2021 is Changing Our Understanding of Entertainment
At Wednesday's CES 2021 panel entitled, "Entertainment Transformed", Ann Sarnoff, Chair and CEO-WarnerMedia Studios and Networks Group spoke about her studio's recent controversial decision to release films concurrently in movie theaters and, in North America, on HBO Max, where they will be available for 31 days.
This day-and-date strategy affects such highly anticipated films as The Suicide Squad and The Matrix 4, and on December 25, 2020, Warner Bros. released its blockbuster Wonder Woman 1984 both theatrically in the U.S. and Canada and also on HBO Max via premium video-on-demand.
The first woman to run Warner Bros., Sarnoff cited the need to make content available where fans can enjoy it, and that they're certainly not calling their new policy, "the death of the theater industry." With day-and-date on HBO Max, Warner is adjusting to the environment we're currently living in. With 60% of theaters currently closed, Sarnoff said that the studio must find other platforms for its films.
Warner Bros. released director Christopher Nolan's film Tenet in theaters in August 2020, during the height of the pandemic, and it has made over $360 million at the box office. Sarnoff described how hard it is to launch a new film when theaters in some cities are closed while those in other cities are open.
Sarnoff addressed questions by panel moderator Michael Kassan, Chairman and CEO of MediaLink, about new platforms and shifting consumer behaviors. Sarnoff replied that Warner's focus was on franchises and Intellectual Property (IP) content. She said that the key to the process was working closely with creators. During the pandemic, Warner Bros. came up with the idea of a 24-hour "super event" for DC Universe fans, which connected them with both the actors and the creators. The event brought about over 22 million fan interactions.
Sarnoff said she thought her biggest accomplishment since taking up her position a year ago was bringing the various divisions of Warner Bros. together, what Sarnoff called "breaking silos." She said her unique background enabled her to build bridges, be a collaborator, and work "across the aisle."
Sarnoff said that when we collaborate, the whole becomes greater than the sum of its parts. She advised that especially women and people of color must first "get a seat at the table" in order to be able to make a difference.
"Instant gratification isn't quick enough"
When Kassan cited what he called "the mantra of the entertainment business," that instant gratification isn't soon enough, Sarnoff replied that using the opening weekend box office metric to predict the success of a film no longer works. The movie Joker opened to a tepid $60 million yet went to do a billion dollars worth of business.
Today, it's all about the number of eyeballs seeing content, and things such as the cost of acquisition and the amount churn must be taken into consideration when computing that number of eyeballs. Churn describes subscribers switching from one streaming service to another.
Content creators are vitally concerned with knowing how many people are viewing their creations, and Sarnoff described the need for a more performance-driven, subscriber-driven marketing strategy for films.
Sports marketing, shoes, and vehicles
Additional members of the panel included Deborah Wahl, Global Chief Marketing Officer-General Motors, Maverick Carter, CEO-The SpringHill Company, and Adrienne Lofton, Vice President of North America Marketing-NIKE.
Wahl described the pivot GM made during the pandemic when they started to build ventilators. She also described the need to get closer to the consumer, and Lofton discussed Nike's desire to move to 100% digital and to connect with their customers. She focused on the "experience" Nike brings to consumers, and how a mantra at Nike is "always do the right thing."
What are consumers turning to for entertainment during COVID?
The panel members responded to Kassan's question that people still love watching sports, and Carter cited the sacrifice NBA players made when they entered the NBA bubble. Panel members also said that the job of the advertiser and marketer is changing — from selling things to engaging and entertaining consumers. By telling amazing stories, consumers will stay connected to their brands.
The panel members agreed that the COVID pandemic has sped up their digital sales, and they cited the need to connect, engage and entertain consumers. Lofton said that content has to say who you are as a brand, and that at the end of the day, the consumer wants content when and where they want it, even in real time.
Wahl described how GM used to debut new vehicles with a reveal during a presentation. With the October 2020 launch of GM's all-electric Hummer, they did it in an entertaining way that included technologists discussing the car's battery system and electric vehicles in general, and that people were engaged in an entirely new way.
It's clear that the COVID pandemic sped up processes that were already at work within the business spaces of the panel members. It's also clear that with Kassan, Sarnoff, Loftin, Wahl, and Carter at the helms of their respective companies, we can expect to see new and carefully constructed strategies that put the consumer squarely in the forefront.