Where's the Money, Bunny?

PlayboyU -- Playboy's (NYSE: PLA  ) new attempt at campus-driven social marketing -- is a lot like a nervous freshman. It's naively ambitious. It's going to drop a few courses. It's also going to pack on a few extra pounds before the year is through.

PlayboyU.com launched on Wednesday, though I was tipped off last week when Ashley Heher from the Associated Press called to discuss the venture's potential. So I'll admit to having a little extra time to scope out how the adult entertainment media empire was getting the word out.

Over on Google's (Nasdaq: GOOG  ) YouTube, the PlayboyU channel shows clips of pre-launch parties and celebrity interviews conducted earlier this year. Over on News Corp.'s (NYSE: NWS  ) MySpace, snapshots of fully clothed centerfolds grace the page as The J. Giles Band's "Centerfold" blares away in the background.

The problem is that even now -- two days after the site's launch was made official -- the viral buzz isn't exactly there. Its YouTube channel has a paltry 40 subscribers. Its MySpace profile page claims just 90 friends. Those would be respectable numbers, if you were a garage band or running a garage sale.

However, this is Playboy! It's a monster brand with a killer resume. It should be raking it in on a cyberspace platform that has no bones about encouraging titillation.

Flunking out of e-college
Maybe it's the mixed messages being sent out by the PlayboyU.com landing page. "Get enrolled at Playboy U, an exclusive college-only non-nude social network," reads the introductory homepage.

Playboy? Non-nude? Obviously Playboy doesn't want to become a hub for pervs. The site wants to attract a lively crowd of college students, and it would rather appeal to the spunky coed who loves to wear baby doll T-shirts with the Playboy bunny logo than alienate her by making it a testosterone-powered "girls gone wild" experiment.

And, yes, only university students with active .edu e-mails can be invited into the website.

"Sorry, but high schoolers, old dudes and your Mom can't join," reads the site. It's another mixed message. Obviously Playboy U wants to be in the same mold as the original Facebook, before the original campus-only social network instituted an open door policy. Playboy U is Facebook circa 2005, only with a lot more attitude, personality, and plunging necklines. The problem here, though, is that it sounds a bit disingenuous to be bashing "old dudes" when you're a company whose iconic patriarch Hugh Hefner is as hip as ever as an octogenarian. Hef's official profile page on MySpace has 89,157 friends (or nearly 1,000 times more than the fledgling PlayboyU).

Avoiding the sophomore slump
If you think I've been a little harsh on PlayboyU.com, let me throw you a curve. I actually think it's going to work (though that may not be evident right away), because the company appears to have the right approach to promoting the site.

The press release indicates the site will have individual school pages, moderated by official Playboy U reps. In other words, there are going to be incentivized students at different campuses , making sure that students are familiar with the website. Playboy is also launching a weekly Playboy U show dedicated to coed issues on its exclusive Sirius (Nasdaq: SIRI  ) radio channel.

This is a surprising real-world approach for a company that doesn't seem to be doing as much as it could online. It's joining National Lampoon (AMEX: NLN  ) as an entrenched social brand that is trying to matter again for undergraduates.

National Lampoon is still milking its Animal House pedigree at the campus level, claiming that it's a familiar brand with 95% of the country's college kids. It recently stopped selling branded spring break vacation packages to party-hungry students, but it hasn't slowed down in cyberspace. Advertising revenue has soared 90% higher over the past year through its Humor Network. The company's network of 55 partner sites attracted six million unique visitors last month. And, yes, that was in July. School is out, but National Lampoon is still flexing its Web pecs.

Getting it right the last time
Few will argue that Playboy isn't a couple of years late in launching a social network. This would have been perfect to roll when Hef and three girlfriends were just starting to light up the reality series stage on E! Network. However, the adult entertainment industry has been a hard sell on the Internet, where free smut always seems to be a click or two away.

Playboy's interactive business isn't growing all that fast, but at least it's not shrinking. It's a relative victory. More risque providers of online erotica, like New Frontier Media (Nasdaq: NOOF  ) and the online arm of Rick's Cabaret (Nasdaq: RICK  ) , have actually posted declines in their Internet businesses through the first half of the year.

With subscription revenue tailing off for many adult entertainment purveyors, Playboy is thinking straight by making a play for an ad-based model through a free social networking site for students. It doesn't have to end here, of course. If its users begin generating enough user-generated quality content, maybe an online magazine can happen. Since Playboy is currently using its namesake print publication as a loss leader to extend the brand globally, becoming a more conventional Web-based media company is the smart, high-margin approach.

Sure, hip-sounding ventures like Rock the Rabbit and the ShopTheBunny.com online storefront haven't been blowout winners for Playboy. However, those were simply electives. Playboy U is gunning for a more active student body, even if that body is -- by most accounts -- completely non-nude.

Foolishness that's safe for your monitor:

Playboy is a Rule Breakers pick. Find out what other cutting-edge picks the growth stock newsletters like with free 30-day trial subscription offers. Don't worry, we've got high schoolers, old dudes, and moms sharing stock picks with the coeds there.

Longtime Fool contributor Rick Munarriz invests with a moral compass, though he wouldn't have a problem with the softcore specialty of Playboy. He does own shares in National Lampoon. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.


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