New Rules of Engagement: Why Marriott and MasterCard Opt for Intimate Concerts that Scale Globally

By Lesa Ukman Mar 25, 2016

New Rules of Engagement: Why Marriott and MasterCard Opt for Intimate Concerts that Scale Globally

At SXSW last week, a theme of multiple sessions—from Bruce Sterling’s keynote to a panel of musicians moderated by Vans’ CMO—was that with the decline of CD and download sales, music labels no longer support more than a handful of new artists.

Even headline acts are feeling the crunch. Record-sale royalties, which used to provide income flow between album cycles, are almost non-existent and streaming has yet to fill in the gaps.

But the corporate sector is a growing source of revenue for musicians at all levels.

For example, Marriott Rewards, a first-time sponsor of South by Southwest Music Conference and Festival, hosted performances by dozens of artists from Vivendi SA's Universal Music Group at the centrally located JW Marriott Austin during SXSW. Rewards members received special access to the Music is Universal shows, which featured headline performances by GRAMMY nominees and daily showcases with additional artists, including new talent.

Music fans not at SXSW could see performances and behind-the-scenes footage via Marriott Rewards' digital, social, and in-room channels, as well as on Periscope. Marriott invited the public to decide which songs were broadcast on Periscope via Twitter polls.

Marriott’s concert series was cosponsored by Gap. A Gap pop-up store was erected within the JW Marriott during SXSW and brochures promoting a co-branded line of Gap clothing were distributed to all guest rooms throughout the event.

From celebrity takeovers of its Snapchat account to video series on its YouTube channel, content is playing an increasingly important role in Marriott International’s marketing strategy. The objective: Engage Millennial, next-gen travelers.

In 2014, the hotel giant launched the Marriot Content Studio, which is charged with creating consumer-facing content across Marriott’s 19 brands. The studio focuses on two types of content: entertainment (TV shows, short films, webisodes, etc.) and travel information (Marriott Traveler digital magazine, etc.).

Much of the content features YouTube celebrities and other digital influencers. As reported in IEG Sponsorship Report, the Marriott Content Studio also is helping the hotel chain activate its partnerships with the NFL and NBA.

Marriott’s global marketing officer, Karin Timpone, will be keynoting IEG 2016.

Gwen Stefani, another Vivendi artist, is also benefitting from increasing corporate tie-ups with musicians, in this case MasterCard. As the Wall Street Journal recently reported, “Since 2014, MasterCard has helped foot the bill for much of Ms. Stefani's expenses including concert production, travel costs and marketing, and has paid for personal appearances and the like.”

New Rules of Engagement: Why Marriott and MasterCard Opt for Intimate Concerts that Scale Globally

The article further reported, “MasterCard tracks its 1.6 billion customers' purchases as they occur so it can see exactly how much its music initiatives move the needle, though it wouldn't share specific purchasing data.

“Raja Rajamannar, MasterCard's chief marketing officer (who also is speaking at IEG 2016), was ranked No. 66 on Billboard's Power 100 list this the company spent about $15 million to $25 million on music, according to the music—industry magazine's estimate.

"We are gaining market share, our brand is growing very strong as a result," said Mr. Rajamannar.

“MasterCard's brand was worth $5.5 billion last year, up 17% in value from the year before, according to the annual rankings of Omnicom Group's Interbrand consultancy.”

MasterCard is one of a growing number of companies that poured a combined $1.4 billion into the music industry last year, according to IEG Sponsorship Report.

By contrast, brands spent $1.1 billion in 2011 on music sponsorship. Spurring corporate sponsor interest is a boom in music listening, which expanded 15 percent last year in the U.S., according to Nielsen Music, due in large part to the proliferation of smartphones, which make it convenient for users to stream music, often for free, rather than buying it.


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ALEX VERGARA 3/15/2017 9:58 AM
Awesome update on the intersection of music and technology.

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