How is the making of an American Idol like the marketing of a new venture?

May 27, 2008

Allow me to make the bold claim that the two are more alike than you think, and that making the comparison may be useful in fleshing out the principles of good marketing, that is, marketing that works.

So what do we have in Idol:

  1. Many people can sing, and come to auditions and begin the screening process.
  2. Three judges and many others who work for them and help in the screening process make decisions.
  3. Contestants that choose songs and attempt to perform as best they can, thereby creating a unique identity, and a fan base.
  4. A public competition in which the public votes (with potential influences by the judges and the producers behind them).
  5. A winner who gets a recording contract, and usually sells many records.

Can you see the resemblance?

Imagine that the judges and the people behind them are the investment community. Further imagine that the competition is a nice form of market research, in the spirit of listening to the customer, or opinion markets.

See it now?

  1. Many people have good ideas, and some of them with entrepreneurial spirit go and seek funding. They start the screening process.
  2. Angels, VCs, and investment institutions sift through all these, doing their due diligence. They carefully select the few and try to do as much market research as they can to minimize risk.
  3. New ventures work to create a differentiated strategic positioning.
  4. Sometimes, the market research involves actually listening to potential customers.
  5. A venture that gets funded has a chance to go to market.

Quite simple, no?

So what is the genius of Idol that has generated a far greater success rate than that of startup companies? Is it the judges being better than the average investor at predicting success? Is it the people behind them doing better due diligence? Is it easier to predict which artist will do well? Is it easier to go to market with a new musical album? I think you will find the answer to most of these negative. We are therefore left with the real clever trick — one of the best marketing can generate: if you go to market when all your potential customers eagerly await the arrival of your product, you don’rsquo;t really need fancy models to predict demand…

If you could conduct market research in a way that both captures potential demand, and generates expectancy and followers to your product (consider Apple’rsquo;s strategy in pre-announcing the iPhone, for example), than the actual sales process becomes trivial. Ok, so not everyone or every product category fits a TV game show format. Nonetheless, the Internet enables many similar tactics that are very much worth considering. If potential investors harness such tools and conduct interactive market research, they may find themselves dealing with less uncertainty than they are used to. Alternatively, if new ventures can demonstrate expectancy to their potential products, they may find investors knocking at their doors.

I therefore propose that the making of a new American Idol is of the same logic and principles as the making of a new startup. The Idols guys simply do it very well, mostly because thanks to extremely clever marketing they end up preaching to the choir.

Happy to hear your thoughts and comments.


5 Responses to “How is the making of an American Idol like the marketing of a new venture?”

  1. Tej Says:

    I can definitely see a parallel, at least on the internet, where more eyeballs (not necessarily monetized or revenue generating at the time ), immediately attract potential buyouts of popular websites.

  2. Matt Says:

    Great post. I have two observations about American Idol that to me disallow it as a ‘startup’. Like so many successful American television programs, it was adapted from a hit UK program (and had significantly lower risk than an ‘original’ program). In this case it seems less like a startup and more like localization. Secondary to that is American Idol’s *insanely* high production value. These guys aren’t running a lean bootstrapped operation–they’re bleeding cash and have been from the start.

    That said, I do think they market the show extremely well–I love the level of interactivity and the consumer communities that they encourage. We do the same thing marketing online video games. There is some risk in getting customers to invest so heavily in a sub-brand (the individual contestants) that they might lose interest in the master brand (American Idol the program) once the sub-brand is discontinued, but they seem to minimize this risk by offering multiple similar archetypes each season (underdogs, diverse cultural composition, different musical styles, etc). That’s where some of the marketing science comes in, I imagine–segmenting the viewers by taste and affiliation so that the best blend of archetypes can be presented to maximize viewer interest. Throw in a few celebrity endorsements, and you’ve got yourself a hit!

  3. radymarketingon Says:

    Let me argue that a slight shift in perspective would improve the analogy: What a VC, for example, needs to do is exactly what you describe – they should optimize their portfolio based on appropriate segmentation and market needs. The making of the individual performer is then quite similar to the making of a new venture.
    The copy-cat argument about the success in other pleces in the world would be equivalent to saying that the VC model for Internet-related ventures has less risk because is succeeded before. What reduces the risk is not success elsewhere, but rather doing the marketing right.
    As for bleeding money, aren’t many of the investment bodies doing just that?

  4. Forrest Wright Says:

    I like the analogy and think it works best for existing brands. Yes, it’s easy for Apple to create anticipation for the iPhone, just as it is for AI to create anticipation for their winner’s new album. But both of those cases have a built-in audience. They already have people’s attention. The real trick is to be a new product/brand/service and to generate curiosity, interest and demand prior to release. This is the movie trailer phenomenon — piquing interest while leaving enough to be desired that someone still wants to shell out $10 a ticket.

    It would be interesting to look back at how Fox built interest for American Idol prior to the start of its first season. What were the words and images they used to create excitement and what were marcomm mediums they used to spread interest?

  5. radymarketingon Says:

    Again, I agree that Idol was an existing brand, but Underwood, Daughtry, Cook, and most importantly Kelly Clarckson were not! At the end of the day, this is what people buy. You may argue that if Clarckson had not done that well – the rest would not either, but I think you will find Idols that have not done as well on the way to David Cook. The trick is that those that reach the top 3 are very talented. They do create value. My argument was that they essentially create what you call “the built-in audience” by involving potential customers in the marketing process. Essentially, in the design of the new product – the next American Idol. In another analogy, consider the support of the San Deigo business community for the Rady School – it is there because they, in essence, created it! If you involve your customer in the value creation process – they will not only get what they want, they will develop commitment and loyalty to it.

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