Media and Marketing with Wharton's Jehoshua Eliashberg
The entertainment industry is Jehoshua Eliashberg’s business. At the Wharton School, Eliashberg sheds light on targeted advertising, the wisdom of crowds and the effects of the current economic climate on the film industry. With consideration for the new administration, Eliashberg also makes predictions for biotech, pharma and the adoption of mobile content technologies, or lack thereof.
With the proliferation of media sharing, the nature of information exchange is changing. What are your predictions for how media companies will transform in order to adjust?
There will be more emphasis on buzz marketing. That is, viral marketing campaigns with seeding e-mails sent out to opinion leaders who then forward them to their contacts until many consumers get "infected."
Media companies will get the consumers more involved in creating and testing their campaign materials. The wisdom of crowds will become a key factor in making various strategic decisions.
[There will be] more spending on developing blogs, social networks, opinion sites, video sharing sites, virtual worlds (e.g., Second Life) sites for better access and reach of specific target audiences.
The media industry has increased pressure from advertisers to deliver targeted audiences. This is because of a change in audience viewing patterns resulting from technology advances such as DVR and user-generated content. In your own research, how has this changed the way media companies deliver their campaigns?
Media companies will invest more in research in order to effectively target their audiences.
New performance metrics (e.g., click and buy) will replace traditional ones (e.g., reach and frequency).
I expect to see a significant growth in product placement in movies and TV series as well as more programming being sponsored by advertisers. However, this will have to be done in a subtle manner in order to deliver the message without upsetting the audience.
How will the current economic climate affect the way in which movies are made, financed and distributed?
Less major ("tent poles") movies will be produced and released each year.
More indie (lower budget) movies will be made and (fortunately) find screens to play on.
The process of transforming to digital distribution and exhibition (e.g., digital cinema or 3D) of movies will slow down.
New sources of finance will be used by moviemakers. Less reliance on the investment banking system. Perhaps more on wealthy individuals, depending on the topic and subject matter. Overall, the decision what movies we will all see will be made by larger groups of people.
Are you interested in mobile content distribution, and do you think it will change the way marketers leverage other distribution channels?
I believe that the expectations are too high regarding mobile content distributions. There are at least two major constraints: battery life and screen size. We will see some content (e.g., short animated movies/ads) being distributed. However, given all the many other options and applications available for mobile phone users, I do not see them a major outlet for content distribution.
Lastly I want to ask you about the pharmaceutical industry. The Obama administration enters the White House with promises of healthcare reform. With speculation that Obama will be controlling prices on expensive biotech drugs, regulating direct to consumer advertising and pushing toward generics, what can we expect to see in the next two years?
If the speculations mentioned above do become real, we can expect more consolidation in the pharmaceutical industry and more companies merging and acquiring smaller biotech companies, mainly because of thin pipelines. I also expect to see a shift in how the pharmaceutical industry will develop and execute marketing strategies. The intense competitive landscape will make them look for solutions in other industries such as the consumer packaged goods industry.
Interview by Blake Landau, editor