A talking chimp arriving in e-mail inboxes speaks in its sender’s voice through a telephone connection or recites a pre-recorded joke for the boss. “Knock, knock. Who’s there? Not me, because I quit!” The monkey can be customized with aviator glasses, a tiara or an i-Pod and set against different locales, including the corner office, a cubicle, an airplane, the golf course, a prison cell or an exotic dance club.

Say hello to the Monk-e-mail, which is among the latest viral marketing campaigns that blend advertisement and entertainment across informal consumer networks. And doing it with great success, according to CareerBuilder, the job-search firm behind this ad, which claims that more than 18 million of its Monk-e-mails have made their way across the Internet. Another corporate-initiated viral ad offers a version of the cartoon opening of The Simpsons shot with live actors, produced for the British Sky Broadcasting television network. Burger King sponsors a “subservient chicken” site, where viewers can type in commands to a person in a bizarre chicken suit with red garters. The chicken will do a cartwheel, sing, fall, jump, and even drop to its knees and pray. (This chicken has standards, however: If asked to strip, it marches forward and wags a finger at the requester.)

The intersection of advertisement, entertainment and interactivity is a key part of the business model behind a new service developed by JibJab, the Santa Monica, Calif., production company that created political cartoons passed virally to millions of PCs during the last U.S. presidential campaign. One of the best known ones, a parody of the song “This Land Is Your Land,” has a singing George Bush calling John Kerry — dressed as a hot dog and clutching a bottle of Heinz ketchup — a liberal weenie. Kerry later opens Bush’s head and puts in a brain while singing, “Sometimes a brain can come in handy.” JibJab has developed a new site called JokeBox, where consumers and corporations can post and share funny videos or jokes online.

According to Wharton marketing professor Peter Fader, the convergence was inevitable. “It took a long time to get to this point because it was a sacred cow — the separation of content and commercial — but now everything is a big mush. Why bother trying to separate it?”

JibJab’s JokeBox and other humorous viral marketing campaigns are a natural venue to launch commercial messages, says Fader, who adds that early efforts to virally promote serious financial services or consumer products failed. “The key to success is to do something that’s naturally viral. And there is nothing more viral than jokes.”

JokeBox’s business model relies heavily on advertising revenue (Bud Light is an initial sponsor). Visitors to the site will see banner ads and paid advertisements after every few videos, says Gregg Spiridellis, chief executive of JibJab, noting that the site will accept submissions from advertisers along with non-commercial contributions, and both will be judged on entertainment value. “If they are not funny, no one’s going to pass them along and they will disappear in the mix.”

The rise of viral marketing could change the nature of the advertising business by providing a relatively low-cost way for companies to distribute their messages, Spiridellis adds. At the same time, the quality of the content will become more important than ever and will require advertisers to ratchet up spending to create ads that are worth passing along.

Wharton marketing professor Patti Williams suggests that the latest forms of Internet viral marketing build on the traditional power of word-of-mouth. “Advertisers are taking the initiative to provide the spark that starts the word-of-mouth. That spark is providing value to consumers by being entertaining. If you can provide something consumers find entertaining, even if it’s advertising, they are likely to expose themselves to it.” Increasing adoption of high-speed broadband connections allows the more intricate viral messages, which often include video, to pass from PC to PC, she adds.

Viral Internet messages are also a way to build integrated brand campaigns, says Williams. CareerBuilder’s e-mail, for example, is based on characters introduced in the firm’s Super Bowl television spots. The monkeys, wearing suits and ties, climb around cubicles in an office as their lone human coworker laments that he works with a bunch of monkeys. “The monkey e-mail is not that different than what we see in their traditional campaign,” she says. “It’s smart of CareerBuilder to leverage this asset. They are extending the equity they have in those characters into a new venue.”

As for Burger King’s subservient chicken, she says the viral campaign enhanced Burger King’s push to present itself as an edgier brand, one that the company hopes will appeal to men between the ages of 18 and 24.

Going for Stealth

According to Kendall Whitehouse, senior director of information technology at Wharton, Internet viral campaigns are part of advertising’s evolution. In the years following World War II, advertisers were successful in reaching consumers through mass media, including television and magazines. Now, with cable television, TiVo and the fragmentation of advertising markets because of the Internet, companies are turning to alternative sources to get their messages out. “The problem is, how do they find a business model that’s successful in this user-selectable content universe,” says Whitehouse. “It will be interesting to see which of these schemes are durable, which are scalable and which are one-shots.” While the subservient chicken may have been clever, he says, it is not clear that quirkiness alone is a sustainable model. “If this kind of thing becomes standard operating procedure, then it loses its impact,” Whitehouse notes. “That’s part of the danger here. It’s great while it works, you can get more visibility than you might get from doing the same old thing, but it really is an interim strategy” until more durable business models emerge.

Another dilemma for viral marketers attempting to meld entertainment with a message is how blatant, or discreet, they should be in pushing their brand. “Some of these are almost stealth campaigns,” says Whitehouse. “A technique a number of companies have employed is to do something clever and subtle because people will be more inclined to pass it along when it’s not a blatant product pitch.”

Art, Not Advertising

Yet no matter how funny or technically cool the campaign, viral marketers are still bound by the basics of successful advertising, suggests Wharton marketing professor Leonard Lodish. “The most important thing is first, to have a product or service that will satisfy and delight, and make people want to talk about it with their friends.”

Lodish says some campaigns add incentives to consumers to talk about a product by providing awards or prizes if they refer others. Viral campaigns that direct consumers back to an advertiser’s own web site, he adds, may not spread as far as a pure viral campaign. However, that strategy could provide the beginnings of a two-way communication between the company and interested consumers that could be valuable to both. “There are a number of products where it’s legitimate to have a dialogue with the customer,” Lodish says.

Wharton marketing professor Xavier Dreze points out that the impact of viral marketing is difficult to assess and is biased toward acknowledging only those ads that are successful. “We keep talking about the ones that work. We don’t talk about the ones that don’t work. By definition, when a viral campaign doesn’t work, nobody knows it ever existed.”

Dreze also notes that developing a viral campaign to spin a message off onto the Internet through chat rooms and discussion boards can be labor-intensive and scattershot, whereas television and print media can provide advertisers with data about the size and demographic make-up of their audience. “I can put an ad on ‘CSI: Miami’ and I know who I’m going to get and I know when I’m going to get them.” Viral marketing can also quickly slip out of an advertiser’s control, adds Dreze. It is impossible to know who will receive viral ads from friends or what the context is. For example, CareerBuilder does not know what its Monk-e-mails are going to say. “So there is a bit of a risk to it.”

To address the issue of effective measurement, the Advertising Research Foundation is about to embark on a pilot project to evaluate consumer “engagement” in advertising. The project will be designed to develop new standards to evaluate the success of innovative forms of advertising, including viral campaigns, across all forms of media. Bob Barocci, chief executive of the Advertising Research Foundation, says research indicates meaningful advertising communication occurs when consumers have a role in creating the message. “The idea is that if we can do a better job of measuring engagement, we will move a whole lot closer to accountability, proven effectiveness, and better return on investment.”

Fader, however, is dubious about whether measures of engagement will tie back to sales. He says high-concept, entertaining spots may be engaging, but fall short when it comes to actually selling the product. “There are a lot of awards for dumb ads that are considered to be art, but they are not advertising.”

Indeed, the advertising industry has long wrestled with the question of whether a memorable ad is effective in generating business, he says. Online advertising provides different ways to measure responses — such as counting how often users click on an ad to view additional information — in a more timely and objective way than older media, says Fader. “Our modeling technology is better, but I don’t think we are that much closer to a clear vision.”

For now, much of the viral advertising produced with elaborate video and interactive capabilities is viewed at work, where corporate systems have better broadband capacity than home-based networks, according to Owen Plotkin, chief executive officer of the now corporation, a New York communications firm that develops Internet advertising content (and uses a lower-case ‘n’).

Employers have been tolerant of workers using office systems to view content because it is one way to keep them happy as they work increasingly long hours, says Plotkin. But he warns that this could change if the rate of Internet monkey business increases dramatically. “People are working longer hours than ever before so it’s only right to let them balance that with e-mailing their [friends]. But if they are just surfing the web and sharing silly movie clips and chatting on AIM [AOL Instant Messenger] all day, I wouldn’t be surprised if we are reaching a point where a happy employee is becoming less productive.”

Plotkin said the promise of new interactive viral communications goes beyond product promotion and could have a deeper impact on society. Traditionally only wealthy people owned television stations or publications and had access to media outlets for their own views. Now, the Internet has democratized media, he says, allowing everyone greater access to wide audiences to promote commercial products and social causes.

Basketball Courts and Free Cakes

Wharton marketing professor Barbara Kahn says interactive and entertaining Internet advertising is part of a larger trend in branding in which ads have moved from being product-focused to being consumer-oriented; experience is now part of the equation. “The idea is that it’s not enough to focus on the benefit to the consumer; you have to provide an experience.”

As an example, Kahn points to Niketown, the shoe manufacturer’s retail chain that features basketball courts in many of its locations. “It wasn’t enough to buy the shoe; you had to play basketball in the shoe in the store,” says Kahn. Another example is a child’s brithday cake. Cakes used to be made from scratch with sugar and eggs. Then they were made with a mix. Later, they were purchased at bakeries, thereby adding to the value chain. Today, birthdays are often celebrated at party locations where the cake is thrown in for free. “Now the birthday is the whole experience around the cake and it’s no longer about the cake.”

The focus, Kahn says, “has become more on the total experience that wraps around the product. We see it in retail, so it makes sense that we are seeing it in promotion.”