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SpirE-Journal 2012 Q2

Entertainment marketing – Tapping on the thirst for entertainment in emerging markets

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Entertainment marketing - Tapping on the thirst for entertainment in emerging markets

The entertainment market is poised to explode in Asia and emerging economies globally. Categories like concerts, gaming and sporting events will gain more viewership and sponsorship dollars. But brand owners will need to engage with entertainment events and products in a discerning way to truly establish that much sought-after emotional connection with customers.

The SpirE-Journal identified the rise of entertainment as a key mega-trend shaping the business landscape in emerging markets over the decade to 2020. It is a trend that holds implications for all companies operating in emerging markets, not only those in the entertainment industry.

The growth in concert and sports event, downloadable music, gaming and other forms of entertainment is multiplying the opportunities for marketers to build that precious emotional bond with their target audience that is one of the loftiest goals of marketing.

Of course, entertainment marketing is hardly new. Advertising and product placement in movies and television shows, for instance, has been around for decades. Celebrity endorsements are at least as old as television. But with the affluence-driven growth of events and the rise of less conventional entertainment forms – like music downloads and gaming – the opportunity matrix facing marketers is evolving.

This article focuses on new and emerging opportunities in entertainment marketing, rather than the mature areas in movies and TV.

Entertainment marketing re-defined

Entertainment marketing refers to the use of platforms, such as concerts, sports matches or celebrities to promote one’s products. Entertainment marketing is prized because of its purported ability to forge an emotional connection with customers. But whether this is actually achieved hinges on getting it right.

An effective entertainment marketing campaign should be mindful of:

Content

Successful entertainment is aimed at creating emotional effects amongst the audience relating to humor, excitement, empathetic sadness and so on. Such effects tie in well with marketing. Research shows how they increase brand associations and information retention.

Channel

The marketing content has to reach the target consumer, meaning that forms of entertainment have to be matched to target demographics and psychographics. Marketers for Silver (i.e. elder-friendly) products ought not to sponsor a Lady Gaga event, for example, but would be well-advised to consider concerts by Elton John or Laura Fygi.

Consumption

This relates to how the content in the entertainment experiences ties back to the brand. Clearly the marketing message cannot be so overt as to detract from the entertainment value. For instance, athletes sporting brand logos on their sports uniforms are acceptable. But celebrities changing their names to the name of the brand – as happened when an Australian football star changed his name to the cat food, Whiskas – is probably crossing the line!

How has the entertainment landscape been changing in emerging markets?

The changing face of entertainment

The rise of internet entertainment is a major theme in Asia and global emerging markets. Although legal music download stores like iTunes are not available everywhere outside of the US, that has not slowed down the rise of digital music downloads – both illegal and, increasingly, legal. It was predicted that the digital music industry in Asia will account for 35 per cent of the global digital music revenues at USD7 billion by 2015, out of a global figure of USD20 billion. A great deal of music is now available legally via streaming sites like YouTube, often bundled with a short advertising message at the beginning.

Another key trend has been the rise of gaming. Previously seen as the preserve of bored youth, the revenues of the computer and internet gaming industry now exceed cinema box office revenues world-wide – and the cost of producing a game can sometimes rival that of making a Hollywood movie. Games are produced for a wide range of customer segments, not only young men, and include some very sophisticated products indeed. At the intersection of social media and gaming, we see the rise of Facebook games like “Farmville”, a phenomenon which almost no one predicted.

Yet another noteworthy trend is the rise of the concert and event industry. In the past, the incidence per capita of concerts and plays in emerging markets lagged North America and Europe by a wide margin. However this is an industry that is very sensitive to changes in affluence. Recently, the number of concerts in Asia has been booming. This trend has been partly driven by musical artistes needing to supplement their incomes, which have been eroded by music piracy. Globally, live concert ticket sales have increased from USD16.6 billion in 2006 to USD23.5 billion in 2011. A good bell-weather of Asia’s growing importance in the global music scene is the initiation of the MTV Asia Music Awards in 2004, coming after the MTV Europe Music Awards were started in 1994.

Marketing through entertainment

What are the main platforms marketers can use in the entertainment space?

Sponsorship and naming rights

The traditional device of sponsorship remains one of the key avenues of engagement for entertainment marketers. This can be taken to the pinnacle of event association, where the sponsoring brand is actually included in the name of the event, as in the BMW Tennis Open.

Sponsorship of entertainment events is believed to help establish certain brand values that are synonymous with that event. This is why sports marketing is so popular – aside from having huge viewership among key demographics, sporting tournaments can also be said to embody the values of excellence through competitive success.

Sponsoring entertainment events is riskier but can be a powerful tool in reaching out to vital demographics who are emotionally engaged with a certain kind of event or artiste – as in Singha beer, Muang Thai Life Assurance and Yamaha Motor’s sponsorship of Lady Gaga’s Asian tour in Bangkok. It can also be a way of conveying certain brand messages – as in Singapore Airlines sponsorship of high school debates in Singapore.

However the example of Lady Gaga highlights a challenge with this – the risk of negative publicity surrounding the artiste or event. This happens when the artiste does not show up to perform, the government bans the event or negative publicity arises. Lady Gaga’s “Born This Way Ball” tour attracted religious protestors in almost every Asian city where it was held.

Sponsorship can help marketers attain multiple goals; such as:

Increase sales

Sponsorship through entertainment provides a platform for sponsors to showcase their products and product attributes. For instance, many food and beverage companies use sponsorships to boost food samplings, with proven benefits to sales.

Raise visibility and brand recall

Sponsorships can help to increase brand and product visibility, generating viewership and media coverage that might otherwise be unavailable or unaffordable.

For instance, Garuda Indonesia has sponsored the Indonesian Masters Golf Tournament as an official Airline partner. This allowed Garuda Indonesia to leverage the strong international and local media platforms that the event offered – such as the Asian Tour’s global television audience in over 200 countries of up to 850 million households.

Influencing customer perceptions

Sponsoring events that appeal to the target audience help to associate a brand with the positive values embodied in that event. An example would be BMW’s support for the BMW Malaysia Open Event held in February 2012 at the Kuala Lumpur Bukit Kiara Equestrian and Country Resort. The tournament has become an established part of the world-wide tennis calendar, and attracts some of the tennis world’s best players. Interestingly, Spire Research and Consulting was named the Official Research Partner to the event, which drew 10,000 spectators and was viewed by a TV audience of over 300 million.

Creating differentiation

Sponsorship can help create brand differentiation by providing a platform for the brand to stand out. This is particularly helpful for smaller companies seeking to compete with industry giants with a larger ad budget. For instance, in the Harley Davidson Rock Riders Tour in India, Harley Davidson and other super bike owners were offered free VIP parking. This cemented loyalty and attracted more spectators to the event. Another good example would be Volvo’s sponsoring the 17th Volvo China Open in April 2011. Volvo construction equipment was featured around the course, including the Volvo EC60C excavator. China has been a key market for Volvo Group and this sponsorship helped to strengthen Volvo’s brand image over competitors among golf enthusiasts (who would include some heavy equipment decision makers) in an intensely competitive field.

Volvo featured its EC60C excavator at the golf course of the 17th Volvo China Open in April 2011.
Endorsements

Endorsements refer to testimonials by celebrities. It is a well-established activity that is at least as old as public television. The challenge for marketers is to build endorsement relationships with celebrities who are associated with qualities that synch well with targeted brand values.

This can be a risky business – as shown by many marketers pulling out their endorsement deals with Tiger Woods when the latter became embroiled in a very public sex scandal in 2011.

The great benefit of endorsement over sponsorships is that people relate best to people. It is easier for customers to feel emotional ties to a person rather than an impersonal brand.

Advertising

May of the new entertainment forms that have arisen still attract an element of advertising. These include ads in legal music streaming videos, banner ads on music download sites and product placement in Facebook or internet games.

With consumers of digital content, though, marketers are well advised to make their ads as un-intrusive as possible. Ad video clips usually come with “Skip ad” buttons that appear after five seconds, for instance.

Cause-related entertainment marketing

This is one of the most exciting areas within entertainment marketing. The reason for this is the proven fascination that many younger people have with social causes, including but not limited to environmental causes. The salience of cause-related entertainment marketing is underlined by the deluge of Corporate Social Responsibility programs around Green themes. This is by now so commonplace among Multi-National Companies that no examples need be cited.

Philips and Chevrolet sponsored Earth Hour, a cause-related entertainment event.

Many events tap celebrities to deliver a cause-related message. One good example would be Live Earth, an event that aims to increase environmental awareness through entertainment. It first held its concerts on 7 July 2007 at 12 locations across seven continents. The headline sponsors of the event were Philips and Chevrolet, who were promoting energy efficient bulbs and hybrid environment friendly vehicles respectively. Live Earth turned out to be the “Most Watched online Entertainment Event Ever”, and was broadcast in 132 countries and seen by 2 billion people.

Earth Hour, now headquartered in Singapore, is treading in the same footsteps. It is an event that aims to get homes all over the world to turn off their lights for an hour. It is also held in conjunction with concerts, and attracts a good deal of sponsorship.

Live-in Marketing

Hostival Connect, the experimental marketing division of Hostival Group, introduced Live-in marketing in 2010. It refers to real-life product placement, wherein a target customer is allowed to use a product in a comfortable environment such as their own home, over a long period of time. Proponents of Live-in Marketing argue that it enables customers to try a product in a relaxed setting and experience more positive interaction with the brand. This could lead to positive word-of-mouth and possible future purchases.

This concept is still nascent, with most marketers adopting a wait-and-see attitude.

Conclusion

Entertainment is a booming sector in emerging markets, thanks to rising affluence and the globalization of culture. Undoubtedly this is creating an increasingly attractive platform for marketers. After all, consumers are being influenced less by traditional print, radio and television advertising, in favor of influences drawn from the internet and social media. Entertainment marketing offers a rare thing – a chance to build emotive bonds with customers through a process they enjoy.

However sponsorships cost money and artistes can be difficult to manage. Does entertainment marketing offer returns on investment (ROI) that are competitive with other forms of marketing spending?

Obviously this needs to be measured with the help of scientific research tools. But the key is ensuring that the expense is steered towards brand conversion in the consumer’s mind.

For instance, Harley Davidson organized a Harley Rock Riders Tour that featured local metal bands in India. The entry passes for the concerts were made available for free. However, one was required to collect the free pass from Harley-Davidson dealer outlets, thus raising brand exposure and consciousness of the path to buying.

As the concerts, games and tournaments flood into global emerging markets, so will the marketing dollars. This will be a boon to consumers, enabling more entertainment to come into these regions. To keep this sustainable, marketers will have to ensure that the money is well-spent.

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