Chip and Joanna Gaines' Magnolia Network

Anita  Elberse; Julia  McNicholas

Case | HBS Case Collection | September 2020

Chip and Joanna Gaines' Magnolia Network

by Anita Elberse and Julia McNicholas

Abstract

Chip and Joanna Gaines, who have shot to fame as stars of the hit television show Fixer Upper, are preparing to launch their own television network. It is April 2019, a year since the home-renovation show Fixer Upper’s fifth season on cable channel HGTV ended, and more than one-and-a-half years since the husband-and-wife duo announced that season would be their last. At the time, entertainment company Discovery Inc. was in the process of acquiring, in a $12-billion deal, Scripps Networks Interactive, HGTV’s parent company. Now, hoping to find a way to bring the duo back, Discovery’s chief executive officer David Zaslav has proposed setting up a joint venture between Discovery and the Gaineses. Under the deal, the latter will receive an ownership stake as well as certain guaranteed payments, be given creative control over the ‘DIY Network’ which they plan to rebrand as ‘Magnolia Network,’ and have a sizable programming budget at their disposal. Meanwhile, the two entrepreneurs are also running a thriving set of other businesses under their ‘Magnolia’ brand, that covers retail and hospitality—including their ‘Magnolia Market at the Silos’ complex and ‘Magnolia Table’ restaurant in Waco, Texas—as well as brand partnerships, books, and a magazine. Is launching Magnolia Network the right move for Chip and Joanna Gaines—and for Discovery? And what can both parties do to ensure the new network will be a success?

Keywords: entertainment; television; superstars; innovation; Creative Industries; Talent; general management; celebrities; Television Entertainment; Entrepreneurship; Joint Ventures; Innovation and Invention; Marketing; Strategy; Entertainment and Recreation Industry; Media and Broadcasting Industry;

Language: English

Format: Print

28 pages

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Citation:

Elberse, Anita, and Julia McNicholas. "Chip and Joanna Gaines' Magnolia Network." Harvard Business School Case 521-044, September 2020.

“We’re in business together, and whether we lose a few million dollars or make a few million dollars, let’s do this. If you think you can pull it off, I’m behind you.” Michael Rapino, chief executive officer of Live Nation, the world’s leading live entertainment company, expresses his support to Pharrell Williams, one of the music industry’s biggest stars, and his long-time manager Ron Laffitte. It is December 2018, and Williams just pitched Rapino an idea for a music festival in Virginia Beach, Something In The Water. Williams is engaged in many endeavors – he is not only a chart-topping musician, but also a fashion designer, film and television producer, brand builder, and business consultant – that are brought together in his company, I Am Other, which is in a joint venture with Live Nation. Although Live Nation generally does not shy away from making big bets on its artists, Williams’ festival idea is risky and has an unusually aggressive time table. Is Rapino right to lend his support to Williams’ proposed festival? Are partnerships like the one it had formed with Williams’ company I Am Other the way forward for Live Nation? And how can the company that dominates the live music space best continue to create value for artists and their managers?

Case | HBS Case Collection | July 2020

Paris Saint-Germain: Building One of the World's Top Sports Brands

Anita Elberse and David Moreno Vicente

In March 2020, Nasser Al-Khelaifi, the president of French soccer club Paris Saint-Germain (‘PSG’) sees his team clinch a spot among the last eight clubs to compete in the UEFA Champions League. Established in 1970 and initially a club with only moderate success, PSG’s fortunes changed when Qatar Sports Investments (QSI) acquired the club in 2011. QSI overhauled the roster of players—by, among other measures, buying Kylian Mbappé and, in a record €222-million transfer that shook the soccer world, Neymar—and professionalized the club’s management, renovated the stadium, developed a new training ground, redefined the PSG brand, and pursued a series of high-profile collaborations. The investment seems to have paid off, on and off the field: since the acquisition, PSG has amassed six French league titles and has risen to fifth place in the ranking of Europe’s highest-grossing soccer clubs. But the biggest prize the club’s owners are eyeing, the Champions League, has so far eluded PSG. Does the club have the right strategy to break the hegemony of Europe’s long-standing soccer powerhouses? And are Al-Khelaifi and his team of executives on the right path toward their goal of establishing PSG as one of the world’s top three sports brands?

Keywords: soccer; football; superstars; Talent; talent development; general management; Sports; Entertainment; Media; Talent and Talent Management; Globalization; Brands and Branding; Marketing; Strategy; Sports Industry; Europe;

Citation:

Elberse, Anita, and David Moreno Vicente. "Paris Saint-Germain: Building One of the World's Top Sports Brands." Harvard Business School Case 521-006, July 2020. View Details

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In July 2019, AFC Ajax’s chief executive officer Edwin van der Sar finalized one of the biggest transfers in soccer—that of Matthijs de Ligt, only 19 years old but already one of the sports world’s brightest stars—from AFC Ajax to Italian powerhouse Juventus FC for a €75 million fee. A few months earlier, Ajax had sold another young star, Frenkie de Jong, to Spanish champions FC Barcelona for a record €86 million. Once Europe’s most feared team, Ajax had lost its prominence to teams from Europe’s bigger leagues since the mid-1990s but gained a stellar reputation as a feeder of young talent to clubs in those leagues. Now, just as Ajax seemingly was making its way back to the highest echelons of European soccer—in the 2018–2019 season, Ajax managed to advance to the semifinal of the Champions League, Europe’s most elite club competition—the club would lose two players who played a crucial role in its comeback. Did van der Sar have the right strategy to find long-term success? Could Ajax continue to develop soccer’s next superstars—all while challenging Europe’s elite clubs?

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