Industry Profile: Jay Durgan
By Larry LeBlanc (CelebrityAccess MediaWire)
This week In the Hot Seat with Larry LeBlanc: Jay Durgan, chief content & marketing officer, MEDIAmobz.
Jay Durgan may always be considered an international music marketing maestro.
For three decades, Durgan—one of the most brilliant music marketing strategists of our time—dazzled the music industry by overseeing with his teams the international music marketing that led to Michael Bublé, Josh Groban, Janet Jackson, Bryan Adams, Soundgarden, Suzanne Vega, Bon Jovi, Boyz II Men, Sheryl Crow, Hanson, Sting, Tonic, Linkin Park, and countless others achieving soaring worldwide sales.
He and his teams also insured that Stevie Wonder, R.E.M., Madonna, Enya, the Coors, Seal, and Phil Collins broke all-existing international album sales projections.
Before Warner Music Group tapped him to be its London-based senior VP of business development and strategic partnerships in 2007 in order to spearhead the company's global strategies (excluding the U.S.) in the digital world, Durgan had served as WMI’s head of global marketing between 2000 and 2004.
Previously, Durgan had worked as senior VP international at both Universal Music Group (1998-1999); and at PolyGram Holding (1996-98), Inc. As well, he held senior international positions at PolyGram, and previously at A&M Records from 1985-1996.
Today, Durgan is a member of the board of directors to Outhink Media, Inc. in San Mateo, California, and heads up business development for the Outhink portfolio company, MEDIAmobz that seeks to fill a growing gap between companies’ demand for multimedia content and resources needed to create that content.
Clients are able to produce quality multimedia and video on MEDIAmobz’ cloud-based platform; and they are provided with a global network of producers focused on saving time, money and accelerating projects from concept to market.
Among the clients that have entrusted their multimedia needs to MEDIAmobz platform's tools and creative network have been Cisco, Business Wire, LG Electronics, and Clorox.
You are now undertaking informational meetings with music companies to better understand their concerns in dealing with the digital world. Does what MEDIAmobz do apply to the music industry?
That is my belief. There was a day that when you had a new proposition, you could hire a department; fund them; staff them; and you would have the financial wherewithal to give it a go for a year or two years, whether or not it shook out.
In this day and age, when margins are being crushed, and revenues are going down, the ability to place bets on certain types of content is difficult, and it would seem potentially impossible. So with MEDIAmobz that I am involved with, and have been for the past 18 months, I have been interfacing and working with enterprise—which is Fortune 1000 to 10,000 (companies)—and with advertising agencies who, for different reasons, are having their own pressures.
The broad stroke question that I ask that opens up the conversation is, “Are your current multimedia demands greater than your resources?” Overwhelmingly, these enterprise companies say, “Absolutely. That not only is the demand greater than the pie, we then face ‘surges’ where we need to create multimedia content for the fourth quarter or for a trade show.”
Because they have this very erratic demand, it is very hard to cost justify bringing on a department to meet it. What I am finding with the clients now using MEDIAmobz tools, or who are in talks about using our tools, is that this simple question resonates. They are seeing that they can basically, by order of magnitude, increase the productivity of their existing small staffs by using our tools, and availing themselves of our platform.
You are now seeking to have the music industry use MEDIAmobz tools?
I have been really been focused on non-entertainment here, but having come from there (the music industry), and now starting to find traction in the enterprise (companies) and in the advertising world—I just had this momentary period when I was able to pick my head up from the desk and say, “I have a hypothesis that what I am offering here could possibly be useful to my old industry.”
As the record industry continues to contract, labels often do not have the resources to provide multimedia content. So the same template is there.
Well, it is. I am doing some informational interviews with certain (music industry) executives, asking, “Are your multimedia demands greater than your resources or your ability to provide that content? If it is, what options are you looking at to remedy that?”
Then I will ask some more questions with a view of trying to understand if MEDIAmobz could augment that process of creating content—not creating records or albums, but the marketing collateral. Or if they are doing something in multi-media—if it’s a series of liner notes that instead of PDF; it could possibly be a video, for example. These are things that we are finding—and our clients in the enterprise (companies) are finding.
We are bringing down costs (for clients) by as much as 40%. We are accelerating their time to market by times-savings of up to 60%. It is basically making that very small, internal resource charged with the responsibility of creating content like little super people. They (clients) are getting the mechanical arms to lift more than their body weight.
With spiraling sales, labels will have to further restructure their businesses over the next five years.
It’ll be, “Well, what outcome do we want?” Certainly, they can say, “Well, we want to survive.” Record companies, specifically, have core assets. They have their masters. How are these masters being used? Well, they are being sold on iTunes, and they have a TV or motion picture company licensing them for soundtracks etc. Is there the opportunity to reverse that? Rather than licensing out their product, is there a way they can bring in more content that would turn the tables as it were? This is a conceptual question. I don’t know if it can be cost justified. I think that they are going to have to restructure themselves, but they are going to have to restructure themselves for a different type of business.
Digital potentially offers better margins than physical formats. There will still be substantial costs to bringing music to market, but digital sales means eliminating the high cost of in-store marketing as well as the costs of manufacturing, storing and distributing physical product.
I absolutely agree. I believe that digital offers a great margin opportunity. The thing of it is there are so few services outside of iTunes and Spotify. What is the opportunity to really experiment and scale? They (labels) are sort of sitting there in this no-man’s land thinking, “I could do this. I would have to invest that; and, yes, my margins would be much greater after I sell X number.” Then they kind of fall after they say, “After I sell that number.” They are sitting there thinking, “Can I sell that number?” to quickly recoup their initial investment. I am not saying that is a good mentality, but that exists.
[Digital music revenues are expected rise about 7% globally to $6.3 billion according to a new study by the research firm Gartner. But revenues from declining CD sales are not expected to make up for the rise in digital revenue led by iTunes and the growing momentum of digital streaming services like Spotify, and Pandora.
By 2015, Gartner forecasts digital music sales to hit $7.7 billion from $5.9 billion in 2010. In the same period, consumer spending on CDs and other physical music is predicted to drop to $10 billion from $15 billion.
"The music industry was the first media sector to feel the full impact of two major forces—the Internet and technology-empowered consumers," said Gartner analyst Mark McGuire in the report. "It has staggered through the first decade of the 21st century, and entered the second bedraggled financially and facing a powerful set of intermediaries, which are creating borderless global ecosystems that defy the industry's previous notions of control and monetization."]
Labels and music publishers are excited over the potential revenue to be derived from mobile music and video applications.
Through Warners I had involvement with video, and post-Warners I had some involvement with some mobile apps that I had invested in and did okay with. It’s surprising to me now how well (mobile) is now doing in the United States. When I started drifting away (from the music industry), America had all of the ideas, but the really great (mobile) implementations were going on outside of the United States. Now I am finding, or so it seems, that there are a lot of great implementations, progress and traction here in the United States with respect to mobile; especially, with something that is important to me, video—video advertising, premium content etc. I find it all rather interesting.
At what juncture did you leave the music business?
I left it properly in 2007, although between 2004 and 2007 I was overseeing digital development at Warner Music Group. So, in that period, I was not in what was my historic involvement in the music industry that spanned a good few years. My hands’ on—working on development with artists and managers—probably ceased in the middle of 2004 when I went into the digital field. It was something that I very much welcomed, and looked at as a new challenge, but also an opportunity, frankly, to retrain myself beyond the music industry, which statistically was shrinking. It was going to shrink (more). And I understand, even though I don’t keep absolute track of it, is continuing to shrink.
[In 2004, Warner Music's international division went through its biggest upheaval since its creation in 1971. Central to the new structure was beefing up WMI's global marketing department and Warner Music U.K.'s international marketing department. Durgan, then senior VP of marketing, was named senior VP of business development and strategic partnerships, and would play a crucial role.]
Labels seemed poorly prepared for the technological revolution.
We were really side-swiped—taken by surprise. There were those people in the companies that would talk about it, but they did not have a large enough bully pulpit or platform. They were the kids in the basement. Roger Ames (chief executive officer of Warner Music Group) did get it. As we were transitioning, as iTunes was coming up, and as Vodafone and T-Mobile were pressing to exercise their mobile footprint, Roger really did take a lead.
Then (in 2004) Edgar (Edgar Bronfman, Jr.) acquired the Warner Music Group and he really did take it to an entirely different level. It was probably timing. Roger was a great leader; but Edgar came in, and he said, “I no longer want digital to be part of marketing”—which it was. It reported to me. He said, “I now want this to be a standalone unit because our very future will depend on this. So, therefore, we need to develop people, and best practices that will maximize our digital opportunities on behalf of our artists.”
So I really do credit Edgar with having the vision and, basically, putting his money where his mouth was in respect to making sure that his company was as best prepared as it could possibly be (in the digital world).
[Edgar Bronfman, Jr. helped to transform WMG by rapidly growing the company's digital music sales, and by diversifying its revenue streams through expansion into growing areas of the music business. Despite a significant music industry decline following the period he took control of the company, WMG produced double-digit growth in its digital business, increased its market share, and delivered stable revenue performance.]
Still, Warners and other companies had to play catch up.
Yeah, we were reeling and no matter how quickly Edgar re-arranged all of that there were still these reverberations. Not only as far as Napster, but with all of the rapid negotiations that one had to do with mobile carriers, fixed line carriers—and, at the time, without a lot of benchmarks. Trying to understand what was real or what wasn’t real. It was a very turbulent time. Is it more or less turbulent today? I really don’t monitor it carefully but, I would imagine that it still must be very turbulent.
Labels got a degree of stability with the emergence of iTunes, and now Spotify.
They are quality offers—quality, reliable, great-looking end-to-end offers, especially in the case of iTunes where you have wonderful devices that you can play your music on. It’s a wonderful server. Quality will hopefully win out at the end of the day.
Could there have been other competitive quality services for music?
Possibly. Could I name them? Probably not. I do look at it back then, and I do have to say to a certain extent—and I was there, and I participated in it, and I’m not going to run away from it—but I think that we (labels) focused so much on grabbing upfront money that we basically choked off the services’ ability to then market themselves; to better develop their technology; to make a better offer that made a better experience for the end user.
There were shortsighted maneuvers that were made by the music industry that probably curtailed or, maybe, didn’t give that one service the best chance that it might have had, if we had been a bit more co-operative, and had nurtured them a little bit. But everybody was then claiming that they were going to be the next big service to distribute music. Trying to pick the runners, and the winners (was difficult). The thing that I have always found curious was that all of the record labels— their business development departments—seemed to think that they would be able to individually, and without anyone else seeing it, discover the next big thing. Historical evidence shows that is not possible.
Label executives were then wary of building another MTV on their backs.
Yes, that (attitude) was there. I do believe that. That’s an interesting topic. The music industry would have nobody but themselves to blame for MTV’s prominence. MTV was just smarter. They did a better deal. You (as a label) may begrudge that; it may not feel good; but, at the end of the day if you honestly look into the mirror, they were simply smarter.
And the labels greatly benefited from MTV.
Yes, I would say that. So, to have sour grapes with it is just not facing the reality. Equally, that was probably the wrong attitude (with the service providers).
By 2004, there was the start of a legal framework for digital music, but there was no multiplatform delivery of music or interoperability at that point.
There were just so many worlds that were colliding, and crashing into one another. And in those different worlds, the people that walked in them spoke different languages.
We were meshing all of these industries, whether it was mobile communications or internet communications; and the music industry was attempting to engage; trying to hire people that they thought would give them an edge. They would bring people in from a telecommunications company who did have a really good insight into mobile communication. Or mobile network operators were hiring digital people out of the music industry; not realizing that, maybe, they had been in that industry for only two or three years, and didn’t really understand its inner workings. They thought, “If we reach into the music industry, here’s someone who understands technology, and who has been in the music industry for three years; gosh they are going to be incredibly valuable to us because they can provide us insight.”
There was a lot of that at the time.
It was very interesting to watch. Kind of a Lazy Susan of personnel moving between content and technology. And a lot of the miscues that were occurring came from thinking, “If we grab that person, that’s going to be the answer for us,” only to realize that "yeah, they could give us their insights," but it was difficult to interpret for their new employer what the next step should be.
There is this thing called Moore's law in the technology industry that is about every 18 months everything changes. So when you are interfacing the music industry, and with technology located in environments where Moore's law applies—that is every 18 months things change—and then you look at the world of music. I’m still finding there’s resistance. There are still anchors to the past, which I understand. But if you have one industry that is not rapidly evolving, and you have another one that is being subjected to a wholesale change every 18 months, it is going to be difficult to navigate those two worlds.
It must be maddening running a record company today, dealing with both the technology and entertainment cultures while facing spiraling physical sales.
I have to say that I haven’t paid attention to it. But, every once in awhile, I do kind of pick my head up, and ask myself, “God, what must it be like?” In the old days, I kind of knew where the levers were. You knew when you’d spend. You knew what you needed to do because there was a very old, and familiar car. As long as you took care of it properly, and minded your Ps and Qs; you could pretty much guarantee yourself a level of success—assuming that the artist was delivering the goods, and was willing to get out on their bicycle, and work on behalf of the project.
I look at today, and I just go, Wow. How do you even start (to launch an act)? What are you going to budget? What is the video? How much are you going to pay for the video? Do you do a video? Sometimes (in the past), you weren’t going to do this that or that, but you would come up with a game plan, and assign a budget. I look out over the digital music landscape today, and I just go, “Wow. This must be very interesting territory to transverse." I don’t even think that with all of my experience that I had, I don’t think that it is any longer applicable to it.
While American acts like Lady Gaga, Madonna, Metallica, Beyoncé, the Black Eyed Peas, and Jay-Z continue to connect with fans in territories around the world, the global appeal of American acts overall has been slipping for over a decade.
That’s fascinating, but that certainly doesn’t surprise me. The trends, and the percentages between domestic and international repertoire was pretty much (traditional) dominated by U.S. artists in those (international) countries. There was Spain, Italy, the United Kingdom, Japan, China, and Korea where the local artists carried the day. And to hear that they are biting even further into the international repertoire, I guess that is still dominated by U.S. artists, is fascinating.
[Since the ‘50s, the global music industry has relied heavily on exports of English-language acts, primarily from the United States. This has been due to the growth of media embracing American values, and cultures internationally; the popularity of English-language repertoire; and such American-based genres as rock, blues, and jazz transcending international boundaries.
But there has been a shift in global sales patterns in recent years.
Though the music industry globally continues to rely heavily on exports from the U.S., the top sellers in many countries today are increasing recordings released by homegrown acts.
Sales began to shift more than a decade ago.
In 2000, an estimated 68% of worldwide sales derived from local repertoire — artists working in their native country, according to the International Federation of the Phonographic Industry (IFPI).
By 2007, domestic acts had greatly increased their share in 19 of the 39 markets surveyed, according to IFPI statistics, with four staying the same. In the previous five years, domestic repertoire had gained market share in 22 of the 42 markets for which numbers are available, with two unchanged.
The trend has continued.
The decline stems partially that genres that have fed the American market for the past decade—including rap, hip hop and country music—do not tend to travel well overseas.]
Before the launch of numerous MTV-branded native-language music channels around the world, international territories were hard to conquer for American artists. With MTV, American artists could more easily reach different markets.
At the period when MTV went international, the period where it gained prominence—whether in Europe or Brazil—it was certainly a great thin edge of the wedge. It was a way to go out and test the waters. It was very helpful. It provided advantage; and there was, obviously, this period when video really drove a lot (of sales); when MTV’s programming was 100% video which is no longer the case on the main MTV channel.
With that advantage, l had the ability to take an artist from Los Angeles or Huntsville, Alabama and be able to make them known or to introduce them to a very susceptible international audience through the MTV channel. But that artist would still need to get out on their bike and compete. There was only so much that MTV could do.
Overall, they did have the ability to define and make an artist based on a video or two videos. They could do that, they had that power. But that was, I would say 20% (of the artists) and MTV was huge. There was still this 80% (of artists) that benefited from MTV, but they had to add the extra layers. They had to put their backs into the local markets.
An artist had to be prepared to relentlessly tour abroad.
I was blessed to work with someone like Bryan Adams. That man got on his bike. He certainly hit with a lot of videos, but he has an incredible work ethic. Sting also has an incredible work ethic. The list would go on of artists who benefited from MTV but they also knew that there would be a local artist who would be down at the local MTV station, giving the interview that would be broadcast in favor of something that had been put in the can in Los Angeles, and sent over to MTV Brazil. Just like politics. All politics are local. All music is local. That doesn’t mean local in respect to the language. It means that if you are in peoples’ line of vision whether through radio, print, television etc. you are making yourself visible to the people who are in that city or country at that point in time.
While you were at A&M and then at Polygram, Janet Jackson, Bryan Adams, and Bon Jovi broke out internationally under your direction. Did you figure out that there were international sales that the companies were missing?
In the environment that I worked at both A&M and then at Polygram overall—the companies within the Polygram umbrella—it was a tripartite conversation that would involve—first and foremost—the artist and the manager; but then there would also be the domestic company; and the international company. In the case of A&M, I would represent the international interests of the company, and our affiliates outside of the United States. I would go to them and provide empirical evidence, rationales and reasons why we needed to work at a certain time in certain parts of the world (with an artist).
The simple proposition, and the question that I would ask was, “Is it not incumbent upon us to make sure that at the end of this project for artist ‘A’ that the pie is as big as it can possibly be? If we can agree on that outcome, then we need to simply work backwards to understand how we achieve that outcome.”
Multinational affiliates in those days resembled little fiefdoms.
And I would agree with that. I would also say that—not meaning to be disrespectful—but I do kind of hold myself out in the global music industry as one of the cutting-edge people. Because of my personality, I wouldn’t accept second-best. I would pose questions like, “What outcome do we wish to achieve?” I would go in armed previous histories of sales etc. and be able to make (the case) that certainly won the day. I would make a good argument in favor of the game plan that would incorporate international in the overall fabric of the project.
So, yes you are correct that there were a lot of fiefdoms, and there was a lot of, “Well, let’s break it in America and then the international lads can have a go with it.” I simply just disagreed with that. I vehemently disagreed with that. I was able to put my case forward to my colleagues, to the artists, and to the managers.
At the end of the day, I really do believe that we began to think about the outcome at that point. Sometimes, there would have to be trade-offs. Sometimes, I didn’t get everything that I wanted. Sometimes, the domestic lads didn’t get everything that they wanted. Then, there was the question of how much can the artist endure? It’s a lot of travel to be a worldwide superstar. They put in a lot of mileage. My hat goes off to them—to people like Bryan Adams, and (Jon) Bon Jovi who is one of the hardest working gentleman I have ever worked with. He was amazing.
[“We didn’t have any other place to play,” recalled Bon Jovi’s former manager Doc McGhee in his profile with CelebrityAccess last year. “We just said ‘Let’s get them out to where somebody could appreciate them.’ One thing about Bryan and Bon Jovi, they didn’t have huge hits out of the box. They had some recognition, and then they became big. Bryan got to go out with a little bit of recognition and, all of a sudden, he started to play (internationally). Bryan would play Viet Nam, everywhere. The same with Bon Jovi.
In explaining how Bon Jovi broke in Japan, McGhee said, “We had done so many dates over there from ’84. ‘Slippery’ (‘Slippery When Wet’) was (released) in late ’86, and didn’t break until ’87 in the States then, it blew up. They (still) weren’t huge. We had the #1 record in America and we were selling 125,000 records a day—which at that time was crazy—and we were opening for .38 Special.”]
You first worked for Japanese-owned Alfa Records in Tokyo after college?
Yes, I had a huge opportunity and great fortune to work at an independent label called Alfa Records, headed by (composer and record producer) Kunhiko Murai.
Alfa distributed the A&M, Zomba and Mute labels in Japan.
That’s right. Most of the time I spent in my early years there—there were six years in total at Alfa—I was working with domestic artists. Taking Casiopea, and Yellow Magic Orchestra and working them to international markets. As is typical in a Japanese company, you rotate departments. I found myself working on behalf of international artists with A&M Records, and then Windham Hill. That all went swimmingly well and I was able to work out a transition where I moved from Tokyo back to Los Angeles and I was the Alfa Records’ representative to A&M Records.
Alfa International had Lulu, Burton Cummings, the Monroes, and a couple of other artists.
Unfortunately, it (Alfa International) didn’t go too far, and they eventually decided to shutter that (Fairfax Avenue) office. I was asked to move over to represent Alfa Records at A&M Records on the lot.
You are originally from Tacoma, Washington. How did you land a job at a record company in Tokyo?
When I was at the University of Southern California, I declared a double major. One of the majors was the Japanese language and culture (the other was accounting). When I arrived in Los Angeles, and I went to the university, I said, “I am going to study the Japanese language. I want to live with Japanese people.”
They worked it out so I ended up living with Japanese undergraduate students, and they turned me onto some Japanese underground fusion jazz music. It happened to be produced by Alfa Records, and the executive producer on all of the albums I bought was Kunhiko Murai.
So I was studying Japanese, living with Japanese students, and being introduced to Japanese fusion jazz. Then, in my very rudimentary scrawl, I wrote, in Japanese, to Kunhiko Murai, and said, “I am buying your records on import; I really love them. As long as you continue to produce this level of music, I promise to continue to buy.” I sent the letter off, and never heard from him again.
Fast-forward to the end of my school days. As an undergraduate, I was writing bibliographies at the USC graduate school. I went to the dean of the MBA program and I said, “I have been doing disc jockey summer internships over in Japan, but I want to work at a proper company (there). He said, “I think I might I know somebody who donates to our program, and I will arrange a meeting."
Later, he said to ask for this guy “Kunhiko” at this address. So I drove to the address. It was the A&M Records’ lot. I went to the front gate, and presented myself. I was told, “He’s waiting for you” and I was shown where the building was. I walked in, and I sat down in front of this man called “Kunhiko.” I had forgotten about the letter. He gave me his card. It was “Alfa Records, Kunhiko Murai, president and CEO.”
The meeting lasted for four hours and we spoke in Japanese. I said, “Back in the late ‘70s, I wrote you a letter that I was buying your records on import, and I would continue to buy if you retained the quality.” He said, "I remember that letter. It was like a third grader had written it to me.”
Four hours later, he said, “How much will it cost you to move to Japan?” This was a question that I was completely unprepared for. I told him what I thought it might cost, and he started to write a personal check. He handed me the check, and said to call a couple of weeks before I would arrive (in Tokyo) and they would pick me up. That is the story. We hit it off magnificently. I owe so very much to that man.
Did working at Alfa Records give you an opportunity to learn basics of the music industry?
Yeah. It was an opportunity to combine my love of music; and my having studied Japanese. I was very, very relentless in my studies, and my pursuit of excellence with that language. So the opportunity to a work in an industry that I very much wanted to work in and to use my language was a combination that I could simply not resist.
Did the experience in Japan provide you with more of a global perspective?
It really did. It taught me a lot about Japanese culture, and how they worked. It was very interesting to sit on the Japanese side of the negotiation table with the American or British label on the other side. Understanding what the Japanese were saying and providing the Japanese executives in Japanese nuances that they may not have been picking up on. That were around that table. It was fascinating to sit on that side of the table.
A cool part of the Japanese system—at least practiced at Alfa Records—was that you are moved around different departments. I had the benefit of working in the A&R department. I had the benefit of working in the creative services department. I had the benefit of working in product management; producing marketing; and, yes, even in the accounting department. And so I had this all-around experience. I got a look at all of the departments; and worked in them very hard.
You always knew that you wanted to do marketing?
When I was in university, I didn’t know that it would be music marketing. But that is what resonated with me. That’s where I was kind of pushed and steered into. Thank God for that. So I practiced marketing (at Alfa) and did well enough that I came to the attention of A&M Records. I was offered an opportunity to work there by my boss, Jack Lossman (A&M Records’ international VP).
Seagram's $10.6 billion acquisition of PolyGram in 1998 led to the merging of the music operations of PolyGram and MCA under the renamed Universal Music Group. When the smoke cleared from the merger that was followed by French utilities firm Vivendi's acquisition of Seagram’s in 2000, so many former Polygram and A&M executives had exited.
A difficult time for you?
Certainly, there was pain. Whenever you see people that you have worked with very diligently—that you have spent sleepless nights, long airplane rides, shared great laughs, and some great heart aches over a number of years—and then not to be working with them quite suddenly, yeah it’s difficult.
These were also people that had invested a lot of time in you as well as vice versa.
Yes. These were people who had invested in me very heavily. I am forever grateful to Herb (Alpert), Jerry (Moss), Jack (Lossman) and all of my colleagues at A&M. I do look back on my days at A&M very, very fondly. I have so many people at that company—not least of which are Jerry and Herb—that I am personally grateful to because they did great things for me personally, as well as professionally.
Then Polygram provided me with a larger (international) platform; and they entrusted me with that; and I am grateful to them for doing that. I remember David Munns coming into my office and saying, “Why is it that all of my people think that they work for you?” He was then worldwide head of marketing for Polygram. I said, “I don’t know. I think the key to what I am doing is that I think down to the sales meeting at each (affiliated) company; and each country; and I attempt to prepare the people who represent us to the sales medium and the retail environment. And I think that I prepare them better than all of the other sister labels. If I do that for them, it makes their life easier.”
While you served as senior VP of international for PolyGram, and then at Universal, international marketing became an extremely important part of the efforts to break new artists, and take successful artists to new levels.
As a result, Janet Jackson, Tonic, Soundgarden, Suzanne Vega, Stevie Wonder, Bryan Adams, Jon Bon Jovi, Boyz II Men, Sheryl Crow, Hanson, and Sting were global stars.
It was great. I can’t recall the specific statistic, but I recall that I was very proud of the fact that in almost all instances, their international sales far exceeded their U.S. sales. But I say that a lot of what happened with certain artists was because of the efforts that were made in America.
Statistics from Universal Music when you were there, indicate that 65% of the company’s sales were from outside North America.
One of the things that Universal certainly benefits from is that they have a strong domestic roster footprint in no matter what country that you go to. They are very well-balanced in that respect. I would attribute that balance to their robust local artist roster for achieving that.
When you arrived at Warner Music Group in 2004, the company was very much an American-centric, margin-driven company that was not chasing market share.
Yes. The thing is that they had an outcome that they desired (to change the company); and they had a plan to execute that. I must say that they did it very, very well. To say that they were focused on margin, that would be correct. (It is also true) to say that they were not as aggressive in certain countries—outside of Spain, and, to a certain level, in the United Kingdom. They really were driven by U.S. repertoire.
It started to change under Roger (Ames’) watch in as much that you started to see a much more active U.K. company. You also started to see attempts to increase rosters in certain strategic countries. But they weren’t going to, in that short a period of time, come close to what Universal had established. And a lot of that with Universal was courtesy of the Polygram labels that had strong local repertoire on the day that Seagram’s acquired PolyGram.
[A phone call from Warner Music Group chairman Roger Ames led to Jay Durgan's arrival as senior VP of marketing at Warner Music, and the challenge of changing the company to an operation that is determined to increase its overall market share.
One of Durgan's key moves has been to strengthen the marketing machine at Warner Music International, including the establishment of a strategic marketing unit. Despite not having any official budget to ramp up marketing functions, Durgan's team worked wonders in its drive to increase market share.]
You had quite a very good run at Warner Music International, successfully marketing Michael Bublé’s Josh Groban, Linkin Park, and the Coors to international audiences, and re-establishing Madonna as a global powerhouse.
I did. I enjoyed all of that. I’m proud of the contributions that my team were able to make. I had a great relationship with the individual presidents, and their teams in each of the countries. There was a great camaraderie there. We all really worked all hard and focused to take Warner up to another level and, to a certain extent, I think that we accomplished that. I am proud of our accomplishments.
You must be pleased with Michael Bublé’s continuing global career that you and your marketing staff kicked off.
It does my heart good to see that type of success. I have very fond memories of Michael Bublé. He is one of those artists who gets on his bike, and works. He is aligned with a manager (Bruce Allen) who understands that; one who has been down that road (with Bryan Adams); and who has benefited from a hard-working artist who has interest in all the world offers. They are appropriately being awarded for that.
Larry LeBlanc is widely recognized as one of the leading music industry journalists in the world. Before joining CelebrityAccess in 2008 as senior editor, he was the Canadian bureau chief of Billboard from 1991-2007 and Canadian editor of Record World from 1970-89. He was also a co-founder of the late Canadian music trade, The Record. He has been quoted on music industry issues in hundreds of publications including Time, Forbes, and the London Times. He is co-author of the book “Music From Far And Wide.