We are living in a post-pandemic world that fuses music, film, streaming, gaming, fashion, celebrities and sports, and where consumers are able to buy anything, anytime and anywhere.
As we prepare for the Olympics opening ceremony in Tokyo on Friday, we’re watching to see how brands will harness partnership marketing in this new era of entertainment-driven commerce.
In a disrupted and fragmented marketplace, consumers no longer flock to your brand, website or store based purely on your product attributes. They respond more favorably when your brand enhances the emotionally charged moments they crave.
The partnership marketing industry represents $200 billion in annual spend when you add up sponsorships, licensing, influencers, celebrities and co-branded activation. On average, marketers will spend 25% of their marketing budgets on partnerships this year.
But are they spending it wisely? Entertainment commerce can create a through-line from brand to demand that makes it easy and fun for people to buy.
The stakes are high. According to Nielsen’s 2021 sponsorship study, measuring sponsorships against sales impact and alongside other marketing activity can lead to a 20% increase in ROI. The Samsung/Netflix/Aviation Gin partnership is just one example of how brands can cleverly weave together IP to unlock growth and drive sales. Samsung generated $480 million in QLED TV sales during the campaign’s run.
But most marketers still focus on creating ‘safe,’ one-dimensional sponsorships measured by vanity metrics such as brand awareness. If your sponsorship budget is spent on product placement, naming rights, logo placements, jersey signage and one-off celebrity endorsements, your brand is likely to be drowned out by savvier competition.
Embracing metrics-driven sponsorships will require change in how you identify, evaluate, negotiate and activate.
Build your brand story with owned equity
Align your brand objectives with consumer passion points while making shopping entertaining. Develop a partnership strategy that seamlessly integrates your brand within the experience and delivers against both your brand values and business objectives. Find the right partners and acquire the right mix of assets and benefits to reinforce shared brand attributes so consumers don’t know where one brand ends and the other begins.
Netflix does this quite well, creating mutually beneficial campaigns between its properties and brands, such as Stranger Things collaboration with Coke, Eggo and Lyft, not to mention its longstanding partnership with Ben & Jerry's. All co-branded content must be Netflix quality, fuel fandom and create moments of consumer joy.
Embrace diversity in communities and audiences
To unlock a partnership’s true potential, move beyond demographics and align with the right communities by tapping into fan bases with a shared message at the right time and place.
During the pandemic, Verizon and The Metropolitan Museum of Art’s “Unframed” immersive AR experience generated 1 billion impressions and 700,000 visits from 153 countries, reinforcing the power of Verizon’s 5G network for diverse art enthusiasts beyond its network reach.
Curate deeper, holistic experiences that convert
Connect shoppers to the most relevant commerce channels. Experiences must be entertaining and shoppable across each consumer’s unique journey. Use a minimum 2:1 ratio between IP rights to activation to ensure you are maximizing the partnership.
Michelob Ultra and the NBA quickly pivoted during the pandemic to make the brand a significant part of the game experience. This was amplified across the NBA fan's key touchpoints including social, digital and in-store/on-pack. The brand saw 32% YOY sales growth in 2020 and even gave homebound fans a way to earn courtside seats inside last year’s playoffs bubble.
Develop a new call to action that drives behavior
Translate content into commerce. For example, Ferrera’s Trolli ‘The Deliciously Dark Escape’ built a video game to attract a younger fanbase while unlocking an experience with Sony’s PlayStation that encouraged repeat purchase by playing into consumers passion points.
Ensure content and commerce are intrinsically linked
It’s time we prove the ROI of our partnership investments. Identify measurable ways to evaluate and optimize performance against business metrics. Some recommended KPIs include retail-specific sales YOY, incremental display, market share, media engagement (CTR) and category growth. Ideally, you can use this data to renegotiate your sponsorship deals so that they’re designed for maximum short-term and long-term growth.
The fusion of culture and commerce will create richer, more connected brand experiences with a new call to action, allowing brands to tie ROI to investments.
Jon Goynshor is VP, head of partnership Marketing at VMLY&R Commerce.