies years ago started bypassing doctors, marketing their drugs directly to prospective patients.

Creativity is the key for consumer-facing stocks marketing directly to customers.  Executives need to be aware of the impact these ads can have on a company’s brand perception.  What happens when the consumer has a bad experience?  Is he or she going to hit the investor chat rooms and bash the company?

Having consumers “discover” that the company is publicly traded may have a greater impact and create a more interested investor.  If not, the end result is confused consumers not sure if the company is truly interested in them or the company’s stock performance.

Reader Beware: More Online News Stories Dubbed as Ads

The line between editorial and advertising has become increasingly blurred, as sorely needed revenues are forcing struggling news organizations to find new money streams.

For online news outlets, native advertising is emerging as a solution in today’s Internet-based media landscape. These sponsored ads, otherwise known as advertorials, are written as news stories, favorably positioning the advertiser.

 Sponsored content in 2013 from The Atlantic posting an ad for the Church of Scientology.

Sponsored content in 2013 from The Atlantic posting an ad for the Church of Scientology.

According to the Pew Research Center’s State of the Media 2014, the number of these types of ads will increase this year, as prestigious new organizations like the New York Times, Washington Post and Wall Street Journal, and others, have at least begun the process to implement sponsored content, which is expected to generate $2.29 billion in 2014, says eMarketer.

More of these “ads” are popping up in financial broadcast outlets since the SEC last year lifted its ban on alternative investment vehicles advertising to the general public as amendments to Rule 506 of Regulation D mandated by the JOBS Act.

Facebook has mastered the art of sponsored content with its “suggested posts” that pop up in news feeds.  These posts are meant to look and feel like generic updates from friends and not by advertisers because the ad content is selected based on user preferences. For example, if a person likes car racing, he or she may receive posts pertaining to an automotive manufacturer or retailer.

The concept is not new.  For years, advertorials appeared in news magazines and newspapers with the corresponding phrase, “special advertising supplement,” alerting readers that the content is an advertisement, although sometimes the ads slip by as editorial content.

The proverbial jury is still out, however. While many publishers have expressed concern over using sponsored content, including the Wall Street Journal’s Chief Editor Gerard Baker calling it a “Faustian pact,” the reality is that sponsored advertising is a necessary evil and a good solution for today’s media outlets, even though it may come disguised as an unbiased news story.