That Coke Can You're Holding Could Be Your New Media ChannelStickyBits App Lets Users 'Check In' to Objects Via Barcodes
by Kunur Patel
Published: April 28, 2010
NEW YORK (AdAge.com) -- A new check-in app for objects is turning soda cans into media channels.
--> StickyBits, which launched during South by Southwest Interactive in March, is an app that lets users affix video, photos, text or audio to real-world objects, as long as those objects have barcodes. This is an example of what some call physical URLs, and while StickyBits is in its early days, consumers are already turning their iPhone and Android apps to consumer package goods, meaning user-generated clouds are starting to form around real cans of Coke and Red Bull.A StickyBits sticker affixed to a laptop.
How does it work? After downloading the free StickyBits app, users scan a barcode -- either unique codes on stickers purchased from StickyBits or printed out, or those on products already in the world -- and then upload a piece of content or view what others have already uploaded. That uploaded video or message is geo-tagged and attributed back to the user's social-media profile and becomes part of that object's content stream.
StickyBits co-founder Seth Goldstein created the concept with developer Billy Chasen and equates the phenomenon of "threaded conversations around objects" to checking into places, a behavior apps such as Foursquare or Loopt have pioneered for real-world locations.
--> "When you scan a product, you're tuning into it," Mr. Goldstein said. For package-goods companies, that could mean creating content for products that can only be unlocked by scanning barcodes with smartphones. "Imagine you're a beverage company, and you have content that people can only see when people check into your can," he added. That also means amassing communities around purchased goods.The StickyBits app allows users to scan barcodes and attach messages, which become part of that object's content stream.
Brands such as Ben & Jerry's, Campbell Soup and Doritos already have content forming around their products. After scanning the barcode of a Coke can from a New York deli, Ad Age viewed 16 bits of content, including amateur product photos, a video of a pizza box and one user asking: "What happens when people start attaching porn to brands?"
In June, StickyBits plans to introduce tools for brands, including means to manage the conversations popping up on its products and an analytics dashboard. Brands will be able to track where and when people scan its products, publish official content, or talk to users that have checked in previously. While StickyBits is already in talks with consumer-package-goods marketers, there are no big brand programs to date, Mr. Goldstein said.
While the App Store is already crowded with location check-in apps, real-object scans up until now happen primarily in stores to compare prices or get further product information. But StickyBits is not the first product check-in app not tied to information gathering. In March, developer Kleiner Perkins Caufield & Byers-backed ShopKick launched a product check-in program for its app CauseWorld. With CauseWorld, users earn money for charity by scanning products of marketing partners P&G and Kraft in retail locations.
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Thursday, April 29, 2010
Media: from aggregation to distribution? That Coke Can You're Holding Could Be Your New Media Channel
Will the producer-consumer turn retailer-consumer? Cellphone Payments Offer Alternative to Cash
Several of the companies have developed small credit card scanners that plug into a cellphone and for small fee enable any individual or small business to turn a phone into a credit card processing terminal. PayPal’s cellphone app calls for only a simple bump of two cellphones to transfer money. Apple has submitted a patent application for a cellphone payment system.
Brian Kusler, 40, a software engineer, is already helping dollar bills join Susan B. Anthony coins as collector’s items. After he polished off grilled lamb and zinfandel at a San Francisco restaurant recently, his dining companion paid the bill and asked him for his share. Instead of hunting down an A.T.M., the two bumped their iPhones together, and Mr. Kusler wirelessly transferred his part of the bill, about $100.
“I don’t carry a lot of cash — I don’t think anyone does these days,” Mr. Kusler said. “We go out, and I oftentimes have to remember to pay my friends back when we get home, and I want to be able to just do it right there.”
There is evidence that paper money is being used less often, according to the Federal Reserve. Though cash payments are difficult to track, the number of noncash transactions in the United States grew from fewer than 250 a person in 1995 to more than 300 in 2006. Data on the stock of small-denomination bills and destroyed bills indicates that the use of cash peaked in the mid-1990s and has been declining since, two economists at the Federal Reserve Bank of Cleveland found.
“When debit cards were introduced in the early ’90s, that was the beginning of the slow and gradual decline of paper checks and cash,” said Red Gillen, a senior analyst at Celent, a research and consulting firm on technology and financial services, based in Boston.
Still, cash has remained essential in certain instances, like paying back a colleague for lunch, buying fruit at a farmers’ market or buying a beer at a cash-only bar. These new mobile payment technologies could finally change that.
“The problem with cash is that it is tangible, it’s inconvenient, you have to carry around a bunch of bills and you have to continually go to the A.T.M.,” said Jack Dorsey, a Twitter co-founder who is now the co-founder and chief executive of Square, which makes a dime-size device that anyone can plug into the earplug jack of an iPhone or iPad to instantly accept credit card payments. “If we can make cards more convenient and faster, it can replace a lot of the experiences around cash.”
Light wallets are not a problem for Joe Mangrum, a sidewalk sand painter in New York, who has been using Square to take donations from passers-by and sell copies of his book. Sales have increased sharply since he started accepting credit cards on his iPhone, he said. “I’ve made the sale as opposed to twiddling my thumbs because they don’t have the cash.”
The new services could have the biggest impact on the smallest businesses, like farm stands or house cleaners, that accept only cash and checks because they do not have stores to house credit card terminals and do not want to enter into complicated, long-term relationships with credit card companies.
Rachel Ancliffe, a clothing designer in Portland, Ore., sells her dresses and blouses at sample sales and from her home, and uses Intuit GoPayment to process credit card payments.
“You can’t accept checks because then you’re just kissing your product goodbye” because of fraud and bounced checks, Ms. Ancliffe said. “I sell 10 times more because I take credit cards.”
Fraud protection offered by the credit card companies is the same as when the card is used at a cash register. Some of the new companies say security against fraud might even be improved because they provide e-mail receipts, and those from Square include photos and a map of where the transactions were made.
The death of cash has been predicted since the 1970s, when electronic transactions like direct deposit of checks were introduced. But most digital payment experiments, like one in 2006 by Visa, have focused on swiping cellphones, as is popular in countries like Japan, instead of credit cards. Mobile payments have not taken off in the United States because Americans are just as happy to reach into their pockets for a plastic card as for a cellphone.
Instead of replacing credit cards, new technologies like Square and GoPayment rely on them. The credit card companies stay squarely in the middle, extracting a fee with each swipe or bump.
GoPayment costs $12.95 a month on top of a per-transaction fee of 30 cents plus 1.7 percent to 3.7 percent of the payment, depending on the credit card companies’ rates. Square is free and users pay 15 cents plus 2.75 percent to 3.5 percent of each transaction. It will be available for iPhones and iPod Touches in May and for other phones and laptops later.
Exchanging money with friends using PayPal’s iPhone app is free if payers use a bank or PayPal account, and costs 30 cents plus 2.9 percent of the transaction for credit cards.
Though people will use cash less and less, it is not on the verge of extinction just yet, said Wayne Abernathy, executive vice president for financial institutions policy at the American Bankers Association. “Historically, we have seen more failed innovations in payments than we’ve seen successful ones, because you have to convince people that it’s secure, more efficient and reliable,” Mr. Abernathy said.
But a cashless society could become more of a reality as the younger generation, accustomed to buying music on iTunes and virtual gifts on Facebook, grows up.
“Older people still tend to like to use cash or checks,” Mr. Abernathy said. “Younger people don’t want to touch a piece of paper. They want to do it all electronically.”
Wednesday, April 21, 2010
This guy's an American Idol - and a poster child for You, Inc. From FT: A mogul on the air everywhere
It is a rare moment when Ryan Seacrest is not in front of a television camera or radio microphone. One of the busiest presenters in broadcasting, the 35-year-old with the blinding white teeth has become an indelible presence on America's airwaves. His jobs include hosting a daily radio show that attracts more than 20m listeners, presenting the American Top 40 chart countdown, hosting a daily entertainment news show for the E! cable channel and, for more than three years, presenting American Idol , the biggest ratings winner of the past decade.
Yet today there are no cameras or microphones to be seen. The patio doors in his office are flung open to the afternoon sun and an impressive view of the Los Angeles skyline. He jumps up to shake hands, his BlackBerry is placed out of reach on a coffee table and he begins outlining his grand plan for media moguldom. "You have to master compartmentalisation," he says.
Mr Seacrest's relentless presenting activities mean he is already a household name in the US. But it is his work as a producer and the commercial deals he has negotiated for his company, Ryan Seacrest Productions, which suggest his talents extend beyond being good on TV. His latest series, Jamie Oliver's Food Revolution , is the English chef's first programme in the US and comes to an end this Friday. Loosely based on Mr Oliver's UK programmes which took aim, among other things, at school dinners, the US show aims to shake up American attitudes to food and health: one recent scene showed a classroom of young children failing to identify common vegetables, like tomatoes. "It was just staggering," says Mr Seacrest.
The programme scored the best Friday night ratings in three years for Walt Disney's ABC network when it launched last month.
The Jamie Oliver show has little in common with other programmes RSP has produced, such as the reality show Keeping Up with the Kardashians , which turned three sisters from the Los Angeles suburbs into pin-up stars. But Mr Seacrest says the idea is to tackle a range of genres. "I want to produce content that's socially conscious as well as pop candy entertainment," he explains. "We don't target one type of show . . . we try to come up with things that are popular."
He is not alone in making the move from in front to behind the camera. Other stars, from model and chatshow host Tyra Banks to his American Idol colleague Simon Cowell, have produced shows in which they do not appear. But Mr Seacrest has carved a lucrative niche thanks to a willingness to embed marketing campaigns with his programming and presenting.
"I try to forge more creative relationships with advertisers," he says, reeling off a list of partners that includes Coca-Cola and Procter & Gamble, which struck a deal with Mr Seacrest through its Crest toothpaste brand - fitting, given his shiny white gnashers. He says advertisers need ways to cut through "all the noise" in the overcrowded media marketplace. "Big companies and advertisers are looking for ways to get their messages through to their audiences and to make those messages stick," he adds.
His relationship with Microsoft's Bing search engine is one example. When Bing launched last year, he featured it heavily on his radio show and regularly points out new features to his listeners, such as the Bing BlackBerry application. He also promotes the search engine on his Twitter feed, where he has more than 3m followers.
Eric Hadley, who runs marketing for the search engine in the US, says Microsoft was looking for new ways to connect with consumers. "We wanted to make Bing culturally relevant and part of the dialogue . . . Ryan has broad appeal. He has social currency and social influence," he says.
One reason is that he is on air so much. The presenter cites Merv Griffin and Dick Clark as his inspirations: both men presented numerous programmes but also owned intellectual property - Griffin created the Jeopardy! and Wheel of Fortune game shows, for example. "I don't get up every morning and say, 'How can I get on TV today?' " says Mr Seacrest. "I'm building something here that runs without me having to stand in front of or beside a camera."
And yet he says his role as a presenter means he can strike commercial deals that are more effective - mainly because he takes on so many roles on and off camera. "If I'm producing a series with an integrated [marketing] message in it I'm the one meeting advertisers," he says. "I talk to the big guys [at these companies] on a regular basis about what's working. And I'm on the front lines hosting the show or producing the show."
Mr Seacrest started RSP in 2006 with help from Comcast, which rents him space for his offices and has a "first look" production deal for his shows, meaning the right to broadcast them before anyone else. He owns the company, which employs 30 people, outright.
He generated headlines two years ago when he struck a three-year deal worth an estimated $35m with Clear Channel for his radio shows. The agreement broke new ground because it gave Mr Seacrest control of some of the airtime on the shows, allowing him to sell his own advertising and embed his marketing partners into the programming.
They certainly help drive his earnings: in addition to the Clear Channel deal, his three-year contract for American Idol is worth $45m and he has a $35m agreement with Comcast, owner of the E! channel. He declines to give earnings figures for RSP, but given the value of his personal deals are his employers concerned that he has too much on his mind? "I'd be lying if I said it made me happy," says Ted Harbert, chief executive of Comcast's entertainment group. "But I feel fortunate that we got him . . . I know how hard he works for us. I never feel that when he's in our building that he's thinking about American Idol . He can get a lot done - more than just about anyone I've ever seen."
Mr Oliver, who has become a friend since the two started working together, adds Mr Seacrest has "laser focus . . . he loves what he does, whether it's presenting his radio show, hosting Idol or having a production meeting at RSP".
Mr Seacrest admits he would like to own his own distribution platform and says he has considered potential purchases. "I would be interested at some point in owning a cable channel or a similar kind of pipe [for our content]," he says. But until then he is content to work multiple jobs, knowing that the more ubiquitous he becomes the more opportunities he can offer advertisers. "The mission is to create pop culture content," he says. "Where it's distributed I will leave to someone else to figure out."
A Ryan Seacrest day
4:30am: Wake up. 5:00am-10:00am: KIIS FM morning show. 10:15am: E! News show meeting. 10:30am: E! News voice-overs. 10:45am: Get camera ready. 11:15am: E! News recording. 12:30pm: Lunch. 1:00pm: Ryan Seacrest Productions staff meeting. 3:00pm: Meetings with RSP colleagues. 4:00pm: American Idol production meeting. 6:00pm: Gym. 7:00pm: Return phone calls and eat dinner. 8:00pm: Sleep.
Monday, April 19, 2010
The game is changing. From GigaOm: The State of the Internet: Now Bigger, Faster & Mobile
The Internet as we know it is not only getting bigger and faster, but it is also becoming more mobile with more and more people accessing Internet-based services from their smartphones. These are some of the key findings of Akamai’s The State of the Internet report for the fourth quarter of 2009. The report uses data collected from Akamai’s global content delivery network to draw conclusions that are good representation of the Internet.
A Bigger Internet
Upon looking through the report, I saw that during the last three months of 2009, nearly 4.7 percent more unique IP addresses were connecting to Akamai’s network. At the end of 2009, there were about 465 million IP addresses from 234 countries vs 401 million at the end of 2008 and 312 million at the end of 2007. US and China account for nearly 40 percent of the total 465 million unique IP addresses. What that tells us is that more people around the world are using the Internet.
Planet Mobile
The rapid growth in the number of unique IP addresses is going to decline mostly because of the law of large numbers. In addition, many service providers, including mobile carriers, are using network address translation (NAT) and proxy/gateway technology to cope with the exhaustion of the IPv4 address space. I will bet that as we start to see more and more “connected” devices, there will be a burst in the number of unique IP addresses. Ericsson recently forecasted 50 billion connected devices by 2020.
Akamai studied 109 mobile providers and found that over 40 had average measured connection speeds of over 1 Mbps in the fourth quarter, while 11 had broadband-level connectivity, which Akamai defines at speeds of 2 Mbps or greater. Austria currently is home to the fastest mobile broadband provider — 3.2 Mbps — while the Russian Federation is fractionally lower, followed by Italy and Poland.
Interestingly, in the US it seems Clearwire (Sprint) is doing a great job of holding the mantle of wireless broadband leader. According to Akamai, “data for a leading WIMAX network provider in the United States – at an average measured connection speed of approximately 1.8 Mbps, they place within the top 20 mobile providers globally. This provider showed a quarterly speed gain of 11.5%, and a yearly gain of 5%.”
More on Mobile Apps
Faster Faster Broadband
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Ironically, the growing popularity of mobile phones is bringing down global average connection speeds, despite substantial network and speed upgrades in many countries. A good case in point is South Korea, where a launch of Apple’s iPhone in November 2009 was so successful that it brought down the average connectivity speed by 24 percent. Now remember, this is South Korea — home to some of the fastest broadband connections anywhere in the planet.
“As the average observed connection speed for this mobile provider was a fraction of that observed from wireline connections in South Korea, we believe that this launch was likely responsible for the significant drop in South Korea’s average observed connection speed in the fourth quarter,” the Akamai report notes.
That said, the Internet got a lot faster. Even though the total broadband connections to Akamai’s network grew only 1.6 percent, now nearly one-fifth of the connections to the network had speeds of 5 Mbps or more, up 6 percent from the Q3 3009. In the US, nearly 25 percent of connections now are 5 Mbps. For further details, check out the chart, which breaks down the top markets and speed shares.
I think it is most interesting to see the share in the ultra-broadband: 25 Mbps or more. The rollout of FTTx/DOCSIS 3.0 technology-based networks is only going to increase, and that will have a long term implication on all types of web services and service providers. Tiny countries like Switzerland, Monaco, Slovakia and Croatia are seeing massive broadband adoption.
Sunday, April 18, 2010
Continuing Coverage of Coupons. From The NYT: Web Coupons Tell Stores More Than You Realize
A new breed of coupon, printed from the Internet or sent to mobile phones, is packed with information about the customer who uses it. While the coupons look standard, their bar codes can be loaded with a startling amount of data, including identification about the customer, Internet address, Facebook page information and even the search terms the customer used to find the coupon in the first place.
And all that information follows that customer into the mall. For example, if a man walks into a Filene’s Basement to buy a suit for his wedding and shows a coupon he retrieved online, the company’s marketing agency can figure out whether he used the search terms “Hugo Boss suit” or “discount wedding clothes” to research his purchase (just don’t tell his fiancée).
Coupons from the Internet are the fastest-growing part of the coupon world — their redemption increased 263 percent to about 50 million coupons in 2009, according to the coupon-processing company Inmar. Using coupons to link Internet behavior with in-store shopping lets retailers figure out which ad slogans or online product promotions work best, how long someone waits between searching and shopping, even what offers a shopper will respond to or ignore.
The coupons can, in some cases, be tracked not just to an anonymous shopper but to an identifiable person: a retailer could know that Amy Smith printed a 15 percent-off coupon after searching for appliance discounts at Ebates.com on Friday at 1:30 p.m. and redeemed it later that afternoon at the store.
“You can really key into who they are,” said Don Batsford Jr., who works on online advertising for the tax preparation company Jackson Hewitt, whose coupons include search information. “It’s almost like being able to read their mind, because they’re confessing to the search engine what they’re looking for.”
While companies once had a slim dossier on each consumer, they now have databases packed with information. And every time a person goes shopping, visits a Web site or buys something, the database gets another entry.
“There is a feeling that anonymity in this space is kind of dead,” said Chris Jay Hoofnagle, director of the Berkeley Center for Law and Technology’s information privacy programs.
None of the tracking is visible to consumers. The coupons, for companies as diverse as Ruby Tuesday and Lord & Taylor, are handled by a company called RevTrax, which displays them on the retailers’ sites or on coupon Web sites, not its own site.
Even if consumers could figure out that RevTrax was creating the coupons, it does not have a privacy policy on its site — RevTrax says that is because it handles data for the retailers and does not directly interact with consumers. RevTrax can also include retailers’ own client identification numbers (Amy Smith might be client No. 2458230), then the retailer can connect that with the actual person if it wants to, for example, to send a follow-up offer or a thank-you note.
Using coupons also lets the retailers get around Google hurdles. Google allows its search advertisers to see reports on which keywords are working well as a whole but not on how each person is responding to each slogan.
“We’ve built privacy protections into all Google services and report Web site trends only in aggregate, without identifying individual users,” Sandra Heikkinen, a spokeswoman for Google, said in an e-mail message.
The retailers, however, can get to an individual level by sending different keyword searches to different Web addresses. The distinct Web addresses are invisible to the consumer, who usually sees just a Web page with a simple address at the top of it.
So clicking on an ad for Jackson Hewitt after searching for “new 2010 deductions” would send someone to a different behind-the-scenes URL than after searching for “Jackson Hewitt 2010,” though the Web pages and addresses might look identical. This data could be coded onto a coupon.
RevTrax works as closely with image-rich display ads, with coupons also signaling what ad a person saw and on what site.
“Wherever we provide a link, whether it’s on search or banner, that thing you click can include actual keywords,” said Rob O’Neil, director of online marketing at Tag New Media, which works with Filene’s. “There’s some trickery.”
The companies argue that the coupon strategy gives them direct feedback on how well their marketing is working.
Once the shopper prints an online coupon or sends it to his cellphone and then goes to a store, the clerk scans it. The bar code information is sent to RevTrax, which, with the ad agency, analyzes it.
“We break people up into teeny little cross sections of who we think they are, and we test that out against how they respond,” said Mr. Batsford, who is a partner at 31 Media, an online marketing company.
RevTrax can identify online shoppers when they are signed in to a coupon site like Ebates or FatWallet or the retailer’s own site. It says it avoids connecting that number with real people to steer clear of privacy issues, but clients can make that match.
The retailer can also make that connection when it is offering coupons to its Facebook fans, like Filene’s Basement is doing.
“When someone joins a fan club, the user’s Facebook ID becomes visible to the merchandiser,” Jonathan Treiber, RevTrax’s co-founder, said. “We take that and embed it in a bar code or promotion code.”
“When the consumer redeems the offer in store, we can track it back, in this case, not to the Google search term but to the actual Facebook user ID that was signing up,” he said. Although Facebook does not signal that Amy Smith responded to a given ad, Filene’s could look up the user ID connected to the coupon and “do some more manual-type research — you could easily see your sex, your location and what you’re interested in,” Mr. Treiber said. (Mr. O’Neil said Filene’s did not do this at the moment.)
The coupon efforts are nascent, but coupon companies say that when they get more data about how people are responding, they can make different offers to different consumers.
“Over time,” Mr. Treiber said, “we’ll be able to do much better profiling around certain I.P. addresses, to say, hey, this I.P. address is showing a proclivity for printing clothing apparel coupons and is really only responding to coupons greater than 20 percent off.”
That alarms some privacy advocates.
Companies can “offer you, perhaps, less desirable products than they offer me, or offer you the same product as they offer me but at a higher price,” said Ed Mierzwinski, consumer program director for the United States Public Interest Research Group, which has asked the Federal Trade Commission for tighter rules on online advertising. “There really have been no rules set up for this ecosystem.”
Saturday, April 17, 2010
Great piece on #32's Second Act. Magic Johnson Proves He Has the Acumen for More than Hoops
Knowledge@Wharton Leadership and Change Research Article
View Article on Knowledge@Wharton Mobile
'We Don't Eat Scones': Magic Johnson Proves He Has the Acumen for More than Hoops
Published: April 14, 2010 in Knowledge@WhartonEarvin "Magic" Johnson's basketball career included five national championships with the Los Angeles Lakers and a gold medal with the "Dream Team" at the 1992 Olympics. But domination on the court meant little when Johnson began approaching investors to launch his first business venture. "Everybody wanted the autograph, but nobody wanted to invest with me. At the beginning, I got turned down 10 times before someone said 'yes'. You know what they said? They said I was a dumb jock," Johnson noted during a recent presentation at Wharton.
Magic the businessman wasn't the proposal's only tough sell. Investors also doubted that there was any money to be made building high-quality movie theaters and restaurants in inner city neighborhoods. Over the past 20 years, however, Johnson has proven he has the acumen for more than hoops. Beverly Hills, Calif.-based Magic Johnson Enterprises now owns or operates gyms, Starbucks coffee shops, Burger Kings, movie theaters and other businesses in 85 cities across 21 states. His Canyon-Johnson Investment Fund has been behind nearly $4 billion in urban revitalization projects that resulted in the creation of 4.5 million square feet of retail and commercial space.
Johnson credits his success to having a concrete business plan that he felt passionately about -- and an ability to help partners see the potential in urban, predominantly African-American and Latino neighborhoods. "You've got to knock on the doors of corporations who have the same mindset as yours, who have the same heart as yours," Johnson noted. "If I'm in New York, I can take [investors] to Harlem, I can take them to the Bronx, I can take them to Los Angeles, and I can take them to the South Side of Chicago. You're going to have to find a way to touch their heart and spirit."
Pound Cake and Sweet Potato Pie
When Johnson was trying to broker a partnership with Starbucks in the 1990s, he told CEO Howard Schultz that "the growth of his business would be in urban America. He already had [coffee shops] on every street and across the street from each other." But a boardroom pitch wasn't enough to close the deal. Johnson invited Schultz to spend a Friday night at one of the 6-foot-9 former point guard's movie theaters. The visit coincided with the opening night of the Whitney Houston vehicle Waiting to Exhale, and the theater's lobby and screening rooms were packed. "Our biggest screen had 500 women inside. All of a sudden every woman thought she knew Whitney Houston personally and started talking to the screen," Johnson recalled. "So Howard grabs me about 20 minutes in and says, 'Earvin, I never had a movie-going experience quite like this.' Guess what happened? That got me the deal."
Frappuccinos, lattes and Pike Place Roast are on the menu at a Magic Johnson-owned Starbucks, but there are subtle differences between the former basketball star's coffee shops and the chain's other locations. Instead of jazz standards and easy listening, R&B music plays on the stereo. There is extra space for meetings of community and church groups, and bulletin boards where local residents can post neighborhood news and events. "People said there's no way Latinos and African-Americans will pay $3 for a cup of coffee. Yes, we will pay $3, but we don't eat scones," Johnson stated. "I had to take scones out of my Starbucks and put in pound cake, Sock It to Me cake and sweet potato pie -- things that resonate with the urban consumer. You have to know your customer and you have to speak to that customer every day."
The strategy to focus on inner city communities was developed by Johnson when he was still playing basketball. Riding high after winning back-to-back championships as a stand-out college, and then NBA, player in 1979 and 1980, Johnson recalled returning home to neighborhoods of crumbling storefronts, where residents had to travel long distances to shop or eat at chains that were plentiful in the suburbs. "Most of the people who own the businesses in urban America don't live in urban America, so they take the money to their communities and spend disposable income in their communities. We have trouble in our communities because we do not own the businesses," Johnson noted. "Now that we put Starbucks there, those same people that live in the community, they spend money there and Mom and Pop stores have more traffic. Now they don't have to close their doors because people have money to spend at those stores."
In addition to the Starbucks partnership launched in 1998, Magic Johnson Enterprises has also entered into agreements to develop T.G.I Friday's restaurants and 24 Hour Fitness locations in targeted markets. The company in 2008 entered into an alliance with Best Buy to help the electronics chain expand into urban areas and strengthen its appeal with multicultural customers. A deal with food service giant Sodexo includes contracts to feed employees of Toyota, John Deere and Disneyland, meaning "Mickey Mouse and all of them eat my food," Johnson said with a chuckle.
Johnson's investments are run through a partnership with Bobby Turner, managing partner of Los Angeles-based asset management company Canyon Capital. Over two years beginning in 1998, the Canyon-Johnson Investment fund raised an initial $300 million. But Johnson noted that he achieved a 30% return on the initial fund and that it took a shorter period to raise $600 million for a subsequent endeavor. "The returns are everything, and when we returned them 30% on money spent on urban America, when they did not want to invest it initially, it raised a lot of eyebrows," Johnson stated. "We just closed about a year ago on a billion in cash. It [required] a year because the economy is so bad.... There's a lot of deal flow out there, but a lot of bad deals."
Earning His Nickname
Johnson retired from the NBA in 1991 after announcing that he had HIV. His company's interests also include a partnership with Abbott Labs to hold educational events and offer free testing in cities with high HIV infection rates. The business's nonprofit arm, the Magic Johnson Foundation, organizes job fairs, operates community "empowerment" centers and offers college scholarships to minority high school students. "There have already been people who have made millions, so you're not doing anything that anyone else hasn't done before," stated Johnson, whose net worth was estimated at nearly $500 million in a 2008 Los Angeles Times story. "But can you save and touch somebody's life? Can you help a community get back on its feet? That hasn't been done before. You can set yourself apart from everybody else if you can do something like that. That's why I love what I do."
As one of 10 children who "grew up poor" in Lansing, Mich., Johnson often arrived home from late basketball practices to find that his siblings had eaten all the food his mother had prepared for dinner. A high school standout, the athlete was given his nickname by a local newspaper columnist and went on to lead Michigan State to victory in the 1979 NCAA championship. As point guard for the Lakers, Johnson earned three Most Valuable Player awards, made nine appearances in the NBA finals, played in 12 All-Star games and still holds the league record for highest average assists per game. Johnson is the only basketball player to win championships at the high school, college, professional and Olympic levels. Those successes come with a responsibility to give back, Johnson said.
"Going down the street growing up, I knew if I turned left that trouble was there. Every time I would come to that street, everybody would say, 'You've got to go that way, young man. You've got to go right.' So I kept going right," Johnson noted. "Just think of all the ballplayers and entertainers of color -- somebody told them to go right, too. So why don't you come back?... You've got to go back and you've got to help out. If you can touch and bring 10 people with you, then they bring 10 and then they bring 10 and now the community changes."
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Very interesting. Would like to know how much involvement those inner city neighborhoods have in these high-quality movie theaters and restaurants. Are they just consumers and minimum wage labor? Is it the rich coming to plunder easy pickings and "Giving Back" by donating a small fraction of their profits to make up for the economic rape? Or do they have any equity and/or managerial power? How much of the dollars made by those ventures remain in their local economy?Post a new comment
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Wednesday, April 14, 2010
Looks like redemption is now at hand! From Nielsen: The Coupon Comeback
April 13, 2010end get author -->
Todd Hale, Senior Vice President, Consumer & Shopper Insights, The Nielsen Company
SUMMARY: Once on their way to extinction, coupons made a strong resurgence in 2009. While they offer consumers a chance to stretch their dollars further, they also offer real growth opportunities for retailers and manufacturers—if they know exactly who to target and how to leverage established and emerging coupon delivery vehicles.
Back to the Future
People of a certain age may nostalgically recall the sight of mom flipping through the Sunday newspaper to clip coupons from the numerous inserts stuffed in the paper. She may have even had a little envelope or “coupon caddy” organized by product category. This kind of memory tends to be among those of us who are baby boomers or Gen Xers—a quaint recollection from the previous century. Indeed, coupon redemption hit a peak in 1999: 4.6 billion, as reported by Inmar.Since then, it’s been downhill for the humble coupon. During the three-year period ending 2008, annual manufacturer coupon redemptions leveled off at just 2.6 billion per year.
The “Great Recession” of 2009 changed all of that and marked a sort of renaissance for the coupon. Inmar reports that coupon redemptions grew by 27% as Americans searched for ways to cut household costs and get more for their money. NCH Marketing Services claimed 2009 coupon redemption levels “achieved the second highest year-over-year growth ever recorded.”
Paperless Progress
While newspaper inserts are still the primary method of coupon distribution (89%) and redemption (53%), Internet redemption growth has skyrocketed, rising 263% in 2009.And while clipping continues to be a primary means of distribution, manufacturers and retailers launched new ways to get coupons into consumers’ hands such as printable coupons on the Internet, in-store kiosks and discounts linked to frequent shopper cards via smartphones and computers, negating the need for a paper coupon at all. In short, it is easier than ever to distribute and use coupons, and this convenience is also a key driver of redemption growth.
Inmar reports that the majority of coupons were redeemed at conventional grocery stores (65%), but all classes of trade—dollar stores, mass merchandisers, convenience stores, military commissaries and drug stores—posted double-digit redemption growth:
Category Redemption Growth Share of Redemption Dollar/Discount/Variety 71% 20% Mass Merchandiser 26% 20% Conventional Supermarket 20% 65% Pharmacy 16% 6% Convenience 12% 4% Military Commissary 12% 4% Source: The Nielsen Company Redemption growth outside of traditional food channels is a reflection of a coupon movement that started with food, but quickly turned to non-food in the second half of 2009. Non-food coupon redemption growth escalated from a rate of 9% in the first quarter to 46% in second quarter and continued growing throughout the year—rising 45% in third quarter and 37% in fourth quarter. A total of 1.2 billion non-food coupons were redeemed in 2009, representing one-third all coupons.
80/20 Rule in Play
While the recession drove heavier coupon usage across low to heavy coupon users from 2008 into 2009, all but the heaviest coupon user group experienced negative total unit growth (with and without a coupon). All told, 83% of units purchased with manufacturer coupons in 2009 were done so by just 22% of households. Coupon enthusiasts—the heaviest users—accounted for 65% of manufacturer coupon unit purchases and 18% of all unit purchases in 2009. They drove a disproportionate amount of sales and sales growth—shopping more frequently, making 1.7 more trips than non-users and buying more (a rate 1.8 times greater annually). While some might think that “crazed coupon clippers” are only interested in a good deal, these findings suggests real benefits to manufacturers and retailers deploying coupons in their marketing mix.More Money = More Coupons
With the value offered by coupons, one might think that the lowest income households would be among the heaviest users. In fact, more affluent households dominate coupon usage: 38% of “super heavy” users and 41% of “enthusiasts” come from households with incomes greater than $70,000. Households with income of $100,000 and up were the primary drivers of coupon growth in 2009. The enthusiast category also attracts a disporportionate number of households with incomes between $50,000 and $69,900.Trends relating to newspaper readership provide some explanation for this imbalance. According to Scarborough Research, better educated and higher income households buy and read the newspaper more than others and newspapers remain a key vehicle for delivering coupons. Additionally, promotions are generally targeted in areas with more affluent consumers. In essence, the better educated and more affluent consumers are much better at looking for deals as they recognize the value of money.
Beyond income levels, more than half (51%) of larger households (3+ members) are “enthusiasts”, while roughly one-third of non- and lighter coupon users are single person households. Younger female households use coupons more, while male-only households use them less. Older users (65+) are also important “heavier” and “super” coupon users.
All ethnic groups use coupons, but three-fourths of the average coupon “clipper” is white. Households residing in comfortable country and affluent suburban spreads are more likely to be heavier coupon users, while non-users are more apt to be those households living in rural areas and struggling urban core areas.
Manufacturers and retailers have real opportunities to reach different groups with coupons and promotions, particularly African-American and Hispanic households. While this may require adjustments to existing tactics, the potential pay-off—in terms of volume growth and winning new customer loyalty—can be significant.
Future Look
As the economy improves, will consumers continue to use coupons? With the economic recovery taking hold slowly and without significant employment growth, expect coupon use to continue. As long as Americans feel unsure about their personal finances or confident about their jobs, they are going to continue to look at ways to save and get the most for their money. In addition to expanding the appeal of coupons in general, manufacturers and retailers would do well to target enthusiasts: their shopping behaviors and demographics make them extremely appealing. With advancements in coupon delivery vehicles that enable both better targeted coupon distribution and redemption, manufacturers and retailers will continue to have real opportunities to use coupons to drive sales for the next few years and beyond.For more: Contact The Nielsen Company or read about our global consumer & media expertise.Related Posts
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Tuesday, April 13, 2010
Monday, April 12, 2010
From the NGO Foundation for Communication Initiatives (FOCI) - Voter Education Video - Please Pass!
The May 10, 2010 Election will be quite different. The more familiar voters are with how it will work, will help in keeping it honest, orderly and peaceful. This video was produced by the non-government organization FOCI, in consultation with the Parish Pastoral Council for Responsible Voting (PPCRV), the Commission on Elections (COMELEC) and other NGO's. Let's help spread the video. Thanks!
Watch out studios - the stars are now in the biz! The Guardian: Want Teri Hatcher's life? Just read her site
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Teri Hatcher, left, with other cast members of Desperate Housewives. Photograph: ABC
It used to be that being a successful actor was about starring in an award-winning film or a hit TV show, but not any more. These days, as everyone from Oprah to Brangelina could tell you, it's all about the brand. It's no longer enough to smoulder successfully on the red carpet or to have a reputation for being a professional, you have to expand your interests, show your human side and, most importantly, build on your "connection to your fans".
That, at least, is the thinking behind Teri Hatcher's latest project. The Desperate Housewives star is to launch a website in May called Get Hatched: A Chick's Guide to Life, which she claims will offer "solutions to the needs and obligations of today's modern woman".
As an idea it sounds suspiciously similar to Gwyneth Paltrow's lifestyle site, Goop, in which the Oscar-winning actress shares tips on everything from where she shops to which names she drops, while posting videos in which she effortlessly makes roast chicken for the family.
Not that Hatcher will welcome the comparisons. Since its launch in 2008, Goop has been much mocked in the media. The Daily Beast and Esquire both sent writers to "live their lives like Gwyneth" and videos mocking Paltrow appeared on YouTube.
By contrast, Hatcher has stressed that she wants Get Hatched to offer relatable, practical advice. "I'm just open and talk about anything, usually with humour, because that's what gets me through the day," she told the Hollywood Reporter. "I don't self-edit."
In addition to Hatcher's own (unedited) musings, the site will also include expert advice, personal blogs and, according to a report in Media Week, an original web series called In The House - "a casual talk show that will be shot in Hatcher's home" featuring guests from "celebrity friends to average women".
"I want to carry on an intimate conversation with people," Hatcher said when the site was announced. "There will be no audience, no publicists. This is not about promoting your next movie. It's about having natural conversations."
And if those conversations mean that Hatcher becomes the Oprah to Paltrow's Martha Stewart, then so much the better for all brands concerned.
Score 1 More Point for OOH! From The NYT: Video Screens Outside the Home Draw More Eyes
The report, called the “Fourth Screen Network Audience Report” (Nielsen is calling it the “fourth screen” after television, the computer and mobile), is expected to be released on Monday. It researched 10 screen networks, from companies like NCM Media Networks and Screenvision, which run ads in movie theaters, to Gas Station TV, which places screens on gas pumps.
“If you took the 10 networks that we measured and put a spot on each of the 10” for a month, “you’d draw more exposures than having a spot on every one of the top 20 programs in prime time” in a given week, said Paul Lindstrom, senior vice president of the Nielsen Company.
The screens are part of a phenomenon of place-based advertising that has gained popularity as consumers move away from traditional media. The networks try to capture people as they are about to buy something, or when they are bored and undistracted — waiting for a movie to start, for instance.
The networks have been pushing Nielsen to create a standard measurement so that they can better sell their ad time to agencies.
“The agencies ask, ‘Why are you better, why should I take some money and not run it on traditional television or somewhere else, and run it with you?’ ” said David Leider, chief executive of Gas Station TV. “If there’s no legitimate measurement behind it, there’s no point for an agency or client to look at it.”
“They were measured all differently by each of the venues, so there was no consistency in the marketplace and no third-party, independent view of it,” said Terrie Brennan, senior vice president for new business development at Nielsen.
To get the ratings, Nielsen looked at variables like how long people spent in front of the screens, and the proximity to the screen — “so in the health clubs, it’s not going to be everybody who swipes in, it’s going to be people in that cardio room that can see those televisions,” Mr. Lindstrom said.
It then interviewed viewers to get demographic information. The number of people interviewed per screen network was as low as 298, for the bar/restaurant TV network Zoom Media & Marketing’s Social Network, and as high as 26,052 for NCM and Screenvision.
Nielsen found that the screen networks reached a broad audience. For example, ads on Screenvision and NCM’s networks in October had 61.7 million exposures. That compared with an average of three million viewers 18 years and older for a typical prime-time commercial on broadcast TV in the same period. So an advertiser could either buy a monthlong series of ads on the theater networks, or about 20 prime-time commercials, to reach the same audience size.
However, some agencies and networks raised questions about Nielsen’s approach. Jack Sullivan, senior vice president and out-of-home activation director at Starcom USA, part of the Starcom MediaVest Group division of the Publicis Groupe, said he was not certain that Nielsen took into account all the differences in these networks.
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“A doctor’s office is different than a grocery store is different than an airport is different than an elevator,” he said. “So the consumer is different in every one of those categories, and the screens are different sizes.”
“There’s really no common denominator,” he said.
By measuring out-of-home screens with the same tools it uses to measure television, Nielsen lets these networks try to be included among the big broadcast ad purchases.
“More and more, now that we have these results, at least in 2010, we’re starting to get looked at from a broadcast budget,” said Scott Marden, research director for Captivate Network, which runs video screens in elevators. “The budgets, and the dollars, are really in the TV world.”
Friday, April 09, 2010
Now, this is Branded Entertainment! From WSJ: Black Eyed Peas: The Most Corporate Band in America
By JOHN JURGENSEN
About 30 minutes into every concert on the Black Eyed Peas' current tour, band leader will.i.am performs a freestyle rap, riffing on text messages sent by audience members. It's a flashy solo turn for the musician who has steered the group since 1995. It's also a moment in the spotlight for the tour's primary sponsor, BlackBerry, which delivers the messages scrolling up two huge screens on the stage.
On its path from rootsy L.A. hip-hop troupe to pop juggernaut, the Black Eyed Peas have been escorted by a parade of corporate backers. From Coors to Levi's, Honda to Apple, Verizon to Pepsi, brands have padded the group's video budgets, underwritten its tours and billboarded band members in prominent places. When Apple was preparing the 2003 launch of the iTunes store, The Peas' "Hey Mama" became the first song associated with the iconic campaign's dancing silhouettes, a point of pride for will.i.am, the band's frontman.
For the musician, wooing potential corporate partners has become as integral to his job as the DJ sets he does on tour at after-parties sponsored by Bacardi. Often will.i.am pitches the concepts himself using "decks" that sum up the Peas' package, frequently in PowerPoint form.
"I consider us a brand. A brand always has stylized decks, from colors to fonts. Here's our demographic. Here's the reach. Here's the potential. Here's how the consumer will benefit from the collaboration."
If will.i.am wasn't in music, "He'd be the best ad executive on Madison Avenue," says Randy Phillips, president and CEO of the concert promoter AEG Live. "I've never seen anyone more astute at dealing with sponsors' and companies' needs and understanding their brands." He says he's planning to have the rapper deliver a seminar to AEG's global marketing team.
'I'm With the Brand'
In pop music, where the cool factor is paramount, corporate sponsorships and product endorsements were once taboo. Now, in a music industry turned upside down, it's tough to name a big artist who hasn't hitched up with a brand.
Associated Press
The Rolling Stones
One-time bad-boy rockers the Rolling Stones went corporate as the first major rock act to sign on a concert-tour sponsor. That scent in the air during the band's 1981 "Tattoo You" tour? Jovan Musk cologne.
A funky spot for Volkswagen in 1997, featuring a few slackers and a stinky lounge chair, catapulted the song "Da Da Da" by obscure German band Trio into a hit. It's a formula that baby bands have been aiming for ever since.
Redferns/Getty Images
Tony Bennett
Music veterans are no strangers to endorsements. Tony Bennett, who broke out when TV shows were sponsored by soap flakes, has appeared in campaigns such as a 1999 blitz for Visa.
Getty Images
U2's Bono and The Edge with Steve Jobs
After a relationship with Apple that included ads featuring the U2 song "Vertigo," the band took up with Research In Motion for BlackBerry commercials and a sponsored tour. The fact that U2 singer Bono is a major investor in a competing smartphone company, Palm, had marketing experts scratching their heads.
Contour/Getty Images
Sting
When Sting's single "Desert Rose" looked like a stiff at radio, Sting made the surprising move of giving it to Jaguar gratis in the form of a music video. He was rewarded with an eye-opening sales spike.
In 2004, the patriarch of countercultural folk, Bob Dylan, appeared with his song "Love Sick" and a lingerie babe from Victoria's Secret. As usual, no one could tell whether the enigmatic Mr. Dylan was putting us on, making a few bucks, or both.
Strange bedfellows, part two. Iggy Pop's banging ode to decadence and drugs, "Lust for Life," was repurposed for a sun-and-fun ad promoting Royal Caribbean Cruise Lines.
The fiscal realities facing music acts hit home when anti-establishment alt-rockers Pearl Jam struck a retailing deal with Target that included a TV commercial. Josh Rabinowitz, a senior vice president at ad agency Grey Group, calls it an "über shocker. They had sworn off that stuff with a venom. Then they gave in. They had to." It was strictly business.
Marketers love the Black Eyed Peas for the rainbow ethnicity of the band's four members. They like its global fan base, and its fetching party anthems like "Boom Boom Pow" and "Imma Be." They like that the band achieves the near-impossible in these post-Michael Jackson times—making both kids and their parents feel cool. All this has turned the Peas into what seems like the only pop ensemble that a fragmented America can agree on. Though the members rhyme, it's not a rap group. Its chugging dance beats, spacey effects, and repetitive hooks have been engineered as party mixes.
Selling records used to be the secret to success. The trajectory of the Black Eyed Peas has been about corporate connections. Last month, a Peas concert in Times Square to promote Samsung's new line of 3-D televisions led to a link-up with "Avatar" director James Cameron, who was also on hand to endorse the sets. The meeting sparked a conversation about whether Mr. Cameron would direct a feature film the Peas plan to start shooting next month. The 3-D film will incorporate concerts, travel footage and narrative themes about technology, dreams and the brain. Will.i.am says of his potential collaborator, "He's a tomorrow person, too. He's part of the TP crew." Mr. Cameron couldn't be reached.
The Peas are poised to be one of music's top earners this year. Released last June, their album "The E.N.D." has sold 2.3 million copies and spawned three No. 1 singles. A rough estimate of the band's income from U.S. music sales, not including licensing, publishing and other revenues, came to $10.1 million in the last year.
Will.i.am says corporate partnerships are equally important. Not long ago, the band was lending its music for relatively paltry fees in exchange for exposure—a common strategy for emerging acts. In the ramp-up to their 2003 breakout album "Elephunk," the Peas made deals with Best Buy, Apple and the NBA, slingshotting their way into households on multimillion-dollar ad campaigns. "It wasn't about the check," says former manager Seth Friedman.
The promotional blitz continues. Within the last year, the Peas' TV performances have included an NFL season-kickoff show, New Year's Eve in Times Square, the Grammys (they've won six), a Victoria's Secret fashion show and the season opener for "The Oprah Winfrey Show," for which they summoned a flash mob of synchronized dancers to downtown Chicago. The group's current tour, for which AEG Live has booked 100 international dates, is a test of whether the band can consistently fill big arenas. It's off to a good start: In 22 U.S. concerts, the band has grossed about $18 million.
Once, when pop music was synonymous with rebellion, a band getting into bed with a large corporation was as improbable as a Brooks Brothers suit at Woodstock. For companies, too risky; for fans, a betrayal.
This changed when advertisers began to leverage elements of the counterculture, which was no longer threatening. First they targeted baby boomers, from the Rolling Stones' "Start Me Up" for Microsoft to John Mellencamp's Chevy commercial. Cries of "sellout" diminished. As CD sales and the marketing surrounding it began to fall into a bottomless pit, younger bands rushed to find other sources of income and publicity. The Peas were among the fastest learners of the industry's new math.
The band still hears muttering that they are shills. "You have to take the criticism, and sometimes it hurts a lot," says Fergie, also known as Stacy Ferguson, whose joining the group in 2002 coincided with its first mainstream hits and a steady string of brand deals.
Pepsi/Getty ImagesFrom left to right: Taboo, Fergie, will.i.am and apl.de.ap in May 2007, after PepsiCo announced a partnership with the band.
Will.i.am shrugs it off. "I get the credit from the brands. They know. I used to work with the marketing people and the agencies, now I work with the CEOs of these companies."
Last Friday night, sitting in his dressing room before a Peas concert at the HP Pavilion in San Jose, Calif., will.i.am gulped a fistful of vitamins. A gadget aficionado who that night would drop "Google" into a song and send a shout-out to the fellow geeks in the audience–"All the technology lovers make some noise!"—he had just come off a run of about 20 meetings, many of them with tech companies based in Silicon Valley.
They included a sit-down with the heads of Twitter and a speech to employees about music and social media. At the St. Francis Yacht Club in San Francisco, he hosted a fundraiser for his i.am scholarship fund that was attended by about 50 tech leaders. Among them was Symantec President and Chief Executive Enrique Salem, who came to the concert the next night with a gaggle of kids lining up for a photo op with band members.
Samsung/Getty ImagesThe Peas performing at the Samsung Times Square Concert last month in New York.
Will.i.am, born William Adams Jr., was raised in the projects of East Los Angeles. Now 35 years old, he cites Run-DMC's 1986 song "My Adidas" as an influential blend of art and commerce. "When I moved my mom out of the projects," he recalls, "I did that with a 30-second song for a product," Dr Pepper.
At the time, the group had a different sound and image, working in the street-wise but literate vein of rap groups like A Tribe Called Quest and De La Soul. In addition to will.i.am, the group included Allen Pineda, a Philippines-born rapper who goes by apl.de.ap, and Jaime Gomez, whose stage name is Taboo.
The Peas remember the 2001 Dr Pepper gig as a point of departure from what will.i.am calls the YPs, or "yesterday people" of the industry. The L.A. band had decamped to Bodega Bay near San Francisco to write songs for their next album, but the Dr Pepper jingle took priority in the initial sessions. "I remember thinking, this is important to the band, but it's taking up a lot of time," says Mike Fratantuno, former backup band member. "Ultimately the goal was to be a world-famous band."
While Fergie is arguably the group's biggest star, projecting a coquettish girl-power appeal, will.i.am, as the Peas' primary producer and songwriter, is "the captain of the ship" on corporate matters, she says.
Will.i.am also had help from a team of plugged-in veterans, including manager David Sonenberg, whose client roster began with Meat Loaf and grew to include acts such as the Fugees. With his partner William Derella, Mr. Sonenberg guides the California act from a limestone townhouse on Manhattan's Upper West Side. With murky German expressionist murals on the walls and ceilings—they came with the building—the office stands in contrast to the Peas' space-age image of late.
Meeno
A portrait of band leader will.i.am.
Mr. Sonenberg also used to manage producer Jimmy Iovine, who is now the chairman of Interscope Geffen A&M, home to Eminem, Dr. Dre and Lady Gaga. Interscope signed the Peas in 1997. Since then, more than 26 million albums by the Peas have been sold world-wide. "I wish I had 10 of them," Mr. Iovine says of the band. He describes will.i.am as a trusted adviser.
Under the Interscope umbrella, will.i.am has his own label imprint, which will soon release an album by the R&B star Kelis. Interscope also invested in will.i.am's online social network, Dipdive, the platform he used to launch the "Yes We Can" video that became a touchstone of Barack Obama's presidential campaign. Mr. Iovine also facilitated what would be a trend-setting licensing deal. An acquaintance of Apple CEO Steve Jobs, Mr. Iovine put the Peas forward when Apple was preparing the 2003 launch of the iTunes store.
The ad boosted "Hey Mama" into radio rotation after telephone surveys demonstrated to radio broadcasters that listeners were already familiar with the song from television.
Photo illustration by Mick Coulas illustration; photos: WireImage/New York Post/Getty Images; Getty Images
With their stage show, the Peas seem to have shot for some hybrid of "Mad Max" and "Tron." Taboo rides a glowing motorcycle out over the audience at one point. Later, Will.i.am strides out clad in metallic plating, beaming red lasers out of his face mask. Brand-wise, this is on-message, he says later. "Here's our verbiage: 'Futuristic. Electronic. Mega.' "
Such a pitch helped the musician upgrade his relationship with BlackBerry maker Research In Motion. Last fall, the company struck a marketing deal with will.i.am's Dipdive site, but was reluctant to sponsor a tour, according to Peas co-manager Mr. Derella. He says the band eventually scored the sponsorship in large part by presenting ideas such as the nightly freestyle rap, and a moment when will.i.am works variations of the company's tag line, "Love what you do," into a seemingly spontaneous monologue during one of the show's closing numbers, "Where Is the Love." Such gambits allowed the Peas to get away without putting any BlackBerry banners on the stage.
Of course few of these deals would have come about if the Peas didn't have a flow of accessible hits to support them. The recent single "I Gotta Feeling," with its refrain "tonight's gonna be a good night," has already become a staple of wedding DJs, sports stadiums and YouTube videos. "I'd pay any amount of money for that song," says Marty Bandier, chairman and CEO of music publishing company Sony/ATV. An especially nice touch, Mr. Bandier says: the line "Fill up my cup, mazel tov," which makes the song an instant anthem for bar and bat mitzvahs.
Will.i.am says the band has struck the right balance with the music in its corporate strategy. "You have to use it right. It's a hammer and a nail. Most cats are just walking around with hammers as necklaces. I'm like, did you know it could do this? Boom boom! I'm gonna make a house."
Write to John Jurgensen at john.jurgensen@wsj.com
Printed in The Wall Street Journal, page W1