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Digital-Only Kids' Brands Lag Established TV Rivals

Advertisers still spooked by risk of being near inappropriate content

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The kids’ marketplace offers one of the odder contradictions in media. No other demographic has adopted new digital platforms faster. And perhaps no other ad market has been slower to embrace digital advertising. “Regardless of the statistics we see, TV still dominates,” said Suhaila Suhimi Hobba, evp and director digital communications at Initiative.

For example, Suhimi Hobba explained that while kids are gravitating to tablets in packs, most advertisers are wary of targeting younger demographics via mobile devices where privacy rules have yet to be established.

Web video is another emerging hotbed for kids’ entertainment, albeit one with challenges. Suhimi Hobba praised Disney for pushing original content on YouTube but warned that some advertisers might be spooked by the idea of encouraging kids to spend time on a site where an inappropriate video may be one click away.

To assuage such concerns, there have been several attempts at creating a walled-garden, Hulu-like site for kids. In 2009 the Canadian company Cookie Jar Entertainment introduced Jaroo, which aggregates forgotten cartoons from the 1980s and 1990s, like Beverly Hills Teens and Adventures of Sonic the Hedgehog. But Jaroo’s audience is so tiny, comScore doesn’t even report on it. Similarly, the kid-friendly video site Kideos.com has failed to attract much of an audience.

YouTube does feature clips from the likes of Sesame Street and Cartoon Network, but kids’ content is limited. Meanwhile Hulu has largely ignored kids to date, focusing on its prime-time partnerships—though PBS recently began distributing kids’ shows to Hulu Plus. In fact, while some TV players have been conservative when it comes to embracing platforms like YouTube, Hulu and the iPad, PBS has emerged as an unexpected leader. Per comScore, PBSKids.org accounted for 40 percent of kids’ video views in February— growth that was “turbocharged by our iPad app,” said Jason Seiken, PBS senior vp of Interactive. Yet despite explosive growth, PBS remains very conservative when it comes to advertising; it only takes sponsorships (not 30-second spots) aimed at moms rather than kids.

Thus, kids’ TV websites—i.e., Nick.com (13.4 million uniques per comScore), Disney sites (12.8 million) and Cartoonnetwork.com (9 million)—often get the lion’s share of digital dollars. Unlike the general market, where companies like Facebook, Google and Yahoo rule online advertising, few Web-only kids’ brands have emerged as powerful audience draws.

The kids’ virtual world space has cooled off, with Webkinz losing half of its audience over the past year. Suhimi Hobba did praise the four-year-old reading-themed Poptropica as attracting more top brands.

Publisher Jess Brallier listed advertisers such as Mattel, Fox, Universal Pictures and Hasbro. “We have a tremendous renewal rate,” said Brallier, noting the company’s presence in 120 countries. But in the U.S., Poptropica’s monthly audience fell 19 percent over the past year.

Overall, when it comes to kids’ online spending, “the numbers are small,” said Suhimi Hobba. “Much of digital kids’ spending has been about virtual play, getting kids to engage with brands. But with TV, you still see sales spike. You can generate that nag factor.”





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