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Title of the attached .pdf file: in Marketing and Advertising: The full 8-page report from the July 28, 2003 print edition of Advertising Age MAIN 07-28-03 A 1 AADB 7/25/03 1:50 PM Page 1

Music in Marketing and Advertising | Special Report July 28, 2003, print edition, Advertising Age

See poster after S-2 for Guide to Music SPECIALREPORT Marketing

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BLIGE:Reebok part of new ’s launch Music dances to a marketing beat By MARC POLLACK pin of a national ad campaign that in- cludes the sneaker marketer and retail a culver city, calif., back lot is bustling chain Foot Locker. The spot will promi- with activity. Dozens of assistant direc- nently feature “Love @ 1st Sight,” the tors, grips, stylists, makeup and lighting first single from Ms. Blige’s upcoming al- people, bodyguards and managers scurry bum, “Love & Life,” in stores Aug. 26. around against a stylized red and black The commercials, created by New York cityscape backdrop, with young girls skip- boutique AKA Advertising, New York, ping rope double Dutch style, as rap/R&B start running Aug. 15-30 on major cable Grammy-winning diva Mary J. Blige networks like BET, MTV, VH1 and E! takes her place on the set. with prominent placement in 600 Lady It’s not a or a feature film Foot Lockers and 1,400 Foot Locker stores but a commercial for Reebok—the linch- Click to continue >>

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July 28, 2003 | Advertising Age | S-1 AdAgeSPECIALREPORT 7. 28 .03 MUSIC MARKETING

MUSIC WORLD NEEDS HELP OF MARKETERS From Page 1 nationally. As part of the promotion, Reebok International will launch a Mary J. Blige sweatsuit line early in 2004 and will sponsor her tour next year. Omnicom Group’s Davie- Brown Entertainment, Reebok’s entertainment marketing shop, along with The Firm, Ms. Blige’s Beverly Hills, Calif.-based management company coordinated the deal. Ms. Blige’s record is the first major new release following the much-publicized merger of MCA Records, which represented the singer, into Geffen, just one more example of the rapidly consolidating music business. Advertising has become the ’s “Times are not only tough, they’re harder. These deals are natural” new favorite suitor: Consumers across all demos are buying fewer CDs than ever. Sales are down 13% from just two years ago and continue to plummet, with no end in sight. CD sales are expected to decline 5% to 8% this year, the International Federation of the Phonographic Industry reported this month. Consolidation has resulted in the loss of thousands of jobs in the record-business food chain. Hard times have hit music-oriented CEOs like Chairman Thomas D. Mottola—who helped pioneer diva marketing with , Celine Dion, and, now, his wife Thalia. They have been succeeded by TV executives like Andrew Lack. The industry has pinned the blame for much of the current downturn on Internet file- sharing, illegal downloading and CD-burning, despite the promise of “legal” sites like Steve Jobs’ ballyhooed iTunes . Record companies are scrambling to find a solution that will expose and monetize music investments. In a recent study of 12-to-44-year-old consumers by Edison Media Research, those who have downloaded more than 100 music files report that their purchases of CDs have dropped 61% from the year before. In STEVEN TACKEFF STEVEN PAPER CHASE: With the marketing muscle of Unilever and its Thermasilk line providing marketing support, Grammy Award-winning toured the country this year. addition, 71% of those heavy downloaders See MUSIC on Page S-2

Sing by segment Q&A Out of tune Extended play INSIDE How labels market by Richard Kirstein Searching for The hits just keep on coming. Be sure to catch all age demo—from discusses music’s role marketing’s role in the coverage on music marketing at the AdAge Wiggles to White at Bartle Bogle solving the download Group. See adcritic.com, ‘Creativity,’ Madison + Stripes Page S-3 Hegarty Page S-7 mess Page S-8 Vine and AdAge.com QwikFind AAO86V AD AGE MAIN 07-28-03 B 2,3 AADB 7/24/03 12:09 PM Page 1

Open the poster on the opposite page for Ad Age’s Guide to Music July 28, 2003 | Advertising Age |S-2 Marketing AdAgeSPECIALREPORT MUSIC MARKETING Music From Page S-1 have “burned someone else’s copy of a CD instead of buying one,” and 48% say they no longer buy CDs “because they download music for free over the Internet.” In this climate, artists, managers, labels and publishing executives are all grasping for alternative revenue streams, or at least another partner to help share the ever- increasing promotional budget to launch new artists and continue to sustain career acts. “At most record companies, the astute marketing people have been tying together artists and products for many years,” says longtime industry executive Phil Quartararo, EMI Recorded Music North America exec VP who oversees the company ’s new in-house marketing entity EMI Music Marketing. However, the consumer today is more inundated than ever before by those “We need to make up for some losses. These types of deals are natural”

competing for multiple impressions. The weight has been put on us to become more focused and selective in coming up with non- traditional sales relationships.” Adds legendary music manager Irving Azoff, who has about 20 corporate deals , including Eagles/Infinity, Steely Dan/GM Credit and Christina Aguilera with Skechers, Target and Mattel: “Times are not only tough, they’re getting harder. We are selling less catalog and fewer new records. With the economy as bad as it is, costs haven’t gone down. We need to make up for some of these losses. These types of deals are natural.”

COLLINS TO STONES This is nothing new, of course. Entertainment Marketing Communications Inc. founder Jay Coleman is considered the father of music marketing, launching such early pairings as Earth, Wind & Fire for Motorola and the groundbreaking sponsorship of Coty U.S.’ Jovan for ’ 1981 tour. The struggling musk oil company paid $500,000 and, according to Mr. Coleman, “It put them on the map in a major way.” The Stones went on to cement sponsorships with Anheuser- Busch’s Budweiser, Sprint, Tommy Hilfiger STEVE GRAYSON STEVE and T-Mobile for their most recent Euro jaunt. TASTE TREAT: Pop singer Rachel Farris is the focus of a multifaceted promotion with Coca-Cola, Fox, Universal Studios and others giving away millions of free CDs to moviegoers. The Who have used Miller Genuine Draft as tour sponsors, Paul McCartney’s show was promoted by Visa International and Phil Thermasilk to use the music for free, a tactic made a cameo appearance in this year’s Mya Broadcasting Corp., getting a song heard on Collins’ presented by Sears, Roebuck & Co. becoming much more prominent. and spot, says the partnership the air has become harder than ever. Labels Management powerhouse The Firm, Examples of recent high-profile ad blitzes between advertisers and labels is inevitable. and artists have turned to major advertisers whose music clients include Ms. Blige, Dixie include Celine Dion/Chrysler Group, which “Our goal is always to match up the right and TV to help reach the broader Chicks, Jennifer Lopez, Michelle Branch, helped launch the diva’s new and her artist, the right brand and the right song, and demographic audience once delivered by Enrique Iglesias and , was one of the first much-hyped Las Vegas connection; Led it to penetrate the marketplace from all radio. These days, with the cherry-picking to recognize the importance of these deals and Zeppelin and General Motors Corp.’s angles, together,” he says. encouraged by most file-sharing services, has aggressively pursued opportunities. For Cadillac; Jewel and Schick; Shakira and Pepsi- legal as well as illegal, and the perception that example, The Firm and Maverick Records Cola Co.’s Pepsi; Jay-Z and Heineken USA RADIO PLAY TOO DIFFICULT many hit are composed of mostly have teamed young singer/ and Reebok; Enrique Iglesias and PepsiCo With the passage of the Telecommunications filler beyond the hits, the record industry’s Michelle Branch with Unilever’s Thermasilk, unit Frito-Lay’s Doritos; and Mya and Act in the mid-1990s, and subsequent sharp growth over the last two decades has which sponsored her recent 12-city tour with Common/Coca-Cola Co. consolidation of the radio business under been curtailed disastrously. And that is why a radio and online campaign. To demonstrate Interscope Geffen A&M, Records monoliths like Clear Channel the exposure music can receive on TV its commitment, the label is allowing Marketing/Sales head Steve Berman, who Communications and Viacom’s Infinity becomes so important. AD AGE MAIN 07-28-03 B 3 AADB 7/23/03 6:30 PM Page 1

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By the demo: music for the ages By KATE FITZGERALD network” and an online message board for parents (thewiggles.com). EENAGERS PAY CLOSE attention to commercial links and Launched by Lyrick Studios (acquired by Hit in 2001), The Wiggles are four Aussie men the wrong association can spell doom for a , say industry mostly in their 40s who studied early executives. childhood education before becoming “Advertisers are more interested in associating with hot new touring around the world, says Ms. T Beddington. Cross-promotion, all handled in- music,whereas several years ago they were missing opportunities,”says house, through Hit’s various preschool Andrew Klein,president of Revolution Marketing.Marketers are having franchises that include Bob the Builder, success by associating with narrow demographics adopted by age groups. continues to drive the brand’s success. Thirteen Wiggles videos have been released in the U.S.; Celine Dion may or may not help sell Chryslers to boomers,but “Magical Adventure: A Wiggly Movie” came Good Charlotte rocks likely Honda Civic drivers.Following are the out this year, and The Wiggles appear daily on marketing tactics used by top musical groups targeting specific age groups: Disney Channel’s “Playhouse Disney.” The release this year of Disney’s “The tots is that every few years Lizzie McGuire Movie” and with ACT: The Wiggles you get a fresh crop who is ACT: Hilary Duff Ms. Duff’s hit song “Why Not” whetted kids’ MUSIC CO.: Hit Entertainment, just as excited about good MUSIC CO.: Walt Disney Co.’s appetites for more. This fall her music will be Dallas entertainment as the last Buena Vista Records unleashed on mainstream media with her TARGET: Preschoolers crowd,” says Sue TARGET: Tweens new album “Metamorphosis” from Disney’s Beddington, director of Buena Vista Records. he wiggles were Australia’s marketing for Hit, which weens fell under the spell of Hilary Duff Although Ms. Duff, 15, has shot her last No. 1 music act among launched the act here by as an actress when she starred in Disney episode of “Lizzie McGuire” and opted Tpreschoolers in 1999, but tagging clips onto Barney TChannel’s “The Lizzie McGuire Show” against making a sequel to that film, Disney they were unknown in the U.S. videos. In-store promotion series beginning in 2001, but when she started has two additional music projects in the when Hit Entertainment, the and live tours, not singing last year, they made her into a radio pipeline with her, to be released over the next Dallas-based keepers of the advertising, made The star. First came the song “I Can’t Wait,” to 18 months, says Damon Whiteside, Buena Barney the Dinosaur franchise, Wiggles stars, she says, plus a accompany the TV series’ soundtrack, followed Vista Records’ director of marketing. got behind their marketing. word-of-mouth pr push by a Christmas album, which aired exclusively “Nurturing Hilary Duff’s music career within “The beauty of marketing to through the “mommy on Disney’s radio and cable TV outlets. See AGE DEMOS on Page S-4

Take, for instance, the longtime sales spike get an artist to fit a product or a product to fit an between a star and an advertiser can be a Universal Studios parks in Los Angeles and seen by Sting, when his eventual hit single artist.” gamble: “If your artist doesn’t perform to Orlando. Ms. Farris’ song “Soak” will be used “Desert Rose,” which couldn’t garner “Just think of bands as brands,” adds Mr. expectations or reach the intended audience, as an accompaniment to the theme parks’ traditional radio , was used as the Coleman. “Reinforcing that can help sell then neither will your product, and the water slide rides, while Fox is offering free theme to a Jaguar TV spot and a Compaq merchandise, records, tickets and content.” campaign will be doomed.” Mr. Coleman tickets to the premiere of “Stuck on You” to Computer Corp. campaign. Although the idea of rockers shilling for points to the Celine Dion Chrysler TV spots, registrants on Ms. Farris’ Web site. Likewise, U.K. band Dirty Vegas’ techno- commercials no longer holds the stigma it did which featured the Crossfire, as a misstep. “If rocker “Days Go By” became a hit only after when Nike used John Lennon’s “Revolution” they were promoting a minivan or an SUV to REFINED PROMOTIONS it was exposed on a Mitsubishi car to sell running shoes, there are some who still soccer moms, like the later commercials did, Big3 Records President Bill Richards, says commercial. Every song on Moby’s album condemn the practice, such as Tom Petty, , it’s fine,” he says. “But they were promoting sales of Ms. Farris’ CD have tripled since the “Play” was used in a commercial, helping it go John Mellencamp and Bruce Springsteen. a sports car, which is usually a male- promotion began: “There has to be another multi-platinum in the process. Neil Young parodied the practice in his dominated item, and I think they turned off a way to get music in people’s hands. Instead of Universal Music Publishing Group award-winning video “This Note’s for You,” great many men buyers by using her.” illegally downloading music, you get it for Worldwide President David Renzer says that While the risks are great, the rewards can free. If you don’t hear something, how can for the last few years, most of his company’s be even greater, especially as the partnerships you possibly know if you want it?” revenue has come from synch-licensing his “Think of bands as become more innovative and creative. The With millions of dollars being spent on songs for commercials. Still, label partners current multimillion-dollar initiative by pairings of artist and product, it’s a foregone continue to urge him to be flexible on those fees brands. Reinforcing independent Big3 Records and Comdex conclusion that these partnerships will take on to gain exposure for acts they’re trying to Group’s LidRock to promote young rock a larger role as the industry tries to reverse its promote, like Andrew W.K., a new artist whose that can sell” all singer/songwriter Rachel Farris is a prime downward slide. One wonders if music will music appeared in commercials for Coors example of out-of-the-box thinking. simply become a sponsored activity, brought to Brewing Co., Target Corp. and Nestle’s KitKat. sorts of things The label, Coca-Cola, 20th Century Fox, you by not just the but third parties “There’s a balance between preserving the Universal Studios Theme Parks, and as well, with their own products to sell. value of copyright and taking into consideration with the refrain “Ain’t singin’ for Pepsi/Ain’t Anschutz Entertainment Group’s Regal, Concludes Mr. Richards: “The music the promotional opportunities to help break an singin’ for Coke/I don’t sing for Edwards and United theaters are partnered in industry’s regular way of doing things doesn’t act,” he says. “It’s a healthy tension.” nobody/Makes me look like a joke.” the promotion. Starting in June and running seem to be working. I believe, with the But the tradition of rock ‘n’ rollers hyping through July, Ms. Farris’ video has been impressions she’s getting, Rachel Farris will be IT’S GOT TO BE A MATCH products goes back to at least the mid-1950s, played in theaters before the feature a household name by the end of July. You’ve Marketing vet Mitch Litvak is the founder of when the King himself, , did a presentation, while consumers who bought a got to be pro-active. You have to play offense, the L.A. Office, a one-stop shop for brands and radio jingle for Southern-Maid doughnuts as large Coca-Cola received a 3-inch, two-song not defense, in this business … or you’ll go out entertainers to strengthen their promotional/- part of his contract with the “Louisiana CD of her music, which was embedded in the of business.” commercial ties. It hosts The L.A. Office Hayride” show, undoubtedly arranged by his lid. The disc also includes two spots, one for Adds Mr. Azoff: “What’s good for one RoadShow, a conference, which last year drew prescient manager, Col. Tom Parker. Elvis’ Universal Studios Theme Parks and another artist may not be right for another. ... The more than 600 attendees, helping introduce image continues to be used in advertising, the for the new Matt Damon-Greg Kinnear- exciting thing about our business is we can brand marketers to opportunities in major latest a series of Keebler elves spots and starring, Farrely brothers-directed comedy continue to come up with new and innovative films, TV and music. “The most important National Basketball Association promos. “Stuck on You,” hitting theaters this fall. ideas to keep the checks coming in.” ■ thing is to know your brand’s essence and Ayiko Broyard, manager of music Four million of the CD lids were CONTRIBUTING: ROY TRAKIN. match it properly to your artists,” Mr. Litvak marketing for Omnicom’s Davie-Brown earmarked for distribution on 7,000 screens in MR. TRAKIN AND MR. POLLACK ARE says. “So much gets messed up when you try to Entertainment, admits any partnership the top 25 markets, with more headed for SENIOR EDITORS AT HITS MAGAZINE. AD AGE MAIN 07-28-03 B 4 AADB 7/23/03 6:35 PM Page 1

July 28, 2003 | Advertising Age |S-4 AdAgeSPECIALREPORT MUSIC MARKETING

sly ploy in its advance press for the album: only vinyl copies were sent. “No one would Age demos admit they didn’t have a turntable handy,” From Page S-3 says Lisa Klipsic, V2’s marketing director, MORE MUSIC Disney’s own media channels provided “but it sure cut down on the number of people SIXTIES’ ROCK TUNES GAIN new life in a powerful cross-marketing opportunities, but burning copies of the album and [illegally] recent spate of commercials . Two of the Special now we’re branching out with her,” says Mr. sending them onto the Internet.” Reports’ staff favorite examples of music Whiteside. The new album will be marketed Another unique twist: adapted to commercials include: Sheraton on MTV and in magazines ranging from appeared for four consecutive nights on NBC- Hotels “Epic” commercial from Deutsch, New Seventeen to ; all advertising is TV’s “Late Night With Conan O’Brien,” York, in which Garage band Convoy brings new handled in-house. playing various songs from the album. meaning to the Stones’ “Let’s Spend the Night The White Stripes have never inked any Together.” Meanwhile, Modernista!, Boston, pays advertising or promotional tie-ins, other than homage to the Who with a Hummer H2 spot set ACT: Good Charlotte those that are routine to promote records to “Happy Jack.” We asked the AdAge Group MUSIC CO.: Sony Music Entertainment’s through major retail chains. V2 is modeled experts their choices: Epic Records like an independent label, and the band ADCRITIC.COM/CREATIVITY SHARE THEIR TARGET: Teens generates its own art. “There are just three of LIST OF FAVORITE MUSIC IN SPOTS: us marketing The White Stripes, and we keep t took about three years for Good Interpublic Group of Cos.’ Martin Agency, it pretty basic,” says Ms. Klipsic. Snuggle Charlotte’s frontmen, 24-year-old Richmond, Va., proving her well-entrenched “Swimpool Bliss” IJoel and Benji Madden, and their bandmates fame with young adult fans. She has also MUSIC:Original track ACT: Celine Dion from Human. to become an overnight sensation among appeared in Reebok TV spots, and her music AGENCY: Lowe, New York those between 13 and 20 years old. The will soon help sell duds from the Gap in TV MUSIC CO.: Sony Music Entertainment’s original traction came from local buzz in their commercials. Epic Records Visa Canada “Luggage” home state of Maryland, which ultimately “Artists used to shun TV commercials, but TARGET: Baby boomers MUSIC:Original track, Groove translated to gigs in the high-profile Van’s today TV has become a premium opportunity Addicts, : Ran Warped Tour in 2001 and 2002. to reach fans—as long as it’s the right fit,” ecause celine dion appeals to a broad Pink, Gilad Ben-Amram says Brian Cohen, senior VP-marketing for audience, TV advertising tie-ins and AGENCY: Leo Burnett, Toronto AOL Time Warner’s Elektra Entertainment, Bmainstream marketing are the perfect “Jimmy which handles Ms. Elliott’s music. tool for promoting her music, says Piero and Jenny” To reach this level, it took several years of Giramonti, senior VP-marketing for Sony MUSIC:Original track, grassroots marketing including live Music Entertainment’s Epic Records Group. Timbaland performances and hand-delivering her music “A younger audience might be more skeptical AGENCY: TBWA/Chiat/Day, to influential DJs and club promoters, says New York Mr. Cohen. “There are so many media Mini Copper channels these days, and each one has to be “Carbonation” worked right down to the last detail,” he says. MUSIC:“Not Bad At All,” Ms. Elliott’s fourth album, “Under licensed track, Natural Construction,” was released last year to great Energy Lab/Stimmung; acclaim. “We have more avenues to reach Steven MacDonald/ audiences these days, from local joints to Waronker online, contests and wireless text messaging, AGENCY: Crispin, Porter & but managing all those avenues is very labor Bogusky, Miami intensive,” says Mr. Cohen. Nike Presto Last year their breakout single, “Lifestyles “Uptown Digital” of the Rich & Famous,” from their album MUSIC:Original track, DJ “The Young & the Hopeless,” gave Good ACT: The White Stripes Uppercut Charlotte a broad following among teenagers. MUSIC CO.: Virgin Entertainment’s AGENCY: Wieden & Kennedy, Key elements in their rise to fame included V2 Records Tokyo appearances on MTV and a heavily trafficked TARGET: Generation X Web site (goodcharlotterocks.com). about overt commercial tie-ins, but an older Coors Light “Rock On” MUSIC:DeepMix, Hollywood. For many of today’s youths, a song only he liner notes of The White Stripes’ audience is receptive to mass media P.O.D.; Run DMC ; Scorpions; becomes real when they see it on video or “play latest album, “Elephant,” declare no messages,” he says. Byrds it” on a videogame, says Steve Schnur, Tcomputer equipment was used to record The multipronged marketing juggernaut AGENCY: Foote Cone & Belding, worldwide executive of music and audio for it—typical of the quirky duo’s originality and surrounding the release this year of Ms. Electronic Arts. Good Charlotte’s song “The its appeal to jaded thirtysomethings. This year Dion’s album “One Heart” included four TV Anthem,” first reached kids in August 2002 on the fourth album from singer-guitarist Jack commercials for DaimlerChrysler via Volkswagen “Squares” EA Sports’ Madden 2003 football videogame. White and drummer Meg White shot up the Omnicom Group’s BBDO Worldwide, Troy, MUSIC:Original score from J Ralph A month later its official release came on the charts, making the pair’s act one of the Mich., plus auto dealer and trade show AGENCY: Arnold Worldwide, album “The Young and the Hopeless,” and its hottest tickets nationwide. appearances. Epic has also promoted Ms. Boston exposure boosted album sales considerably, Virgin Entertainment’s V2 Records used a Dion’s music through this year’s opening of says Epic. “The game sold more than five her Las Vegas show, which is slated to run for Hummer H2 “Big Race” million copies and based on average game- three years. Omnicom’s Arnell Group, New MUSIC:“Happy Jack,” The Who playing patterns, that song has been played York, also played a key role in the deal AGENCY: Modernista!, Boston over 500 million times on the videogame,” says between DaimlerChrysler and Ms. Dion. Mr. Schnur. “Videogames are the dominant Using in-house resources, Epic has Levi’s “Car” MUSIC:“Crazy Beats,” Blur media channel for a lot of these kids.” advertised Ms. Dion’s new album through AGENCY: Bartle Bogle Hegarty, various print and outdoor channels. To reach New York new fans, Epic has used non-traditional ACT: promotional methods including sponsoring Nike “Battle” MUSIC CO.: AOL Time Warner’s local TV weather reports and talk radio MUSIC:Original track, the Elektra Entertainment programs, as well as radio contests. Neptunes TARGET: Generation Y While Ms. Dion’s music has gotten a boost, AGENCY: Wieden & Kennedy, Chrysler’s had problems moving its new Portland, Ore. ip-hop’s biggest female star, Missy Pacifica and Crossfire models. For now, the FOR MORE ON THE AD AGE GROUP’S COVERAGE Elliott, didn’t even rap or sing when she carmaker will use the singer’s music in OF MUSIC MARKETING, SEE THIS MONTH’S ISSUE Happeared in a Vanilla Coke commercial commercials but her days as the public face of OF ‘CREATIVITY’ AND GO TO ADCRITIC.COM AND ■ with Chazz Palminteri earlier this year from ROSSMAN Chrysler appear curtailed. ADAGE.COM QWIKFIND AAO86V AD AGE MAIN 07-28-03 B 6 AADB 7/23/03 6:33 PM Page 1

July 28, 2003 | Advertising Age |S-6 AdAgeSPECIALREPORT MUSIC MARKETING

had senior music marketing In six years working on about 25 positions at AOL Time Warner’s tours, Mr. Ellis has had Ford Motor , Sony Corp.’s Co., PepsiCo, Levi Strauss & Co., Message is cool for school Sony Music and BMG L’Oreal, Bolt.com and others as tour Entertainment. “It’s a way to match sponsors for his company, which By WAYNE FRIEDMAN Why the rush? marketing company, has perfected teen empowerment issues.” describes the company’s target Students are not just looking to the delicate art of blending pop acts For music companies, his tours, demographic age group. Sponsors get n some 1,000-school assemblies, get front row seats for social cause with cause-related efforts and which range from 15 to 30 markets, sampling and signage at the events. scores of kids have come chats but to see short from bringing them into high schools and act as grass-roots marketing for While other marketing agents charging down the aisles in big or growing pop stars such as junior high schools. young music acts—for a relatively have put Irecent years to listen to talks , Dream or Play. “We found this really cool way low cost. “Media are cluttered,” he together mall about anti-drugs, anti-guns or the Richard Ellis, president and to get into schools with these says. “You can’t get records on radio. and college problems with drinking and driving. founder of 12 to 20, a teen programs,” says Mr. Ellis, who has You can’t get videos on MTV.” tours for the music labels, Mr. Ellis has been the only It All Starts With Music. one in the last several years to market into junior high and high schools. ELLIS: Bridging the gap “Richard has cornered the market on promotional touring for developing teen artists,” says Kenetta Bailey, VP-marketing for BMG Strategic Marketing Group. One of the major cause-related participants of his tours is the Office of National Drug Control Policy, which has done three tours for artists such as Sony Music’s Solange (sister of Destiny’s Child’s Beyoncé Knowles) and Play.

IT’S ALL IN PRESENTATION “In a very intelligent way, he figures out how to present the information while still respecting their intelligence,” says Peter Klaus, executive producer of FreeVibe.com, an ONDCP youth- targeted Web site who has worked with 12 to 20. “It’s still their choice to make their own decision.” Brian Cohen, senior VP- marketing for AOL Time Warner’s Electra Records, used 12 to 20 to for its established artist, Fabolous, for a spring 15-city tour, mostly in boys and girls clubs: “He understands what it takes to deliver to these kids. It’s not just a marketing message. They are in that room to be entertained and enlightened.” Some of the bigger names Mr. Logos r Ellis worked to help develop include

e BMG Music’s Bad Boy Records’ act present conf Dream. BMG has done three tours with Mr. Ellis’ company, and next

irm month it’s going to launch a fourth. ed presenters as of 6/20/03 “It actually helped launch Dream,” says Ms. Bailey. “It’s In association with: Platinum Sponsors: going to be in launching Nodesha in the U.S.” Nodesha is a hip-hop/pop artist from BMG’s Arista label. Fresh The L.A. Office RoadShow Begins September 16 With The RoadShow Music Day. Look, an eye contacts manufacturer, is sponsoring the tour. New Releases, Artists, Music Trends, Priorities and Marketing Opportunities. The key for music label is The RoadShow Music Day is part of The L.A. Office RoadShow, a three-day entertainment marketing building music-brand loyalties early event where hundreds of opportunities in Film, Television, and Music are introduced to an audience of brand marketers, retailers and agency executives in a unique show-and-tell format. on. “If you remember that Dream came to your school,” says Ms. Just added: The RoadShow Music Day will feature three very special sessions: “Using Music in Retail Promotions,” “The Successful Use of Music in Advertising Campaigns” and “Music in a Digital World.” Bailey, “and then you tell someone ‘look at the autograph I have from To register for The RoadShow Music Day, or the entire three-day event, visit www.laoffice.com or call (310) 275-2088. Dream,’ they are going to remember Look for the "RoadShow Map to Entertainment Marketing" special advertising section in Advertising Age on September 15, 2003. that band for a long time.” ■ For advertising information, contact Deborah Kalinsky (323) 370-2440/[email protected]. Copyright notice: © 2003 The L.A. Office. All rights reserved. All trademarks, logos and artwork are the property of The L.A. Office or the applicable owners and are used with permission. AD AGE MAIN 07-28-03 B 7 AADB 7/23/03 6:39 PM Page 1

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print opera pieces. music for specific commercials— And for Leo Burnett in the U.K., what happens when the campaigns we picked up publishing rights on a have ended? BBH’s new music model campaign for Kellogg Co.’s Frosties MR. KIRSTEIN: When a from Myke Gray. They campaign is finished, we can re- artle bogle hegarty music production company is rights from the group Amadeus to wanted to do something heavy exploit it as library music for the commercials have spawned Morgan Van Dam. They created a theme for a Gordon’s gin metal in the vein of Limp Bizkit. audio-visual community, though nine No. 1 selling singles in the track specifically. The commercial, called “H2O.” That commercial is already on air. strictly with prior written approval. B the U.K.; now the trans- commercial is on air in Spain and BBH is currently working on a Our artists are jobbing composers, Atlantic ad agency is looking to Belgium, and will roll out across campaign for Bertolli olive oil. We they act as free agents. We’ve picked AA: So far, much of your work is create a new business model to help Europe. Again, we are talking to are working with Debbie Wiseman, up eight titles so far. in the U.K. What about the U.S.? it take a share in future hits. record labels about its potential. who has scored movies such as MR. KIRSTEIN: We are already BBH recently set up an in- We’ve also acquired publishing “Tom & Viv” to rearrange out-of- AA: You commission pieces of working with BBH in New York. ■ publishing company, Leap Music, a joint venture with former Zomba Music Publishing executive Richard Kirstein. Leap’s mission is to acquire the copyright to music pieces commissioned for commercials. Mr. Kirstein explains, in an interview with Advertising Age Reporter Claire Atkinson, how the new model will benefit BBH, marketers and possibly Publicis Groupe, which owns a 49% stake in BBH.

AA: How does the existence of Leap Music benefit the clients of BBH? MR. KIRSTEIN: The agency works smarter, it controls the costs [of the music] for relicensing at a later date. In acquiring our rights in the composition, it works better because when it is relicensed to a company for an extended term, BBH is doing it at the KIRSTEIN: New imports Leap rate [as opposed to the composer’s rate]. Second, there is an advantage in owning the copyright. When it is broadcast on TV, we share in the royalties, there is a back-end incentive. Leap pays the dividend to BBH and to the client to get both a cost saving and a back-end income stream as a result.

AA: What are your current projects, and where do you find the artists? MR. KIRSTEIN: We’ve licensed one title to BBH, New York and [in the U.K.], one to Leo Burnett Co. and six to BBH. BBH, New York, is about to launch a new commercial for Unilever’s Axe deodorant [in the U.K. it is known as Lynx] The composer was a British company called Past Present Organization, and BBH, New York, bought it. The style is upbeat guitar/acid . If it works, we’ll be talking to American record labels. In the latest Lynx commercial, we brokered a deal with a composer on the song “I See Girls.” The idea of the commercial is that Lynx makes guys attractive to girls, so there’s lots of scantily clad women. We are currently turning that 30 seconds into a 3-minute song. The rapper is Daniel Anderson, and the AD AGE MAIN 07-28-03 B 8 AADB 7/23/03 6:37 PM Page 1

July 28, 2003 | Advertising Age |S-8 AdAgeSPECIALREPORT MUSIC MARKETING Marketing tackles download mess iTunes a viable model as music world tries to beat FILE THIS Almost a third of Internet users download music free services at own game (Survey results from March-May 2003 unless otherwise noted) By TOBI ELKIN NUMBER OF U.S. CONSUMERS (18+) WHO GO ONLINE: he competitive landscape for online 61% (122 million) subscription music services is likely to PERCENT OF U.S. CONSUMERS WHO up over the next six to nine ANSWERED YES TO THE QUESTION: Tmonths, spurred by the success of “Do you ever download music files onto Apple Computer’s iTunes music store, which your computer so you can play them launched this spring. Roxio’s plan to relaunch at any time you want?” Pressplay, which it recently acquired, as Napster—albeit as a for-pay, legal service—is a sign that momentum is building in the category. But how will subscription download services such as MusicNet, MusicMatch, iTunes, Audio, Listen’s Rhapsody, Full ON A TYPICAL DAY 4% of Internet users Audio’s Music Now and Yahoo!’s Launch downloaded music. create viable businesses and create critical mass in a world where free services Kazaa, INTERNET USERS WITH HIGH-SPEED Grokster, iMesh and Morpheus rack up access at home are much more likely to millions of downloads a month? At its peak, download music. Napster had about 1.5 million people logged 29% OF INTERNET USERS, or about 35 in on any given day and saw 2.7 billion—yes, million, say they have a high-speed connection at billion—downloads a month, according to Lee home, whether it is DSL, cable, T1 or another kind Black, senior analyst, Jupiter Research. of connection. Globally, illegal downloads are estimated at 2 billion to 2.6 billion per month and were 41% OF THESE BROADBAND users, or about forecast to have hit 24 billion to 31.2 billion in 14 million, download music. 2002, according to Leo Kivijarv, director of 9% DOWNLOAD MUSIC on a typical day. research and publications, Veronis Suhler RIPPING: Subscription services and download sites are ON THE UPSWING competing for attention in a high-stakes copyright game. Source: Pew Internet & Project Stevenson. ComScore Networks puts the number of U.S. computers using Kazaa in Music subscription spending projections May at 7.5 million , while the number of of a radio service. person doesn’t know Rhapsody and Full Audio engaged visitors to subscription-based “The next six to nine months will be a very and the others,” Mr. Leigh says, adding “The mp3.com in May was only 920,000. intense period for Windows [Microsoft circumstances are almost ideal for the labels All the software encryption in the world Windows-based] music services,” Mr. here, Apple is a brand that everyone knows.” won’t eliminate illegal file-sharing and digital Bernoff says. The anticipated launch of Apple’s iTunes struck a chord with its 5 downloads, say industry-watchers. They say Apple’s iTunes for Windows PCs later this million downloads claimed the marketer since that the legitimate services will need to create year, coupled with forays by Microsoft Corp. April: “It really proved if you give consumers unique marketing propositions to and into the space is expected to the rights to the downloads they want, they’ll differentiate themselves from one another. stoke excitement in the category. buy them,” Mr. Black says. “Consumers Marketing on the basis of ease-of-use, high He projects that the period from December have said as long as they can own it and copy it quality downloads, extra features, value- 2003-April 2004 will see a rash of service to other devices, they’ll pay for it … Give added incentives and strong customer service launches, accompanied by high profile them usage rights and they’ll buy it.” will all be important in coming months as the marketing pushes. for-pay services compete for market share. Mr. Black points out that subscription POORLY ENCODED Jupiter Research projects consumer spending Source: Jupiter Research music services, backed in part by big record The legitimate services must try to beat the on subscription music services will grow from labels, have limped along for the last couple of free services at their own game and market $50 million in 2003 to $500 million by 2006. from $3.95 to $19.95 per month, depending years. They built network infrastructure, their strengths, Mr. Black contends. “The free on the number of downloads offered and secured licenses and content and created services often have poorly encoded EXPECTED TO PIQUE INTEREST whether CD burning is part of the alliances with portals and other content downloads, low bandwidth and tons of junk The big question: Will the downloads kill the subscription. Apple’s a la carte store charges providers—but there was no money for software … there will be a flight to quality subscription services before they even get off 99¢ per digital download, while Listen’s marketing to support subscriber acquisition service,” he says. Word-of-mouth and viral the ground, Mr. Black wonders. The growing Rhapsody charges 79¢ a track for CD burning. and awareness-building. That is expected to marketing are considered critical to the future number of broadband Internet-enabled Volume discounts are also offered. change in the coming months. Apple’s high- of online music subscription services. To date, households is expected to help drive interest in “The sweet spot is zero,” laughs Josh profile ad campaign by Omnicom Group’s “It has been very unclear how to position the and demand for subscription services. Bernoff, an analyst at Forrester Research, when TBWA/Chiat Day, Playa del Rey, Calif., has services, but there’s also been no money [for According to survey results from the Pew asked about the ideal price point for consumers. set the bar for rivals—it has also begun to marketing],” Mr. Black asserts. Internet & American Life Project, 29% of While most of the services decline to create category awareness. Marketing is key, Mr. Leigh maintains in a Internet users, or about 35 million Americans, specify their subscriber numbers other than to “Apple’s marketing and media push is recent report: “As music shifts to Internet say they have a broadband Internet connection suggest they’re in the “hundreds of likely to drive awareness for the entire online distribution, the value of brand recognition at home and 41% of these broadband thousands,” MusicMatch is believed to have music category. “The No. 1 factor is the should not be underestimated,” adding that consumers (about 14 million), download about 145,000 subscribers who pay between brand,” says Phil Leigh, digital media analyst at big Internet brands like Yahoo!, Amazon, music—9% on any given day. $3 and $5 a month, Mr. Bernoff says. The the investment firm Raymond James & RealNetworks and Napster, repositioned Subscription services charge anywhere service doesn’t offer CD burning and is more Associates, St Petersburg, Fla. “The average from “free,” will thrive. ■