VIDEO CO-MARKETING GETS GOOD REVIEWS

JOHN KAROLEFSKI

NEW YORK -- Three-partner, account-specific promotions involving stores, home video releases and other packaged goods work well because they enable retailers to brand their stores as different than the competition. That's the opinion of Rick Detterder, senior vice president of marketing services for Mattel Toys, El Segundo, Calif., and Max Goldberg, vice president of promotions for Buena Vista/Walt Disney Home Video, Burbank, Calif. "We can take a video release and turn it into a full-store event as opposed to a departmental event," said Goldberg. "It becomes better for the store and, by extension, for us."

Said Detterder: "To really drive your product to new levels and turn singles into home runs, what you need to do is to focus on the channel of distribution and differentiate your product at retail, also." The executives, whose companies are strategic partners for promotional events for retailers, spoke here at an account-specific co-marketing conference sponsored by International Business Communications, Scarborough, Mass. "One of the things we share is an intense focus on branding," said Detterder. "It starts with product differentiation, and understanding the end consumer. A focus on building product differentiation and delivering that to the consumer." Since the country is overstored, retailers can't grow by simply opening more stores like in the past, he said. So they need to differentiate themselves. "Our sense was that we could be more successful and prosper by becoming a partner in that differentiation." Goldberg said that every major retailer needs to create a brand image for their stores. For example, Disney works with Target the way Target wants to be branded vs. the way Wal-Mart wants to be branded. "We are learning more and more how to work with our customers so that we can develop specific programs for them," he said. "That's particularly important because many of our titles are not going to sell enough units to justify advertising. When that happens, the only way we have to communicate with consumers is [in the store]. Everything goes to retail. There's a higher sales effort." He gave the example of the sequel to the blockbuster "Aladdin" called "Return of Jafar," which bypassed theaters by going direct to video. Disney partnered with Mattel, which holds the license for characters in the films. "We were very concerned about how retailers were going to react to a full-length animated feature film that had never been in theaters," he said. "By tying in to companies like Mattel and allowing a rebate to be on the video, the retailer gets an extra ring at the register. The consumer wins because they get added value, which is the rebate. The retailer wins because they get to build their margins between two items. "Our experience shows us that sales of licensed merchandise of our properties goes up 150% when the home video comes out. Why? Because the home video is a packaged good sold at retail. So we made the experience happen at retail." The partnership also gave the Aladdin license and property new life, according to Goldberg. The movie had already been out for over a year, and the video had been out six months. The new partnership "allowed everybody to participate again in that franchise in a very profitable way," he said. Point-of-purchase displays figure prominently in in-store events, according to Goldberg. Disney's account management team creates custom displays for those retailers that it ships to directly.

What retailers want and can accommodate varies, he said. For example, club stores and some other retailers will take in pallets. Target will not. "If you want to get a good display in Target, you have to come up with a very creative interactive display that's not in pallet form," said Goldberg. Disney started to make "interactive" displays about two years ago, he said. "You just don't walk up and pick up a video box. There are things on there that you can do. For 'Snow White,' there was a mirror that distorted the view. Kids could walk up and be tall or short. There were things you could spin and play with to get them to interact with the display," he said. Size of the displays have been increasing, too, he added. Displays for "Lion King" next month will be three times the size of the displays for "Snow White," which were twice the size of the displays for "Aladdin."

"Each time the displays get bigger, the retailer is happy to accommodate them because it allows a focus [in the store]," said Goldberg.

Mattel's Detterder pointed out that there's a big distinction between promotional partnerships and long-term partnerships. "We want to have big displays built around events, but we also want to have ones that are day-in, day-out," he said. Goldberg said Disney takes part in day-in, day-out account specific promotions on a regular basis with three to five companies, including Duracell and Kodak. "The reason we go to those companies is that they have 100% distribution," he said. "Whether we are concentrated in grocery, drug or mass, it doesn't matter because Duracell and Kodak are in every single one of them." Detterder said scale is the secret of success. "If you have something that's a big event for the retailer, everybody will win. If you can't get there by yourself, it makes sense to partner." Said Goldberg: "You have to be able to work with your accounts on a regular basis. It's a matter of sitting down and planning. When are we going to be in the circular? What kind of position are we going to take in the circular? Are we going to tie in with branding the store? Are we going to come in with Mattel, a great partner of our company, and figure out something we'll do together to create an event at that store? "All of this takes constant planning, and it's always changing. You're always looking over your shoulder to see where the other guy is going," he said. Detterder said, "Both of our companies have set up similar situations where we have account marketing teams that go beyond the sales person relationship. We certainly have traditional sales, but we also have a group that focuses on marketing through the channels. It's by customer and by channel. How do you market to Kmart, to Target and to Venture?"