NUE Agency's Jesse Kirshbaum on Brands' Evolving Relationship with the Music Industry In conversation with CAD Management CEO Clayton Durant, NUE Agency's CEO Jesse Kirshbaum discusses why brands need a chief music officer, and how the music industry can better communicate its value to advertisers and brands
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Jesse Kirshbaum has a theory: brands in today's congested marketing environment will need to double down on their music marketing efforts to break through the noise.
The CEO of NUE Agency's theory has real merit. Breaking down the advertising landscape today, marketing experts estimate that consumers globally are exposed to around 4,000 to 10,000 advertisements each day. Couple that with the fact that music consumption is exploding globally, as noted in IFPI's Global Music Report 2019, which found that the global recorded music market grew by 9.7 per cent in 2018 — the fourth consecutive year of growth.
Although the data clearly shows that brands can leverage music to connect to audiences globally, the difficulty comes when marketing executives have to navigate a landscape where cultural relevance and authenticity drive the campaign's success. This is where Kirshbaum and his team of four spend their days in the trenches with brands, identifying the right music partners and cultural moments to elevate a brand's presence in a crowded marketplace. His early entry into this space and commitment to helping brands authentically tap into musical culture has allowed NUE Agency to not only become one of Inc's 5,000 fastest growing media and technology companies but has helped the organisation accumulate an impressive brand roster that includes Nike, 1800 Tequila, Spotify, and more.
I got a chance to sit down with Kirshbaum in his midtown Manhattan office, where we talked about his entry into the music business, why he shifted NUE from a talent agency to an experiential marketing agency, and why he thinks companies will soon need a Chief Music Officer to keep their products and services relevant in today's consumer landscape.
In pic: NUE Agency's CEO Jesse Kirshbaum
You started your career on the agency side, representing some of the biggest and most relevant artists of our time — Clipse, Pusha T, J. Cole, Big Sean, Mike Posner, Wale, Action Bronson, Solange, and many more. How did you make the move to the brand side?
At the very beginning of my career, a family friend advised me that being an agent was the best way to gain experience and learn multiple facets of the business. It's a fast-paced game that taught me how to "eat what you kill." As a business owner and entrepreneur by nature, I was able to earn instant revenue without needing to raise upfront capital. Plus, as an agent, you meet all the people in the live performance side of the ecosystem and discover how to build and break artists by touching their fans.
Initially, when I got into the industry, recorded music was going down the drain. It was the live business that was keeping everything afloat. Those dynamics keep shifting, but because I got traction early — I signed The Clipse when I was 22 and Nue Agency launched in November 2007 — I've been able to shift with them. One of the main reasons these artists were interested in working with us was because we saw talent in them first and were able to bring value immediately. The main differentiator was that we focused on areas that the majors didn't at the time: the college market and the tech sector. We were finding a lot of our talent in the college market and touring artists there, too. Some of the artists we signed were not even on labels yet — or, in many instances, committed to managers. Some of the acts were even so young that they were still in college. So we were not only instrumental in getting their live careers off the ground, we were the first line of defense for all of the deals and inquiries coming in. We were able to build relationships with a lot of brands and tech companies looking to leverage these artists for various events, activations, and campaigns. In a way, we became "tech whisperers" for our artists. The companies liked the way we took interest and were passionate about their visions. We weren't just beating them up for the biggest paycheck possible. We saw what they saw and made a bet that tech platforms could be a great savior for the music business.
Eventually, we started to get asked by brands like Spotify to consult for them beyond the scope of booking our talent. They wanted our expertise when it came to how to break into the college market or create lifestyle marketing strategies for them. That was exciting. That was the moment we realised we needed to change things up. Representing artists is a 24*7 job with no days off. We had brokered so many concert deals and stayed up all hours managing these live careers that I had to stabilize my mental and physical well-being so I could be here for the long run. We decided to do a rebrand from a talent agency to a new wave culture marketing agency. We brought in our friends at Red Antler to orchestrate a proper rebrand and began to envision the next chapter. Because of our experience and workload, we were nimble and could handle the volume. It was honestly an easy pivot.
One of your most successful brand campaigns that NUE developed was Sour Patch's The Patch Houses, which created a lodging opportunity for touring artists around major cities. Can you walk us through how the idea came to be and the impact a partnership like this had for the brand?
Sour Patch Kids came knocking at an opportune time: when we were rebranding Nue. I was already known as a person who could make crazy ideas come to life in the artist and branding space, and one day I got a call from one of the most respected marketers in the brand world, Bonin Bough, who was at Mondelez at the time. Bonin and I had worked together for many years and he was excited to tell me about his next big idea. By coincidence, on a long international flight, he had met an artist that Nue represented. The two of them got to scribbling on cocktail napkins and hashed out a plan for Sour Patch Kids to impact the music business. We brought in a team to execute, starting with the takeover of a brownstone in Brooklyn where emerging artists would spend the night when on the road. The concept was based around supporting this pain point for emerging artists while igniting a huge, organic, content generator and allowing Sour Patch Kids to embed themselves in the lifestyle space. It was a lot of work getting the program off the ground and earning the industry's trust to work with a candy brand in such an intimate way. I mean, it doesn't get more intimate than housing. In four years, the program hosted over 300 artists and became one of the most buzzed-about programs of the decade. Not only did Sour Patch Kids earn hundreds of millions of impressions over the course of the program, but it also became the number-one selling candy in its category and the people's champ among artists and fans.
You are releasing your first book, Beats, Bytes & Brands: Lessons Every Brand Can Learn from Musicians in the Digital Age, in March 2020. What are some of the key findings that you hope music, marketing, and brand executives can take away from the book?
In 2019, every brand needs to think like an artist and every artist needs to think like a brand. I live at the intersection of music, big business, and tech. This book is my life story wrapped in key lessons that everyone can learn from artists. Whether you're a Fortune 100 CMO, a startup, a mom & pop or the most common type of this day and age, a personal brand, you need to think more like a musician. The book also breaks down the history of brands and artists from the Rolling Stones to Post Malone. The first real brand deal was the Rolling Stones and over time the dynamics have shifted. A co-sign from a major brand was once viewed as selling out but is now perceived as a badge of legitimacy.
One of the most interesting projects you helped develop was the CRWN music series with Elliott Wilson for Tidal. How has the series grown, and where do you see it going in the future?
One day during a festival in Martha's Vineyard that we helped launch for Neon Gold Records, I walked into a diner and saw Elliott Wilson and his wife Danyel. Elliott and I only knew each other in passing but I joined their table and we quickly built a rapport. He started hitting me up about collaborating and we landed on an idea to try an interview experience at SXSW with Kendrick Lamar. Elliott was a very credible journalist in the magazine world but began reinventing himself for the digital age. We named the show #CRWN. Essentially, it's a long-form interview show that feels like a cover story come to life. It's designed to elevate an artist when they're at their most hot and relevant.
Our first interview was with Tyler, The Creator about six years ago.. We had to tape at midnight as that was the only risk [the venue we filmed at] would take, but that wound up making the fan experience more cool and cult-like. Mountain Dew sponsored the first one to help us cover our production costs and we premiered Tyler's new videos. Since Tyler, we have done every artist from Drake to Jennifer Lopez and most of these artists contacted us to appear.
Elliott is such an incredible interviewer. He really goes to school on these superstars each time. Doing these tapings in front of a live audience comprised of the artists' die-hard fans, select tastemakers, hip-hop nerds, and culture heads allows the talent the time and space to really tell their story. This has helped make CRWN a staple in culture. I see it getting written into more and more release plans. It's a right of passage now, like an Inside the Actors Studio with a new-school twist.
Sports sponsorships rack in close to $60 billion a year while music sponsorships sit close to $1.5 billion a year. Why is there such a disparity in spending, and how can the music business better communicate its value to advertisers?
This is the big arbitrage opportunity right now in my opinion. There is so much more money being spent on sports than in music, but musicians dominate in relevance on social media platforms. Artists like Drake can sell out basketball arenas night in and night out. Frankly, he's worth more tickets than the entire NBA combined. The biggest reason is the lack of a central hub or marketplace for these types of deals. Music deals look more like an endless stream of one-offs right now. On top of that, it's confusing to get these deals done because there are so many stakeholders; you've got labels, agencies, managers, artists themselves, publishing companies, and DSPs. How does a brand maneuver to get these deals done efficiently?
Especially since the sentiment around influencers is fading and voice commerce is growing, the big question now is, "What does your brand sound like?" How do you properly align with an artist and integrate with their fan base? Things need to change and brands need to take better precautions. Bringing in a chief music officer at every brand makes a lot of sense. There is a big opportunity for savvy brand managers looking to make an impact on culture to capitalize on both the indie and major label businesses. In the interim, brands can hire a firm like ours to help them navigate the industry and find opportunities for their brand to more deeply align with music, both as an overarching strategy and on a case-by-case level. Playing in the music space often requires a brand to move "at the speed of culture," so it's good to have a multi-tiered approach.
What are a few music and brand trends you are seeing that CMOs should be aware of the back half of 2019 into 2020?
I think this period will be dedicated to a few core themes. One will be the end of the decade. There will be a lot of focus on recaps. What do you even call this era? I've heard it referred to as "the end of the genre." I like that but it's nowhere near as snappy as Y2K or The '90s. Nostalgia is an incredibly powerful marketing tool.
The other key theme in America will be election rhetoric. The stakes are high and everything from the economy, to globalization, to environmental issues, to human rights, to social justice will shape trends through 2020.
Another important consideration will be thinking globally but acting locally. Fake news is going to be a massive disruptor and become more pervasive. There is so much content, but so little of it connects. So the power is really in the artists' hands. Who they grant interviews to and what platforms they run with will be important.
On top of that, artists are going to cut more deals to own their masters. I think artist ownership, whether it be their festival brand, their merch, or their masters, is the future of music. Even artists owning their own data and fan relationships is becoming increasingly important. It's leading to a rise in revenue for the middle class, working artists. It's a great time to be an artist in this industry, especially one that understands the power of brand marketing.
Truthfully, the industry as a whole is moving towards B2C. The labels of the past did not have direct relationships with their consumers. and have struggled to communicate directly with fans. This has to change, and I think the labels and artists know it. Social media is helping everyone understand their fans better but the next step will be communicating directly with consumers via text, email, and other fan experiences.
I think we are also seeing live streaming events and concerts really working. People are tuning in and connecting via socials instead of in real life. We will continue to see more experiences like that. Coachella traffic online is a lot easier to deal with than Coachella traffic back to Airbnb.
Lastly, I want to highlight the rise of phygital (physical + digital). In the early days of the social media boom, people would utilize digital media to amplify their events. But as social media becomes more prevalent and the quest for likes continues to be a way of life, more and more companies are doing the reverse: creating events that amplify the digital. It's a total dynamic shift. A couple of close colleagues and I want to kill the term "experiential" since it doesn't really encompass the science of a well-orchestrated physical and digital event. There is a lot of room for innovation here and a lot more "Museum of Ice Cream" clones in the works.