Wal-Mart, Yahoo! and other major brands either have joined or are expected to join McDonald’s and Sony in using music as a significant branding tool. Vans Shoes has hopped aboard sponsorship of the famed, hard-rock Warped Tour. Blimpie’s sub shops and other retailers are selling big fountain drinks with CDs by Alanis Morissette and others, simply attached to the lids. Meanwhile, Starbucks essentially has created its own music label. And Apple is leveraging the tremendous popularity of its iPod MP3 players into further positioning as a high-tech lifestyle brand whose product line happens to include computers.
While marketers clearly continue to capitalize on the appeal of music to other generations – witness the success of Cadillac’s rockin’ TV ads in helping the revival of that once-troubled General Motors brand, or the tight association between United Airlines and “Rhapsody in Blue” – brand stewards exploiting music mostly are taking aim at the youth market.
“These companies are simply trying to associate themselves with cool music,” says Chris DeWolfe, president of MySpace.com, a Los Angeles-based company that operates a social-networking site on the Web. “It doesn’t have that much to do with their products, but it casts them as being young, cool and hip. That’s the objective of companies that are trying to reach 18- to 24-year-olds.”
So far, no brand has exploited this connection more effectively than Starbucks Coffee Co. Along the way toward becoming the world’s leading retailer of specialty coffee and opening more than 7,500 locations around the world, Starbucks executives discovered that patrons were enjoying the eclectic, custom sound that it selected to play. Soon the company was compiling and selling its own CDs of the music. In 1999, Starbucks acquired a company that was expert in picking and mixing songs and charged the company with building Starbucks’ brand presence in music. The result is Hear Music, what the company terms “the Voice of Music at Starbucks.” Many other brands, ranging from Old Navy to Pottery Barn, followed Starbucks’ lead and created their own CD compilations,
Don MacKinnon, vice president of music and entertainment at Starbucks, encapsulates what’s happened to music distribution and branding: “The way people discover and acquire music is really broken in America, and we’re going to help solve it,” he says. “Twenty years ago, radio was great for that, but now it has narrowed into more and more specialization. Ten years ago, large record stores had a broad variety of music. But now, it’s largely sold at big-box stores with a small assortment of hits. There’s no brand that is helping consumers to discover music. Even MTV now seems more concerned about game shows, and VH-1is about movies and music. So Starbucks, we think, is in a very unique place as one of the most frequented retailers in the world.”
Hear Music has been adding to Starbucks’ growing music proposition by compiling CDs of musical artists’ favorite songs, including selections by Sheryl Crow, Willie Nelson and the late Johnny Cash. Soon, Starbucks outlets also will be adding the capability to burn CDs on-site, downloading from the company’s vast catalogue of songs to be able to create custom collections for customers on the spot.
Music downloading at Starbucks, and getting a song as part of a Big Mac promotion, is only the latest ramification of the digitization of music over the last decade or so. The most earth-shaking effect, of course, has been music labels’ epic struggle against piracy of their songs via illegal downloading of music via the Internet. And even though the industry succeeded in vanquishing Napster (which was charged with creating a software architecture that encouraged illegal transmission of music files), the practice of downloading now is like a horse that has escaped the barn. The industry never will be able to bring the animal back inside; music brands have to do the best they can simply to corral it.
Fortunately, the labels and their artists – who are, after all, the ultimate brands in the music business – are getting plenty of help in encouraging legal downloading from some venerable brands that see the practice as a great opportunity to associate themselves with the charms of music. Cupertino, California-based Apple, previously best known for being the maverick brand of the personal-computer business, was the first major brand to recognize and capitalize on the opportunity. Last year, the company introduced iPod, which already enjoys greater buzz among young consumers than any electronic device with the possible exception of a cell phone.
“There’s no brand right now that’s cooler with teens than Apple, because of iPod,” says Tina Wells, managing director of Blue Fusion, a New York City-based youth-marketing consulting firm. “I’ve seen kids shift spending to electronic spending that normally would go to clothing, and iPod is where they’re spending their money.”
Apple’s Web-based service called iTunes, which allows downloading of individual songs for 99 cents apiece, has spawned many eager imitators, including Wal-Mart’s me-too-but-cheaper service.
As important as introducing several nutrition-oriented menu items has been to its turnaround over the last year or so, McDonald’s also gives a lot of credit to a new marketing campaign under the “I’m Lovin’ It” tag. Popular among teenagers, the campaign has served as a jumping-off point for McDonald’s attempt to carve out a place for itself as a youth lifestyle brand. So in addition to the Big Mac promotion and other programs featuring downloadable music, for example, McDonald’s also plans to experiment with making movie-DVD rentals available.
“It wouldn’t surprise me to learn down the road that The Gap and Old Navy are launching download sites as well,” says Monty Bruell, president of Wingspan, a Santa Monica, California-based brand-strategy firm. “Any company with a teenage demographic would want to do that.”
In addition to changing the ways in which music is purchased, Internet downloading also has decoupled individual songs from the traditional album format and restored the importance of “singles” to the business. “Not only can the consuming audience be more discerning, but they also have the technical ability to purchase only the product that they perceive to be of high quality,” Bruell says. “That has forced songwriters and artists to improve the quality of their products.”
It also has created more promotional opportunities for brands and the advertising-services business. LidRock, for example, is an Atlanta-based firm that has sprung up to supply short-format CDs to restaurants, theater chains and others that are selling or using them as large-drink lids for promotional purposes. Typically, the CD has two or three tracks, and the restaurant either gives it away as a premium or charges an additional 99 cents for it. Customers can rip the CD out of its packaging and stick it in their car CD player on the way home.
“With sales declining in the music sector, we just thought this would be a way to rejuvenate a revenue stream for the industry,” says Dawn Whaley, executive vice president of marketing for LidRock. “It adds a whole new layer of convenience and impulsiveness.”
A number of other macro trends have contributed to this shifting picture. For one thing, today’s teenagers and young adults are “cheerfully commercial,” as compared with previous generations of youth who treated with more skepticism big brands’ efforts to associate themselves with music, says Mark DiMassimo, CEO of DiMassimo Brand Advertising, in New York City.
And yet at the same time, digitization is allowing today’s teenagers to exercise unprecedented skepticism about the marketing and branding envelope that traditionally has surrounded music – a clear caution for the growing number of big brands that are counting on the magic of music to boost their standing with kids.
“I can remember that I wanted to buy the CD and own the photos of the Back Street Boys or whatever,” says Blue Fusion’s Wells, who is 24 years old. “But today’s kids look at songs more as an isolated, creative tool – more as a background track to a slide show they’re putting together of their own lives. All the marketing of music isn’t being held in as high regard. They just want to take songs they like and listen to them however they want.” Convenience and impulsiveness.