Madison & Vine is still one of the busiest intersections in marketing, but navigating it has become dramatically more complicated.
During its glory days, almost two
decades ago, when Mark Burnett was scoring tremendous deals with his reality TV franchises, “branded entertainment” was all the rage. Ultimately, media agencies and sellers realized there
was scant profit in doing many of these deals — most were TV buy value adds — and the lively corner of Madison & Vine quieted.
Today, with the burgeoning success of paid streaming services, the fine art of weaving products into storylines and producing branded programming is enjoying a comeback. But this time
around, it looks far more sustainable compared to the recent past, when every media agency on the planet struggled to launch a viable entertainment practice.
At the same time, it’s more
of a challenge now, as the major OTTs creative and control their own content on essentially ad-free platforms. Or so it would appear.
Let’s face
it, there’s a tremendous amount of disgust with advertising today, especially among younger demos. I look at the focus group in my household: Two kids who don’t even know how to work
cable. They’re working the Big Three: Netflix, Amazon Prime and Hulu. Commercials are anathema to these cord cutters.
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A McCarthy Group study way back in 2014 warned
us that 84% of millennials do not like traditional marketing, don’t trust it and are not consuming it. They prefer live streaming and video-on-demand.
Another more recent
study from Defy Media and Kelton Research showed that 85% of the millennials they polled regularly watch YouTube. There still is massive interest in broadcast
television events like "The Voice" and "American Idol" and some live sports, but that’s about it.
Citing an IPG Magna study, The New York Times recently reported that in
just two more years, 48 million U.S. households will drop their TV subscriptions altogether and/or not even sign up for TV in the first place.
Coming
down the pipeline now is another major disruption, the new Disney app or streaming service that will carry Disney Studio, Pixar, Marvel and Star Wars content. It’s likely there will be two
models for the Disney app, one free and supported by commercials and another supported by subscription with no ads, not unlike the early days Hulu.
Amazon continues to flirt with a free
ad-supported service. In which case,there obviously is opportunity for spots, dots and pre-roll.
But the train has already left the station as the
industry tracks toward direct-to-consumer, advertising-free subscription services. The numbers are there — 125 million people worldwide on Netflix alone right now, and that number is going up.
Not only consumer brands, but entertainment brands also are searching for space in this sandbox.
On streaming services there are no promos, just algorithms: if you liked this show, you’ll
like this other one. Or you can see a thumbnail. That’s it. Of course, new shows can be launched out-of-home, but what about on the service itself, at the very touchpoint, right where consumers
can actually pull the trigger?
Another question. How does the sales culture of TV flow with streaming?
The TV industry counts legions of
salespeople, pitching eyeballs and cross-platform deals. Streaming denies this culture. There really are no sales people in digital, only techies. Netflix and Amazon started as technology companies,
not media companies. They created the template.
The bottom line is that subscription streaming services don’t really care. They don’t worry
about advertising. They can ignore it, and they do. The good news is that the Big Three haven’t cut off discussions between brands and their producers, the content creators and show runners.
Partnering up with a brand in an organic way through strategic placement can alleviate some of their tremendous production costs. There is wiggle room in the stream.
The upside for a brand integration on the Big Three can be big, not always in purchase intent, but in the brand awareness part of the sales funnel. Integration can be low cost and
effective. And despite the hundreds of companies that claim they can track and measure the effectiveness of brand integration, the practice really doesn’t warrant major ROI scrutiny.
The
only real measure is what people are saying and doing — they are watching non-ad supported content by the hundreds of millions. This stuff is important.
There are lots of ways to get brands into this new game, but there are no rules. It’s the Wild West again. That said, think organic and sustainable first; you can’t stick a
square peg in a round hole. You can’t integrate a brand that doesn’t fit. There are brands that have big charisma and energy and can create buzz in a show. They fit.
And there are
brands that just blend right into stories and contexts, with certain characters, helping define them and make them feel more real and relevant and appropriate. Another fit.
Procter & Gamble executed a
deal recently, to get its brands written into the plot of the ABC show “Black-ish.” And now with films like "Uncle Drew," a
movie based on Pepsi commercials, and Red Bull Media extreme sport documentaries on Netflix, like "Art of Flight," the prospects for long-form branded entertainment content on the Big Three also looks
cautiously promising.
Every brand should be looking at a content strategy. The shift away from traditional TV advertising today is real.
There is
a new generation out there that is growing up in a non-ad world. Brands and their agencies need to step into the intersection and cross the road in a new way, diagonally. In L.A., we call it a
scramble crosswalk. They’re very successful here and provide a great metaphor for our business. They allow pedestrians to cross in any direction, which is exactly what advertisers
need to do if they are going to get into the stream of things.