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Made in America: Did It Work?

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Live Nation

The heavily promoted two-day Philadelphia music festival got off to a promising start in its inaugural year, attracting top talent and large turnout.

Budweiser Made in America had a lot of elements of a blockbuster: a curated lineup and headlining set from Jay-Z, promotion from Live Nation, live streams from YouTube and Pandora and a title sponsorship from Anheuser-Busch, which shelled out big bucks to put on the festival and advertise it during the Olympics. But was the Philadelphia event a bona fide hit?

Executives connected to and familiar with the two-day festival suggest that Made in America did quite well for a first-year event. It had more than 80,000 attendees across two days (Sept. 1-2), reaching 80.5 percent of Benjamin Franklin Parkway's 100,000 capacity. Although final attendance numbers are still being crunched, Live Nation Philadelphia president Geoff Gordon says the festival likely will finish just above or below the break-even point.

"When you're trying to establish a new festival, that's something we're pretty proud of," Gordon says.

CONCERT REVIEW: Made in America Festival, Day 1

Budweiser's support helped offset costs, with Anheuser-Busch paying the equivalent of "two title sponsorships," according to Gordon, which would put the company's outlay in the $1.5 million-$3 million range, compared with rates for title sponsorships at similar festivals. The city of Philadelphia also contributed an undisclosed sum to the event's funding, particularly on the backend with cleanup.

Festival veterans who spoke with Billboard consider Made in America's break-even financials noteworthy when compared with the early stages of other now-established festivals like Vans Warped Tour, which lost money during its first few years in the early ’90s, and Coachella, whose founder Goldenvoice had to sell half of its company to AEG Live to stay afloat. Made in America also paid competitive rates to attract top talent, with Pearl Jam alone earning $2 million for its only 2012 U.S. festival appearance, according to executives familiar with the deal.

"If you have 40,000 people in one day for a first-year festival, that's a win," says one industry veteran familiar with the event. "Bands will make it work whether they're on tour or not. If you look at a calendar and see Coachella as that mid-April time frame and Lollapalooza is the mid-June, early-July period, the timing was actually a well thought-out placement so as to not conflict or overlap with the other festivals."

PHOTOS AND STORY: Pearl Jam and Jay-Z Rock Together to Cap Made in America Fest

Festival veterans who spoke with Billboard consider Made in America's break-even financials noteworthy when compared with the early stages of other now-established festivals like Vans Warped Tour, which lost money during its first few years in the early ’90s, and Coachella, whose founder Goldenvoice had to sell half of its company to AEG Live to stay afloat. Made in America also paid competitive rates to attract top talent, with Pearl Jam alone earning $2 million for its only 2012 U.S. festival appearance, according to executives familiar with the deal.

One minor conflict for Made in America was New York's Electric Zoo festival, which attracted a record 110,000 attendees to Randall's Island during a three-day period that shared days and even a headliner – Skrillex – with the Philly festival. Although Made in America's EDM-heavy lineup (Calvin Harris, Deadmau5, Afrojack) ran the risk of cannibalizing Electric Zoo and vice versa, Skrillex manager Tim Smith says it was a "mutually beneficial" scenario.

"It was a diverse crowd, and there wasn't 100 bands on the bill," says Smith, founder/CEO of Blood Company. "It was a lot more selective and focused, which made artists feel special."

Among the other acts on the bill were Drake, Run-DMC, Jill Scott, The Hives, Miike Snow, Gary Clark Jr. and Rita Ora.

Kevin Liles, CEO of KWL Management and manager of D'Angelo, says the festival paid "well more than our going rate" to attract reclusive singer D'Angelo and ultimately determined the routing of his Liberation tour with Mary J. Blige. "D was particularly excited to play for a different audience," Liles says. "Where Bonnaroo provided a platform to jam with his friends in
The Roots, this was a platform to bring his new art to a diverse audience."

And considering the festival only started booking in earnest in March, the turnout was more than satisfactory for Anheuser-Busch vp marketing Paul Chibe. "Anytime you try to do something big, there's some risk," he says. "But that risk paid off beyond our expectations. You had a beautiful location, you had great music, and there were very little issues from any standpoint with the weather or with people's behavior."

Indeed, only one festival-related arrest was made all weekend in Philadelphia, compared with a June Miranda Lambert concert in Pennsylvania's Delaware Valley, where 191 arrests were made.

It's Budweiser's heavily integrated role in the festival (the company owns the trademark to the phrase "Made in America") that delivered the biggest payoff for Steve Stoute, CEO of ad agency Translation, who helped pair Anheuser-Busch with Jay-Z and also will produce a forthcoming documentary about the festival with Brian Grazer, Ron Howard and @radical media.

"Music and packaged goods have never come together in this tight of an integration ever," Stoute says, noting that ads featuring custom voice-overs from Jay-Z ran during primetime Olympics coverage six weeks prior to the festival. "It was very cool to see diversity at an event that was all about fusing different cultures. We though it would be all young people, but you had people in their early 40s, late 30s, people in their early teens. That really was the goal from our end to make sure the new Budweiser stood for celebrating that diversity."

While the success metrics of the inaugural festival are still being evaluated, all executives interviewed expressed interest in extending the franchise. "That conversation will happen very soon," Live Nation's Gordon says. "The desired direction is to have this live on for multiple years."