• by Wayne Friedman , December 13, 2005

Branded entertainment agencies are seemingly experiencing growing pains--as more and more marketers question their value and how to get proper return on investment.

A recent report, for example, suggested that fragrance maker Coty Inc. didn't get all that it needed from a branded entertainment deal with Mark Burnett Productions' "The Apprentice," which this year has seen its ratings fall off dramatically.

On the heels of this news comes one high-profile branded entertainment agency that is rethinking how branded entertainment marketing deals will fit into its overall TV production plans.

Embassy Row is a major high-profile venture started in May by none other than "Who Wants To Be A Millionaire" creator Michael Davies. Embassy Row's point of differentiation is that it would focus on branded entertainment-laden TV shows.

But, last week--after only seven months of operation--Embassy shifted gears in a mode of consolidation, saying it would close down its Los Angeles office, which had worked exclusively on branded entertainment projects. Davies has said the office didn't sign up any advertising clients beyond Pepsi-Cola--which has done a number of deals with the company.

Additionally, two of Davies' partners in Embassy have departed--Chris Moore, filmmaker, performer (HBO's "Project Greenlight"), and former LivePlanet Chairman and CEO, and Tera Hanks, the former president of Davie-Brown Entertainment, a major Los Angeles-based product placement and entertainment marketing agency.

Hanks was considered a key player because of her connections to the marketing world. Davie-Brown's big client is Pepsi-Cola. Davies and Hanks put together a deal for "Pepsi's Play for a Billion," which ran first on the WB, then ABC. It was produced by Davies' former production company Diplomatic.

Now Embassy's work will primarily exist in New York, where a staff of 30 or more people will work on a variety of projects. Some--but not all--will include branded entertainment deals. As opposed to the New York office, Embassy's LA office was working only on branded entertainment TV shows--but it turns out that's not where the business is coming from.

"Projects tend to be where the revenue is," said Davies. "We make the majority of our money from production fees."

Embassy Row isn't de-emphasizing branded entertainment--but not all its projects are with brands. Davies says that 50 to 60 percent of its TV shows have brands attached. He says, "I want to work with brands to help get shows on the air."

Right now, Embassy has ten shows in production--including "Who Wants to Be a Millionaire" in syndication, and "Wife Swap," the reality show on Fox.

"Millionaire" was one of the shows in which high-profile branded entertainment deals took hold--especially when contestants needed a helping hand from a friend, usually from an in-show phone call. Host Regis Philbin would then say, "Let's go to our friends at AT&T." In syndication, "Millionaire" now has branded deals with AOL, Capital One, and Netflix.

Davies knows where his bread is buttered. "Millionaires would not have gone on the air without AT&T and McDonald's," said Davies. "I have people such as Peter Sterling (McDonald's marketing executive) to thank for that."

But Davies also takes pride that not all shows need branded entertainment--even reality shows that almost always lend themselves to it these days. For Embassy, that show is "Wife Swap." "There isn't a single piece of integration in that show," says Davies. That wasn't the case with the show "My Kind of Town"--a summer show on ABC last season--as a host of companies touted their brands.

Embassy now has some 20 projects in development. One high-level pilot at ESPN is the "World Series of Darts," which intends to do for darts what the World Series of Poker has done for poker.

Embassy Row has also completed work on the "Iconoclasts" series that is being produced for Sundance Channel, where celebrities interview one another: such as Samuel L. Jackson interviewing basketball great Bill Russell, or Robert Redford questioning Paul Newman.

Although Hanks has left, Davies says he still has an association with her when it comes to branded entertainment deals he needs to put together. That will be helpful. While at the product placement company Davie-Brown Entertainment, the agency's clients included (in addition to Pepsi-Cola) Hewlett-Packard, BMW, NFL, and Reebok.

Davies will also still work with Chris Moore, who will now focus on producing and directing films. Moore has produced "Good Will Hunting" and the "American Pie" franchise.

"The three of us are incredibly good friends," said Davies. "We remain that close today. This is in no way a separation." Both Moore and Hanks are executive producers in a Universal Pictures/Embassy Row/Davie Brown Entertainment production of a theatrical documentary on snowboarding, now running in theaters, called "First Descent." Pepsi-Cola is a key partner in the project.