K-pop is having a moment in America, and for once, BTS is not the only reason. But is K-pop truly achieving mainstream popularity Stateside beyond its fan base?
The genre of pop music born in South Korea is a global phenomenon, and although K-pop is bigger than BTS, the Korean boy band’s loyal and global fan base (the ARMY) is surely a major reason why BTS has been the face of K-pop in the United States for the past few years. During the weekend of April 12, BTS set a record for the song with the most YouTube views within 24 hours, racking up 74.6 million views for its single “Boy with Luv” (featuring Halsey) from an album, Map of the Soul: Persona– which had sold millions of copies long before its April 12 release.
And on April 13, BTS became the first K-pop group to appear on Saturday Night Live, prompting music veteran Bob Lefsetz to write, “What kind of crazy, f—ked-up world do we live in where a Korean boy band sings to track and blows away every performance on SNLthis year? . . . That’s right, the Koreans know more about music than the Americans, at least those in the music industry.” Meanwhile, Map of the Soul: Persona was on its way to becoming a Billboard Number One seller.
The Rise of Blackpink
And BTS has company. On April 12, Blackpink became the first-ever female K-pop act to perform at the Coachella Valley Music & Arts Festival — and on April 19, Blackpink performed during Coachella’s second weekend. Blackpink’s appearance was a coup because Coachella caters to the largest demographic in the United States, millennials. Of course, Blackpink was participating in a larger festival featuring headliners such as Ariana Grande and Janelle Monáe. Even still, Blackpink’s appearance stole buzz from BTS, creating, I suppose, K-pop’s equivalent of the Beatles-versus-Stones rivalry during the British Invasion. And consider these popularity signals:
When BTS accumulated the most YouTube views within 24 hours, the band broke a record that Blackpink had just set for their song “Kill This Love” a week earlier.
The group’s EP Kill This Love debuted at 24 on the Billboard 200 chart.
As of this writing, Blackpink is keeping K-pop visible on the charts, not BTS. But stay tuned.
How Big Is K-Pop?
Meanwhile, whether K-pop has become a mainstream phenomenon in the United States is open to debate. True, we’re seeing K-pop acts achieving prominent roles in mainstream TV shows and concerts (after Coachella Weekend One, Blackpink performed on The Late Late Show with James Cordon. BTS is appearing on CBS Sunday Morning April 21). And BTS’s 2019 tour sold out quickly.
On the other hand, the singles and album charts are dominated by mainstream pop and hip-hop, with K-pop barely visible (as you can see by reviewing the Apple Music Top 100, Billboard 200, Billboard Hot 100, and Spotify Charts). And BTS’s SNL performance, while lauded, did not exactly win over mainstream American viewers. SNL suffered low ratings when BTS performed, especially among the 18-49 age bracket, an important age cohort with spending power. As Ashley King of Digital Music News points out, the low ratings reinforce a perception that BTS’s fan base remains firmly entrenched among digital natives as opposed to a larger American audience:
Teen girls in the United States may love BTS, but SNL viewers do not. Adding to the mismatch, BTS’ younger base is far less likely to care about live television — or even know how to access it.
King goes so far as to state:
The no-show raises the possibility that BTS’ popularity in America may be a flash in the pan, with finicky younger audiences eventually moving onto the next boy band. The numbers suggest that BTS may already be past its prime in the U.S. The K-pop group placed 7 tracks in the top 10 on iTunes last Friday, but they are mostly gone now. Last August, the group claimed all 12 top spots on the U.S. iTunes chart with tracks from the Love Yourself album.
Incidentally, all 26 songs from the Love Yourself album featured in the top 50 when it debuted. This rapid success on the charts has prompted plenty of media outlets to highlight the craze, making it seem like K-pop is a huge media sensation. In reality, the genre still appears to be popular among a particular niche of fans.
Adam Buckley of Digital Music News argues that a vocal and relentless fan base makes K-pop seem bigger than it really is. (Side note: are Adam Buckley and Ashley King the same person?) Buckley points out that K-pop songs fall off the charts as quickly as they rise, and he also notes the paucity of K-pop songs on the Billboard lists.
That said, the popularity of the BTS tour cannot be denied although I’m sure Adam and Ashley will fold their arms and ask just how many of the stadium fillers are of legal age. At the risk of bringing the wrath of music fans on my head, I will say this: when the Beatles first hit it big, no one thought they’d really break through beyond the teen market, even after their triumph on Ed Sullivan (a historic ratings breakthrough unlike BTS’s paltry ratings on SNL). Beatlemania was about screaming teenage girls. And then things changed.
Amazon Prime Video wants to empower diverse voices with a new film festival. On April 8, Prime Video began accepting entries for the first annual All Voices Film Festival. According to Prime Video, the All Voices Film Festival is designed to uplift underrepresented communities. Prime Video invites filmmakers to submit short (40-minute) films with the following requirement:
The writer, director, cast or theme of the short must reflect underrepresented communities. This includes but is not limited to people of color, ethnic, gender and religious minorities, members of the LGBTQI community, people with disabilities, veterans, young, aspiring filmmakers as well as older adults, and other groups that are underrepresented or marginalized in the US or globally.
A panel of judges will select winning entries in July. Prizes range from a $25,000 royalty bonus and paid trip to visit Amazon Studios to a $10,000 royalty bonus.
My take: the All Voices Film Festival is a smart move for Amazon Prime Video, Amazon’s streaming service. The festival, if curated well, should lend cultural relevance to Prime Video, a follower to Netflix and Hulu.
Amazon Prime Video Plays Catch-Up
Amazon Prime Video distributes both third-party and original content (the latter made by Amazon Studios). Amazon CEO Jeff Bezos has characterized video content as a stepping stone for creating more Prime members. As he once said, “We get to monetize [our subscription video] in a very unusual way. When we win a Golden Globe, it helps us sell more shoes. And it does that in a very direct way. Because if you look at Prime members, they buy more on Amazon than non-Prime members, and one of the reasons they do that is once they pay their annual fee, they’re looking around to see, ‘How can I get more value out of the program?’”
The problem is that being a stepping stone for selling more shoes detracts from the legitimacy of Prime Video. Prime Video has certainly distributed popular and prestigious content. But Prime Video doesn’t create buzz and shape mainstream cultural tastes as Netflix – and, to a lesser extent, Hulu – does. Netflix creates cultural relevance by shaping pop culture (see Stranger Things and its impact on 1980s nostalgia) and influencing behavior (as Tidying up with Marie Kondo has done by making so many people want to streamline their homes that resale shops are being overrun).
A Step in the Right Direction
The All Voices Film Festival is a step in the right direction. Netflix has been building a reputation as a haven for New Hollywood visionaries who want to make personal movies that Old Hollywood won’t touch, an example being Alfonso Cuarón’s Roma. TheAll Voices Film Festival may give Amazon Prime Video the high ground for emerging talent. And its focus on under-represented voices – ranging from LGBTQi to veterans – taps into an important national conversation about diversity and inclusion that is much bigger than the movie industry. Being a source of content that connects at a topical level nationally is what cultural relevance looks like.
As Latasha Gillespie, Amazon Studios’ head of diversity, equity, and inclusion, told Variety, “At Amazon Studios, we are looking for passionate storytellers who reflect and represent all backgrounds, specifically so that we can share their experiences and stories. We created this opportunity because we wanted a way for underrepresented voices to be heard.”
A Warning Shot Across the Bow
The All Voices Film Festival also represents another warning shot across the bow of Old Hollywood. Although Netflix gets credit for challenging Old Hollywood, Amazon Studios was actually the first streaming service to release a movie nominated for Best Picture at the Academy Awards (Manchester by the Sea). Its feature-length titles include Cold War, nominated for Best Foreign Language Film Oscar. Amazon Studios is also producing the anticipated Lord of the Rings television series. The All Voices Film Festival could give Amazon Studios the inside track to emerging talent and position Amazon Prime Video well against Netflix, too.
Everything now comes down to execution: developing potentially exciting new talent and using good marketing to promote it. Amazon has deep pockets. Money doesn’t buy you good judgment and cultural relevance. But Amazon Prime Video is off to a promising start.
Jagger famously captured the essence of rebellion and raw sexuality decades ago. At the height of his creative powers and cultural relevance in the 1960s, he was a threat to the established order and a voice for a younger generation. He was also aware of the limitations of that role. He once said, “I’d rather be dead than sing ‘Satisfaction’ when I’m 45.”
Now he’s singing “Satisfaction” well into his 70s. Why? Because performing is what he loves. Being a musician is his passion. And so he continues to tour and record music, as the Rolling Stones have been doing since 1962. But we don’t know how to handle a 75-year-old Mick Jagger prancing onstage, shaking his butt, and singing “Let’s Spend the Night Together,” “Start Me Up,” and, indeed “(I Can’t Get No) Satisfaction,” all of them staples of the Stones’s No Filter tour in 2018.
Seventy-five-year-olds are not supposed to sing about sex and drugs. They’re supposed to move over and let a younger generation have the stage. It’s OK for older generations to occasionally entertain us so long as they do cute things such as escape nursing homes to attend heavy metal concerts. But Mick Jagger refuses to step aside and age quietly.
Our discomfort with Mick Jagger became clear when news broke that the Rolling Stones were going to postpone their 2019 tour because Jagger was suffering from an undisclosed medical condition. In due course, we would learn that he required a heart valve replacement, which was performed successfully April 4. Although the news triggered plenty of supportive comments, jokes about his age surfaced on social media, and The New York Times ran an ageist article that noted, “Jagger is not the first 1960s-era music icon to show signs of slowing down in old age” and chalked up his (then undisclosed) health problem as a result of the demands of touring.
I thought it was interesting and disappointing that The New York Times assumed Mick Jagger was suffering an age-related problem before anyone knew what was wrong with him. And citing the ravages of touring seemed odd given that Jagger has prided himself on how well he takes care of his body through a strict diet and rigorous exercise. If anything, touring energizes him.
To be sure, the odds of requiring a heart valve replacement increase as you get older. But why is it necessary for publications such as CNN to point out repeatedly that Jagger is a 75-year-old grandfather and great grandfather when reporting the results of the surgery?
We don’t know what to do about Mick Jagger because we don’t know what to do about the reality of growing old. We want to keep the elderly in the background because seeing them reminds us of our older selves. Perhaps this very personal fear of growing old helps explain rampant ageism in the workplace, as discussed in a recent Fast Company article, “Ageism is thriving, so what are companies going to do about it?” Ageism is not about rejection of The Other. Ageism is about negating our older selves.
In fact, Mick Jagger is a reminder that our stereotypical notions about aging can be proven wrong. He’s a vibrant rock star dancing and singing about whatever he wants, even if the notion of a 75-year-old man singing about sex makes some people uncomfortable. Well, deal with it. And hope that your future is as bright as Mick Jagger’s.
Steven Spielberg has seen the future, and he doesn’t like it one bit.
At the 91stAcademy Awards, Netflix took home four Oscars including three for Roma, which had been nominated for Best Picture. In addition, Amazon Studios and Hulu both achieved Oscar nominations. Spielberg dislikes the notion of the Academy of Motion Picture Arts and Sciences nominating movies from companies that stream movies in homes. So he reportedly wants to change the rules to block Netflix and its streaming competitors from nominating movies for the Oscars.
And Steven Spielberg is dead wrong.
Spielberg believes in the purity of the big screen and the joy of experiencing a movie in a theater. He wants to keep a sharp distinction between movies shown in theaters and movies made by streaming services. As he told British TV network ITV News in 2018, “Once you commit to a television format, you’re a TV movie. I don’t believe films that are just given token qualifications in a couple of theaters for less than a week should qualify for the Academy Award nomination.”
With Amazon Studios, Hulu, and Netflix landing multiple nominations at the 91stAcademy Awards, apparently he’s feeling threated. A spokesperson for Spielberg’s Amblin Entertainment told IndieWire’s Anne Thompson, “Steven feels strongly about the difference between the streaming and theatrical situation. He’ll be happy if the others will join [his campaign] when that comes up [at the Academy Board of Governors meeting]. He will see what happens.”
Defenders of Old Hollywood believe the Academy’s nomination rules are too lax. A movie need not be distributed exclusively in a movie theater to qualify; a movie simply needs to appear in theaters. In addition, Hollywood studios follow an unwritten rule that movies should appear in theaters for at least 90 days before becoming available on video or streaming. Netflix doesn’t play be those rules. For instance, Netflix’s Roma appeared exclusively in theaters for only three weeks. A rule change could, say, require Oscar nominees to make movies available for a minimum period of time.
Reports of Spielberg wanting to change the Oscar nomination rules have been disputed, but the controversy has drawn attention to his opposition of streaming services – an opposition is on the wrong side of history for a number of reasons, including:
Viewing Habits Are Changing
There’s a reason Netflix has become one of the biggest brands in the world. Audiences want the flexibility of seeing movies on their own terms: at home, on the go, and in theaters. Streaming services are accommodating them. When recently I moderated a discussion about Old Hollywood versus Netflix on my Facebook page, Facebooker Brian Schultz summed one of the reasons why viewers want choice:
The theatrical experience isn’t what it used to be. Projection quality differs from theatre to theatre, too many previews, rude ass moviegoers, and high ticket prices make staying at home a better option.
You can see some movies from streaming companies in theaters, too. You could have seen Amazon Studios’ Cold War (nominated for Best Foreign Language Film) and Roma in theaters, on a TV screen, or on a device. (I prefer seeing movies on big screens. But I don’t always have the time and money to go to the movies. I saw Roma at home and Cold War in a theater. Both experiences were equally satisfying.)
And streaming is becoming even bigger. Disney will soon launch its own service, Disney+. AT&T will launch its own streaming service, capitalizing on its ownership of Time Warner to feature content from WarnerMedia, a newly formed entity that includes HBO and Turner Broadcasting.
Old Hollywood’s war against streaming is going to be harder to fight, especially with Disney putting its muscle behind streaming. You don’t mess with the Mouse.
Streaming Services Offer Alternatives for Artists
Roma is an intensely personal movie from Alfonso Cuarón, who previously won multiple Oscars for directing Gravity. When Roma won multiple Golden Globe Awards in January, Cuarón was asked to comment on a perception that Netflix is threatening independent cinema. He replied:
My question to you is, how many theaters did you think that a Mexican film in black and white, in Spanish and Mixteco, that is a drama without stars — how big did you think it would be as a conventional theatrical release? I just hope the discussion between Netflix and platforms in general should be over. I think those guys, platforms and theatrical, should go together . . . They both together can elevate cinema, and more important, they can create a diversity in cinema.
Anne Thompson of IndieWire recently provided some inside baseball on how Netflix ended up with Roma:
The studios could have acquired “Roma.” Participant showed ten minutes of footage to seven companies with global distribution. There were no passes and three offers. Four companies explained that because a black-and-white film in Spanish would not qualify for their Pay-TV output deals, they needed to see the film (which was still in post and not available to screen). Once they could see the film they’d be able to seek a waiver from their Pay-TV output partners, as The Weinstein Co. did on “The Artist.”
Participant explored the three offers and after a month-long negotiation landed on Netflix, which gave the most persuasive (and financially viable) marketing, distribution, and awards commitment. The studios weren’t willing to step up to Netflix’s bid for worldwide rights (a bit more than $20 million), which included a commitment for a substantial global theatrical release (excluding China — which Participant kept and will open in theaters, having just passed the censors).
Alfonso Cuarón is not the only big-name director working with Netflix. Even an Old Hollywood stalwart like Martin Scorsese is leaping into the arms of Netflix. Scorsese’s forthcoming movie, The Irishman, will be distributed by Netflix in theaters and via streaming. The movie is reportedly a long-time passion project of Scorsese’s. Commenting on Netflix’s involvement in the film, he said, “People such as Netflix are taking risks. ‘The Irishman’ is a risky film. No one else wanted to fund the pic for five to seven years. And of course we’re all getting older. Netflix took the risk.”
Given the enormous cost of developing content, Netflix may stay firmly rooted in streaming for the near term, making Amazon a more likely candidate to buy a movie theater chain (also not a far-fetched notion with Amazon expanding into the brick-and-mortar grocery and retail industries).
Something Is Happening Here
Meanwhile, Netflix addressed the Old Hollywood-versus-Netflix story with a thoughtful Tweet:
Which evoked replies such as these:
Instead of trying to move the goal line for streaming companies, the defenders of Old Hollywood need to ask why exciting directors such as Alfonso Cuarón are turning to streaming companies and why businesses such as Disney are changing with the times, too. Old Hollywood can change just as record labels eventually adapted their business models for music streaming. Meanwhile, to paraphrase Bob Dylan, something is happening here, but you don’t know what it is, do you, Mr. Spielberg?
Venture capitalist, entrepreneur, author, and all-around business rock star Guy Kawasaki has succeeded the old fashioned way: by working hard and having uncompromising standards.
He’s well known for what he’s done and how he’s done it. He changed the way businesses practice marketing through product evangelism. At the same time, Guy has been an advocate for the importance of exercising values and behaving with grace and dignity – an ethos that has influenced business leaders such as Gary Vaynerchuk. In his new book Wise Guy: Lessons from a Life, Guy Kawasaki shares some of the lessons he’s learned throughout his life. Wise Guy is not a biography in the linear sense. Combining a self-effacing sense of humor with clear-headed analysis, he tells stories about people who have taught him something and about incidents that have shaped his life (and continue to).
You quickly learn that although he has accomplished a great deal in his life, his childhood was pretty ordinary. He did not overcome poverty to cure cancer by age 15. In fact, as a college student, he was interested in dating girls and someday owning a nice car. He tried out for football and quit. He studied law and quit. In other words, he grew up a lot like many of us do – which makes him more human and his story more relatable.
In the business world, though, he experienced epic adventures. For instance, at Apple he famously worked for Steve Jobs. And Wise Guycontains some fascinating stories that will make you grateful that you never worked for Steve Jobs. His career as an Apple product evangelist (he popularized evangelism as a marketing approach) and later as a successful entrepreneur and venture capitalist makes for some engaging stories and lessons learned. And there are many in Wise Guy. But for me, the most memorable and telling details in the book are not necessarily the most glamorous. (And I’ve read the book twice – an early draft for which I was privileged to provide feedback, and then the published version.) For instance:
He once read the entire Chicago Manual of Style cover to cover. And let me tell you – The Chicago Manual of Style isa massive book with some excruciating details about the finer points of the English language. Why did Guy read such a book? Because a demanding high school English teacher instilled in him a respect for minding the details of the English language. If you’ve ever worked with Guy (as I have), you know he continues to apply high standards today and does not hold back with constructive criticism. Lesson learned: there are no short cuts to doing the job right. You have to understand every nuance of a skill to master it.
He left a fortune on the table by leaving Apple— and then left a bigger fortune on the table by turning down a chance to interview for the CEO job at Yahoo! Guy freely admits he left Apple too early, long before it became one of the world’s most valuable brands – a decision that cost him tens of millions of dollars. And taking a pass on the Yahoo! opportunity probably cost him billions. In both cases, he did not grasp how big either company would become, something that still bothers him. But he does not regret why he chose something else over Apple and Yahoo! With Apple, he left to pursue a career as an entrepreneur. “[I]f I had stayed at Apple,” he writes, “my life would have been less interesting. I wouldn’t have started companies, become a venture capitalist, advised dozens of entrepreneurs, spoken at hundreds of events all over the world, and written fifteen books.” With Yahoo!, he chose time with his family over the demands of being CEO. “What price can you put on being around when your kids are growing up?” he asks. Lesson learned: stay true to yourself and your values.
He learned ice hockey at age 48. And then he learned how to surf at age 62. These are not the easiest sports to learn at any age. In fact, Guy says that surfing is one of the most difficult challenges he’s ever tackled. There’s an obvious lesson learned here about continuing to push yourself no matter where you are in life – highly relevant as our population ages. In addition, his determination to learn is a tribute to hard work and the value of learning for the sake of learning. “The acquisition of skill is a process, not an event, and the process itself can be the reward,” he writes. “My path to surfing competency was the same as my path for speaking, writing, and evangelizing: grit, repetition, and hard work, not ‘natural talent.’”
Steve Case once honored a handshake agreement even though he didn’t have to. In the early days of AOL, Steve Case asked Guy to do some consulting for $2,000 monthly plus stock options. Guy agreed, and the arrangement lasted a few months. Many years later, he saw Steve Case, who asked him if AOL had ever given him his stock options. “I told him I hadn’t done much work, so the company wasn’t paying me, and I had never gotten the stock,” he writes. “I told him to forget about it.’” But Case insisted that he get options for two thousand shares. The options mushroomed into a lucrative payday. Lesson learned: be honorable in all that you do.
The Steve Case story is the most important. Guy Kawasaki writes and speaks often of acting with values, and treating people as you would have them treat you. In fact, he wrote an entire book about the business value of enchanting behavior, Enchantment. I think his legacy is that being a decent person in business is not only honorable but sensible – which is more important than being a marketing guru, an engaging author, or an exciting speaker. Wise Guy is Guy Kawasaki’s lasting statement. I recommend you buy Wise Guy — and learn from it.
Jeff Bezos is a market maker. As I wrote in Fast Company in 2013, market makers do more than sell products. They influence beliefs and behaviors. Jeff Bezos is changing how people live and businesses operate through voice and cloud computing.
Amazon is ushering in a voice-first world along with Google. With astonishing speed, Amazon has unleashed products such as AI-powered smart speakers that rely on voice commands to manage our homes, search for things, purchase goods and services, and navigate our cars.
In the home: per Amazon, the number of devices with Alexa built-in more than doubled in 2018. More than 150 products have Alexa built in, ranging from headphones to smart home devices. Consumers can choose from 28,000+ Alexa-compatible smart home devices from more than 4,500 brands.
On the go: more than one million customers requested an invitation for Echo Auto, Amazon’s new Echo designed for vehicles, shortly after Amazon announced its availability. Several automotive partners announced support for Alexa at CES 2019. For example, Telenav, a provider of connected car and location-based services, announced a relationship with Amazon that makes it possible for drivers to use the Telenav Alexa-powered navigation system to do the same kinds of functional tasks that they can do with Google Maps.
At work: in 2017, Amazon launched Alexa for Business to begin a voice-first transformation inside enterprises. Amazon wants employees of businesses to rely on Alexa to schedule meetings, manage their personal calendars, and handle a host of other tasks. Brooks Brothers and Conde Nast are among the companies that use Alexa for Business to manage meetings according to Amazon. In addition, businesses are creating Alexa skills to manage several functions. To wit: financial services firm TIAA recently announced a new Alexa skill that helps its customers get financial information and obtain customer service. And now that Amazon has made it easy for anyone to create Alexa skills, I predict that so many more businesses are going to adopt Alexa that the creation of an Alexa skill won’t be news.
Jeff Bezos is so enamored with voice that he mentioned Alexa six times in Amazon’s fourth-quarter earnings announcement. In fact, Alexa is about all he talked about in a prepared statement:
Alexa was very busy during her holiday season. Echo Dot was the best-selling item across all products on Amazon globally, and customers purchased millions more devices from the Echo family compared to last year . . . The number of research scientists working on Alexa has more than doubled in the past year, and the results of the team’s hard work are clear. In 2018, we improved Alexa’s ability to understand requests and answer questions by more than 20% through advances in machine learning, we added billions of facts making Alexa more knowledgeable than ever, developers doubled the number of Alexa skills to over 80,000, and customers spoke to Alexa tens of billions more times in 2018 compared to 2017. We’re energized by and grateful for the response, and you can count on us to keep working hard to bring even more invention to customers.
Typically in earnings announcements, CEOs don’t dive into the details of how their products are evolving. But not so with Jeff Bezos. His words demonstrate his belief in the power of voice.
Bezos’s comments about making Alexa more accurate might make him sound a bit geeky, but accuracy matters. Amazon needs to make Alexa more effective at recognizing human speech to make us comfortable using the voice interface to buy things — which is what Jeff Bezos wants us to do while we are on Amazon. Right now, for the most part, people use their smart speakers to check the weather and listen to music. Jeff Bezos’s vision for voice is all about commerce, not checking sports scores. The question is not whether, but when, Amazon will realize that vision.
Going hand in hand with voice computing is Bezos’s ambition for businesses and people to manage their lives on a virtual network known as the cloud. Amazon founded its cloud computing business, Amazon Web Services (AWS), in 2006. Today AWS provides the backbone of Amazon’s entire voice ecosystem. When you use Alexa in your home, on the go, or at work, you use AWS.
Bezos envisioned the rise of cloud computing long before voice came along, though, and the cloud powers more than Amazon’s own voice ecosystem. In his 2007 letter to shareholders, he wrote of people using their Kindle e-books to read and record margin notes “on the server-side in the ‘cloud,’ where they can’t be lost.” Eight years later, in his 2015 letter to shareholders, Bezos spoke of the cloud in much more grandiose terms:
Whether you are a startup founded yesterday or a business that has been around for 140 years, the cloud is providing all of us with unbelievable opportunities to reinvent our businesses, add new customer experiences, redeploy capital to fuel growth, increase security, and do all of this so much faster than before.
And he was not exaggerating. By 2015, AWS was providing the backbone for businesses to adapt to the cloud. Today, AWS powers so many companies that it made $25.7 billion in 2018. For example, if you use Airbnb to book a room or Slack to send a message, you’re relying on a business that uses AWS. And Netflix famously relies on AWS to keep its 24/7 content stream going.
Where would cloud computing be today without Amazon Web Services?
Vision Costs Money
But building voice and cloud-based products and services costs money. In 2018, Amazon increased its marketing and advertising costs considerably. As noted in CNBC, Amazon reported a $13.8 billion marketing expense for 2018, up 37 percent from the prior year. Nearly 100 million viewers of Super Bowl LIII saw some of that spend in the form of a number of 30-second spots promoting Alexa. Those spots cost $5 million each.
And here is why Amazon’s advertising services, bundled under Amazon Advertising, are so valuable. Amazon Advertising gives Amazon a way to recoup its costs though an increasingly lucrative revenue stream. Through Amazon Advertising, businesses on Amazon promote their products through various forms of display advertising and sponsored product displays that appear in a consumers’ search results on Amazon, similar to how advertising on Google works.
Amazon’s ambitions for advertising go beyond serving up ads on Amazon itself. As the New York Times reported, Amazon also targets ads to people across the digital world by tapping into the data it has amassed about consumers’ purchases made on Amazon itself. Since Amazon knows exactly what you’ve searched for and purchased on the site, Amazon can advertise for other brands with pinpoint accuracy, as these examples from the New York Times article illustrate:
When a chain of physical therapy centers wanted new patients, it aimed online ads at people near its offices who had bought knee braces recently on Amazon.
When a financial services provider wanted to promote its retirement advisory business, it directed ads to people in their 40s and 50s who had recently ordered a personal finance book from Amazon.
And when a major credit card company wanted new customers, it targeted people who used cards from other banks on the retail site.
The advertisers found those people by using Amazon’s advertising services, which leverage what the company knows better than anyone: consumers’ online buying habits
Just the Cheese, a brand run by Specialty Cheese Company in Reeseville, Wis., makes crunchy dried cheese bars that have taken off as a low-carb snack. By using algorithms to analyze how Just the Cheese’s search ads performed on Amazon’s site, the ad agency Quartile Digital noticed that people who searched for keto snacks and cauliflower pizza crust, both low-carb diet trends, also bought a lot of cheese bars. So Quartile ran display ads across the web targeting Amazon customers who had bought those two specific product categories. Over three months, Amazon showed the ads on websites more than six million times, which resulted in almost 22,000 clicks and more than 4,000 orders.
That 20 percent conversion rate — a sale to one out of five people who clicked on the ads — was “amazing,” Mr. Knijnik said. “That is the kind of powerful granularity for building the target audiences that just Amazon can give you.”
And, just like that, Amazon is upending the digital ad industry while creating a mini-industry of companies such as Quartile Digital that offer services related to Amazon’s advertising products. And herein lies an undeniable reality: Amazon giveth, and Amazon taketh. With advertising, Amazon takes business away from established players like Facebook and Google while spurring the launch of new companies that capitalize on Amazon.
“Amazon Is Not Too Big to Fail”
Advertising has helped Jeff Bezos pull off a feat that is extremely hard for a publicly traded firm to do: invest for the long haul while rewarding shareholders in the short term. He also does not take Amazon’s success for granted. As he told employees recently, “Amazon is not too big to fail. In fact, I predict one day Amazon will fail. Amazon will go bankrupt. If you look at large companies, their lifespans tend to be 30-plus years, not a hundred-plus years.”
Whether Jeff Bezos is correct about Amazon’s future remains to be seen. In the meantime, he has helped unleash technologies whose impact is incalculable.
The old music institutions are losing their grip. The Super Bowl LIII halftime show February 3 was a bust because of a musicians’ boycott. And now musicians who matter are blowing off the Grammy Awards. Childish Gambino, Drake, Ariana Grande, and Kendrick Lamar have turned down the chance to perform at the 61st Grammy Awards on February 10. What’s going on?
The Super Bowl halftime show boycott was a matter of principle. Musicians such as Cardi B, Jay Z, and Rihanna boycotted the Super Bowl halftime show as a show of solidarity with embattled NFL quarterback Colin Kaepernick. The Grammys are about relevance.
The Grammys, run by the Recording Academy, call themselves the music industry’s highest honor. But the Grammys have demonstrated an astounding lack of relevance year after year. This is the institution that once awarded Best Rock & Roll Recording to “Winchester Cathedral” over the Beatles’ “Eleanor Rigby” and the Beach Boys’ “Good Vibrations,” among other notable gaffes. In recent years, the Grammys have been taken to task for failing to recognize progressive music from women and people of color in its nominations and choice of performers during the telecast. In 2018, Recording Academy President Neil Portnow came under fire for making a condescending remark about women while at the same time the Recording Academy snubbed Lorde as a performer (even though she was up for Album of the Year), and Alessia Cara was the only solo female Grammy winner.
Who can blame the musicians for skipping the Grammys? Artists build their fan bases on their own digital platforms, not at the Grammys. On digital, they can reach a more relevant audience that listens their music, attends their concerts, and buys their merchandise. Consider Ariana Grande. She dropped her new album, thank u, next, two days before the Grammys. You’d think a televised appearance before millions of people would be the perfect opportunity to promote her new music. But instead she just gave the Grammys a very public middle finger.
Ariana Grande doesn’t need the additional exposure. Her 294 million combined followers on Facebook, Instagram, Spotify, Twitter, and YouTube alone do a powerful job promoting thank u, next, and to a more relevant audience (compared to the 19.8 million who watched the Grammys on TV in 2018). She’s already dropped two singles from the album, one of which was her first-ever Number One on the Billboard Hot 100. She was the top-streamed female artist in 2018. Ticket sales for her Sweetener tour, launching in March, appear to be strong based on her adding shows. She’s headlining Coachella in April.
What would the Grammys do for Ariana Grande except associate her name with a stodgy, out-of-touch brand?
It will be interesting to see if more musicians avoid the institutions of yore such as the Academy Awards. But I wouldn’t count on any of the old-guard television events adapting. They’re using a playbook created last century. Meanwhile, the artists are creating a new game.
The Super Bowl halftime show used to feature marching bands and harmless American cheese such as Up with People. Then the show became a high-profile global stage for big-time musicians such as Beyoncé and Bruno Mars. This year, it’s a lightning rod for controversy and an embarrassment for the NFL.
For the Super Bowl LIII halftime show occurring February 3 in Atlanta, the NFL has struggled to find performers to land a gig so prominent that stars are usually willing to perform essentially for free. That’s because a number of musicians have staged an unofficial boycott of the halftime show to express their solidarity with embattled NFL quarterback Colin Kaepernick.
The Colin Kaepernick Factor
In 2016, Kaepernick triggered a national culture war and a public battle with NFL owners when he took a knee during pre-game national anthems to protest oppression of people of color. He became a free agent before the 2017 season, but no team signed him. In the wake of his not being signed, he filed a collusion suit against the NFL that is expected to move forward in 2019.
Over the past two years, Kaepernick has become transformed from an NFL star into a social activist. His public profile received a major boost when a Nike ad in September 2018 positioned him as a leader who transcends sports. And now the NFL Super Bowl halftime show has done the same although certainly not by design.
The Rihanna Factor
Normally, artists jump at the chance to perform at the halftime show, and it’s easy to see why: since 2010, Super Bowl viewership has ranged from 103 million to 114 million, giving halftime show performers a gigantic stage to promote their music and elevate their personal brands. But when the NFL approached Rihanna to appear at Super Bowl LIII, she reportedly turned down the gig to support Kaepernick. And when someone with Rihanna’s clout acts, others follow. Musicians joining the unofficial boycott include, reportedly, Cardi B, Mary J. Blige, Usher, Lauryn Hill, and Nicki Minaj. The NFL finally confirmed Maroon 5 on January 13, and then Big Boi and Travis Scott agreed to join them. By contrast, the NFL confirmed Justin Timberlake, last year’s headliner, five months before the Super Bowl.
In the days leading up to Super Bowl LIII, Big Boi, Maroon 5 and Travis Scott have faced criticism on social media and from other artists. For example, Roger Waters has challenged Maroon 5 to take a knee onstage as Colin Kaepernick did before the national anthem. T.I. has called Travis Scott selfish for agreeing to perform. Black Twitter has spoken out as well. The show has now become a racially charged PR fiasco for the NFL, an especially embarrassing situation given Atlanta’s prominence as a burgeoning hip-hop center and its reputation as the black mecca of the United States.
Two Big Questions
In the aftermath of the media storm surrounding the controversy, two questions remain:
Will all the drama hurt Big Boi, Maroon 5, and Travis Scott? Yes and no. They’ve lost credibility with other musicians for crossing the unofficial boycott line. But fans are another story. An artist has to try really hard to alienate their fans to the point where they stop buying their music. If anything, the media exposure will help Maroon 5 and Travis Scott sell more tickets for their tours, which are in progress. Big Boi just released two new songs in advance of the Super Bowl. He’s banking on the controversy to help him.
Will the NFL be affected? Not on Super Bowl Sunday. Fans are not going to boycott the game because of the halftime show. But it says something that musicians were willing to skip a show that should have been a no-brainer decision to do. The NFL can be wounded (especially when Rihanna wields the sword). The unofficial boycott has called attention to Colin Kaepernick and the national anthem controversy just when it seemed as though the issue had become dormant. The NFL would prefer that the Super Bowl buzz focus on football, not on racial injustice. But the artists have stolen the narrative. They have collective power that they could exercise in other ways in the future, such as turning down Super Bowl ad spots.
Meanwhile, the halftime show mess has probably helped the man at the center of the boycott, Colin Kaepernick, by keeping his name in circulation as his grievance against the NFL goes to trial. The graphic below shows the volume of searches for Colin Kaepernick in the United States within the past month. Searches for his name spiked on January 16 when a story broke about Travis Scott reportedly meeting with Kaepernick before Scott joined the halftime show lineup. Interest is climbing again on the eve of the Super Bowl.
I doubt that Colin Kaepernick’s protests have had any impact on NFL viewership. NFL fans, like music fans, are very good at compartmentalizing. Viewership ratings have dipped and then increased over the past few years, and the quality of the play on the field has made the difference. But Colin Kaepernick never said he was protesting the NFL when he took a knee. He was, and is, calling attention to oppression of people of color in the United States. He has succeeded. Musicians have helped him keep the conversation about racial injustice in the public eye. And this conversation is bigger than the Super Bowl.
Tidying up with Marie Kondo is more than a Netflix reality television series about an organizing consultant who helps people de-clutter their homes. It’s a cultural phenomenon. Since Netflix aired eight episodes January 1, Tidying up with Marie Kondo has sparked a discussion about Japanese culture, the role of books in our lives, our societal pursuit of happiness, and materialism, among other topics. The show also demonstrates a major advantage Netflix wields against Amazon Video and Hulu: cultural relevance.
Tidying up with Marie Kondo is one of many examples of how Netflix seeps into our everyday culture by creating relevant content and even shaping our behavior. Netflix is not the only streaming service to create content that taps into the cultural zeitgeist – Hulu does so in spades with The Handmaid’s Tale. But Netflix creates cultural relevance more consistently and in more ways.
Prophet Brand Relevance Index
According to the Prophet Brand Relevance Index, Netflix is the fourth-most relevant brand in the United States, behind Pinterest, Amazon, and Apple and ahead of companies such as Google and Nike. Amazon ranks ahead of Netflix not because of its streaming service but because of its ecommerce leadership – an important distinction. Amazon Video creates original content as a means to an end – to gain more Prime members for Amazon. Netflix lives and dies by the strength of its content. And the difference shows.
According to Prophet, “[Netflix’s] relevance comes from knowing what we want to watch, which means old favorites and $12 billion worth of exciting new projects, including contracts with executive producer Shonda Rhimes, director Spike Lee and former President and First Lady, Barack and Michelle Obama.”
Creating Cultural Relevance
Prophet focused on consumer relevance. Netflix’s cultural relevance goes beyond knowing what we want to watch although content is one important element. Cultural relevance means influencing how we talk, how we behave, how we work, and, yes, what we watch. Here are some examples:
Netflix and Chill
Netflix is part of our everyday vernacular. You don’t hear anyone refer to “Hulu and Chill” or “Amazon Video and Chill” as a euphemism for having sex. And let’s not even consider a world in which “Disney+ and Chill” catches on once Disney launches its own streaming service, Disney+. “Netflix and Chill” has become so common we don’t necessarily equate the phrase with its original meaning. The article “Netflix and Chill . . . and Share it on Instagram Stories” by Geoff Desreumaux certainly does not refer to hooking up. And I’m pretty sure investor Dan Victor wasn’t thinking about getting some afternoon delight when he wrote the Seeking Alpha financial analysis of Netflix, “Buy Netflix and Chill – It’s Going Back to $400.”
“Netflix and chill” is not the only example of Netflix-related phrases that have worked their way into our vocabulary. For instance, “Netflix cheating” is the act of watching episodes of a Netflix series ahead of your partner. Netflexting occurs when two people watch a Netflix show in different locations and text each other at the same time. Netflix block happens when you scroll through your Netflix queue and cannot settle on something to watch. Here are more phrases that demonstrate Netflix achieving cultural relevance through our vocabulary.
The cultural relevance with content occurs two ways:
Creating content from another medium that has already attracted an audience (Tidying up with Marie Kondo was already a well-known book, and Dear White People was a notable movie first).
Releasing content that becomes so popular that its success transcends its original medium, which is what happened with Stranger Things.
In fact, most of Netflix’s original content does not enter the cultural mainstream the way Stranger Things has done. But Netflix hits the mark more than anyone else.
Netflix is actually changing our behavior. When Netflix began dropping all episodes of its new TV shows simultaneously, we responded by changing how we watch TV. Thanks to Netflix, we consume show after show for hours at a time. We now watch what we want when we want it, instead of a network making us wait for a weekly broadcast. The phrase “binge-watch” became the Collins English Dictionary word of the year in 2015. Four years later, we’re still talking about binge watching. Mashable devotes a section of its news content to binge watching. And you can get paid to binge watch. Binge watching is bigger than ever.
Highly Aligned, and Loosely Coupled
Netflix is also culturally relevant to the workplace. Netflix is well known among management consultants and the HR community for the way the company operates. Netflix is known for its “highly aligned, loosely coupled” approach of setting a clear strategy but empowering work teams to act autonomously. We now have PhD-level management consultants extolling the “7 Aspects of Netflix’s Company Culture That You’ll Want to Copy.” Its 2009 Culture Deck is called “the BIG DADDY of culture decks.” Its technology blog is also popular among product developers and engineers throughout the workplace. Amazon is also closely followed for its management practices – but here again, I’m focusing on the streaming business, where Amazon Video doesn’t create the kind of conversation for its business practices that Netflix does.
But cultural relevance is fleeting. You can’t manufacture cultural relevance on demand although you can improve your odds by adapting already-popular content that has been tested in another medium, as with Tidying up with Marie Kondo and Dear White People. So far, Netflix sets the pace. But it will be interesting to see what happens when Disney launches Disney+. Disney wrote the book on cultural relevance and is well positioned to challenge Netflix with its Disney, Marvel, Pixar, and Star Wars brands (Star Wars created the template for phenomenon such as Stranger Things). The key will be how well Disney draws upon these popular names to create new content, which it plans to do with shows such as original episodes coming from Marvel. Disney+ will be an extremely costly venture. But Disney has very deep pockets, while Netflix is under constant pressure from investors for its spending. Netflix CEO Reed Hastings has his work cut out for him. But I think he’s up for the challenge. And he’s operating with a big head start and an ability to do things that no one else sees coming, such as introducing binge watching.
The next frontier for Netflix will be to create cultural relevance in international markets such as India, which is proving to be an enormously difficult task. In India, Netflix also has its hands full with local competitors such as Hotstar. Because of its cash burn rate, Netflix is under more pressure to ramp up faster in markets such as India. The race is on – and the next several months will prove to be exciting.
Now I know we’re really living a voice-first world.
Pringles has released three teasers for its Super Bowl LIII spot. The star of the ad will be a — wait for it — voice assistant. At a time when advertisers are loading up on celebrities such as Chance the Rapper to hustle products, Pringles is relying on a faceless, Alexa-like voice assistant to sell us on the emotional power of Pringles flavors.
The ad, which will play during the second quarter of the Super Bowl February 3, will sell the viewer on the appeal of “flavor stacking,” or combining Pringles flavors in interesting and tasty stacks. The teasers depict an “emotional smart device” (in the words of a Pringles press release) that laments not being able to taste Pringles. In one teaser, the device sighs, “I cannot taste Pringles. I can only order them.”
The ad will also supported by “a fully integrated marketing campaign including PR, digital, social media, e-commerce and product sampling.”
Whether a depressed voice assistant will inspire Super Bowl watchers to start stacking Buffalo Ranch, Wavy Applewood Smoked Cheddar, or Screamin’ Dill Pickle Pringles remains to be seen. But the fact that a well-known consumer packaged goods company would shell out $5 million (the approximate cost of a 30-second spot for Super Bowl LIII) for an ad that makes a joke involving a voice assistant shows just how rapidly the voice-first economy is evolving.