He calls them ‘new rules’ and in the case of rapper Jay-Z and other large-scale stars, new rules is an apt term.
Leveraging the power of celebrity in business is nothing new, but Shawn Carter, aka Jay-Z. is taking the concept to never before seen levels. So much so, in fact, that one could say the artist now is more connected and relevant to the business world than he is to the musical one. Last week was an example, when Jay-Z launched his new album through a collaboration with Samsung.
Carter the man who boasted on Kanye West’s Diamonds From Sierra Leone that he sold “kilos of coke” has over the past month entered into two commercial undertakings that are basically unprecedented.
Firstly, he has become an accredited sports agent. This has allowed him to formally work within his Roc Nation sports joint venture with mega Los Angeles-based representation firm Creative Artists Agency as the lead agent. Carter had inked a deal with New York Yankees star Robinson Cano earlier this year when the initiative was announced and, after selling his minority stake in the Brooklyn Nets NBA team to become accredited to operate as an agent, Carter celebrated by signing bona fide NBA star Kevin Durant of the Oklahoma City Thunder. Both are well paid – Cano will earn $US15 million this season with the Yankees and will be a hotly contested free agent at the completion of this season, Durant earned $US17.8 million in the just completed NBA season. It is likely that Roc Nation Sports will eventually manage the commercial dealings of an athlete pool generating over $1 billion in revenue per year.
Roc Nation Sports is a sister agent to Roc Nation, which manages acts such as Carter himself, Haim, Rihanna, Kylie Minogue, Shakira and MIA; and releases music from artists such as Calvin Harris and Rita Ora. With Roc Nation Sports Jay-Z is putting himself firmly at the commercial centre of two of the most popular and lucrative entertainment channels in the world. Sports may have seemed like an odd business for the Brooklyn-born rapper, but in many ways sports stars are more powerful than pop stars and with the advent of social media, sports stars are cultivating fan bases in the tens of millions and becoming media vehicles in their own right.
The emerging power of celebrity as media was no doubt behind Carter’s recently entered marketing arrangement with Samsung.
The deal, reportedly worth $20 million, puts Samsung at the forefront of Jay-Z’s new Magna Carta Holy Grail album. Samsung has invested $5 million in purchasing one million copies of the new record, which it will pre-release exclusively to Samsung Galaxy mobile phones via a custom app. For Samsung the hope is a large scale artist like Jay-Z will add credibility to the brand and assist them in winning the battle for hearts and minds against Apple; for Jay-Z it gives him one million units in sales before the album is released and hopefully access to 1 million people who will enjoy the album and ideally end up purchasing tickets to his live shows (live performances being where the serious money is now for music acts).
Samsung is well integrated into the pre-album marketing campaign. It is featured within this video which has had more than 22 million views on YouTube and is growing, as well as featured on Carter’s ‘Life and Times’ website and the Roc Nation site. It is likely that the deal also extends across tours and live shows involving Carter. For Samsung it’s about attaching its brand with an artist it believes has power, in a way that extends across TV, digital and events.
For Carter it’s not the first brand he’s been paid to spruik. Last year Jay-Z was the face of Duracell’s ‘Power Mat’, fronted a festival for Budweiser in partnership with Live Nation, and launched cognac brand D’Usse in conjunction with Bacardi. On top of this he was the unofficial celebrity ambassador for the Brooklyn Nets NBA franchise and worked with the club on their rebrand. Purists may argue that Carter has sold-out and lost focus on the craft that built his brand, while others may argue that his ambitions have always been bigger than music and these brand partnerships represent the next stage of his act.
Jay-Z symbolises the new appeal of artists and celebrities, an appeal that in many ways puts them in direct competition with the media outlets that rely on them to drive sales and pageviews. In today's world, the celebrity has more power than the media – in many ways they have become the media. Musicians, movie stars and artists used to rely on the media to promote their vehicles, the media being the only way to reach large scale audiences. Now, the media heavily rely on these celebrities to drive pageviews and circulation, yet at the same time the celebrities have their own media channels in Facebook, Twitter, YouTube and Instagram – so their reliance on mainstream media is minimal.
So while media outlets have traditionally sold their power, influence and scale to advertisers; now you have celebrities like Jay-Z who are forging direct relationships with advertisers and using their own channels to bring them to life. Jay-Z is in no way the only example of this, you have the likes of Beyonce (a recent $50 million deal with Pepsi), Will.I.Am (commercial deals with Intel, Coca Cola, Beats), Tiesto (Guess), Avicii (Ralph Lauren) not only fronting brands but giving them direct access to their large scale audiences.
New rules indeed.