Times have changed, however, and in 2006, many of the major players in adult entertainment are offering a wide variety of products, some of which are not necessarily adult entertainment per se. Vivid Entertainment, Wicked Pictures, Larry Flynt's LFP/Hustler empire and Private Media Group are still adult entertainment companies first and foremost, but they are adult entertainment companies that have been diversifying more and more. And they have been diversifying thanks to the power of branding. If a brand is strong enough, an adult entertainment company is in a position to offer anything from vodka (Private) to a casino (Hustler) to a major jazz festival (Playboy).
"Branding is all about expanding your company in new markets and getting into areas that aren't primarily what you do," said Joy King, who is the vice president of special products for Wicked Pictures and played a major role in the rise of adult film superstar Jenna Jameson in the 1990s.
The first adult entertainment company that truly recognized the possibilities of branding was, without question, Playboy. It was Playboy magazine that put Hefner on the map in 1953, and Hefner expanded the Playboy brand when, in Chicago, he held the first Playboy Jazz Festival in 1959 and opened the first Playboy Club in 1960. In the early 1960s, it became clear that Hefner was not only selling sex, he also was interested in marketing nightclubs and live music — although the Playboy Jazz Festival did not become a regular annual event until Hefner moved it to the Hollywood Bowl in 1979, and there was a 20-year gap between the first and second Playboy Jazz Festivals.
Branding As Exception
But again, branding was the exception instead of the rule for adult entertainment companies in the 1960s and 1970s, whereas these days, it is the norm, which is why Vivid operates a well-known dance club inside Las Vegas' pricy Venetian Resort Hotel and Casino and why Wicked is selling items ranging from trading cards to a line of sex toys.
Gary Thoulouis, marketing director for Barcelona-based Private Media Group, noted that for many years, Private was not brand-minded. Founded by Berth Milton Sr. in Stockholm in 1965, Private was a successful, popular adult magazine company in the 1960s and 1970s but was not manufacturing jeans or vodka in those days. The company, however, diversified considerably after Milton Sr.'s son Berth Milton Jr. took over in 1991. Milton Jr. envisioned Private as a full-fledged brand, and under his leadership, Private now offers not only erotic entertainment but also everything from Private Vodka, Private Wines and the Private Energy Drink to a Private-branded clothing line. There is even a duty-free store of Private-branded merchandise in the Munich Airport in Germany.
"A lot of our marketing campaigns today are geared toward marketing the brand as opposed to only marketing the product," Thoulouis stressed. "It goes hand in hand because the more popular the brand becomes, the more popular the products will inevitably become. Private has been in business for 41 years, but it took about 30 years before we started marketing the brand instead of only trying to sell magazines or videos."
Mainstream companies, Thoulouis pointed out, were marketing their brands long before the adult entertainment industry became so brand-conscious. But now, Thoulouis said, more and more adult companies are seeing the bigger picture and are promoting their brands as well as their products. Thoulouis was reminded of the power of branding in mainstream commerce during a recent trip to Milan, Italy, where he visited a Ferrari-themed store and saw that the Ferrari brand was being used to sell a variety of things other than vehicles — and the same principle applies to adult companies, he said.
Brand Value Takes Off
"In that Ferrari shop, you had everything but Ferraris," Thoulouis said. "You had bags, clocks, watches, shaving equipment, MP3 players, everything branded with Ferrari. You even had a Ferrari computer. That's because the brand has value. And today, new adult entertainment companies also realize the importance of marketing their brand. They are trademarking, packaging, protecting and nurturing their brand from the very beginning, the result of which is that brands grow much faster today in adult entertainment."
"When people started realizing that a brand could sell a lot more things than only the core product, the idea of brand value really took off," Thoulouis said. In Ferrari's case, the core products are luxury cars. For Private, Wicked, Vivid and LFP/Hustler, it is erotic entertainment. Thoulouis stressed that selling an energy drink or CD compilations of club/dance music does not erase Private's identity as an adult entertainment provider; erotica remains the company's core product. Similarly, taking the Hustler brand into some mainstream areas does not mean that Larry Flynt is decreasing his involvement with adult entertainment — far from it. Michael Klein, president of LFP Broadcasting and LFP Internet Group, explained that continuing to expand the Hustler brand means always being on the lookout for new ways to distribute erotic content as well as pursuing business ventures that are not adult entertainment per se.
In part two, we'll look at Hustler's brand longevity, deals to avoid and more.
