Annual Madison & Vine Marketing Overview

MARKETERS INCREASE BRANDED ENTERTAINMENT BUDGETS

Acceptance of New Ad Methods Gains

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NEW YORK (AdAge.com) -- The money is starting to follow the call to arms for the marketing-through-entertainment business.


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As that community reconvenes Feb. 4 at Advertising Age's second annual Madison & Vine conference, there are tangible signs that advertisers and their agencies are taking a more central role in creating content for a media-hungry public.

'04 budget change,br> "There is such momentum and an increase in enthusiasm and support on all sides of the business from brands to the creative community to distributors," said Tera Hanks, president of Omnicom Group's Davie-Brown Entertainment, Los Angeles. "And for the first time, with the '04 budgets, our clients and the brands are actually budgeting specifically for nontraditional opportunities."

It was at the inaugural M&V conference a year ago that Coca-Cola Co.'s president and chief operating officer, Steven Heyer, in the keynote address, confidently assumed the role of branded-entertainment firebrand, cajoling both Hollywood and Madison Avenue to "collaborate or die" in creating a new media-neutral marketing paradigm. To anyone in the Rodeo Ballroom at the Beverly Hills Hotel that day, it was a mesmerizing performance marked by boldness and passion. It's no surprise that the ideas expounded in his call-to-arms speech have been co-opted by players on both sides of the aisle as a manifesto for the space.

Omnicom moves
Omnicom, among others, is making good on that call. It's pursuing new business models that could generate ownership and brand equity across TV, film and music for its advertiser clients, which include Pepsi-Cola North America and Hewlett-Packard Co.

Reflecting that shifting focus is Omnicom's hiring of Robert Riesenberg last month to head a new "advertainment" unit. Mr. Riesenberg comes to Omnicom from Interpublic Group of Cos., where he oversaw Magna Global Entertainment.

Andy Marks, a partner in Matter, a newly formed independent branded-entertainment outfit, and one of the architects of the Chrysler Million Dollar Film Festival, is also optimistic about the opportunities ahead. But he warns there's still a significant learning curve.

'A ways to go'
"We have a ways to go with clients in convincing them to pull the trigger," he said.

One marketer who gets it is Steve Tihanyi, General Motors Corp.'s general director of marketing alliances and regional operations. Mr. Tihanyi acknowledged he is considering new revenue models involving content creation, but he reiterated that at the end of the day, GM is an "auto manufacturer and not a production company."

Mr. Tihanyi, like Mr. Marks, said both sides have to develop a better understanding of the possibilities in co-marketing. "When I walk into the room with somebody from Hollywood," he said, "it's like they look at me as a walking checkbook, and that bothers me."

Digitalization of the economy
What impact the implacable digitalization of the economy will ultimately have on marketing is uncertain, but 2004 could wind up as a seminal year. Those with their heads in the sand may finally hoist themselves out of denial.

Because even if last year's Yankee Group forecast of 20% U.S. digital-video-recorder capability penetration by 2007 isn't met, it's a virtual lock that more and more average Americans will avail themselves of the joys and conveniences of commercial zapping and time-shifted TV viewing.

News Corp. Chairman Rupert Murdoch, upon closing his acquisition of satellite provider DirecTV, said DVRs would become a critical carrot to lure subscribers away from cable. The major cable operators themselves are gradually starting to roll out their next-generation set-top boxes with DVRs. Comcast Corp., the nation's largest multiple system operator, is developing a proprietary DVR offering.

ROI metrics
As companies like Intermedia Advertising Group and the much-beleaguered Nielsen Media Research roll out product-placement evaluation tools to offer a tangible return-on-investment metric, marketers and networks could become more emboldened in 2004 to ante up for entertainment-based alternative marketing solutions. An improving economy could also spur greater experimentation and more risk taking.

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