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« Are you a 'Gracious' Musician? | Main | Getting the music advertising ROI calculation correct... »
Tuesday
Nov012011

How A Major Label Markets A New Artist

Recently, ASCAP’s Daily Brief included an article by David F. Carr entitled, “How Warner Music Turns Social Media Fans Into Customers”.  I thought there was one paragraph in there that was extremely insightful that some readers may not have caught. It needed to be expounded upon. If you’ve always wondered how a major label goes about building a fanbase for a new artist - as far as their overarching philosophy on it - there it was! 

The statement came from Eric Snowden, VP of Digital Creative and Technology at Atlantic Records (Warner Music). Here’s the paragraph:

The promotional strategy is also different for new artists than for established ones, Snowden said. “At the beginning of an artist’s career, we want to keep the barrier to entry very low,” he said, and that may mean publishing more free content and sharing it more widely. As an artist becomes more popular, “we ask a little bit more from fans and try to drive them to our own wholly owned properties more.”

For some reading this, it’s a “duh” kind-of-thing. But, I thought there are those out there for whom understanding this will help them become more clear in how to market their music. So the major label’s approach is two-fold:

  1. When you’re unknown, make it easy for people to engage (content is free, content is everywhere).
  2. When you become more popular, you can ask for more from people (content is paid, content is exclusive). 

We usually are only aware of the process that takes place after a new major label artist has hit a critical mass point and is getting ready to be pushed into national recognition. It’s a funny thing. Think about it. When you hear about a “new” or “emerging” artist in the media, they’ve actually already reached critical mass, they just haven’t reached national recognition. 

There are artists that reach that critical mass on their own and then sign with a major label. Then, there are artists that major labels bring to that point and then push them onto national recognition. I have a friend who has a development deal w/ a major and I’ve been following his process. And I’m seeing the overarching philosophy mentioned above at work. 

When I read the article above, it also made me think about Drake’s (the rapper) early career and how the same overarching philosophy is applied (I’m referring to the method of releasing free mixtapes and having him everywhere to be discovered - even before his sound became fine-tuned - even before the So Far Gone mixtape). It also made me think of drug dealing.  First few hits are free. Once you’re hooked, it’s time to pay. 

The more I learn about this music business, the more I realize how much common sense comes into play. It’s understanding basic human psychology and working it to your advantage, using whatever means and methods necessary (short of breaking the law, of course). It’s a real hustle. I’m sure many can attest to this. And when you hustle, understanding the philosophy above, you’ll eventually be big - given that you don’t quit and your product is good. 

—-

Minh is an artist, producer, and entrepreneur based in the DC metro area. His website is www.reachminh.com

Reader Comments (21)

Makes sense.

October 27 | Registered Commenterjoe brown

I've been discussing this topic with a friend of mine and we agree that free content is the way to go...If the music is good, it'll speak for its self.

November 1 | Unregistered CommenterKoopDaVille

I don't think anyone doubts the validity of this method. I think people just wonder whether there's a way to make it big without giving everything away after spending all of your money to make a quality product.

I'd rather hear how the little guy markets THEMSELVES effectively than how the majors, who have that money in their budget market a new artist. Some people don't have the money to burn for the give-everything-away method.

I'd love to hear about an alternative.

November 1 | Unregistered CommenterKW

This is actually good info overall. To say it's "common sense" is only half true, mostly because this is a Major Label who's talking here. These "emerging" artists can afford to take the hit because of the financial stability of other artists that pick up the slack on the label, the ones who actually turn a profit...on top of the capital that already has existed for years (not to mention that the Major Label can potentially push an artist to national recognition, but not necessarily national success) it may never end.

This is not common sense for an independent artist, or label that doesn't have that type of disposable income or liquidity. I do believe that you need to make content accessible, but you also need product (durable or virtual) to retain some semblance of value within your work. This is more or less the basis of the "freemium" concept.

Another aspect that needs to be considered is the glut of content, and free content at that. Sure the first few hits are free, until you ask to pay, then the user goes to the next dealer where the first few hits are free....it's really a never ending cycle, and being that artists can (by virtue of a viable label) or are told to (so they don't go unnoticed as an independent).

Also, drake is a HORRIBLE example of a success story using this template. This is someone who was already well within the entertainment business as an actor well before his career in music started.

Look at someone like 50 Cent, who did the same thing from street, that's a more realistic success/learning curve... while you're at it, check out the 50th Law, a great book he co-authored.

November 1 | Unregistered Commentergaetano

There's another interesting clue in this quote. In fact it doesn't say Atlantic pushes content "everywhere" - it says "sharing it more widely". It would be good to know how Atlantic decides where to share content. Do they use demographics? Location? Key words? Association?

Better results come from being more focused compared with "being everywhere". Being focused or getting well known in a 'niche' is more achievable for indie artists.

Eliza

The Fan Formula

I agree strategy is important, but isn't Warner Music Group losing around $40 million a quarter? You might want to follow strategies of people that are actually making money.

November 1 | Unregistered CommenterGustavo

I have read several articles (by experienced music business people and artists) who say the opposite: If you present yourself and your music by giving it all away for free, you communicate that the quality of your music is not good. In real life, we are used to "getting what we pay for". Why not in the music world as well? I prefer to sell my music, but if someone is asking me to get an album for free, I will give it away for free, of course. There is absolutely no cost in giving away a digital track or album, so I have nothing to lose. I love the web shop www.bandcamp.com because I can offer my music for a reasonable price and ask my fans to pay what they can afford. In most cases, they will pay more than I am asking for :)

November 1 | Unregistered CommenterHelge Krabye

OK so a performer releases a couple of albums or several singles for free online, develops a fan base clamoring for more, and then look forward to getting signed... to a 'devlopment' deal? I didn't think they existed anymore. No wonder many performers don't look to the majors anymore. Too many labels want to change what already works, then wonder why the performer didn't 'develop' into what they wanted.

Yes this article hones in on something that is definitely a common sense approach. But the immediate and necessary bookends to this subject are not put into the context, so the books therefore all fall off the shelf...

November 1 | Unregistered CommenterBill

Hey all...great comments! Please keep in mind the article isn't about giving away everything free (a freemium model). It's about the principle of getting people hooked before demanding things from them.

November 2 | Registered CommenterMinh D. Chau

You know what I think music promotion is going full circle. The Spotify model is totally flawed and not necessary anymore. I won't go as far and say that we need filters but what we do enjoy more is a random selection of music so the internet radio model has a lot of scope to grow.

Also the war between content providers and the freemium streaming providers is going to get worse. We7 have already switched model to a radio model and Jango is pretty excellent with its selection of music.

A smart Richard Branson type could clean up immensely here. Jango offers indies "airplay" at a price thereby injecting valuable dollars into the service without annoying customers, though I feel their price is too high and they do not offer indies any other airplay option which is pretty much totally a flawed model. If they offered indies regular playlist slots and on top of that offer the music industry as a whole ad spots would work a treat. However in terms of this article free streaming or radio model is the only freemium model I would recommend, it also has a low barrier to entry. Requiring emails for downloads does not have a low barrier to entry so is not the best way forward. So to cap it all, I would say look at the radio model and maybe we can adopt it as indies.

November 2 | Registered CommenterKehinde azeez

I think this is a good article. That being said, even in offering free content there has to be money invested to drive people to that content and make them aware that it exists before someone can get to critical mass. A good PR person can help with this as well as a great marketing strategy

Brian Lee
Music Producer & Engineer
http://www.mrbrianlee.com

I think it's really important to note that "FREE" shouldn't necessarily mean FREE. Asking for an e-mail address, a Facebook 'like', or a Tweet allows for a very low barrier-of-entry, but gives the artist a valuable tool & sets them up for the future.

Giving away music for absolutely nothing means you are missing a key opportunity to market yourself. If you don't expect people to invest any time into you, they won't.

November 3 | Unregistered CommenterMike

I disagree with giving it all away for free. I think artists should put a value on their music to a certain degree. You can give away a few songs, but at the end of the day, it is always about musicians making money so they can continue to build their careers. Also there is much more to marketing than just free downloads. It includes exposure through live shows and mass media.

November 3 | Unregistered CommenterAnne Leighton

He never said Free. nor "music." he said content and low barrier to entry. as I read it, the "free" was added by the author in the original post.

November 4 | Unregistered Commenterfollow along

You have to understand that this is a major label exec talking. The major labels are all about monetizing music! They're the last people that want music given away for free!!! I repeat, MAJOR LABELS ARE THE LAST to want music given away for free.

However, there are marketing realities they have to succumb to in order to MAKE MONEY from music. And we'd be wise to pay attention. In my artist, I said very clearly "content is free". This does not mean only music. This is where you have to be creative. But yes, you'll have to have your music readily available in as many places as possible.

The overarching principle in the article is to get them hooked with freebies prior to trying to charge them. And of course, you should always try to get an email address. That's a given. Please read what's there in the article and not what you're thinking it says.

November 4 | Registered CommenterMinh D. Chau

Working on a indie music site where the price of tracks and albums start at 0, then increase with number of downloads: http://songballoon.com

At the moment, need musicians!

Cheers,

Stephan

November 4 | Unregistered CommenterStephan Wehner

Businesses that rely on small purchases (99c is definitely small) give away stuff to entice customers. Businesses that rely on large purchases offer discounts, stress conferred status and give you freebies once you made the big splurge. How is this news to anyone?

November 9 | Unregistered CommenterLil Johnny Doe

Yea i'd be wary of taking any advice from people who're losing tons of money with huge budgets. You wouldn't take math help from someone failing math. you wouldn't take financial advise from someone who's neck deep in debt.

Free content does serve a purpose and if used correctly can draw the attention of people who can be converted into fans and in some cases, the die hards who'll buy everything you put out. But to think that free MUSIC, free SHOWS, free MERCHANDISE is the way to gain these fans one would be sadly mistaken.

There has to be a balance - which is ultimately up to the artist or band or label. It's no different then the sample tables at the grocery store, they're there to let you know just how good a certain product is and hopefully in that 20 second span you're there you hear something about how much it is and what aisle it's on and if it's good you go check it out.

November 9 | Unregistered CommenterItsTheIndieGuy

As a response to some of the comments written, I want to add this note:

It's a mistake to think that the majors do not know how to market music because they are losing money. They're losing money because they were behind on the changes in technology and have been losing on what used to be a highly lucrative income stream (i.e. CD sales).

And there's too much ranting about giving music away for free. No good business wants to JUST give away music for free. But if it's part of a marketing plan to capture eventual buying customers, then you have to do it. The marketing principle presented in the article is one used not just by major labels, but by all kinds of businesses, big and small. A business mentor once said to me all the time, "Business is common sense."

November 15 | Registered CommenterMinh D. Chau

This is interesting but as far as independent artists are concerned, it is a dreadful example.
Let me say this loud and clear. WE CANNOT FOLLOW THE MAJORS ON ANYTHING.
Not because the majors are rubbish or not good or losing money or any of that nonsense, but because the majors have more money and clout and for them they have a very different strategy and end game.

For us we need to have a very different approach especially early in the game.

Independents should be following a model that takes unknown nobodies and then turns them into known somebodies. This is the only approach that would work for us and I am talking very much out of experience here.

I also think many of the professionals in the "make it in music" industry say a lot of things that do not help many people in the industry. They mostly tell you things you already know or can find by using Google, and charge you for it. We know the basics and we can find the basics and we don't need anyone to sell us solutions that don't bring anything new to the table or are not suited to our needs or that just don't work.

As someone who is running his own label (and there are others like me on here) my information is based on experience and is totally free. I am not trying to sell anyone anything as I believe we need to find a way for the DIY industry to grow up in the market place and be taken seriously. Rant over.

Now back to what we should be doing.

It is my firm belief that until you reach a certain threshold, NO ONE is really interested in your music, so to try and get them to buy, or share their email with you is totally unrealistic. This is NOT what you should concentrate on, even though you should always give people that option.

There is only one model that works for complete unknowns - the YOUTUBE/reality TV model.

Basically it works like this:

Put a video on Youtube, do some promotion to rack up your views (it is madness to spend money on PR, radio promotion or anything else at this stage) and let the YOUTUBE formula go to work. That is likes, comments and subscriptions. Then direct all your PR activities to your online TV show. The press love a good internet hit.

Your Youtube video could be done like a mini reality TV show or even a monologue rant a la Jenna Marbles, Ray William Johnson etc. Also you should have an EPK and some sort of performance video (studio, live etc). But they should be monetised. As a rule of thumb 1 million views should earn you at least $3000, so imagine have 3 5 min videos a week x a 12 week campaign. You could gross up to $108,000.

GAGA is an artist using this model (yes she is a major label artist but she has really mastered this perfectly). Video has always been part of Gaga's strategy and we haven't even began to scratch the surface to the power of online video. People need to be familiar with you and bond with you BEFORE they will buy from you.

Under NO circumstance should you even think of free downloads. They are sooo 2005. Now it is all about streaming baby and monetised streaming at that. Tough cheddar if viewers don't like ads. Youtube is becoming very adcentric and people are still watching videos like crazy. Give people a link to join your fanclub and links to your Itunes page (via a download button) and that is it.

Youtube is changing. It is becoming a lot more like a regular TV channel (or it wants to) and is preparing for a major inroad into terrestrial TV land. Google are going to take on the TV networks and a lot of them are going to buckle. One thing the music and TV industries took for granted was their viewers. They thought they were more important than their viewers and their distribution models were sacred cows. But iTunes has dealt the record industry a mortal blow and Youtube is doing the same with TV. The internet is going to gobble up all advertisers who will wake up to the fact that for years they were being hoodwinked by the experts. Now advertisers want accurate stats and want to pay for results. Only the internet can deliver on that front. Google are circling. They know what lies ahead so now it is time to revamp your online video strategy and work out where Youtube fits therein.

Your videos should be monetised by Youtube via their partner programme. If you can get on it, then that will be superb. If not then all is not lost. Use your website instead.

Go to http://www.vhprecords.com/ and look at our example. On the one screen you should have your monetised Youtube video, and on the other a video ad or even a Google display or text ad. Videos get more plays but Google gets higher CPCs.
Don't be shy of ads, you are in the TV business now.

Do this until you get substantial view and a series of videos (preferably with a theme). At this stage you are ready to take it to the next level which is to promote the playlist or even your channel. This should be done through your webpage as well as directly on Youtube, Facebook etc. You can even start to think of going offline and into TV land either using regional commercials or infomercials. This way you can add "As seen on TV" to your promotional material.

Youtube and Reality TV are creating stars out of unknown nobodies far more efficiently than anything the music industry is doing. Face it no one is interested in your boring music. It is YOU they are interested in so start selling them brand YOU!

PS: Product placement is going to be huge (if it is not already) and there are companies offering product placement for the little guys.

PPS: Feel free to argue with me :) I am all for different views.

December 2 | Registered CommenterKehinde azeez

interesting post indeed. thanks for sharing this info

Tina
Catch Friday

January 26 | Unregistered CommenterTina Pierce

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