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What does a $100 million dollar advertising budget look like?

One of the few positives out of yesterdays earnings call was the announcement that RIM will finally be aggressively advertising in America. This will be to the tune of $100 million dollars in the next quarter alone. There were rumors a couple months ago that RIM was shopping ad companies so they obviously have picked their company and marketing materials must be in the pipeline. While we don’t know yet what this campaign will look like, I would like to give you a reference point so you can vision the scale that a $100 million dollar budget will bring.

In 2006 the average ad budget for a major studio movie release was around $35 Million.  No official figures have come out since 2006, but, many think the average has gone up to 40-50 million.  Think about how many ads you see for major studio movies, most recently Hugo, The Muppets, Twilight, New Year’s Eve etc et.  When major studios launch campaigns of this level, you can’t help but see the ads, they are EVERYWHERE ALL THE TIME.

With a budget of $100 million, we can expect to be overrun with Blackbery ads… a true Shock and Awe ad campaign. Its unclear at this point what % of the budget will go where.  Mike and Jim indicated that the budget  might also discounts promotions, presumably through carriers.

It will also be interesting to see how they market OS 7.

I have read many people poopooing this marketting effort and saying it will not make much difference.  I see and understand that point of view, but, I have always been one that believes the consumer public, especially the American consumer public, is VERY easily swayed.  If RIM can implement a super aggressive, effective marketting campaign, I think the results will be surprising.

Apple has been telling you for years the iPhone is the best at everything and that Apple invented everything good.  There is nothing to say RIM can’t create their own “distortion field”

20 total comments on this postSubmit your comment!
  1. I’ve been thinking about how RIMM can remain relevant until the BB10 phones arrive:
    – Add more OS updates to blackberry devices – beyond 7.1.
    – Make sure PlayBook OS 2.0 has a lot of great features.
    – Show off what a Blackberry really can do – Hopefully, covered in the mass marketing campaign.
    – Make sure when BB10 phones do come out that they are comparable spec wise with the competition as well as has have revolutionary features.

  2. One thing they might want to consider is a program where if you buy a current OS7 device you can get a discounted upgrade to a new BB10 phone when they come out. That might help with people who don’t want to upgrade and be stuck with an old phone for 2 years.

    • While I seriously doubt they would do this it would certainly be nice. I was going to wait for a BBX/10 device but since its gonna be awhile now I will probably pick up a 9900 instead. That would mean foregoing a BB10 until later then.

  3. This will work for one quarter only. As soon as the 2012 Android phones hit the shops, ads will only reinforce how inferior RIM’s products are.

    April 2012, sales agent in the streets: Look at this super 9900 smartphone from last year! It has the design of a phone we made 3 years ago and the internals specs of what was released by our competitors 2 years ago! It has this brilliant camera that can’t focus, but it can shoot 720p HD videos, amazing, right?! We’ve refined our OS from 7 years ago and it features extra smooth scrolling between homescreen whiiiiiz! and you can install BBM…er…wait nobody cares about that here anymore… you can install Skype…oops, no, my bad, we screwed up on that one, let’s see, oh yeah, you can install Whatsaaaaapp! All this for a donation to the “The Save RIM Foundation”.

    Polite tech savvy non-Blackberry customers giggles and walks away, average joe is tempted, walks in the shops, sees the incredible choice of Android phones available at the same price, but with great cameras, dual-core processors, more, better apps, etc. and buys that instead.

    • Except the next gen android phones are out now. It will be mid-late 2012 before items such as galaxy s 3 or next nexus hit.

      • ICS has just been released and the 2011 Nexus is only a dev phone. The best of this generation is yet to come and lots of new phones will get released in the coming months.
        The 9900 and 9850 won’t be in the same league as the high–end Androids next year, but it will have a fair chance of competing against the mid-range for a few months if they get the price right.
        The big unknown for me is how well they can manage to sell the Curve. Maybe this is where they’ll try to hit hard. Market it like those old Danger phones, target teenagers and people on lower income. An entry level smartphone for people wanting to upgrade from a candy bar. Apple is still selling millions of 3GS, so it must be possible for RIM to do the same.

  4. Basically all RIM has to do is beat apple and google at there own game.

  5. It sounded to me like to 100M is built solely around preventing further erosion of US market share. In other words, it’ll be all about loyalty, and retaining existing customers. In that vein I expect:
    – Expansion of the trade-up program
    – Heavily discounted BBs if you opt to keep your BB plan but want to get a better device
    – Spiffs to salespeople for pushing BBs to customers who are looking at switching

    • No doubt a good portion will go to promotions as you outline, but, make no mistake, the ad campaign will be big. Even if they threw 40 million at ads it would be huge.

    • The trade-up program could be critical. Right now if you can get 160 bucks for a 9800. If they up’d that to say 250.. that would get a lot of attention

      • Imagine you have a 9700.

        You want a 9900.

        The 9900 should drop to $75 bucks

        You get $150 bucks for your 9700, its at $100 bucks now

        So you get the 9900 and pocket $75 bucks…

        thats awesome!

  6. They will have to put some serious spin on ads to make the OS7 phones sound competitive against the current iPhone and Android offerings.

    I think they need to use a lot of that $100M to drive down the price of the phones. At $200 or more the OS7 phones don’t stack up so well, but at $50 or less they might fly off the shelves. Ads will need to stress the discounts and potential upgrade deals on BB10.

    They need to talk less about features and specs since that is where they don’t stack up as well.

    • I think all the OS 7 phones need to be sub 75 bucks.

      Also, they need to target the off contract market

      The trade up program is the best way to do it.

      Offer a minimum $150 bucks for any blackberry no matter how old.

      RIM literally needs to PAY THE USER to stay with them lol

      They can buy themselves 6 months with promotions like this

  7. How about an incentive to trade in non-smartphones? That might get some people who haven’t made the leap to a smartphone interested in grabbing one.

  8. Enough with “portable, powerful, Playabook”? Great!!!

    Bring on the “here is what we can do” ads!

  9. A lot of add space and crappy adds is a bad combination… Lets hp[e the adds appeal to the customer. And BBM is still the best…. show that off!!

  10. blackberry meets the needs of many people. not all (certainly not all). not most (nope, not that either). but if it meets the needs of some then it can meet the needs of others. i’ve never quite understood RIM’s lack of advertising.

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