The Samsung Deal with Jay-Z
Not only did Samsung score exclusive access to Jay-Z's first solo album in four years, the consumer electronics behemoth inspired the multi-hyphenate rapper to do something he'd done even less frequently -- tweet.
"If 1 Million records gets SOLD and billboard doesnt report it, did it happen? Ha. #newrules #magnacartaholygrail Platinum!!! VII IV XIII," he tweeted at 1:34 p.m. on June 17, some 16 hours after he made global headlines when a surprise three-minute commercial chronicling the making of Jay-Z's "Magna Carta Holy Grail" aired during halftime of the NBA Finals.
Just how big was Samsung's check? The New York Post's initial report announcing the deal valued the partnership at $20 million, a figure that likely included media spend, but sources put the value of the entire deal closer to $30 million and say Jay-Z likely received as much as $7.5 million in music rights and endorsement fees. And that's in addition to his summer stadium tour with Justin Timberlake as well as active deals with Budweiser, where he's curated the second year of the Made in America festival, and Duracell's PowerMat, in which he has a minority stake.
Partnering with a brand to boost first-week sales is something several superstar acts have tried before. Lady Gaga, most notably, had a tentative deal with Virgin Mobile to give away 100,000 copies of 2011's "Born This Way" that fell apart due to Virgin's merger with Sprint. Guy Oseary, manager of Madonna, says he had attempted something similar for Madonna's "MDNA," but abandoned it once he discovered doing so wouldn't count toward first-week sales. "It took about three months to figure that out when we had other deals on the table," he says.
Samsung's pact with Jay-Z, however, came together in less than a month, and was brokered directly by Samsung chief marketing officer Todd Pendleton, Roc Nation's Jay Brown and John Meneilly and Jay-Z himself. Representatives for both companies declined comment on further details.
So why Samsung and not, say, Pepsi, Coca-Cola or Apple -- three other giant brands that have a history with supporting music? Simple: Samsung Electronics' 2012 global ad spend was $4.6 billion, an amount that's more than Coke ($3.3 billion) and Apple ($1 billion) combined, and almost a full billion more than Pepsi's spend ($3.7 billion), according to the companies' financial statements. That's also nearly $2 billion more than the $2.7 billion that labels spent on A&R globally in 2012, according to IFPI's annual report.
Article written by Andrew Hopp from Billboard.com