June 3rd, 2009

When Bands and Brands Collide

By Tal Pinchevsky
Minyanville

Adam Kluger is a busy man. He’s in Miami to oversee a music-video shoot for Atlantic Records’ (WMG) artist Flo Rida, but he isn’t an artist rep, label head, or even part of the video-production company. He is, however, the founder and head of brand partnerships at the Kluger Agency, and he’s creating relationships that have both performers and their music labels reaping big rewards.

“Brands are tripling their revenue because of a mention in a Jay-Z song. So we go after the companies and partner them with the demographic,” says Kluger. “If you hear an artist talking about his new Fila sneakers, you’re going to think about it when you go shopping.”

This week in Miami, the product in question is a dating site; the Flo Rida video will be built entirely around it.

“We worked with the director and wrote the entire video around the product. So the video has Flo going online, looking for a love interest in the video,” says Kluger. “This song was not going to be a radio single, but it’s so perfect for a video that we were able to get the brand to pay enough that we could make the song into a single.”

Artists have been referencing their favorite products for decades, from Janis Joplin’s “Mercedes Benz” to the Beach Boys’ “T-Bird” (courtesy of Ford (F)). But the first truly shameless marriage of an artist and a brand came in 2003, with the release of Busta Rhymes’ hit song “Pass the Courvoisier,” which caused a major spike in US sales of the cognac company, which later signed a promotional deal with the rapper.

Since then, brands ranging from Nokia (NOK) to Nike (NKE) have been prominently placed in both music videos and lyrics.

With music videos now streaming through the Internet, television, and DVDs, product placement has become key. The 2003 Madonna/Britney Spears video “Me Against the Music” begins with Spears exiting a Mazda RX-8 sports car before the song even begins. The car’s 14-second appearance in a major music video was seen as a watershed moment, eventually leading to Chrysler’s 3-year, $14 million partnership with singer Celine Dion. After one year, Chrysler backed away from the alliance, but Chevrolet’s (GRM) launch of a similar campaign last year, with singer Mary J. Blige, proves that such branding persists despite extremely tough times.

Admittedly, artists from all musical backgrounds have featured products in their videos. But the musical supergroup/Benetton ad known as the Black Eyed Peas may have become product placement’s poster children. The HP (HPQ) TouchSmart computer at the center of their latest video continues a trend started by their 2007 video for “Let’s Get it Started” (which featured a close-up of a Motorola (MOT) phone), and “My Humps” (which featured shots of couture apparel).

Other formal agreements have placed products by Apple (AAPL) and Mattel (MAT) alongside rappers The Game and Ludacris, respectively. In a music industry in dire need of a new revenue model, this isn’t payola - it’s a potential life-vest.

With a greater variety of artists engaging in this kind of branding, and fears over artistic integrity subsiding, labels couldn’t be happier. A recording industry in decline for almost a decade is now using branding to offset production costs for albums, videos, and tours.

“It will get to the point where the brand is paying for the entire production of an album. The labels and artists will not have to put up any money,” says Kluger. “So everything is profit. That’s 2 years away, not 10.”

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