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WORKING WEEKEND: Studio marketers seek synergy and synchronicity

25 Apr, 2002 By: Bruce Apar

Synergy's typically gotten a bad rap, especially where entertainment goliaths are concerned. Just ask anyone who works at either of the companies masquerading as the singular AOL Time Warner.

But drill down a little and you discover that at major studio's divisions such as home entertainment and consumer products either are working hand-in-glove to forge a unified front with major retailers, or in fact report to the same executive.

In Hollywood more and more these days, video (as always, in this space that includes VHS and DVD, and even video games) plays an integral role in the marketing of other goods and services. That's because home video itself has become a commodity consumer good that essentially is a licensed product, even if it is released by the same studio that produced and/or distributed its theatrical parent.

As the studios' home entertainment units have grown into multibillion-dollar revenue streams, they have been increasingly synchronized with the marketing strategies and operations of the entire company, from theatrical to consumer products.

At 20th Century Fox, Pat Wyatt ran the consumer products group – which encompasses studiowide licensing, promotion and interactive games -- before adding home entertainment to her portfolio several years ago. Conversely, there's a generation of homegrown video executives who have inherited sizable and strategically vital consumer products units at their studios.

These include Ben Feingold, president of Business and Operations of Columbia TriStar Motion Picture Group, MGM Home Entertainment Group COO and president David Bishop, and the latest addition to the club, Louis Feola. The former president of Universal Studios Home Video recently was named president of Universal Pictures Franchise Development. That's a new division that includes consumer products, two specialty production units and all Vivendi Universal franchise properties.

The effect at retail is that the studios today are working more closely than ever with the A-list merchants, including Wal-Mart, Toys ‘R' Us, Target and what the licensing and promotions people call QSRs – quick service restaurants – such as McDonald's and Pizza Hut, among many others. Wal-Mart can command its own proprietary packaging for titles such as Warner Home Video's Harry Potter DVD.

In the business of licensed movie merchandise and promotions, the lesson learned in recent years is that less is more. Licensors -- the studios – and the consumer goods marketers of apparel, books, plush toys and other items that are their licensees would rather focus on fewer categories of merchandise moving through fewer channels of distribution, and know that the SKUs are being heavily promoted, receiving prime shelf space and selling through with minimum returns. That's why you'll see less Star Wars merchandise for Episode 2: Attack of the Clonesthan for The Phantom Menace.

Customized and exclusive retail promotions on event titles have become the industry standard.

Universal Studios Consumer Products Group signed what it calls “an unprecedented and exclusive three-year worldwide merchandising program in more than 20 countries with Toys'R' Us, Inc., the world's largest specialty retailer, to develop a full range of exclusive E.T. product.”

At Sony Pictures, Consumer Products SVP Al Ovadia notes his group works closely with home entertainment in calling on chains like Wal-Mart. On an inevitable blockbuster release like Spider-Man, he explains, the sister studio divisions can be in the same meeting with the account and lay out the movie's marketing program “from pre-theatrical through to video. It's pretty convenient.”

At MGM Consumer Products, Lisa Westfield Avent, VP worldwide licensing and retail development, says her group works closely with home entertainment, in part to keep tabs on which genres of catalog product are popular.

Having tracked historical data showing that, for example, horror cult favorite Army of Darkness was a big seller, the consumer products group decided to target its fans by signing five licensees to market a line of tie-in merchandise. So if you know someone who collects bobblehead dolls, tell them there's an army of ‘em waiting to be conscripted.

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