brad berens executive editor imedia communications, inc. changes in the marketing mix

Brad BerensBrad Berens

Executive EditorExecutive EditoriMedia Communications, Inc.iMedia Communications, Inc.

Changes in the Changes in the Marketing MixMarketing Mix

Celebrity Equations

Jim Carrey Ben Stiller

- =

Christina Aguilera Erik Estrada

+ =

Mick Jagger James Brown

- =

Part 1

The audience is changing…

1995: Estimated Movie Tickets Sold

1 Toy Story 50.2 million

2 Batman Forever 39.8 million

3 Apollo 13 39.1 million

Top 3 Movies

Sources: Nielsen EDI, Box Office Reports and Exhibitor Relations

2000: Estimated Movie Tickets Sold

1 How the Grinch Stole Christmas 50.3 million

2 Cast Away 43 million

3 Mission Impossible 2 39.6 million

Top 3 Movies

Sources: Nielsen EDI, Box Office Reports and Exhibitor Relations

Modest growth…

2004: Estimated Movie Tickets Sold

1 Shrek 2 74.6 million

2 Spider-Man 2 60.2 million

3 Passion of the Christ 53.7 million

Top 3 Movies

Sources: Nielsen EDI, Box Office Reports and Exhibitor Relations

Things look GOOD for ticket sales, but…

No 'Passion,' no problem? The summer of mixed messages

U.S. Box Office Hits Longest Modern Slump

'Batman' Can't Begin to Rescue Film Industry

CNN did an online poll Friday, asking what movie people were most likely to see over the weekend. The new films "Herbie," "Bewitched" and "Land of the Dead" received 27% of the vote. The landslide winner, with 73%, was "None, I'd rather rent a DVD of something good."

Patrick Goldstein, Times Staff Writer

June 28, 2005

Home Video: DVD Unit Sales

Year Film TitleUnits Sold (millions)

Gross Revenue (millions)

2005 (YTD) The Incredibles 14.01 $252

2004 Shrek 2 18.2 $316

2003 Finding Nemo 18.5 $320.4

2002 Spider-Man 12.2 $215.3

2001 Shrek 8 $157

2000 Gladiator 3.4 $63.1

Source: LeesMovieInfo.netDoes not count rentals.

A VHS aside…

Year Film Title Units Sold (millions) Gross Revenue (millions)

2004 Shrek 2 2 $25

2003 Finding Nemo 3.71 $77.90

2002 Monsters, Inc. 9.2 $145.20

2001 Shrek 13.9 $228

2000 Tarzan 10.5 $210

The DVD market is bigger than the VHS ever was.

Source: LeesMovieInfo.net

#1 TV Show: A Gradual Decline

1994-1995 Seinfeld 31 12.3 30,330,000

1999-2000 Who Wants to be a Millionaire? 29 11 28,533,000

2004-2005 CSI 25 9.5 26,308,000

ShareSeason % Viewers

Source: Nielsen Media Research

#5 TV Show: Even Worse...

ShareSeason % Viewers

1994-1995 Monday Night Football 30 9.9 24,420,000

1999-2000 Friends 23 8.1 20,950,000

2004-2005 CSI: Miami 20 6.8 18,881,000

Source: Nielsen Media Research

One word to describe this?

Oy.

Implications…

• Your audience is fragmenting

• They go where they want, when they want

• We’re not talking enough about Games

• Mass culture is a lot less massive (but it hasn’t been around all that long anyway)

Part 2

Show me the money!

• Nearly all advertisers are spending more

• But more $$$ do not equal more audience

• You’re paying more for less

• And this does NOT include DVRs and SIMM

Who is spending what?

Let’s zoom

in…

After 2002, entertainment companies did not embrace online with enthusiasm…

Who is missing?

And, this just came in yesterday…

Network TV growth had already slowed down in Q1, and then…

Ad Icon P&G Cuts Commitment To TV Commercials

P&G to reduce "upfront" TV spending

P&G sharply cuts commitment to TV ads

Remember: P&G is the USA’s biggest advertiser.

June 13, 2005

So why did P&G make the change?

• TiVo and other DVRs

• Internet and Games

• Increased investment in PPP

Generally, a move away from…

"Spray and pray."

Wenda Harris MillardChief of Sales Yahoo!

Although the budgets are miniscule compared to TV and newspapers, the big growth areas for marketing are more targeted.

And topping the list…

Part 3

Online: what the fuss is about

(I’ve shown you this next slide before…)

So why -- and how -- are most advertisers spending money online?

WHY

The Big Question

Should entertainment marketers follow the rest of marketers and invest more online?

Answer: Yes. That’s where your consumer is.

Part 4

Entertainment Consumers & the Internet

• Leading provider of marketing research for the entertainment industry

• Known for innovation in consumer understanding

www.comscore.com

(See press pages for insight on Star Wars Episode III: Revenge of the Sith!)

Number of Unique Visitors (000's)

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v-03

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-05

Total Internet Users Total Movie Site Visitors

Entertainment marketers have the opportunity to reach almost 60 Million consumers per month via the Internet!

Source: comScore Media Metrix

40 to 60 Million U.S. Consumers Visit Movie Sites

Every Month!

Percent of Internet Users Who:

0%

10%

20%

30%

40%

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60%

Nov-0

3

Dec-0

3

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4

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4

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4

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-04

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04

Jul-0

4

Aug-0

4

Sep-0

4

Oct-0

4

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4

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4

Jan-0

5

Feb-0

5

Mar

-05

Visited Movie Sites Visited Music Sites

In March '05, 1 of every 2 Internet users visited a music site; and 1 of every 3 visited a movies site!

Source: comScore Media Metrix

Strong GrowthYear-to-Year

Movie Site Visitors* Can Be Hard to Reach Through Traditional Media

• 31% to 34% are "light" TV viewers

Source: AiM, by comScore Media Metrix*Visitors of Yahoo! Movies, Moviefone, or IMDB.com

Movie Site Visitors* Can Be Hard to Reach Through Traditional Media

• 31% to 34% are "light" TV viewers

• 28% to 30% claim they don’t listen to the Radio, or listen rarely

Source: AiM, by comScore Media Metrix*Visitors of Yahoo! Movies, Moviefone, or IMDB.com

Movie Site Visitors* Can Be Hard to Reach Through Traditional Media

• 31% to 34% are "light" TV viewers

• 28% to 30% claim they don’t listen to the Radio, or listen rarely

• 59% to 65% have computers in the same room as their TV… and use them while they’re watching!

Source: AiM, by comScore Media Metrix*Visitors of Yahoo! Movies, Moviefone, or IMDB.com

= SIMM

Sales of event & movie tickets on the Internet shows continued growth

Source: comScore eCommerce InsightsIncludes delivery of physical products, does NOT include streamed content

U.S. Internet Sales of Movie and Event Tickets

$-

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

Janu

ary

Febru

ary

Mar

chApr

ilM

ayJu

ne July

Augus

t

Septe

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Octob

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Novem

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2002 2003 2004 2005

Consumers have proven that they want streamed content over the Internet …

43 45

57

69 73

90

September 2004 November 2004 February 2005

Percent of Internet Users Who Have Consumed Streamed Content Millions of Internet Streamers*Includes both streamed content and progressive downloads.

Source: comScore Streaming Report

Particularly entertainment content, which was the fastest growing of all online paid

content categories in 2004

Source: comScore / OPA Online Paid Content Report – 2005 Release

Percent Change in Paid Content by Category (2004 vs. 2003)

Consumers like streamed content

• Millions of consumers are watching online trailers, listening to music online, and downloading clips and movies every month.

• Even smaller sites can have very loyal viewers -- the average viewer on iFilm Network streamed over 20 times in the last month!

Source: comScore Streaming Report – February 2005

Number of People Who Streamed from This Internet SiteFebruary 2005

5,359,000

4,362,000

2,179,000

1,319,000

973,000

Walt DisneyInternet Group

Viacom Online

Warner Music

Vivendi-Universal

iFILM Network

When Showtime provided a webcast of the "Fat Actress" Pilot on Yahoo!, over 15% of

the total viewing audience "tuned in"

Source: comScore Streaming Report

Internet portals remain the primary source for consumer information about listings, reviews, and

show times

Source: comScore Media Metrix; February 2005

Search marketing: movie sites vary in their use of the major search engines

Source: comScore Media Metrix; February 2005

Percent Share of Clicks to the Site by Search Engine

0%

10%

20%

30%

40%

50%

60%

70%

Google.com Yahoo! Web Search MSN Search

MOVIETICKETS.COM IMDB.COM HOLLYWOOD.COM Moviefone NETFLIX.COM MOVIELINK.COM

The Internet: a great way to reach the emerging digital media services market

• People who use devices like Microsoft’s Media Center and Dell’s Media Experience use the Internet significantly more than other consumers.

• Also, 89% use Broadband making them an obvious target for online movie trailers, etc.

• They skew towards higher income, and larger households (5+) with parents aged 55-64 years old and teen-aged kids.

2691

4576

1616

2583

DMS Users Average Internet User

Minutes per User Pages per UserSource: comScore Marketing Solutions; March 2005

Digital media services users are avid Internet entertainment consumers

• People who use devices like Microsoft’s Media Center and Dell’s Media Experience are significantly more likely to visit entertainment-oriented websites than the average Internet consumer.

% of Digital Media Services' Users Who Visit:

62%

61%

61%

51%

64%

67%Music Sites

Multi-mediaSites

Games Sites

Movies Sites

Television Sites

Sports Sites

Source: comScore Marketing Solutions; March 2005

Conclusions

• Entertainment consumers are a moving target, but they are engaged with and passionate about your products

• Entertainment marketers need to catch up with these consumers

• Integrated marketing is the way to go• As mobile computing and wireless

entertainment spread -- enabling consumers to move even FASTER -- integration will become even more important

www.imediaconnection.com

brad@imediaconnection.com

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