In April of this year, AEG launched their in-house branded content division, AEG Studios. It was a logical next-step for the global promoter who for years, has been connecting some of the biggest brands in the world with some of the biggest live music, sporting events, and musical acts.
Also logical, was placing Raymond Roker — an entertainment industry veteran, having founded URB Magazine/URB.com and led numerous festival sponsorship activations as Content Creative Director for Coachella/Goldenvoice — in the captain’s chair as Head of the studio.
Last month I moderated the Digital Hollywood panel, “Live Stream of Music Festivals and Concerts: Brands, Bands and New Technologies,” with Roker on the panel, along with John Petrocelli from Bulldog DM, Brian Anderson from YouTube, Eddie Vaca from AmpLive, and Marc Scarpa from Simplynew. After DH was done and dusted, I got a chance to chat with Roker about how things were coming along with AEG Studios, the major shifts taking place in the content and advertising worlds, and how they’re positing themselves within the rise of branded and sponsored content.
“Essentially, AEG created this division in a response to the demand in the marketplace with our brand partners,” Roker explained. “Many of AEG Global’s brand partners across business units have been asking us for this solution in terms of content, both long form and short-form content. It was a natural evolution for us, a natural move to be responsive to this demand; this changing marketplace.”
The State of Content and Advertising: A Collision of Upheaval
The marketplace is indeed changing, far faster and more dramatically than most industries, including advertising, retail, and entertainment, could have predicted five or ten years ago. Content consumption habits in the age of live streaming and on-demand online entertainment have heavily influenced how brands reach consumers through traditional advertising and marketing channels.
Unless you’ve been living under the proverbial rock, you know this. But before we delve into the rise of branded and sponsored content, it’s myriad of advantages and benefits, and AEG Studios’ major role in taking it further, let’s first break down what’s transpired thus far in 2017 in traditional and digital channels ad and content channels that is causing AEG’s brands partners to seek better, different content strategies for connecting with consumers.
Television advertising. In the US, ad spend is expected to reach $61.1 billion for the 2016-2017 season, according to Nielsen. That’s an increase over the 2015-2016 season, which hit $59 billion. That’s great, if brands are targeting people age 50-64, the largest television watching age group.
It’s not great for the majority of consumer brands that are targeting the largest US population segment, ages 18-34, which pulled ahead of the older TV-watching folks for the first time in 2015. Today this hefty demographic wields over a trillion dollars in spending power and is largely responsible for the dramatic cord-cutting, cord-never statistics.
Sports broadcast networks are attempting to retain the shrinking appointment TV audience by running shorter ads that the 15-second and 30-seconds that have been the norm. In August the New York Times reported that Fox Sports was “hoping to make six-second ads an industry standard across broadcasters as consumers in the internet era show less tolerance for frequent, bloated ad breaks during shows.” Before running the more brief commercial disruptions, Fox first tested the six-second ad unit on the short-attention-span theater audience during the broadcast of the Teen Choice Awards; six-second ads that teens and tweens are used to seeing on platforms like Snapchat.
Even though this shorter format has been championed by YouTube since 2016, Dave Campanelli from ad-buying firm, Horizon Media, is skeptical about whether a six-second ad unit gives brands enough time to get their message across, especially within the DVR-skipping, distracted population. “With so many different ways to record and fast-forward,” he told the NY Times, “or look at your phone during the commercial break and not pay attention, or just change the channel, that’s hurt commercial retention and hurt commercial viewership.”
Ya think?!
Cable subscriptions where TV ads live. Back to cord-cutting. In the first quarter of 2017 UBS reported pay-TV providers could lose more than a million subscribers. “That would be the worst result on record and equate to a 2.5% annual decline,” wrote the analyst, John C. Hodulik.
Then the second quarter came around, and it did get worse, as pay-TV lost another 1.28 million subscribers, according to Wells Fargo analyst, Marci Ryvicker. “We estimate this will put the industry on pace for a 3.3% decline in 2017 and 4.0% in 2018.”
As content consumers opt out of cable and satellite or bypass them all together, choosing vMPVD providers like Netflix (which has no commercials), Hulu (that offers a premium, commercial-free subscription), and Amazon (that is expected to align their massive product research and buying data set with their “blitz on the ad industry”), legacy players like AT&T are attempting to straddle both worlds.
In early October, Randall Stephenson, AT&T’s CEO, touted their vMPVD offering for mobile subscribers, who could stream 45-channels of live TV for only $10 via DirecTV Now. “That’s a game changer,” he told Vanity Fair. His sights are set on the company’s acquisition of Time Warner while also using these type of low-priced subscription model to bring customers back into their TV ecosystem, “and then use advertising to enhance the revenue generation on this, to keep this at a price point where we can do some very interesting things.”
This statement to Variety came on the heels of AT&T’s quarterly report to regulators, which showed a loss of 90,000 traditional TV subscribers in just three months, which exceeded the number of new DirecTV Now subscriptions but at a lower level of revenue generation for the parent company. AT&T’s competitors were also hurting. Charter Communications lost 104,000 TV customers in the third quarter, which Bloomberg stated was almost four times the 28,000 that analysts were expecting. Comcast had their biggest decline in three years with a loss of 125,000 cable-TV customers.
Looking at the MPVD industry as a whole, the Washington Post reported the number of households subscribing to traditional TV services has dropped to the levels of 2000, citing a study by New Street Research.
Adblockers. The use of ad blockers on desktop and mobile combined has hit an all-time high of 615 million devices worldwide, an increase of 30 percent, according to PageFair’s annual report. Of the 615M, 62 percent of ad block apps run on mobile, where all content consumption has been headed and continues to increase. And when faced with a website that won’t allow access unless adblock is disabled, 74 percent of people bounce.
There are now five industry initiatives “aimed at trying to bring trust and accountability to the supply chain, improve user experiences and keep ad dollars flowing to digital,” reported MarTech. This includes Ads.txt, Trustworth Accountability Group (TAG), Coalition for Better Ads, and LEAN Ads. The fifth initiative area is bringing transparency and safety to digital advertising through the use of blockchain technology. One blockchain platform cited in the MarTech piece is adChain by MetaX*, which leverages the Ethereum blockchain to address the massive problem of fraud and lack of transparency in the digital advertising supply chain.
Vetting quality advertising, programmatic ad transparency, and inaccurate reporting. For over year, Facebook has admitted numerous times that its ad metrics reporting has been way off, and it happened again this past September when the company claimed its advertising platform was able to reach a larger U.S. audience segment than actually lived in the country, according to U.S. Census data.
The now infamous speech made by Procter & Gamble’s global chief brand officer, Marc Pritchard, during the US IAB conference in January demanded transparency and accuracy in reporting, “We have a media supply chain that is murky at best and fraudulent at worst.” Between January and May of 2017, P&G, the largest advertiser, pulled $140 million dollars in digital adverting, and “nothing bad happened.”
Brand safety and fake news. Alphabet and Facebook, who own the lion’s share of US ad spend at 60 percent and 80-90 percent of ad growth, along with Twitter, had their feet held to the fire this month as Congress grilled them on the part their companies played in Russia’s manipulative ads and meddling in the 2016 US election. Each company’s responses on the hill left many calling into question whether the social giants will prevent another similar occurrence from happening.
In February of this year, and before we learned this month that Russian’s electoral disinformation ad reach was 126 million people on Facebook and 20 million on Instagram (146 million total), brand safety headlines broke across U.S. and international news outlets. The Times first broke the story that “Household names unwittingly pay extremist supporters and pornographers as adverts dumped online.” One glaring example was the Mercedes A-Class ad that ran on YouTube next to a pro-Islamic State video which was viewed more than 115,000 times. The result was a boycott of YouTube by several major brands in the US and internationally, from Havas Group agency, Toyota, McDonald’s, and HSBC, to AT&T, Pepsico, Verizon, Walmart, and Nestle.
A major voice in the tech world, Salesforce founder and CEO, Marc Benioff, spoke with Yahoo! Finance during their annual Dreamforce conference. Weighing in on Facebook, Google, and Twitter’s Congressional testimony, which revealed that the media companies, after all the brand safety issues, STILL don’t know how their platforms are really being used and who’s using them, Benioff stated, “Well, that’s unacceptable. These companies have to take full responsibility for the technology that they’ve created and to make sure that it’s being used in a proper way with the right morals and values that we would expect any corporation to be led by.”
The Time of Interruptive, Annoying Marketing is Done
So that was a lot, but it’s important to review where things stand today with all the marketing and advertising touch points brands use to reach their target audiences. How those media platforms perform for their advertising clients, and how they can still be used effectively with a heightened level of awareness and insight.
Facebook, Instagram, YouTube, and Twitter are and will continue to be viable, powerful, valuable connectors to massive, targeted audience groups, especially as highly effective content distribution channels. The live sports and entertainment industries have reaped huge benefits, as have their fans, through their use and will continue to do so. The caveat is shifting tactics, strategies and approaches to monetization and conversions through advertising.
We’re in a time where interruptive marketing is done, Roker stated, emphatically. “Brands need to have permission-based conversations with their customers. Brands know this. Customers know this.”
Bringing up ad blockers and specifically the discussion we had on the topic during the Digital Hollywood panel, “That’s not new news but it is a growing reality, right?”
Right, and if there’s an upside to the upheaval, it is the creation of the new marketing and advertising initiatives, including the Coalition for Better Ads spearheaded by Facebook, Google, P&G, Unilever, IAB, plus other related advertising groups and brands. Google will begin blocking ads and websites on its Chrome browser that do not meet the standards, in 2018. This browser-based ad blocking is already taking place on Apple’s iOS and Safari browser. “These changes will give individuals more control over their data and rein in annoying and intrusive advertising,” stated Columbia Journalism Review.
Roker recognizes that being the brand to get in between people and their entertainment media consumption can have adverse effects. “Now it’s not to say that there aren’t innovations in how you can surface brand messaging in content streams and all sorts of ways, and in fact, that’s getting ever more sophisticated,” he explained.
Roker refers to the ways branded content is being used on Facebook and Instagram, which requires compelling creativity. “That kind of ‘brand messaging,’ it has to be something the end consumer, i.e. your customer, is going to welcome, going to share, and going to be entertained by it in some way. Or at least informed by it.”
This is the major shift taking place in the marketplace, which requires brands to have all the resources needed to create quality, thoughtful content consistently over time; to deliver on their brand promise. “The AEG Studios mission is to be part of that solution specifically around our myriad properties, which are plentiful.”
Toyota Music Den x Firefly from AEG Studios on Vimeo.
The Rise of Branded, Consumer-Centric Content & the AEG Studios Model
During the Super Bowl, the brands and their agencies bring out their Sunday best. Every year, people tune in JUST to watch the commercials instead of skipping through them or picking up their smartphone for the 118th time that day. But the rest of the year, TV-watching folks are stuck with some Big Pharma ad and all of its disgusting, scary side effects. Or getting that awful baby-back ribs jingle stuck in our heads.
“Fortunately, that’s not the business that we’re in,” Roker said, laughing . But, “Even the best television advertising is shareable, story-based content.”
True. While this didn’t come from AEG, I have to call out a stunning example of quality, story-based content in advertising: the new John Lewis commercial, “Moz the Monster.” This home run captures the heart in such a lovely, lasting way while featuring a wonderful accompanying song by Elbow, “Golden Slumbers.”
A recent piece in Adweek highlighted the rise of brands gravitating more their strategies and budgets towards branded experiences, “Advertisers haven’t had to look too far for negative news lately. But as broadcast spending dips and clients question the safety and effectiveness of digital buys, more and more agencies are turning toward a rare bright spot in the ad world: experiential marketing.”
When it comes to AEG Studios, they have access to a plethora of content people are willing to pay for in the live entertainment and sports space. Having access to AEG’s Global Partnerships arm opens up numerous opportunities to craft sponsored stories that can live evergreen within a variety of platforms, from OTT and social platforms, to sporting team’s mobile apps.
“The bottom line is, nothing is off the table in terms of avenues or platforms or content solutions that we might pursue,” Roker explains. “The great thing about building [the studio] on top of AEG and on top of Global Partnerships is that Global Partnerships touches every aspect of AEG. I’ve been given no lane that’s off limits.
“We’re having LOTS of conversations and we’re meeting with all sorts of stakeholders across our various assets looking for opportunities. It’s so plentiful, it’s just a matter of choosing what makes the most sense for the timing, for the brands that we might involve, and for the [way] content technology is moving. It’s a really exciting time to be in this business.”
Part of those conversations is messaging the AEG Studios’ own model for providing content solutions that make sense for the application, the audience, the property, and the brand.
“It’s definitely not a priority for us to create something that isn’t a match. I would say, fortunately, the conversations that we’ve been having, have been pointed in the right direction in terms of our brand partners’ openness to get creative. They’re not coming to us to do a traditional media buy with traditional ad units in a very, by-the-numbers kind of manner. They’re really coming to us with wide, curious questions about interacting and producing content and producing partnerships with our audiences. I think the first thing we do is think about, ‘Where are we? Where will this content live? Who does it serve?’ We have such a deep understanding of our customer, of our fans, that we’re able to apply that to what we’re creating for brands. In that regard, we’re both serving kind of the same master.”
Toyota Music feat. ROZES x Firefly from AEG Studios on Vimeo.
Designing Content Attribution and Distribution Strategies
In terms of knowing the AEG audiences through ticketing data and social data, how does the AEG Studios team tap that information to best discover audiences that the brand doesn’t currently have access to, audience affinities and preferences, and then combining it all to build the creative brief for a given content project?
“I can partially answer that and know enough to stay a little in my lane here,” Roker states. “There’s a lot happening with AEG digital that is constantly evolving and very exciting. In terms of our ability to amplify content and send content on its own customer journey, we absolutely have that ability. Part of what we offer our partners is looking at content as not just ‘Production is over, we’re done.’ It’s really about, ‘Where does that content live on owned and operated channels, and beyond?'”
Pulling in that digital data and attribution component, combined with remarketing, can play a powerful role in meeting marketing and advertising KPIs. A piece of branded content could be used to pull in fans to watch a concert live stream, giving those remote audiences not attending in person the ability to still enjoy the show. Through geo-targeting, that audience receives a follow-up ad that the tour is coming to their town, giving them the option to click through to AXS.com to purchase a ticket. While AEG Studios stays in the content lane, that powerful arm of AEG digital integrates into the overall project to provide the closed-loop attribution and monetization model.
“The ability for AEG Studios to tap into the distribution and digital expertise of that [digital] team is something that’s very exciting and something that we’re definitely making use of,” Roker states. “These conversations happen on several different levels — digital and distributions, looking at how content can meet our customers where they are, meet our fans where they are — is something that’s really interesting that we’ll be playing with a lot in the coming year, as well as how it all ties back into on-site activations and other sorts of more traditional partnerships.”
One of AEG Studio’s on-site activation projects from this last year was the brand partner program, Toyota’s Music Den, which took place at AEG festivals, including Firefly and Panorama. Music fans get the opportunity experience up-close-and-personal performance from their favorite bands, participate in a variety fun activities, learn about the Toyota Giving program to support music education, all while getting exposure to the Toyota brand.
Roker’s team has been in the business of creating digital content within their own channel ecosystem, including AXS.com, AXS TV, along with the native content being creating around their family of festivals and tentpole events, including Coachella, Stagecoach, Bumbershoot, plus Panorama and Firefly. But when it comes to that content journey as it pertains to their brand, they stay platform agnostic.
“We definitely have partners that have a certain media strategy that we produce for, whether that be Facebook, or Instagram, or Snapchat or thereabouts. There are clearly future conversations that can grow well beyond every platform, every channel, every publisher. Every platform has its place.”
I asked about creating content for Snapchat’s unique platform that may be more difficult to maneuver than say, Facebook posting and advertising.
“The way I look at Snapchat, there’s clearly content that is ‘Snapchat first’ appropriate. It just builds and works. We utilize a lot of the more ephemeral content in the field for our festivals. We haven’t gotten as deep with that with brand partners yet, but I’m sure that will change. We’re excited for building solutions that live natively on Snapchat for brands as well.
“Right now we’re seeing a lot of innovation like Snapchat with Instagram Stories, and that’s sort of again, ‘Poof, it’s gone’ storytelling. Personally, I love to look at things that are going to kind of echo for a minute, that’s just kind of different [story] tellers, different stories, deserve different platforms. We try to really be cognizant of that end goal when designing any kind of content solution for our partner. Clearly, our partners are very sophisticated and they have their own sense of where their brand lives and where it makes sense for them. They’re not coming to us, virgins in this space. They’ve already had successes. They’ve already had social media platforms. They already know what speaks to their audience best. We’re ready to rise and meet them in the middle there and start creating that understanding. It’s really key, and when I say agnostic, it’s that the content should be malleable. It should be able to consider any vessel.”
With the growing trend of major brands launching their own in-house agencies, along with consultancies and publishers disrupting the traditional agency model, does this concern Roker’s team and AEG Studios’ positioning?
He stated that their goal is never to replace the agency-of-record model, “But the dirty little secret today is that there is no one entity or enterprise that has all the answers. It is such a fragmented, changing, morphing arena when it comes to marketing and digital content, which is clearly what makes it exciting and presents all these opportunities.”
This also means more companies are entering into the branded content world, and new agencies are popping up as a result. In the way his team stays limber on the platform side, they’re also flexible in the working relationship, be it through the AOR or directly with the brand. “If a brand brings us on to work on content, I think the understanding is that we’re going to be the best people to tell stories to our fans in their world in our setting; in our arenas and at our venues. That’s just something that we feel very confident in.”
The Future is Bright for Live Events and Storytelling
Today’s consumers, no matter the age or demographic, have more content choices than ever. There will never be enough time in the day or a lifetime to binge it all. With as much face time we’re giving our screens, HuffPo reported that “80% of U.S. Millennials are expected to attend a live event each year and spend more than double the per capita average in our country on these events.” As the world gets more nuts by the day, and real-life tragedies are even happening at festivals, that’s got people wanting more live music experiences, not less. “Perhaps we are gravitating towards live events to instill the sense of community and social connectedness that is difficult to find elsewhere in our modern age,” wrote HuffPo contributor, Brett Blumberg.
Because of this, AEG Studios also believes there’s still a lot of storytelling territory to cover. A new experience with the artist rising up. A musical icon making a come back. A sport team’s Cinderella story to tell. People will always want more. Taking into account their entertainment reach and presence around the globe and in every major city, they’re in a unique and powerful pole position to lead the way.
“We don’t pride ourselves on reinventing the wheel, but we believe there is a lot of untapped potential in the type of storytelling that brands can do, especially again, in our world; in the AEG world. The best way we do that is by staying in touch with these events.
AEG touches the lives of customers thousands of times a day. This is the best way that we remain vital. It’s the best way that we’re able to provide this service to our brand partners. We stay ahead of the curve.
Really, it comes down to that understanding and that partnership we already have with our fans. That’s our pathway to be successful.”
Raymond Roker is speaking this week at FestForums on the panel, “Lights! Camera! Releases! Filming Your Festival” 2.0 on Thursday, November 16, 3:30 – 4:20 PM. Check out all that’s in store for FestForums, the conference for live event promoters, organizers, event tech companies, along with marketers and journalists like me,here.
I’ll also be moderating one of the TOURTech 15 Summit panels as part of FestForums, “BEEN THERE, DOING THAT,” Friday, November 17
10:00 – 10:50 AM, on what it takes to innovate and stay competitive in the continually changing event tech industry.
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*Disclosure: MetaX is a client of the Radix Collective agency. Kim Owens of Kaffeine Buzz provides marketing services to Radix through Buzz Boulevard, her marketing agency).
