Pepsi Teams With iTunes Radio for Exclusive Channels

9:00 AM PST 09/19/2013 by Andrew Hampp, Billboard

The company’s sponsorship, which is committed through the end of 2014, includes other brands in the PepsiCo portfolio, like Mountain Dew and Frito-Lay snacks.

Apple’s long-awaited launch of iTunes Radio on Wednesday boasts an exclusive list of sponsors -- McDonald’s, Nissan, and Procter & Gamble among them -- but only one with its own branded stations. Pepsi, iTunes Radio’s premier beverage sponsor, is hosting four of its own channels, dubbed “Pulse of Now,” at iTunesRadio.com/Pepsi. Other brands in the PepsiCo portfolio, including Mountain Dew and Frito-Lay snacks, are expected to roll out their own channels over the course of the company’s sponsorship, which is committed through the end of 2014.

Pepsi’s four stations are dedicated to pop, country, Latin and EDM, respectively, and will feature Pepsi-backed artists like Mexican dance group 3ballMTY and country singer Hunter Hayes, as well as global Pepsi artists like Eva Simons, with whom the company works in the Netherlands, and introduce them to U.S. audiences. A version of Pepsi’s global ad starring Beyonce will also appear throughout the iTunes Radio ad load, which includes one video ad an hour and three additional ads every 15 minutes.

iTunes Radio is available as part of the new iOS 7 launch, across all iTunes-compliant devices including PCs, tablets, iPads, iPods, iPhones and Apple TVs. Pepsi will be the platforms’ exclusive beverage sponsor through the end of 2013. As previously confirmed by Billboard, ad packages for sponsors beginning in 2014 will be sold at a minimum of $1 million and will include a 12-month commitment.

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Frank Cooper, chief marketing officer of global consumer engagement for PepsiCo’s global beverages group, says the initial conversations with Apple began in 2012 alongside media agency OMD, senior Pepsi beverage marketers, Frito-Lay marketers and key Apple executives. “It wasn’t only sales; it was the music leads, programming execs,” says Cooper. “We really came in from the beginning with a cross-section to create broader ideas of where this partnership could lead.”

While iTunes Radio may be a me-twelve entrant in the streaming music space, Pepsi has a history as a launch partner of startups (its two-year-old Digital Labs program), boutique labels (the brand will sponsor a creative lab with L.A. label Innovative Leisure this weekend) and new-to-the-U.S. TV properties (The X Factor, a deal that expired after 2012’s under-performing season). Pepsi and iTunes also have a history that dates back to 2004, when Pepsi sponsored 100 million free song downloads via specially marked codes on Pepsi products (the promotion was discontinued early, however, as the still-nascent iTunes was available only to Mac users at the time).

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“Clearly, streaming is not new, but we think there’s a lot of growth ahead,” Cooper says. “When you look at the broad Apple ecosystem, to us that becomes extraordinarily interesting. The data and the engagement that they have across the entire iTunes platform, the devices that they have and the creativity that they have in terms of delivering a complete, holistic experience for our music gives us the confidence that this could become a critical piece of the broader picture in engaging music fans and our own consumers around music.”

Over the course of the next 15 months, PepsiCo will track the effectiveness of its iTunes Radio sponsorship in a variety of ways, adds Cooper. “We think we’ll be able to measure the talk value around this -- can we actually iterate what people think about Pepsi’s participation in it? It’s not our intention to beat people over the head with Pepsi; it’s about their listening experience. We think we can do certain things on this platform with Apple as a partner that will create some social media measurement tools. We’ll also look at brand equity overall through a wider window, and that’s not gonna run during the first three months. Maybe not in the first year -- but for the longer term.”

Twitter: @billboardbiz

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