AMERICAN EAGLE, MIRAMAX DEAL: A RISKY NEW ROAD

Byline: Vicki M. Young

NEW YORK — With convergence being the latest buzzword in entertainment, the American Eagle Outfitters deal with Miramax could signal a new wave in the fashion-Hollywood connection.
The road is paved with risks, though, and industry insiders said fashion companies paying for sponsorship deals could be spending more money than the exposure is worth. There’s also the issue of control over the product, and even overexposure.
As first reported in WWD, American Eagle last week signed a sponsorship deal to be the official wardrobe provider for at least four productions of Dimension Films, Miramax’s genre film division, targeting the teen audience.
Lori Sale, senior vice president for worldwide promotion at Miramax, disclosed that the retailer is paying the film company an undisclosed sum for the alliance. Michael Leedy, executive vice president of marketing and e-commerce at American Eagle, declined comment on the financial terms. He stated, “It’s a good deal, with good exposure because the movies reflect what is cool in our culture.”
The first film, “Boys and Girls,” featuring Jason Biggs in American Eagle gear, was released last month. The second, “Getting Over Allison,” is scheduled to be released next January. The remaining two films have yet to be identified. The marketing alliance calls for promotion of Dimension Films’s productions and of its roster of talent at American Eagle’s Web site and in its seasonal magazines, as well as at its 503 stores in 46 states.
Michael Nyman of Bragman Nyman Cafarelli, a public relations and marketing firm, said, “These deals are still unique, still really new. You’ll find marketers who have an affinity for these deals, but sometimes those at the forefront get burned. You have to ask, ‘At the end of the day, what do you want to get out of it?”‘
According to Nyman, the exclusive sponsorship deals are a natural evolution of longer-term strategic partnerships between marketers. He expects to see more convergence and integration on all levels, whether its marketing, publicity or sampling opportunities.
“Obviously, entertainment is the largest general export this country has — it’s a runaway train. Now there are so many elements in entertainment. It used to be television, music and film. In the future, it will be Internet, publishing and fashion. That’s the convergence factor, and it’s real critical. Any good marketer is going to figure out a way to harness the entertainment vehicle,” he concluded.
Irma Zandl, president of trend research firm The Zandl Group, observed, “I expect to see more deals like this for a little while. The Web configuration is a great element. People can truly hunt you down and you can convert their interest into a real purchase. When people are trained to go to your site, that ups your chances of catching on with your consumer.”
Leedy views the deal as a great way for his company to reach its targeted consumer, those between the ages of 16 and 34.
“Thanks to Hollywood, American style has always captivated the world. From James Dean to Audrey Hepburn to Miramax today, and great intelligent stars like Matt Damon and Gwyneth Paltrow, the silver screen has always been a reflection of the fashion of the day,” Leedy said.
As previously reported in these columns, this isn’t the retailer’s first foray into a Hollywood deal. Last year, it partnered with Columbia TriStar Television to be the official wardrobe provider for the teen drama “Dawson’s Creek.” Leedy disclosed Friday, “We’ve renewed the relationship for the upcoming [TV] season. It continues to be a great fit for us. This year, we are expanding our advertising, together with radio advertising spots, nationwide beginning in October.”
As for the Miramax deal, Sale said it was for one year only because “American Eagle was unwilling to commit beyond the year until it knew what films were in the pipeline.” She credits their successful partnership in “Boys and Girls” to have helped clinch the current deal.
“‘Boys and Girls’ was a great test. It was one where the filmmaker saw the product and was happy to use it [because] it enhanced one of the characters.”
Product placement for the film included American Eagle’s Web site at ae.com, a contest for a trip to San Francisco where the film was shot, trailers of the film shown in the specialty retailer’s stores, and bag stuffers one month before the film opened.
“It was tremendous exposure for us,” Sale said.
Leedy noted that the Miramax deal is likely to be the last one for quite some time. “I don’t foresee us hatching any other deal. Columbia TriStar and Miramax are a perfect fit for us, as we are for them. It makes sense to have a relationship with just one [film] studio and then to develop it.”
To be sure, items showing up either on small or large screens sometimes create enough buzz to start a fashion trend. At the start of the fall 1995 TV season, those delicate Y-necklaces became a hot wardrobe staple for actresses on such shows as “Friends” and “Melrose Place.”
Richard Jaffe, retail analyst at PaineWebber, noted, “You can’t get a Y-necklace every season, but if you can get teen idols to wear your clothes, it can’t hurt. We identify with characters on a show and what they are going through. Companies can get a nice fashion buzz if they can get a personality their customers identify with.”
But as Marcia Aaron, retail analyst at Deutsche Banc Alex. Brown, observed, “It’s a good way to be more authentic about your product, but it’s got to fit in with the movie and you have to make sure the customer knows that it’s your product. If your product can’t be identified, is it worth the money?”
Joe Teklits, equity analyst at Ferris Baker Watts, pointed out, “These sponsorship deals can be risky because there’s the chance that the company is giving up some measure of control over where and how the brand is used. There’s a chance the brand could be embarrassed or get too much exposure. These deals are good for a brand that needs exposure, the ones that are up-and-coming. It’s hard to quantify the upside if the brand is already out there.”
And Zandl added, “You have to wonder how much the company is spending for the opportunity and whether it’s worth it, because teen movies often don’t go anywhere. A deal with ‘Dawson’s Creek’ is one thing; it’s a successful show. But being on an obscure show that nobody’s watching, that’s a risky proposition.”
According to Leedy, “Miramax and Dimension have a great track record for making great films that target our audience. We have a choice of their movies and the right of first refusal to pick which ones we want to be involved in.”
Other releases from Dimension Films this year, but not part of the American Eagle deal, include “Scream 3,” “Scary Movie” and “Reindeer Games.”
Leedy played down the risk of overexposure: “Overexposure is always a consideration. But if you are true to the soul of your brand and you only pick partners and media that makes sense, and it’s your culture, you’re OK. Otherwise, if you just partner with anyone that comes along, you do run the risk of diluting your brand.”
According to Miramax’s Sale, “This is a great relationship both ways….We can tap into their designs so our films are relevant. They have the ability to reach the consumer audience in places where we have no access.”
Sale said American Eagle doesn’t have any say over which characters in the films get to wear the retailer’s clothes, nor are any filmmakers obligated to use American Eagle apparel. That doesn’t bother Leedy.
“It makes sense for Miramax to use our product as much as it can,” he said, “so we can continue to highlight their product with our promotions.”

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