Warner Honcho Flom Woos Brands

Atlantic chairman sez co-marketing key to tunes biz

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%%STORYIMAGE_RIGHT%% If you want to gauge how big of a priority it is for Jason Flom to develop strategic-marketing relationships with advertisers, look no further than a promotional DVD for the brand marketer community that Warner Music Group's Lava Records—the label that Flom founded in 1995 under the auspices of Atlantic Records—created.

Flom prevailed upon one of the world's epic salesmen, former President Bill Clinton, to plug the label's artist roster in the promo. If one is lucky enough to be able to call in a favor from a popular ex-president, ostensibly it would be for a cause that's of supreme importance. Clinton appears at the beginning of the promo and again at the end, when he cracks in mock exasperation, "the things I do for Jason Flom."

Flom plans on continuing to pull out all the stops in his expanded role as CEO-chairman of Atlantic Records and president of Lava Records following the re-org orchestrated by Warner Music Group chief Lyor Cohen after the sale of the group earlier this year by Time Warner to a private-equity group headed by Edgar Bronfman Jr. for $2.6 billion.

While Flom relies mightily on the efforts of his strategic-marketing team led by Camille Hackney, VP-strategic marketing, Atlantic Records/Elektra Entertainment Group, and Kevin Weaver, senior VP-strategic marketing at Atlantic Records/Lava Records, he promises to be involved in a hands-on manner with all brands that are game for any co-branding alchemy. It's the same roll-up-your-sleeves tenacity and energy that Flom has brought to Atlantic since the early days as an A&R dynamo, signing acts as diverse as heavy-metal sensations Twisted Sister and Skid Row to singer-songwriters Tori Amos and Kid Rock.

Flom sat down with Madison + Vine last week to discuss the fortunes of the music industry as well as the increasingly entwined paths of marketers and labels.

M+V: How's it going with the new ownership? What does Edgar bring to the party and does being a private company that's no longer a slave to Wall Street give you more freedom in taking risks?

JF: We are the only pure independent music company now. Edgar and the investors went into this because they believe in the music industry. There's no other reason why one would buy a music company. Some of the other labels are part of larger conglomerates that may or may not be interested in the music industry. It's a great feeling to be in a place where you're wanted and valued. Edgar gets involved in a way that's not intrusive but constructive.

M+V: One of the consequences of the conglomeratization of the music industry is that labels just don't develop artists the way they use to. But because you have this new ownership situation, do you believe you can lead a renaissance in the old ways of artist development?

JF: We have a strategic advantage, which was discussed in the very first meetings with our new owners and they see it our way, which is that we're not under the same pressure to report and to make quarterly numbers. Of course, they have emphasized that they would like us to run this like a business. They do have a significant amount of money invested in us so we are going to run it in a responsible way. That said, it's a tremendous advantage to not have that kind of pressure because careers can be ruined by quarterly pressure. They recognize that we're better off taking a long-term view and not sacrificing it for short-term gain.

M+V: First-half Soundscan numbers are encouraging and the industry as a whole seems to be getting somewhat of a handle on the online issues. Do you feel that the worst is over?

JF: I'm a perpetual optimist so I'm very bullish on the future. If we make great records, people will buy them. I trust that the Internet situation will reach a place where it's manageable. Also the industry has moved aggressively to exploit everything from video games to ringtones and I think one of the next great opportunities lies with the synergies that can be created between advertisers and record companies.

AGGRESSIVE CO-BRANDING

M+V: You guys have been as aggressive as anyone in seeking out corporate America for co-branding initiatives. What is the ultimate co-branding venture?

JF: Everything is constantly changing because right now someone is dreaming up a genius new ad campaign for a product that one of our records would be perfect for. The best thing that could happen for both our industries is to have a more open dialogue between creative people on both ends. A year and a half ago, there was an incredible campaign between Atlantic Records and Schick where Jewel was the artist and Intuition was the product [and the name of one of her songs] and it was a home run in terms of impact on product. I'm a firm believer in the power of advertising and the synergies that can be created. I've seen it work. Sugar Ray has developed a relationship with the Kia brand. They did the Spike TV show and it looks like the relationship is going to grow. So I'm looking forward to sitting down with Sugar Ray's management and Kia's reps to map out the next-level thing. Maybe it's a Sugar Ray album released on a Kia imprint through Atlantic. And profit participation is something that we'd be willing to talk about.

M+V: Do you see artists increasingly writing songs with brands in mind?

JF: It's definitely a possibility but it has to be done in a way where it doesn't compromise the artistic integrity of the band. It doesn't have to; we're not in the '60s or '70s. It's become commonplace for bands to align themselves with brands. We're pragmatists in the music business. Ideally, if you can get the right song in a commercial, especially with a kyron, you can reach a very large number of people and reinforce the impact the song is making on radio and MTV and potentially drive it to the next level. Of course, the opportunity to use advertiser dollars for aspects of [our] marketing campaign, which sometimes can come into play, is also exciting to us. Fact is, these corporations are dealing in numbers that dwarf the numbers we normally spend on a marketing campaign.

%%PULLQUOTE_LEFT%% M+V: Who are some of your high priority artists and why would they be attractive to brands?

JF: We have Jewel and Simple Plan putting new records out soon. Simple Plan is a bull's-eye for brands trying to reach the teenage demo. As far as an older, 30-something, middle-class audience is concerned, a group called Trans-Siberian Orchestra (trans-siberian.com) would be great. Their music has become a Christmas phenomenon. It's a group that I helped create in 1997 that has since become one of the largest touring attractions in the country. Their tour this Christmas will gross approximately $25 million. It's a hybrid of rock, pop and orchestral music. It's an amazing phenomenon; Gateway used them in a commercial last year. As long as they don't cancel Christmas, they'll keep growing.

M+V: If more label CEOs were more hands-on in developing relationships with advertisers, wouldn't it send a powerful message that you guys are serious about fostering long-term strategic partnerships instead of just looking for a check?

JF: I believe this is a great growth area for us. I love the artists and the music we release and the company that I work for—I've been here 25 years. And anything I can do to help further those careers, I'll do. And I believe one of the greatest and most under-utilized ways for us to help get our music exposed and sold is through better communication with advertisers.

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