Over the last four years I have gained experience in the music business where I played a significant role in creation of the digital supply chain between the record labels and DSP’s (Digital Service Providers) such as iTunes, Sony Connect, MSN and over 100 other providers around the world etc.  In addition we built and dominated (approx 80% market share) the 30 second preview clips powering Yahoo, MSN, WindowsMedia, Amazon, AOL, B&N delivering over 1 billion samples per year.

From there I moved to CinemaNow where I am currently the COO and where we are building the digital supply chain between the major studio’s and ourselves. Being only one of a handful of companies with the rights to sell full length movie and TV download, and being the first company to offer the ability to download and burn full features DVD products.

A core component of this is marrying these supply chains against the marketing efforts of these organization. My statement is that phase one of building a supply chain is to get the “right product to the right place at the right time” and phase two is “to get the right product with the right marketing message to the right place at the right time to maximize demand.”

In parallel to these efforts I have been researching and have personally invested in a company that provides POS advertising in the grocery business that is tightly aligned with the category management techniques being used by CPG companies. It is very interesting to note that many of the large studio’s hired to run their distribution companies executives from CPG in order to ensure that the tightly aligned their supply chain (distribution) strategies with category management based marketing and merchandizing strategies.

 It is also interesting to note that Amazon hired a former WalMart executive to help design their distribution operations. These trends are continuing to evolve over time as Neilson’s books on the subject states that today’s category management trends are focused on “Consumer Centric Category Management”.

It is my opinion that giant leaps that have been and are continuing to be driven forward by digital distribution industries are yet to be taken advantage of by marketing and advertising departments. i.e. I firmly believe that the sciences behind supply chain management and consumer centric category management could be further enhanced by the technologies that have been developed with-in digital distribution and asset management to enable companies to morph and distribute their marketing messages to match ever changing market needs.

It is my opinion that supply chain management is a well developed science the maximizes both the selling potential of a channel and the use of capital. On the marketing side of the equation companies like Google have focused on “relevance” especially the relevance of the marketing message.

While we have seen some embryonic attempts to link these two worlds through direct marketing, and POS advertising the general content management infrastructure (or digital supply chain) has proven to be significantly harder to build than people would have thought. I used to joke “its easier to ship a CD on truck across the country and put it on a store shelf on time than it is to get a Digital CD on the virtual shelf of DSP.” A second example of the embryonic stage that linking physical and digital supply chains is the use of digital assets as a rewards mechanism for physical goods. (Think iTunes and Pepsi).

I therefore predict that the following three things WILL happen:

1. Linking relevance of on-line advertising with physical supply chains. (Think Google being able to predict based on peoples searches physical retail sales patterns)
2. Reconstruction of the digital supply chain to match the physical supply chain right from the creation process to the play-back experience where that marketing message will be most relevant.
3. Coupons have since the days of Claude C Hopkins been used to pull product through a channel. We will need to think of digital assets (without devaluing digital assets) as being the coupon of the future through links to rewards programs.

David Cook