Dimuro Sees Efficiencies In New Bmg Structure

BMG Strategic Marketing Group—the newly created division housing BMG Special Products, BMG Heritage, Strategic Marketing, and Direct Response TV—is set to begin rolling out its first projects as an integrated unit this quarter. Initial releases include titles from Elvis Presley, Yanni, and Dolly Parton.

As part of the reorganization, catalog exploitation will be centralized under former special-products chief Gary Newman in the role of executive VP of BMG Special Products/BMG Heritage (Billboard, Dec. 21, 2002).

Joe DiMuro, executive VP of the New York-based unit, outlines BMG's motivations for linking the businesses and his vision for the group:



What are the benefits of the new structure?

There is a certain amount of efficiencies that can be created from integrating the units. We can bring in more marketing and strategic marketing aspects through some of the special-products releases that are coming out. Certainly we can apply some of the marketing principles of the Elvis 30 #1 Hits campaign across a variety of different catalogs and repertoires. I'm not saying everything is going to be Elvis Presley. It's not. But there are certain principles that are fundamental that we can apply. And they haven't been applied before. Everything had been done in very separate units; the intent here is to unify it.



What are the cost-saving opportunities?

There are several reasons for the exercise. First, there's the strategic standpoint. But there's also an economic standpoint. Financially there are certain savings and scales of economies. Not only in terms of personnel but also in terms of the functionality of the businesses.

I think you can look for more consolidation in the amount of agencies we work with and in the amount of outsourcing that we do. A lot of it now will be done in-house or with a select group of agencies that will work with all the business units, rather than hiring independently in each of these silos.



Are there going to be layoffs?

Not necessarily. It's really not a case where we're looking at layoffs or termination of personnel. I think it is, in most cases, expanded responsibilities and redeployment of responsibilities.



What's happening with direct-response TV?

We're in the process of hiring an executive specifically to work on direct-response TV initiatives. In the past it was fragmented. I did some of it; Gary Newman did some of it. We would outsource the creative, and I would deploy a project manager to oversee the initiative. What we're looking at now is hiring someone much more for the A&R and repertoire standpoint, as well as to oversee the joint venture between BMG and Warner Music Group on the Totally Hits collection, and also to look at additional joint-venture and third-party cooperative alliance programs that can be solicited on television.



Are you viewing licensing to digital-subscription services as an online strategic marketing initiative?

That's right. It's going to be handled by [senior director of online strategic marketing] Keive Huffman. He's been with me at RCA handling all the online affiliate relationships with MSN, AOL, Launch, vh1/mtv.com, and so on, but more from a marketing perspective. We're now adding to his responsibilities the commercial aspects of all the digital licensing. Previously that was handled by a consortium. Gary Newman and his group were doing all the production and processing of the licensing, [BMG Distribution president] Pete Jones and his group were overseeing the marketing applications of these licenses, and the business affairs group was overseeing licensing for BMG corporate worldwide. Now we've consolidated all of it within this department. We're handling all the licensing and all the business affairs and deal generation points.



What about DVD?

Another aspect of the BMG Strategic Marketing Group is we are aggressively looking at catalog acquisitions and new product development acquisitions, including formats like DVD. That's an area of growth for us, which, again, had been handled in a very fragmented way in the past. Now all the DVD business development and marketing/sales/distribution applications will work through our department. Brian Garrity