LOS ANGELES After the advent of high-definition plasma and LCD displays brought ads for televisions back to TV, a second front in the high-def wars has developed between HD-DVD and Blu-ray discs. The marketing battle is shifting business alliances and influencing the advertising of consumer electronics and the movie releases that drive their sales in both formats.
"It's now a real format war," said Steve Martin, president of WPP Group's SicolaMartin, Austin, Texas, the agency that handled the Blu-ray Disc Association (BDA) trade group—backed by Hitachi, LG Electronics, Matsushita Electric (Panasonic), Pioneer, Philips, Samsung, Sharp, Sony and Thomson—until last summer when the BDA jumped to movie-advertising specialty shop Trailer Park, Hollywood, Calif., signaling the marketing emphasis to come. "My feeling is that the power of the studios is so strong in the Blu-ray camp … it may be the decisive factor," Martin said. "In any case, I would expect a significant increase in marketing. [HD-DVD promoter] Toshiba won't go down without a fight. Once you're all-in, you have to go all the way."
According to the BDA, Blu-ray held a 63 percent market share, HD-DVD 30 percent and dual-format players 7 percent over the summer, when movie disc sales for both formats spiked dramatically to a weekly volume of more than 260,000, according to data from Nielsen VideoScan. Also among the factors supporting an ongoing marketing war: game consoles. Late-model Sony PlayStations play Blu-ray discs; Microsoft Xbox 360 consoles cue up HD-DVDs—a not inconsiderable factor given that 53 percent of U.S. households own a game console and 79 percent of American teenagers command one, according to Nielsen Games. A Media Control Gfk International study indicates that Blu-ray movie discs have outsold HD-DVD three-to-one since the launch of the PlayStation 3.
Toshiba, the principal consumer-electronics proponent of HD-DVD, is making moves to ensure its survival. Recently the digital products division took what had been a $10 million account at nFusion, Austin, and moved it to WPP Group's Y&R Brands with the promise of increased overall spending and a higher percentage of HD communications. Ron Smith, Toshiba's vp of marketing communications, said HD-related initiatives alone would add 15-20 percent to the current marketing budget of Toshiba laptop computers outfitted with HD-DVD drives. Smith said that a focus on HD across all Toshiba products is a corporate initiative "umbrella" covering all upcoming efforts. "It's a huge part of our strategy for 2008," Smith said. "We have to help consumers understand that new formats like HD-DVD are the way to go, if not the ultimate movie-watching experience." Smith said he is feeling "a nice momentum from studios involved with [HD-DVD] releases," and expects more synergy between hardware makers, studios and retailers such as Wal-Mart, who he lauded as "taking their role as an educator of consumers seriously."
Meanwhile, the BDA is spending upwards of $4 million domestically on its own print and online efforts, per Nielsen Monitor-Plus, with the most recent execution, "I Do Blu," showing a Sony Blu-ray player and a Sony HD display romantically entangled by their twisted electric cords.
Recently, the emphasis on HD versions of movies transitioned from a now obligatory tag about the format to the creative theme itself. According to a studio source, Walt Disney Studios Home Entertainment's marketing already reflects that shift. Upcoming Blu-ray DVD releases from the studio, including Lost, High School Musical and Pirates of the Caribbean: At World's End, which came out last week, are now tagged with Blu-ray promotion across all mass media. And giant titles such as Pirates are earning separate 60-second spots for broadcast on HD Net with half the message devoted to the special Blu-ray features.
In the other camp, Omnicom's GSD&M Idea City, Austin, fashioned the current three-spot package for the release of DreamWorks SKG's Shrek the Third, in which the animated characters banter with a supposed DreamWorks exec about how good they look in the HD-DVD format. Jonathan Silverstein, GSD&M svp, business development and new ventures, said that Toshiba licensed the DreamWorks footage and placed the media buy, and DreamWorks hired the agency. The terms of the arrangement between the manufacturer and studio were undisclosed by both parties. He added, "The technology has gotten so confusing, [manufacturers] have been relying on point-of-sale education, but now they're looking at point of difference, and seeing a need to differentiate on brand."