In mid-December 2013, without any prior fanfare or warning, Beyoncé released her self-titled album through iTunes, skipping the traditional distribution channels. The move led to Kevin Roberts, the CEO of Saatchi & Saatchi, declaring to Bloomberg that "Marketing as we knew it is dead".
While the action took the industry by surprise, was it really a revolutionary game-changer that warranted such a strong statement?
As an industry, we can be so quick to pronounce early demises when something new or different is introduced into the market. Some may remember the claim that the death of television was imminent with the introduction of the Internet, social media and smartphones. Well, that industry prophecy is wrong. The data from Nielsen shows that on average viewers spent per day watching Live TV, DVR playback, video games, and DVD playback at 5 hours and 7 minutes. This trend was essentially flat on a year-on-year basis. There is a drop in live TV consumption with 4 hours and 18 minutes being the lowest for a third quarter for the study period (from Q3-2009 onwards). TV viewing behaviour may be evolving, but it’s certainly not dead.
Let’s get back to Beyoncé.
Many forgot that prior to the release of her latest album, Beyoncé’s exposure was already high due to her 132 “The Mrs. Carter Show World Tour” concerts across Europe, North America, South America and Australasia throughout 2013. She was also featured in Pepsi Max’s “Mirrors” campaign that was launched globally across 70 countries. Her brand in the market was also maintained by singers performing her songs in various high-rating talent shows all around the world. So when the new album was launched, all of the promotion had practically been done and her awareness had essentially been maintained throughout the period.
Her choice to launch the product on iTunes was a savvy business move; however this was not without any fallout. She had to handle the repercussion from the market, as large retailers like Target and Amazon expressed their strong disappointment with Beyoncé’s action to bypass them. In the end, she still needed to partner with Walmart to also distribute her physical albums before Christmas. So this strategy perhaps may be hard to replicate by other artists who have not been as active in maintaining their awareness in the market and have the same “star power” in having easy access to a large distribution network.
Beyoncé’s partnership with iTunes did not show that marketing is dead, but rather, highlighted the key principles that ensure that your brand remains relevant in the market. Professor Byron Sharp lists these two principles in his book: “How Brands Grow”. First of all, brands need to be mentally available among potential consumers. Brands that opt to advertise with short but big intense bursts followed by long silences may suffer when consumers are in the market to purchase during those periods. Consumers may not remember your brand as prominently compared to other brands that continuously advertise at a lower intensity.
The second principle is that brands need to be physically available by having a good distribution strategy. Thus, when consumers see your advertising, remember your brand and are in the market to purchase the product, they can easily access the product. For Beyoncé, digital downloads already cover 40 per cent of the US market – making it easy for her to distribute her album in one single bang, and then supplement it by partnering it with Walmart to cover the physical distribution.
So marketing as we know it is still alive and well. Beyoncé has just provided us with an interesting case study on how to do it differently as the market evolves. It also emphasises the importance of setting business strategies on solid marketing science, and not on opinions that sound intuitively and rationally sensible – without proof.
Arry Tanusondjaja is a research associate at the Ehrenberg-Bass Institute