Strategic Insights for Creative Industries from HBS' Elberse

Anita Elberse of the Harvard Business School is just as likely to be analyzing 30 Rock as she is a 10-K. She specializes in studying the strategies of media and entertainment companies and passing the lessons along in her class "Strategic Marketing in Creative Industries."

BNET: Compared to many business school professors, you have some very unusual areas of research. How did you decide on your areas of focus?

Elberse: Most professors focus on a certain topics, but I made a choice to focus on a set of verticals, and was fortunate that such a choice is possible at HBS. All of my research revolves around entertainment, media, sports and related industries, which is obviously very exciting, and coming to learn the exact ways in which these industries work greatly benefits my research; I can't understand why more colleagues aren't doing the same thing!

There are still a lot of big problems in these industries that we researchers are just starting to come to terms with. These are industries where students and professors can still have a big impact on the way business is conducted, particularly if I compare it to, say, the consumer packaged goods industry. I think it's useful to focus on industries that have not had as much solid attention from academic researchers. There's also a tremendous amount of data in these industries and much of it is in the public domain. Moreover, products in these industries tend to have short lifecycles -- biologists study fruit flies because there are lots of them and they reproduce and die fast; the same thing holds for movies, where you can look at the birth, life and death of a product in a release window over a matter of weeks and months. So, there are huge advantages to studying these types of industries.

BNET: So, what are these big problems you referenced? What do managers in these industries still have to figure out?

Elberse: Just think of the film industry. How does one distribute products to globally over a short period of time? How do you optimize advertising when the lion's share of the advertising occurs before any sales happen? You can't just take a model of the shelf for other industries and say, "Let's run with this one." There are pricing issues: every movie is priced the same and every song is 99 cents on iTunes. Why should a Britney Spears song be sold at the same price as a U2 song? That seems odd. And demand is highly uncertain: because we're dealing with "experience goods" that don't necessarily differentiate on observable attributes, it's not easy to predict sales. These are the problems that make these types of industries interesting from a marketer's perspective; you often can't just take tools from other industries and apply them here.

BNET: You mentioned the lessons from other industries. Some people view entertainment and sports as so unique that there's not a lot to apply in their industries. What do you think managers can learn here?

Elberse: For one, I think people who work in Hollywood or in sports are really good brand managers. They have quite a bit of knowledge of how one manages a brand, often in a rapidly changing environment. Lots of industries are stressing the "intangibles" in their products, and brands, and they can likely learn from the creative industries in that respect. Managers in the entertainment industries are also experts on how to deal with new technologies disrupting their industry -- the media industry has been disrupted by new technologies virtually from its inception.

We'll be back next week to hear about Prof. Elberse's view on the real value of star power in entertainment and sports.