By Robert Wheatley

New deal sets stage for music biz transformation

Continuing our ongoing celebration of great moments in brand Trailblazing, we take a departure to the world of entertainment where innovation and ideas are combining to form what is likely to be a transformation-generating business model in the music industry: Live Nation Entertainment.

Beverly Hills-based Live Nation this week announces its merger with Ticketmaster to form a new entertainment giant that, we believe, will no less than revolutionize the music and concert business over time.

We all know of the sea change precipitated by the development of Internet platforms that led to the collapse of the record business. For artists this re-shaped the entire model for distributing and monetizing their work. And in the process put new emphasis on performances and touring to fill the revenue gap. Historically, concert promotion has been mostly a regional affair run by entrepreneurs with roots in rock and roll. Throughout the value chain in the music business the principles of brand management and development have been haphazard at best.

Enter Live Nation and its quest to re-invent the business from top to bottom and in the process bring value creation to every aspect of the industry.

Live Nation, America’s premier venue promoter controlling more than 140 venues, has been at work consolidating various parts of the music business. Their strategies could eventually lead to a new form of “packaging” and improved business model for artists that rolls up management, branding, licensing, performing, recording and distribution into a seamless business.

Corporate brand sponsorship opportunities…?

The exciting part of this is the consumer win on the other end, as delivery of the immersive concert experience gets improvements along the way. On a parallel track the strategic moves at work here could offer better opportunities for consumer brand participation in what has to be one of the most important lifestyle connected businesses around – music in all its forms and genres.

Brands increasingly depend on authentic relevance to consumer lifestyle passions as the essential path to their meaning and value. The alignment of all these moving parts in the entertainment world and the better management of them could improve traction for corporate sponsorship of concert tours and venues. Business marketers can get uncomfortable in the murky world of live shows, venues and related promotion. The disciplines applied here to better manage the entire equation may act as a door opener to businesses that can envision benefits but have been reluctant to dive into the pool of involvement with music.

Best example: House of Blues…

Evidence of this more business-like approach can be found in one of Live Nation’s jewels-in-the-crown, their House of Blues club chain, which may be one of the most professionally and competently run entertainment businesses in America. Within the walls of the HOB venues is a well thought out mix of ambiance, experience and VIP treatment options via their Foundation Room clubs.

Live Nation CEO Michael Rapino was quoted on the Ticketmaster deal saying, “This combination will drive measurable benefits to consumers and accelerate the execution of our strategy to build a better artist-to-fan direct distribution model.” What has to be honored here is the vision and long-term possibilities, combined with a measure of intestinal fortitude to see the through. This is going to be fun to watch both on stage and off.