Spirits Giant Diageo Goes Hollywood

Providing Content Instead of Pitching Product at Heart of New Mandalay Deal

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LOS ANGELES -- Diageo is saying cheers to branded entertainment.
Sharpleft is partnering with Mandalay to turn Diageo's drink brands into characters that consumers can emotionally connect to.

The London alcoholic-beverage giant, which owns brands such as Smirnoff vodka, Captain Morgan rum and Guinness beer, is getting ready to devote more of its marketing dollars to entertainment.

Diageo has given the green light to its entertainment agency of record, Sharpleft, New York, to partner with Hollywood production company Mandalay Entertainment Group to develop projects. The idea is to develop original concepts that put a spotlight on Diageo's products and essentially turn them into characters that form an "emotional connection" with consumers.

Several of Diageo's brands, which include Crown Royal whiskey, Johnnie Walker and J&B Scotch, Jose Cuervo tequila, Tanqueray gin and Bailey's, have already been dabbling in branded entertainment.

Crown Royal Television

Crown Royal's website has hosted Crown Royal Television -- an "Entertainment Tonight"-like program of footage from the various celebrity and sporting events the brand sponsors -- since last August. Sharpleft produces the project, which had launched two episodes a month but now updates weekly.

"We wanted to maximize the company's marketing budget and highlight their brand's sponsorship experiences and put them on the web," said Doug Langway, CEO of Sharpleft, who has been working with Diageo for three years.

Crown Royal also sponsored "P. Diddy Presents the Bad Boys of Comedy," a nine-episode series that ran on HBO for which Sharpleft shot behind-the-scenes footage for the DVD release.

Among Diageo's other brands, Johnnie Walker's website has long been streaming video content. And Tanqueray recently launched "Tony's Telly," an online TV network hosted by brand spokesman Tony Sinclair.

Ownership of content

Most of the company's brands, however, have been focused on events and sponsorships. But Diageo's brand reps are looking to start producing more mainstream fare, such as TV shows and movies that can be exploited across various distribution platforms and that the company can own.

"When a brand makes something and owns it and can repurpose it and distribute it, it gives them a different stage to preach from," said Christian Tureaud, executive producer at Mandalay Integrated Media Entertainment, a division of Mandalay Entertainment Group.

Sharpleft and Mandalay pitched the idea of working together to Diageo executives two months ago, promoting the concept of turning products into emotional characters that can serve as spokesmen for the company and citing films such as "The Sisterhood of the Traveling Pants" and "Harold and Kumar Go to White Castle" as examples of entertainment vehicles that seamlessly integrated brands into the content.

"Your brand can actually be something that's loved," Mr. Langway said.

Diageo's brand reps sparked to the idea.

"That's our mission right now," Mr. Langway said. "To make movies that integrate the brand so well that it's the natural progression for the brand -- where the brand and the brand's message are the reason why the film can exist."

Beyond product placement

Sharpleft and Mandalay Integrated Media Entertainment have yet to decide on specific ideas to pitch to Diageo's brands, but the companies are interested in developing original concepts that go beyond solely product placement.

"What we want to do is very different from product placement," said David Salzberg, president of Mandalay Integrated Marketing Entertainment. "We want to tell stories that are relevant to the brand's corporate messaging. But we also want to tell stories that create an emotional bond and resonance with the brand. It's about giving the audience an entertainment experience that makes the brand look classier, cooler, hipper." He said by doing so, brands "become a provider, not a pitcher."

As part of their relationship, Sharpleft would guide each project and deal directly with Diageo, while Mandalay would serve as a conduit for talent, such as writers, directors, actors and producers, as well as distributors.

"We're driving the storytelling aspect from the brand's point of view," Mr. Langway said. "We're leaning on them [Mandalay] for their great resources. They would be in charge of talent and production."

Owning a piece of the property

Although financial terms were not disclosed, and are dependent upon which projects end up getting produced, Diageo would finance a significant percent of the budget, with Sharpleft and Mandalay owning a piece of each property.

"It keeps us engaged in the game, because the [product] is the true asset," Mr. Salzberg said.

Diageo will naturally also foot the bill to promote the content.

Best known for having produced films such as "Sleepy Hollow," "Enemy at the Gates," "The Jacket" and last year's "Into the Blue," Mandalay's chief executive, Peter Guber, has been pushing the company into new areas over the years. That includes children's programming, internet and mobile programming, the ownership of minor-league-baseball teams and partnering with Mosaic Media Group to produce the Golden Globe Awards and "Dick Clark's New Year's Rockin' Eve" through its majority ownership of Dick Clark Productions.

But his expansion plans have also included branded entertainment.

The company is currently readying "For Right or Wrong," a documentary about snowboarding that it produced with Burton Snowboards. The film is seeking distribution, but Mandalay hopes to release it in theaters in October. The film shot for 100 days across five continents. However, it follows last year's release of the Mountain Dew-funded "First Descent," a feature-length snowboarding documentary that Universal Pictures distributed. That film ended up collecting a scant $751,000 at the box office.
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