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Issue Date: Vol. 45, No. 8, August 2005, Posted On: 9/6/2005


Music, Amusements Are Under Attack: Leadership Needed


Marcus Webb

LAS VEGAS - At this spring's Nightclub & Bar Show, tavern owners were offered a seminar on how to maximize music earnings in their locations. I had attended this event expecting the moderator to ignore jukeboxes entirely , but I was wrong.

The speaker, CEO of a music programming company, mentioned jukeboxes all right. In fact, he went out of his way to urge tavern owners to get rid of jukeboxes. His reasoning? "You don't want your customers taking control of your music," he said, "any more than you want them dictating what brands of alcohol you serve."

Instead, the speaker urged tavern owners to employ a "foreground music service" , essentially, computerized DJ music play-lists. In this type of service, songs are pre-arranged in one-hour sets that carefully escalate from 90 to 160 beats per minute to keep the bar's energy a constant rising curve. The moderator also claimed locations can get customized, genre-appropriate play-lists with hit tunes and no repeated music over a three-week span.

Nobody in that seminar stood up to point out that the jukebox is a terrific moneymaker for bars. Nobody reminded bar owners that downloading jukes, in particular, offer the unbeatable thrill of selecting just about any song in today's popular music library and getting to hear it, then and there. No alternative seminar offered a positive vision of the jukebox or the coin-op industry as a whole.

Talk about d©jà vu all over again'

It was 10 years ago this year that I ruffled some feathers among the leadership of the Amusement and Music Operators Association by writing a story headlined "AMOA AWOL At Nightclub & Bar Show." I reported in 1995 that at seminars on using coin-op equipment, not a single operator was present to defend his brothers as tavern owners went on the attack, standing up in public forums and repeatedly charging the operating community with everything from incompetence to dishonesty.

The jukebox is arguably the industry's number-one earner in terms of weekly revenue for a single machine in a bar. And yet, as VT has been reporting in the past few months, the jukebox industry is under attack from "iPod nights," satellite radio and other forms of new competition. The operating industry remains under-represented at the NC&B show, and the attacks on jukeboxes and operators continue to go unanswered at the main trade show and convention for our industry's number-one location.

In the summer of 2004 I had the privilege of sitting in on deliberations of the industry promotions committee of the American Amusement Machine Association. The main topic of discussion was AAMA's successful Location Trade Show program, its most popular member benefit and a very good program indeed. Yet, some committee members expressed frustration that more new ideas are needed to put more life and force into the marketing of amusements.

The conclusion is inescapable that this industry is under attack. "iPod nights" and anti-jukebox seminars at the bar show are only the latest in a long series of wake-up calls, telling us that our locations may not remain ours much longer if we don't take the initiative and defend this industry's market position. We applaud the Amusement and Music Operators Association for retaining a top intellectual property lawyer to investigate the legal status of "iPod nights," but we know more is needed.

We urge the music and amusements industry to create a united front that will launch a steady marketing campaign. The purpose of this campaign will be to explain aggressively the coin-op story to locations, helping ensure that both manufacturers and operators continue to have healthy outlets for their products and services.

It doesn't have to cost a mint. The key elements in marketing are creativity and hard work. AMOA, AAMA and IALEI have plenty of these. Now all that's needed is the leadership to make it happen. Here is my suggested combined marketing program and budget for the rest of 2005 and beyond:

1) Have all three trade associations hold their board meetings at the same time and place. Additional cost: zero. (At a minimum, have the AMOA jukebox promotion committee hold integrated meetings with the AMOA and AAMA industry promotion committees. But this is less desirable since it would entail an additional trip and further expenses by at least some committee members.)

2) Throw out all old assumptions and convenient scapegoats for why this industry has been "soft" for a decade. Commission some heavy-duty market surveys and consumer polls to find out what the public thinks of our industry, if they think of it at all. Such surveys were vital in the turnaround of a leading food industry 20 years ago. They can be vital in turning this industry around, too. Cost: it's already in the budget. According to one past association president, at least two of the three national associations have funds allocated for such studies, but they are not being spent.

3) Based on survey results, promotions committee members should lay out a comprehensive communications strategy that includes the creation and dissemination of the industry's message to locations and players. Create an industry-wide slogan that can be used in all industry marketing programs including media, Location Trade Show signage, seminars, etc. For example, something simple and fun like "The Play's the Thing" applies to jukeboxes, games and sports as well as FECs, CECs and LBEs. Cost: zero.

4) Send an aggressive marketing team of speakers and seminar leaders , including at least one operator, distributor and manufacturer , to the NC&B Show every year. Cost: zero. Valley-Dynamo's Dave Courington, Gary Spencer of California Coin, and several eloquent distributors already attend this show on their own. Ask these fellows to team up to revive the twice-annual "Make Money With Coin-Op" seminars at NC&B. Cost: zero. (Okay, reward them with a free dinner at a very nice restaurant; now it costs $300.) Promote the seminar with classic NC&B come-ons: models and booze. Cost: say $1,000. And, promote the seminar with ads in Nightclub & Bar magazine. Cost: potentially zero if step number five is followed.

5) Go after free media. AAMA members are already spending plenty of money on paid ads in location trade magazines these days. If anything, this trend is increasing. The money buys exposure for the ad itself, of course. Beyond that, what value are amusement industry members getting for their location magazine ad money in terms of editorial support? Virtually nothing.

This should change. And again it costs nothing. If AAMA approaches the editorial staffs of these magazines (Pizza Today, NC&B, etc.) and , in the collective name of those coin-op advertisers , suggests story ideas on the opportunities that the coin-op industry can offer locations, this industry should be able to get such a story published in location magazines on an annual basis (or even twice a year). For free.

It's a good idea to approach location magazines that don't carry ads from AAMA members also. They are always looking for new story ideas, and the amusements industry needs the publicity.

The text of each story, like the seminars suggested in step (4) above, should give three fresh examples of different, current, successful coin-op product placement in that magazine's type of location (that bowling centers, pizzerias, bars, etc. are making good money with coin-op equipment).

Ask AAMA and/or AMOA staff to write the story. Cost: zero. Or, someone on William T. Glasgow Inc.'s staff could write it. Or, the promotions team can simply "suggest" the headline and approach, then give names and numbers of locations and/or operators to interview to the location magazine editors, and let the magazine's own staff write it. Cost: free or minimal.

Get even more free media. Going beyond location trade magazines to the nation's newspapers, I believe this industry's associations could get more free, positive publicity from their charity and educational missions than they currently do. Does anyone send out press releases to the local papers and to charity journals when AAMA contributes money to the Make A Wish Foundation and/or other charities? Does anybody send a press release to local newspapers when AMOA awards scholarships to students in a particular state or town? Maybe they do. If not, they should. And of course, a book of press clippings should be maintained. Cost: zero.

6) Create an "industry good news" data bank. Someone at the associations should compile a "clippings book" with all of the positive stories on amusements and games gathered into a central resource. This resource would be useful in dealing with consumers, mainstream media and in countering negative stories about violent video games, etc.

7) Consistently publicize the industry slogan in all materials that go to locations, players, and the broader world beyond our own industry. For example, AAMA could (and in my mind, should) display the industry slogan on a large banner at its pavilion at location trade shows, for starters. The slogan should also be used in any PR materials that are distributed prior to, and at, location trade shows. Readers of Pizza Today, etc., might see the slogan, remember the story or the PR materials, and be more likely to visit the AAMA pavilion.

8) AMOA should take a booth at the Nightclub & Bar show. The booth should feature a large banner with the industry slogan on it, and operators who are already attending the show should staff the booth. Their mission: refer bar owners to local operators. Above all, be visible. Talk to location owners. Educate them about coin-op success stories. Cost: possibly zero if some trade-off can be generated.

9) Start gathering player e-mail addresses and send industry promotional messages on a regular basis , at least once per month. Many arcades already do this. An industry website such as Betson's player-run barcade.com is in a great position to do likewise. Members of AAMA, AMOA and IALEI are already compiling e-mail addresses of players; so too are manufacturers of networked tournament video games. These lists should be compiled in a central industry promotions team roster (costs little or nothing ' just have members send their lists in).

Where not prohibited by the industry's Information Privacy and Security Policy, and when not barred by conditions-of-use promises made by the original list compilers, the aggregate national e-mail players list should be used to send, for example, a monthly message to U.S. players nationwide, touting new releases that players can find in their local arcade or street location, and/or new songs now playing on their local jukebox (costs nothing, takes five minutes to compile).

For example, Merit and Ecast are already generating press releases on a regular basis that could be used as sources of some information for such national monthly e-mails. Additional AAMA, AMOA and IALEI members would quickly follow suit when they saw the program up and running. And of course, the e-mails sent to the national player roster should highlight the industry's all-encompassing slogan.

10) Build an industry-sponsored website for locations and players. What Betson has done for players, AMOA, AAMA and IALEI should do for locations (and, secondarily, players). I am not talking about a competitor to barcade.com, but a complementary site with a different mission. This industry needs a "one-for-all, all-for-one" calling card and portal. It should be named after the industry's universal slogan (the-playsthething.com or whatever). And it should offer the same types of information that would be publicized in the free media campaign mentioned above. Cost: variable depending on functionality. The industry promotion committees should ask Betson's Ryan and Todd Cravens, who has helped spearhead barcade.com, for guidance on these matters.

11) Team up with major corporations that will shell out big bucks for joint promotions. Corporate sponsorships have been tried at the individual factory level with mixed success at best. I believe the missing ingredients are (a) somebody with specific expertise in this type of venture; and (b) sufficient numbers of participating machines, locations and players to get big corporate sponsors excited.

Glenn Remick of the American Darters Association is a master of this technique. He has cemented alliances with Budweiser/Amberbock Beer, Coca-Cola and global TV networks (see VT, May 2005).

If Remick can do it with darts, which are a relatively weak product in today's coin-op lineup, then AAMA, AMOA and IALEI can do it 10 times larger with a national coalition of video games, redemption and jukeboxes.

Cost: zero. Or, the industry could hire Remick to do for coin-op in general what he is already doing for darts. Cost: negotiable. But, what is the cost of not doing it? Millions. This industry is arguably leaving millions of dollars on the table every year in potential sponsorship funds by not reaching out.

Another good example of this philosophy in action is IALEI's hi-tech signage program in cooperation with Zoom Media. Cost to the industry: zero. Benefit: millions.

12) Finally, create that long-promised alliance between operators, manufacturers and taverns. AMOA and AAMA presidents have spoken of this goal many times over the past 20 years. Some have tried, but little has come of their efforts. If national tavern industry associations are not responsive to this industry's overtures, then our associations should seek out state associations that are responsive (such as in Illinois, New York and Pennsylvania), and we should build on those relationships. Working through these state operator associations, our industry should build a growing state-level network in additional states where the local tavern associations are open to cooperation.

None of these suggestions is terribly original, and in fact all of them are pretty obvious. And, despite the potentially powerful effect that an integrated program such as the one described above could have, few of these action items would be expensive to implement , and many cost nothing or next to nothing. The items that do carry a price tag can translate into money well spent with a hefty ROI. In fact, just getting some corporate sponsorships going would pay for a lavishly upgraded version of everything else on this 12-point list.

To round out the list, let me add one more thing that the industry has to do to achieve a successful, aggressive, industry-wide marketing program: The industry has to believe that it can be done.


Topic: Music and Games Features

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