Giant needs something that's gonna pull those kids away from their Rock 'Em Sock 'Em Robots, Spirographs, Moby Grape, and 90210...
I guess the thing is, what are they aiming for? The profit margin for high-end racing bikes is quite high, but they're low-volume. The converse of that situation is high-volume low-margin bikes, and these are how most companies make money (think of VW making lots of Golfs and Polos to be able to make the Bugatti Veyron, which sells for a loss). There are way more people out there who will buy a utilitarian bike than will get a high-zoot carbon racer. Add to that the number of people who own a racing bike AND a commuter and you get the idea that they want to sell these lower-end bikes.
Now let's look at the market and their buying preferences. It's not hard to sell guys bikes. There are fewer societal pressures to maintain a perfect appearance, generally shorter hairstyles are either not mussed by the air or can easily recover from wearing a helmet. I think females are a huge untapped market as far as selling bikes go. Now how do you get someone to pay $500 for a bike? Well how do you get someone to pay $500 for a handbag? Make it glamorous. True this advertising campaign fails, but I think they have the idea. I don't know about everyone here, but I'm willing to bet we that because this is a "road biking forum" we have people who ALREADY like riding bikes, whether it be for racing, fitness, or commuting (or all of the above!). They're trying to sell to people who aren't of our mindset and so who knows, maybe it appeals to them? I think they have the wrong bikes in those pictures though. Look at the bikes that are being sold in downtown NYC, those are the ones that people seem to want to buy, not a mountain bike with suspension...