Branding

Brands Bank on Live Music's Return: 'They're Sick of Being on the Sidelines'

Megan Thee Stallion
Barry Brecheisen/Getty Images

Megan Thee Stallion performs at Lollapalooza in Grant Park on July 31, 2021 in Chicago.

"Jazz Fest canceled, and it hasn't stopped anyone," says the head of global music and business for one major brand.

Fifteen days before a Notorious B.I.G. tribute concert starring Busta Rhymes, Lil' Kim and others in Brooklyn, New York City changed the rules. Suddenly, music fans at concert venues had to show proof of vaccination -- leading Budweiser, which hosted the show, to scramble to inform the 8,000 RSVPs.

"It just created extra layers and extra work," says Ronnie Yoked, head of experiential at Bud's parent company Anheuser-Busch, "but it was the right thing to do."

After a year and a half of pulling hundreds of millions of dollars out of planned live-event sponsorships during the pandemic, brands like Budweiser, Bacardi, T-Mobile and Toyota have spent much of 2021 rushing back to concerts and festivals in the Vaccine Era. But as the Delta variant has led to evolving health rules and canceled shows, from New Orleans Jazz & Heritage Festival to Foo Fighters at the Forum, corporations have had to be flexible and adapt.

"Brands are trying to be proactive and cautious, but also trying to find the right balance moving initiatives forward," says Rick Faigin, evp of Los Angeles marketing company Acceleration Advisory. "They're constantly monitoring social and press and the discussion around it."

Tour sponsorships accounted for $590 million of top promoter Live Nation's 2019 budget, but the pandemic forced major corporations to abruptly cancel those allocations or shift them to livestreams or digital events like Travis Scott's "Fortnite" concert last year. For a while in 2021, it looked like concerts would roar back, and sponsorships with them, but the variant has created an up-and-down situation where some corporations are enthusiastic and some are tentative.

After withholding their live budgets in 2020 or getting refunds from canceled events, "brands have a lot of money," says Marcie Allen, president of MAC Presents, a New York agency that connects artists with corporations, but "brands are scared of events that are indoors and large events that could be seen as COVID hotspots."

She adds, though: "It's absolutely temporary."

Joe Killian, founder of Killian and Company, which produces events for brands, says major companies still have robust sponsorship budgets and they're spending the money on a combination of live and digital events. One of his clients, American Express, as well as Saks Fifth Avenue, recently sponsored a rescheduled show by R&B singer Kehlani in the Hamptons; not long before that, Ariana Grande's "Fortnite" concert in early August drew millions of viewers. Killian expects those kinds of music experiences to merge into a branding "hybrid," in which festivals working with companies like alcohol-delivery service Drizzly or cooking company Blue Apron to provide home viewers with resources to enjoy a livestream or other digital event.

"I don't think you see brands shying away from partnerships or sponsorships, but they may be slightly different," he says. "Technology drove us forward three to five years in a couple of months [during the pandemic] as brands adapted to this new reality."

Many companies, and live promoters, say brands are plunging back into concerts as quickly as tickets can go on sale. Despite early concerns that Lollapalooza might turn into a super-spreader event, the festival ended on a hopeful note -- the vaccine requirements were more or less effective, according to Chicago officials, and just 204 attendees tested positive for COVID, despite overall attendance of 385,000 in July. That made brands worry less about being associated with super-spreader events.

"Jazz Fest canceled, and it hasn't stopped anyone," says Missy Worth, head of global music and business for Bacardi, which has sponsored festivals including Lollapalooza and Outside Lands. "Did it make some lawyers maybe ask a couple of extra questions? Maybe. But no one took that and went, 'OK, let's all panic.'"

Live Nation has signed up dozens of sponsors for its upcoming shows, including 11 sold-out festivals since Lollapalooza. Although some brands are "holding those budgets" for 2022 events, according to Russell Wallach, Live Nation's global president of media and sponsorship, the top promoter has sold out 11 festivals since Lollapalooza, all of which were festooned with brands.

"Ninety percent of our partners have stuck with us through the pandemic. Will there be blips along the way? I can't predict everything," he says. "But brands are interested in being involved with sponsorships and marketing programs where there's an audience."

"Brands are sick of being on the sidelines," adds Matt Ferrigno, co-founder of marketing agency MTW. "They want to be where the consumer is."