In a global landscape where sponsorship spend is now a whooping 62.8 billion US dollars, (in Ireland the sponsorship market is expected to grow by 6% to €173 million in 2017, and make up 18% of marketing spend), we explored the challenges faced by both official SXSW brand sponsors and non-affiliated brands, seeking to be relevant to culturally-hungry youth audiences.
Mid March in Austin, Texas means the mammoth conference and festival that is SXSW is in full swing. Now in its 31st year, SXSW continues to be a world leader in the sphere of future media, marketing and entertainment (notably music & film). The festival is known as "the premier destination for discovery". Up to 100,000 industry players, artists, film buffs and music enthusiasts converge in the Texas capital over the eight-day event. They arrive hungry for the latest game changing insights, trends, networking opportunities or simply to soak in the atmosphere of this cultural melting pot.
Festivals within the festival
Naturally many key global brands want in on the action and their input is hugely beneficial to SXSW. Sponsors aside, many brands are not affiliated with the official SXSW programming. But, their activations serve almost as festivals within the festival. They attract tens of thousands of non-industry young consumers, with their top tier stacked entertainment billing, free booze & food and impactful highly shareable experiences. While these separate brand activations are outside of SXSW’s control, it’s these brands who have the big budgets for production and talent. Which, in turn get SXSW massive coverage and allow the festival to command a hefty ticket price ($550-$1,550).
Another big aid to the success of SXSW has been the city of Austin itself. Proudly pushing the motto "Help Keep Austin Weird", as well as claiming the title of "Music Capital of the US", Austin stands out as a democrat haven in a largely conservative Texas. A city with more gig venues per-capita than any other we know, semi-collapsing prairie houses come bars, Mexican style tattoo parlours & barbershops, warehouse sized piñata & fancy dress stores, vintage markets, trailer parks serving up world class street food, (notably barbecue and Tex-Mex eats), and not to mention being the home to the original Wholefoods Supermarket and famed vegan crew Conscious Cravings. Austin has acted as an almost unsung influencer of today's current wave of youth culture trends. SXSW has benefited hugely from having all this on its door step.
Scarcity breeds creativity
SXSW’s overall success, along with other key events, has led Austin to become the fastest growing city in the US, with new skyscrapers shooting up constantly and fast paced and highly polished gentrification of the city's quirkier areas (sadly to the detriment of their motto!). This year more than ever, the city’s economic growth has impacted on a number of bigger brand activations that have become synonymous with SXSW. The availability of event spaces such as parking lots and warehouses downtown is becoming few and far between, and pricing also unrealistic and prohibitive. Hence, previously successful brand activations have had to reassess their participation this year.
For example, after five years of Spotify House, the streaming platform have replaced their 2000+ capacity event for a live artist lounge to record Spotify Sessions and to road test new digital integration programs with SXSW. Fader Fort (in partnership with Converse & Toyota), always the most in demand event and most cutting edge from a youth audience perspective at SXSW, have considerably reduced their space in comparison to their previous location of many years. BudLight are doing a one day event instead of a four day BudLight Factory, and Capital One Bank are taking over just one venue instead of multiple. While Hype Machine’s Hype Hotel (in partnership with Mazda) and the Samsung Lounge have both decided to take a year out altogether.
Brand Takeouts: It goes without saying, brands are questioning brand presence saturation and asking, ‘what is required to stand out from the crowd’?
- Know the scene: When in Austin, be part of the Austin vibe. Wherever you activate, understand the broader cultural environment.
- Intimate & immersive = impactful: As brands pull back from big scale blowouts to more focused small scale takeovers, it allows them to have more defined and focused marketing goals and event strategies. From an activation perspective, there is large scope for the consumer experience to become much more immersive, impactful, intimate and personal. The exclusivity factor can serve to really increase FOMO and demand, offering consumers unique experiences and memories which they can boast to their peers about having been a part of.
- Think Instagrammable, Snapchattable first: 100 of the right people at your event, coupled with owned social media activity (Facebook Live) can be more impactful in terms of share of voice than an event crammed with people of little social influence and a million times removed from your consumer bullseye. Having a great and memorable party doesn't depend on having the most people crammed into a space, or serving the most free drinks, or even having the biggest bands. It's about the overall experience that you're giving guest.
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