MAM
Branded content market sky rockets from ?5 to ?22 in one yr
MUMBAI: Major US entertainment companies such as Disney, Electronic Arts and Viacom have identified branded-content as a potentially valuable revenue stream. The figures say it all. In 2003 the market size of the branded content programme market size was approximate ?5 million while the figure sky rocketed in 2004 to an estimated of ?22 million.
A study on Branded Content Market Overview done by the Branded Content Marketing Association in the UK revealed that the total number of branded content programmes commissioned in 2003 were more than 36 (not including sports programmes) and the same were also actually aired in 2003. Around 20 projects of branded content programmes have been commissioned and/or are in development today. The study said that the average budget of the commissioned branded content programmes was approximately ?100-150,000 per project, which means that the budget is the same as the average budget of regular commissioned programmes. But at the same time, the budget does differ for different genres of programmes like factual, sports, music, entertainment etc.
A few examples of branded content that have been developed spanning all genres and/or all channels like music, TV spanning programmes, film, events, sport are: Heineken – Thirst Tour (Music Matrix/CC Lab), Nike – Run London, Scorpion Football, Freestyle, Carling – live music spanning official buskers on the tube through to Homecoming series (incl. TV coverage).
Another area of focus of the study was on branded content gaming. The advergaming (Branded entertainment games) market size is $1 billion per year industry by 2005 according to what Forrester said in December 2002.
According to information available, 60 per cent of Americans regularly play computer games and in 2002, the global computer game hardware and software sales were $26.5 billion (more than the global movie box office). The Entertainment Software Association found in 2003 that the average age of a gamer is 19 and 17 per cent gamers are 50+ years old. Whereas 41.9 per cent of gamers are female and 41.6 per cent are 35+ years old.
A few brands that have used advergames are Nike, Joe Boxer, Pepsi, Nabisco, Kraft, Nestle, Heinz, BMW, Toyota, Daimler Chrysler, BA, Thomas Cook, Orbitz, HSBC, Tesco Personal Finance, Sony, Panasonic, GSK, MTV, The Sun, Fox Sports, Microsoft and Albion Computers.
A couple of case studies have been highlighted in the study which reveals that branded programming and gaming was highly effective. For example: Mitsubishi launched the Lancer in the US only after it grew in popularity through its placement in the Gran Turismo series of racing games. “There’s no doubt that Gran Turismo played a huge role in our decision to launch the Lancer Evolution in the United States,” said Takashi Kiuchi, a product relations official at Mitsubishi in the Gaming Age in December 2002.
Another example is that of Nabisco which created an online arcade of games to feature their range of sweets. The site attracts half a million visitors a month. “The jump in attitudes and brand awareness were tremendous,” said Global e-Business Nabisco- Skyworks (former) president Sharon Fordham.
A few examples of branded content music projects that the stodu has cited are:
Carling – Carling Live concerts, Festivals – Reading and Leeds, Carling Live.com content and community, Carling Homecoming concerts aired on Channel 4
Smirnoff experience: events, Joy of Decks TV programme, online content
Pop Idol: TV programme, magazine, record label, online, etc.
mycokemusic.com
Pepsi chart show
Orange: bright weekend music events
Virgin: V-festival
Guinness: Witness Festival
Heineken: Heineken Green Energy Festival, TV programme Hotel Babylon
Budweiser: Bud House Party clubbing events
MTV: Awards, Winterjam, Isle of MTV
Red Stripe: official sponsors of Notting Hill Carnival
Absolut: www.threetracks.com exclusive music tracks commissioned by Absolut vodka
Nokia: Snowboarding and Music Events
Princes Trust: T in the Park
Innocent Smoothies: Fruitstock Festival
Diesel: U-Music awards
NME: NME Awards (also broadcast)
However there a few differences between the US and UK branded entertainment market. Firstly, the US market is significantly larger (even accounting for their larger economy and population) and secondly the US advertisers are more amenable to branded entertainment initiatives than that of the UK. The reasons for this are that the regulatory environment in the US has historically been more open to this type of marketing communication than that of the UK. Also the US is home to the worlds leading entertainment producers and distributors and the larger population of the US increases the potential return made on an entertainment investment. Another reason is that the US has had a larger number of high profile success BE projects.
The above mentioned factors have significantly altered the US market in many ways.
1. The US has been a leader in product placement through Hollywood and now television. This has led to US advertisers being more open to entertainment-based marketing (witness The LA Office Roadshow which is entering its seventh year of bringing together brands and entertainment properties). In contrast the UK regulators have long taken a negative view of advertisers receiving undue prominence in programming. Programme sponsorship was only legalised in 1991 whilst product placement is still effectively banned (though it does occur it was estimated to be a 20 million per year industry in the UK by the Sunday Times in 1999).
2. Major US entertainment companies such as Disney, Electronic Arts and Viacom have identified branded-content as a potentially valuable revenue stream. These organisations have brought a high profile to the market that has sped its development, but the creative talent that these organisations possess has also aided the market by creating great concepts.
3. Entertainment productions can be expensive; balancing those costs against a potential market of 250m people is significantly easier than against a population of 60 million.
4. The US has had a large number of high profile successes in branded entertainment: Ford/24, Nokia/Alias, BMW films, Nabiscos Candystand and numerous Hollywood films. Inevitably these successes lead other brands to follow the lead.
The study also presents a selection of recent production examples. The first one being that of the American Express which launched a Seinfeld-meets-Superman program for internet distribution. Another one was also of the American Express funding a film to be produced with Vanity Fair editor Graydon Carter and directed by Wes Anderson. It features a look at American culture through the eyes of humorist and author Fran Lebowitz. A 2005 release is planned. South West Airlines has prepared a reality show for broadcast whereas Radioshack and Shockwave have Zip Zap online racing games. Quicksilver and Forever Films launching Riding Giants feature film to be the opener for the 2004sundance, Sony TV and General Mills Cereal distributing TV on DVD on cereal boxes and Sears Roebuck’s Extreme Makeover are a few other examples.
The study also throws light on the fading of the broadcast audience in the US because the television programming is more frequently becoming available via new distribution channels such as: TV on DVD – more than 500 TV titles were released in 2003 (up nearly 100 per cent from the previous year); TV on DVD sales in 2003 were $1.5 billion up from $610 million in 2002; IPTV and Movie downloading – The MPAA conservatively estimates that there are 400,000 illegal movie downloads occurring every day, a relatively small number compared to music, but the technology is only getting faster and this is a real new distribution channel and problem for both broadcast and movies; Penetration of Broadband is much higher in the US than UK (June 2003 eight per cent USA v/s four per cent UK source DATE); TV on Promotional Packaging (General Mills Cereals releasing TV favourites on CDs attached to Cereal boxes).
Another reason is that the audiences are consuming differently, tomorrow’s content is niche, independent selections rather than mainstream broadcasting.
Digital
GUEST COLUMN: How AI is restructuring distributor and retailer motivation models
From incentives to intelligence, AI is redefining how brands engage channel partners
MUMBAI: Artificial intelligence is rapidly transforming how brands engage with their most critical yet often overlooked stakeholders: distributors, retailers, and last-mile influencers. For Abhinav Jain, co-founder and CEO of Almonds Ai, this shift marks a fundamental departure from traditional, transaction-led incentive models toward behaviour-driven, data-intelligent ecosystems. In this piece, Jain examines how AI is enabling brands to decode partner motivations, predict engagement patterns, and deliver personalised, scalable experiences—ultimately redefining channel relationships from transactional exchanges to long-term growth partnerships.
Across many sectors, there is increasing recognition that motivating those who bring products to market (distributors, retailers, last-mile influencers) poses a growing challenge.
Brands continue to invest significant marketing and digital resources to consumers, yet in many countries and the vast majority of emerging economies, these types of consumer-focused investment areas have had little impact on ultimate product delivery. Rather, it is still the case that traditional retail continues to make up most products sold.
So why is it that the systems built around motivating these channels have yet to evolve?
For decades, distributor and retailer engagement revolved around static schemes – quarterly targets, volume-based rewards, and occasional trade promotions. These programs were designed around transactions, not behaviour. The assumption was simple: if incentives increase, performance will follow.
Now, with the advent of artificial intelligence, the definition of performance is being challenged.
With the development of artificial intelligence, businesses can move beyond simply creating loyalty based on transactional-based models and toward models built on behaviours, the behaviours of channel partners that are intrinsic to their motivations in engaging with particular brands. As a result, the means by which businesses develop relationships within their distribution network are starting to evolve; thus, ultimately changing how brands interact with those within their distribution network.
Assessing engagement: Transitioning from transactional- to behavioural intelligence
Traditional loyalty systems refer to transactional activity (sales data). Although this data is valuable and important, it only provides a partial view of engagement across the channel partner.
For example, a retailer may have a high frequency of sales of a product, but their lack of engagement with the manufacturer would not reflect that they have true loyalty toward that brand. Conversely, a retailer who actively participates in training programmes, acts as brand advocates, and is engaged in learning with the supplier would exhibit more profound levels of loyalty but would have been invisible based on historical incentive programmes.
Artificial intelligence allows for the identification of behaviours that help to address this gap. Brands are able to use a variety of engagement data points, participate in learning programs, respond to communications, redeem behaviour and track platform use behaviour in order to identify motivation through behaviour.
McKinsey has stated that companies that leverage advanced analytics for their sales and distribution functions can achieve as much as a 15-20 per cent increase in productivity due to increased awareness of their behavioural trends throughout their networks.
This visibility of behavioural patterns within channel ecosystems can be transformational to brands as they can now view how partners engage on their path to purchasing products, instead of just measuring the sales revenue generated by those purchases.
Predicting motivations, not just measuring performance
Possibly, the largest contribution of Artificial Intelligence (AI) to helping brands engage with partners via channel ecosystems is its ability to predict future engagement versus simply measuring past performance.
Traditionally, brands only realised that a partner was disengaged (not likely to purchase products) once their sales performance had already declined. By then, the brand would have to use significant amounts of incentives or aggressive promotional activities to recovery their partner’s engagement level.
AI models can help organisations to detect early signs that a partner is becoming disengaged, such as declining participation in learning modules, declining interaction via the platform, or slower reward redemption rates. These indicators can help organisations to proactively engage with their partners before their sales performance begins to decline.
The practical application of AI and predictive analytics gives brands the ability to re-engage with their partners prior to their sales performance declines. For example, instead of developing and implementing broad-reaching incentive programs that provide a “one size fits all” incentive to all partners in an ecosystem, brands are able to develop targeted, engaging re-engagement programmes. This is how personalisation can be done on a large scale, such as across global distribution and retail networks.
The vast majority of distributor and retailer channels have thousands, if not millions, of individual channel partners. Historically, providing personalisation to such a large number of businesses has not been feasible.
However, with the advent of AI, personalisation at scale is becoming a reality.
Brands can now create tailored engagement journeys for all their partners, based on their partner profiles, through some combination of machine learning models and behavioural segmentation. For example, high-performing distributors might receive higher levels of leadership-based recognition and greater incentives to continue to grow. Emerging retailers, on the other hand, might be supported with training, onboarding rewards, and measurable performance milestones.
The shift towards personalisation of partner engagement echoes the direction that consumer marketing is already moving towards.
According to Salesforce’s report, over 70 per cent of customers expect personalisation in the way that brands engage with them. As such, there is a growing expectation for B2B ecosystems to have these same types of expectations from their channel partners.
Gamification and continuous engagement
AI is also radically changing how brands will engage with their channel partners through the use of gamification.
Many traditional incentive-based contests and leaderboards would spark temporary engagement among their participants, but they struggled to sustain engagement over time. With the use of AI, gamification mechanics are evolving dynamically based on historical and evolving participation patterns by their channel partners.
Challenges, rewards, and recognition structures can be modified continuously in order to sustain engagement with all of a brand’s partner segments. This will provide a greater opportunity to move away from episodic campaigns towards ongoing, continuous engagement experiences.
When channel partners receive motivation as part of their daily business activities through recognition, learning, and tracking their performance, long-term loyalty will be achieved.
Aligning motivation to broader impact
There is a growing trend within the channel ecosystem to integrate sustainability and socially responsible behaviours into the channel partner programmes of brands.
Increasingly, brands are motivating their partners to use sustainable practices in their operations, participate in sustainable practices like sustainability-related knowledge programmes, or promote products that are in line with their sustainability objectives.
Brands can use AI to monitor and measure these types of behaviours and incorporate them into their incentive frameworks so that brands can align their commercial objectives with broader social and environmental outcomes.
A shift in the way brands view their channel partners
AI is having the most significant impact on the way that brands are now viewing their channel partners, as it relates to the underlying philosophy of those fundamental relationships.
For the past several decades, many brands have viewed their channel partners as intermediaries in the supply chain. More and more brands are now beginning to view their channel partners as key ‘partners-in-growth,’ and their actions can have a direct impact on market performance.
In fact, all the channel ecosystems are using behavioural engagement platforms to design new models that reward not just transactional behaviour, but also create continuous engagement journeys for their partners, where their partners can receive recognition for their participation, learning, and continued engagement, thereby reinforcing long-term loyalty to the brand.
The future: Intelligent channel ecosystems
As we consider what the next phase of channel engagement may look like, many believe that it will be based on intelligent ecosystems, using AI to continuously monitor and adjust the engagement strategies used to engage their channel partners, in real time and based on the behaviours of those partners.
For brands operating in complex distribution networks, the ability to perform well will be determined both by whether products are available to their customers, as well as by the enthusiasm, expertise, and loyalty shown from each channel partner that represents the brand each and every day that they are working on behalf of the brand.
While AI clearly does not eliminate the human aspect of a brand’s relationship with its channel partners, it does allow brands to better understand and nurture that relationship.
In markets where the last mile will determine whether a sale is made, how one leverages the intelligence gained by using AI will ultimately be the difference between gaining a new, sustainable competitive advantage versus losing one.
