If you have Hollywood ambitions, rubbing shoulders with Meryl Streep isn't a bad place to start. And if you want to make it big in the music business, Usher is a pretty good guy to know.
So it was fitting that the two megastars were among the first celebrities to make use of PepsiCo's sparkling new, state-of-the-art content studio in Manhattan. That space will be key as the food and beverage giant strengthens its ties to the entertainment world, pumping out branded content while also pursuing distribution deals with film studios, online publishers and other outlets for brand-agnostic content. And the central mission of all of that content is to entertain, not to sell chips, soda, oatmeal and other PepsiCo products -- at least not directly.
PepsiCo envisions selling enough unbranded content to cover the costs of creating ad content that does fuel product sales. The unit, called the Creators League, will serve as an internal production arm for scripted series, films, music recordings, reality shows and other content distributed for TV, online viewing and services such as Amazon Prime.
It is an ambitious venture considering that marketing is typically viewed as an expense, not a profit center. But PepsiCo executive Brad Jakeman said he believes that PepsiCo's massive brands, from Doritos to Gatorade to Mtn Dew, have value beyond what is in the bag or bottle -- and he wants to monetize it.
"Our goal is to really behave like a Hollywood studio," said Mr. Jakeman, president of PepsiCo's global beverage group. He oversees the content studio along with Kristin Patrick, senior VP-global brand development. So, for instance, brand Pepsi might sell music-related content during the NewFronts, and Gatorade could work with sports leagues to package and sell content like behind-the-scenes videos.
"The holy grail for me is to leverage the incredible power of our brands and their equities to essentially fund their own marketing," Mr. Jakeman said last week, as he and Ms. Patrick gave Ad Age a tour of the studio. "Will we ever get there? It is going to take a while. Are we making steps toward that direction? Absolutely, we are."
"For many, many years, we have been the people who have been renting the content from the networks and the studios. There's an opportunity for us to become more ingrained in that profit pool," added Ms. Patrick, who joined PepsiCo in 2013 after serving as chief marketing officer for Playboy Enterprises. Her resume also includes stints at Walt Disney, NBC Universal and William Morris Endeavor. At PepsiCo, she is stationed in Los Angeles, close to the entertainment moguls the company is wooing.
Already, the Creators League has signed a development deal with AOL's Partner Studios to co-create a slate of branded and unbranded content around music, pop culture, and health and wellness for distribution on AOL and Microsoft properties. PepsiCo is even getting into the movie business, after inking a deal with The Firm, a management and production company, and hip-hop artist Tip "T.I." Harris to make what is described as a coming-of-age feature film.
The planned movie, which Ms. Patrick described as an "urban 'Pitch Perfect,'" is in its early stages. A key player in the deal is The Firm's film division president, Robbie Brenner, whose credits include producing "Dallas Buyers Club." She hooked up with PepsiCo through Ms. Patrick, with whom she has a social relationship, she said. PepsiCo will be an executive producer of the movie, which will star T.I. "This isn't about branding and putting Pepsi in the movie at all," Ms. Brenner said. "It's about a culture. And because the content and the subject speaks to their demographic, this is a great fit for them."