Advertising Commercials

An extremely valuable source of income for the songwriter and music publisher is the use of songs in radio and television commercials for consumer products.

Microsoft paid a substantial amount to use the Rolling Stones' "Start Me Up" in its Windows 95 campaign. Cadillac did the same to use Led Zeppelin's "Rock and Roll," and "When You Wish Upon A Star" (from the 1940 Disney animated feature Pinocchio) has been the musical hook of TV spots for Disneyland and Disney World for years.

The fees paid by advertising agencies and their clients for commercials can be substantial (from $125,000 to more than $1,000,000 per year for successful songs), depending on whether, among other things (a) the commercial is for radio, TV or the Internet, (b) it is targeted for a national or limited-territory campaign, (c) there are options for other countries, (d) the original lyrics are being changed or new lyrics added, or (e) the ad agency requests the song for alladvertising exclusivity or product-category-only exclusivity.

On occasion, an agency will ask for a non-broadcast test period during which it will test the commercial in shopping malls, inter- agency screenings, etc., to determine whether the pairing of the song and the product is effective. Fees for this off-air testing range from $3,000 to over $20,000, and the term normally ranges from a few weeks to four months.

In other instances, the ad agency will request a limited-broadcast test period during which a commercial will actually be aired for a specified regional market - for example, on television in New York or California for two months only, or a three-month test in cities that contain not more than 10% of the total U.S. population. Fees for regional-broadcast test periods normally range from $5,000 to over $30,000 depending on, among other things, the duration of the test period, the population of the region, the importance of the song, the product being advertised and whether there has been a lyric change.

Certain major advertisers may request total exclusivity (a restriction for licensing to all products, as opposed to just similar or competing products) from a publisher, but the fees for this type of grant are substantial for a recent hit song or well-known standard (from $150,000 to more than $1,000,000), since the song is effectively being taken out of the marketplace.

However, most commercial licensing agreements provide for restrictions on licensing only competing or similar products. For example, a beer commercial may restrict the writer or publisher from licensing the same song for another alcoholic beverage commercial, but will allow licensing for use in advertising campaigns for food products, electronics, or automobiles.


© 2008 Todd Brabec, Jeff Brabec
For more information, check out the book Music, Money and Success: The Insider's Guide To Making Money In The Music Business (Schirmer Trade Books/Music Sales/502 pages) available for sale at Amazon.com, Barnes & Noble, Borders, Music Sales Group and www.musicandmoney.com.


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