Ready for Its Closeup
Whether it’s a determined clownfish, a web-slinging boy wonder or a style-setting rap artist, the right match between an entertainment property and a brand has become more important than ever.
As the “trinity in brand building: content, media and marketing” (to quote Coca-Cola CEO Steve Heyer) continues to converge, PROMO is drilling down for a closer look at the ties between them.
Estimates on U.S.-based brand marketing ties to entertainment properties range upward from $100 billion for 2003. For example, just two agencies — Media Edge CIA and Mindshare North America, both New York City-based entertainment marketing firms under the WPP umbrella — collectively managed $32 billion in ad and promotion spending over the year.
But the dollar value of the brand investment in entertainment can be elusive since the two worlds intersect on so many levels. Relationships may include licensing and sponsorship (covered elsewhere in this report), royalty fees, tie-ins endowing certain rights in the entertainment property and product placement. Then there are the non-cash deals, in which products are incorporated into the entertainment or even “offstage” in exchange for some borrowed equity.
The stakes can be high. “The royalty fee alone on a widely distributed, popular film can run $3 million to $5 million,” says Mitch Litvak, president of entertainment marketing firm The L.A. Office, Los Angeles. “A Pixar family film like Finding Nemo would easily fall into that range.”
Last year’s top EMMA winner, the blockbuster action film Spider-Man, is a textbook case study of how to do it right. The Sony Pictures/Columbia TriStar Entertainment production had partners in every key product category, including Cingular Wireless, Carl’s Jr./Hardee’s, Kellogg and Dr Pepper. It exercised licensing, product placement, event cross-overs and much more, with big payoffs for both the studios and the affiliated brands.
Big change, small screen
Until recently, most brand spending in broadcast and cable TV took the form of media buys — 15 and 30-second spots that only occasionally were tied to some promotional activity, like a sweepstakes. Then there was TiVo.
“Product placement and marketing within programming is going to be even bigger,” says Jim Chabin, CEO of Promax&BDA, a broadcast and cable-television industry association. “With the integration of HDTV and TiVo-like time-shifting devices, the American audience will be watching television in a totally different way.”
According to research by the Yankee Group, 77% of all television commercials are skipped by TiVo users; it predicts that the technology will erode at least 10% of the U.S. TV ad spend (which was $50 billion in 2003).
And that presents further opportunities for brands, Chabin says. As the impact of media ads wanes, brands need to be part of the entertainment itself. Gone are the days of simply placing the cereal box on Seinfeld’s kitchen countertop. Now, scripts are being developed around brands.
In fact, many say, “product placement” is an obsolete concept, now being replaced by “brand integration,” whereby the product becomes integrated with the entertainment experience.
In December, TV network ABC announced it had created a partnership with MindShare to collaborate on programming. The deal lets MindShare help develop prime-time shows and perhaps promote clients’ brands in programs. MindShare helps fund production and may even share profits of hit shows. It also gets ad time at a set rate. Clients such as Unilever and Sears, Roebuck & Co. are involved in the early development.
MindShare hired former CBS Entertainment president Peter Tortorici as director of programming. Reportedly, the deal was developed by ABC’s entertainment execs, not its sales division.
Such partnerships must be handled with care, warns Mark Malinowski, senior VP/director of Ketchum Entertainment Marketing. “Ask if the entertainment property matches the essence of the brand,” he cautions. “Can the brand build a strategic, integrated marketing program around the property that will strengthen and reinforce the communication in the brand’s existing campaign?” A tie-in to a blockbuster film or TV show may not be right for every brands, Malinowski says.
And the ABC/MindShare deal could prove sensitive because it involves prime-time sitcoms and dramas, which have been considered off-limits despite promotional tie-ins with soap operas and other programming.
SNAPSHOT 2003
- Estimates on U.S.-based brand marketing ties to entertainment properties range upward from $100 billion in 2003
- TiVo penetration will drive further “brand integration” with TV programming
- New opportunities emerging for brand ties to digital games
