JacoBlog - Jacobs Media's Blog

Why "Guitar Hero" Matters

It's just a game, right?  No, Guitar Hero and Rock Band are more than just games.  They capture the fantasy aspect of Rock music that we all have inside us.  From the very first dude who ever played the "air guitar," Rock music lovers have always pretended to be Keith Richards, Eric Clapton, and Jimmy Page - just as baseball fans mimicked the batting styles of Mantle, Aaron, and Big Papi.

And that's where Guitar Hero and Rock Band have filled the void.  In our newest Tech Poll, we found that nearly half of those who play video games have played either of these Rock-based games.  It's a big number, and it transcends age and gender.

But here's the kicker: Of those who have played either or both Guitar Hero or Rock Band, three in ten say they've purchased music that was featured in the games.  That's an incredible stat that says a lot about the role that "new media" plays in music sales, and about the power and influence of these participation games.

American Idol and Activision (the creators of Guitar Hero) pulled off a cool "product placement stunt" by producing a commercial that features their two finalists (the "two Davids") playing a Guitar Hero guitar in a parody spot of the Tom Cruise scene from Risky Business.  The tag line - "Unleash Your Inner Rock Star" - perfectly nails the emotion that these games bring to living rooms all over America.

These games are powerful - not just in their ability to capture the Rock 'n' Roll vibe - but also in their proven capacity to sell music.  And because they celebrate Rock music (at a time when the musical winds are often blowing the other way), we should embrace Guitar Hero and Rock Band as brand extensions that are contributing to fanning the flames of music passion.

Follow The Money - Part II

Here is part 2 of the guest post from Paul Jacobs who offers his insight on how radio needs to invest in solutions to reach younger consumers:

Assume for a minute that radio's revenue growth via the traditional commercial platform is going to continue to be challenging.  And if your station specializes in lower demand demographics like 18-34s and Teens, you know that radio has fallen out of favor with many key advertisers, with no apparent turnaround on the horizon.

Yet, many major advertisers haven't changed their target demographic strategy.  They've changed tactics.  And radio, especially formats like Alternative and CHR, has to respond to this shift in order to survive.

Here's the facts:  A recent report from PQ Media found that spending on "branded media" - event sponsorship and marketing (+12%), product placement (+34%), and advergaming and webisodes (+35%) - grew nearly 15% last year to $22 billion.  And who are most of these advertisers targeting?  The hard-to-reach youth market - Alternative and CHR's target listeners.

So, for radio, there's an obvious disconnect.  The problem isn't younger-targeted radio station's demographics or our audience size (which is considerable).  It's the way we're delivering listeners to advertisers, many of whom are moving away from the paradigm being the third spot in a five spot cluster.

Alternative and CHR stations have proven expertise in creating compelling events (and generating considerable profit from them), but there's a long way to go on digital platforms.  Most aren't structured properly to satisfy changing advertiser needs.  In a flat traditional advertising revenue market where owners and Wall Street are demanding growth, doesn't it make sense to ask some hard questions about the entire business model of these stations and consider some radical surgery?

Looking at it a different way, youth-targeted radio formats might be able to lead the way to revenue growth for the radio industry.  There are billions of dollars available chasing youth (maybe even more than for aging baby boomers).  Maybe these stations need to consider some serious experimentation by re-structuring their promotional, digital, and sales models.  Maybe they need to, in the words of Jason Calacanis at Summit 12 - "surrender" to the reality that the current business model is not the road to revenue growth.

Let's invent a new one, and in the process, begin to reinvent the way that radio interfaces with advertisers - and the audience.

The Content Guys

A recent article in The New York Times caught my attention because of its obvious parallels to what's going on in radio.  In this case, it's about video game giant, Electronic Arts, an industry leader that is finding the going tough because of innovative new games like Guitar Hero (created by Activision).  It seems that many of EA's games are essentially tired retreads, repeating past successes, rather than innovating for today's video game player. 

That's the way it goes in the ridiculously fast-moving world of media and technology.  One day you're Yahoo! and everyone uses your search tools.  And then you get replaced by upstart Google, and you're on the road to failure.  If it can happen to leaders like EA and Yahoo!, why should we be surprised that a more traditional industry like radio got caught up in the new media maelstrom?

But the interesting thing about EA's dilemma is the way in which CEO John Riccitiello is meeting his company's challenges head-on.  In a recent speech, Riccitiello admitted his company's mistake:  trying to manage a corporate top-down creative process that was fiscally in-line at the obvious expense of the creative content process.  As he noted, "It could certainly make for a great case study at Harvard if it worked, but I just don't think it works."  Later, he admitted to financial analysts that even EA's acquisition of hot new game development companies failed because EA did not allow them to have creative freedom.

So he's going a new route by acquiring two solid studios, BioWare and Pandemic, and allowing them the independence to create great games.  Consider this quote by Riccitiello, and how it might apply to other industries facing a similar plight:

"Frankly, the core of our business, like in any creative business, are the guys and women who are actually making the product... The companies that succeed are those that provide a stage for their best people and let them do what they do best, and it's taken us some time to understand that.  In our business the accountant, the guy in the green eyeshade, is like the guy in the alien movie that eventually gets eaten.  If you let him run your business, it is neither inspiring or effective."

Hopefully, Riccitiello's new path for EA will actually become a Harvard case study, and a way forward for other struggling media companies and industries.

New Tricks

Contrary to what you may read, there's a lot of music being sold these days.  But much of it is not being sold in traditional ways.  As record labels lose their grip on the musicians and bands that used to be their bread and butter, music is being consumed in very non-traditional ways.

Of course, there's iTunes, but consider how much music is now being sold via TV shows.  Or songs that are purchased as a result of playing video games like Guitar Hero or Rock Band.  Or even the way that Radiohead is creating a new model by giving away their album, and letting consumers set the price.

Or the way that Eagles' manager Irving Azoff only offered Long Road Out of Eden at Wal-Mart.  Azoff understood Wal-Mart's great reach, not to mention how many shoppers buy products online.  Like Amazon, it's easy to buy CDs on Wal-Mart's website.  In a recent New York Post article, Azoff was asked what he was thinking when he put together the Wal-Mart deal, considering the chain has no New York City stores.  He mentioned the website sales, of course, but also pointed out that Virgin stores in NYC simply bought copies of Long Road Out Of Eden at Wal-Mart, and marked up the CDs to make their margins.

Again, in a rapidly changing entertainment world, this is more proof that non-traditional models can be effective.  Radio could benefit from these marketing "experiments" whether it's in the way we package, market, and build out advertising models for clients.  The days of simply pointing to a ratings book, and quoting a rate for spots are coming to an end.  Like Azoff proved with the Eagles, using a strong brand to sell products in non-traditional venues can be done.

It takes creativity, a sense of risk, and an understanding of the market.

It's All A Game

The momentum for Guitar Hero and now Rock Band continues to point to the exploding popularity of video games that take the player beyond the typical controller.  With one part air guitar, one part "School of Rock," and another part Reality TV, these games give fans a chance to play along.  So far, Activision reports that Guitar Hero has generated $1 billion in sales... in North America alone.  And beyond that, these games sell music.  Nielsen's SoundScan reports that 11 of the 12 songs featured in Guitar Hero II showed huge sales increases (Cheap Trick's "Surrender" nearly tripled its numbers).  MTV has tracked 2.5 million downloads for Rock Band, while Guitar Hero 3 has broken the 5 million mark.  At a time when there's very little good news in the music business, these games are bucking the trend.

Now Aerosmith is starting a new trend with their own signature version of Guitar Hero, due to be released in June.  It is hard not to imagine similar projects for iconic bands like Zeppelin, the Stones, the Foo Fighters, and the Chili Peppers as the world loves to play along.  And for radio, there continue to be opportunities to socially network this trend into live and local events, contests, and tournaments.  At a time when Rock struggles for attention on the Grammys and in music sales, Guitar Hero and Rock Band represent a hot new wave of activity and interest.  Smart stations will jump on this bandwagon, and take it to another level.

Not Playing Games

In a recent CNNMoney article, Electronic Arts CEO, John Riccitello, outlined some of the lessons he's learned during the past ten years since he took over that mega-gaming empire.  If you didn't know better, you'd think he was talking about radio.

1. Embrace change even if it costs a lot.  Riccitello talks about how the big three TV networks sat back and watched cable eat their lunch.  He claims that even though gaming comprises $31 billion in annual revenue, it needs to re-evaluate its entire architecture:  "In the next five years, we're all going to have to deal with this.  In China, they're giving games away for free.  People who benefit from the current model will need to embrace a new revenue model, or wait for others to disrupt it."  He sounds a lot like Jason Calacanis, explaining to Summit 11 attendees in '06 that it was time for the radio business to "surrender" - and come up with a new model for revenue generation.

2. Don't let detractors define you.  In his world, it involves allowing the media to paint the picture that games are too violent.  In our world, it's the media buying XM and Sirius' PR that broadcast radio is yesterday's entertainment.  As David Rehr pointed out in his "2020" speech, radio has to re-take control of its own message.

3. Admit your mistakes.  We live in a culture where it has somehow become impossible to take credit for bad decisions, whether it was invading Iraq, or in Riccitello's case, coming up with a failed interactive thriller game back in 2001, Majestic.  He realizes that in order to grow, learn, and benefit from the process, he had "to admit my mistake and move on."

4. Put your trust in visionary people.  In spite of Majestic failing, Riccitello hung with creator Neil Young, and it paid off brilliantly when the latter put together EA's Lord of the Rings deal.  He puts faith in game developers (that is, programmers) because he realizes the importance of creative content in the gaming biz.

There's a great deal we can learn from successful people in the media/entertainment space, and Riccitello clearly is someone who truly "gets" it.

Sonic Youth

Leave it to Little Steven to take a major step designed to engage young people to appreciate Rock and its rich history and heritage.  While it's great that video games like Guitar Hero glorify the music, or that TV programs like CSI and half the commercials we see use Rock music as their soundtracks, our friend Steven Van Zandt has a new initiative that you should know about that takes Rock right to America's classrooms.

Steven's plan is to create a 40 chapter course (DVDs, CDs, web) for all of the U.S.'s middle and high schools - at no charge.  The idea is to teach about the roots of Rock, and the course actually has the blessing of The National Association for Music Education.  Working with Scholastic to make sure the course meets all the guidelines, Steven is in the process of enlisting rock journalists and players to participate.

It's interesting that in the midst of a youth crisis for both broadcast and Rock radio, the solutions could come from some unlikely sources - the video game industry through games like Guitar Hero and now Rock Band, as well as initiatives like this one from Steven.  As the struggle continues to keep young Americans interested in both radio and Rock, this is a venture that every Rock radio station should and could support.

As more and more young people in America begin to discover the roots of Rock and its rich heritage, it benefits all of us working inside and on the fringes of the music business.  Steven lives by the Lou Reed credo that his "life was saved by Rock n' Roll."  As he has done during the past several years, he continues to turn the tables and make an important contribution.

Rock on, Little Steven.

Rock On

The video game buzz continues to intensify with the release of Guitar Hero III, and the great news if you're in Rock Radio is that it's all about you.  After all the "Rock Is Dead" articles you've had to explain away to your sales people and your jocks, the gaming industry continues to glorify the music gods that are the epicenter of your format.

But on November 20th, gaming gets a new entrant with the release of Rock Band, where players now control a guitar, mic, and drum kit.  And as an added bonus, the mic doubles as a cow bell, which should make fans everywhere very happy.  And the "set list" for Rock Band (at least the '70s and '80s material") pretty much reads like a meat and potatoes Classic Rock station (see below).  Additionally, the entire Who's Next and Metallica's One album will be downloadable, along with 18 Grateful Dead songs.

Aside from attractive giveaways, a fun activity at station events, and some great morning show bits (please consider a video cam for the studio), Rock Band is another reminder that the genre is - and always will be - fun, participatory, and cool.  Maybe it takes a push from a related industry to remind us how great it is to sit behind a bass drum or strum an electric guitar to some of Rock's biggest anthems.  This is yet another form of listener generated media, where anybody can be a star.

Rock on.  Game on.

P.S.  And in a bizarre and often hilarious tie-in, the folks at Vh1 Classic have the "story" of "Rock Band Band," the Spinal Tap-like foursome who personify this new game.  These are great video segments, and add a lot to the flavor and buzz of "Rock Band."

No, NOT A Blender...

Jacobs Media's Dave Beasing gets his game on in today's post:

Quick quiz:  What brand name gift item has been in the top 3 on Amazon.com's wedding gift registry for the past several weeks?

Give up?  It's the Nintendo Wii videogame system.  Apparently videogames have evolved from a reason couples split up to become something that brings them together.

It's further confirmation of a key finding in the Arbitron/Jacobs Bedroom Project - that videogames are largely a social activity these days.  Many of the young people we visited at home were eager to show us how much fun they have playing videogames with their friends - either in person or in online competition - and they told us they often "talk smack" with their rivals.  One high school senior even said that he and his friends often refer to each other by their on-screen player names.  (I thought to myself, "At least teenagers get to pick their own nicknames now.  That's social progress.")

The Bedroom Project also verified what our friend Steve Schnur at EA Games has been telling us for years, that games are often a "gateway" to discovering other entertainment.  It's Steve's job to decide what sounds - and music - get put on popular games like Madden Football and NBA Live, causing many gamers to then search for more songs by those artists.  If not through James Bond videogames, how else would one of our Bedroomers - a senior at UCLA - have become a Henry Mancini fan?

Just as a whole generation has grown up loving the NFL because of Madden (the videogame, not the play-by-play analyst), Rock music is experiencing a revival that can be directly credited to Guitar Hero.  The third edition was just released with fanfare, and it's still not too late to celebrate.  Clients should check out our handy idea starters on JacobsMedia.com.

Technology changes, but common sense marketing doesn't.  Videogames like Guitar Hero bring people together, and - whenever that happens - there's a golden opportunity.

The Halo Effect

This morning's blog has been guest written by resident video game player/fan, Eric Holmes:

Kanye West and 50 Cent are the two biggest names in music right now and each had their new albums released on the same day Tuesday, September 11th.  Between the two of them, 1.6 million albums were sold in a week.

Linkin Park, arguably the biggest current rock band in the country, has sold a little over 1.6 million copies of their new CD which came out May 15th.

Halo 3 is out for the XBOX 360 today, and is already projected to sell over 3.5 million copies.  That’s 3.5 million copies in ONE DAY.

If you think that's overly optimistic, consider this:  Halo 2 sold 2.38 million on its first day.

Your male audience will be buying this game, talking about this game, and spending countless hours every day playing this game.  (Your female audience will be putting up with their male counterparts.)  As a listener, if your favorite rock station shows interest in one of your favorite past times, you’re going to listen.  Don’t let the opportunity of promotion with Halo 3 slip by.