Derek Sivers revolutionised the way music is distributed when he created CD Baby. Since then many others versions have popped up. Is there scope now for another CD Baby-esque venture?
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Entries in music business (50)
So much talk about the success, or lack of, making it in the new music business industry. But it really comes down to treating your musician career as a business. Let’s look at some statistics. History shows that…
One of the interesting aspects of the Rethink Music conference back in April was hearing MOG CEO David Hyman and (separately) Pandora CEO Joe Kennedy discuss the present and future of online music subscription services.
MOG is all about access. Outside of the usual holdouts, MOG’s catalog contains just about everything, including most of the releases on our Static Motor imprint. For fans, it makes for an intelligent (Echo Nest-driven) music discovery experience that seamlessly blends the mainstream and the independent. For artists, getting your music onto MOG is a cinch. As long as you’re distributed via an indie aggregator (CD Baby in our case) your music will soon pop up on MOG. For fans and artists alike, MOG is an excellent platform. Easy access for all, with top-notch audio quality to boot (and no ads!).
A different business with a very different model, Pandora certainly talks a similar talk, which is why I was struck when Joe Kennedy commented (paraphrasing):
Pandora is all about connecting people to new music.
Amongst the busy chatter of digital DIY dudes and galloping gurus it’s easy to forget that there is a major, multi-million dollar music industry that already exists. That’s because we seldom hear from the major players outside the sanitized propaganda sheets of Billboard and Music Week. But this week we can read their views in a Music Tank report by ex-EMI head, Tony Wadsworth.
A general rule of commerce is this: You cannot demand money until you have generated demand, or at the very least, the perception of demand. And a sure way to generate demand is by using a loss leader. Your music is your business. And in business, in order to spike sales and increase the bottom line, you have to pick and put into play a loss leader. A loss leader is a part of your whole product offering that you will lose money on (or not make money on) in order to get potential customers through the door. Once they are in, their experience with your “brand” should cause them to buy other products you also offer as well as become repeat customers. This adds to your bottom line. This is what a loss leader does.
With the present state of the music industry, the chances of landing that entry-level, dream job in the music business is even more difficult than it may have been ten or even five years ago. As an intern in the music business working for companies that may be in the realm of record labels, music publishing, marketing or other types of social media/digital companies, you may be asked to do anything and everything.
I used to be afraid of always talking about my music to people, whether it was online or offline. Mainly because I was afraid I would annoy and lose them. I found myself in a dilemma of sorts because the promotion of my music was inconsistent as result. And inconsistency doesn’t breed success. So I had to check myself. I was taking this music thing too personally. I needed to step back and be a bit more objective with my career. I needed to think like a businessman. After all, I’ve spent 6 years building my own marketing company.
As I understood business, when you have a good product, the main task at hand is to figure out ways to let your target audience know it exists and raise your product’s profile in their lives. That is your focus. You are the owner. You are the marketer. The success of that product is in your hands. And, being in music makes no difference. If I ever want to make this passion my “9 to 5”, I had better pull things together. What I’ve found is that it took just as much creativity to be in business as it did to make music. Both requires you to take what is seemingly nothing and make it into something. Except when it comes to the business side of things, your job is to make your music, which at the start is nothing in the mind of a consumer, become something meaningful to that consumer. And the key to great marketing is one word: frequency.
I know what you’re thinking. “There’s no such thing.” That’s what I thought too. Until I started to piece together the stories and advice I heard after going to several music industry events. It all came together for me when I attended the recent ASCAP NY Sessions. The light came on. I saw a common denominator - an overarching theme in all of their stories and thoughts. There it was. Could it be? The silver bullet for music business success? Except it wasn’t the shiny silver bullet I expected to see.
I am a KISS fan, going back to 1976 when my mom first bought me Rock N’ Roll Over. I remember taking heat in the late 70s at school for liking the band, I heard the phrase “KISS sucks” more than a few times. It also took a lot of courage to wear a KISS t-shirt to school at the time… you became a instant target. I grew up with KISS and their marketing has clearly been a influence on me and business growth. I often tell people I went to the Gene Simmons School of Marketing.
Up until now, music was in a unique competitive product category: there simply wasn’t much competition (for consumer attention) between well-made songs.
Songs are inexpensive, consumed in under four minutes, easily obtained, and songs are the only product in the world where billions of users…each own thousands of ‘competing’ alternatives. In reality, uniformly-priced competitors are often stacked up and then consumed in succession, and in the age of the iPod, the stacks (the playlists) are growing instead of shrinking.
However the modern world conspires to ultimately deliver, in every product category, the greatest value at the lowest price, and songs are about to loose their long held exception.
Have you bought a video game recently? Have you ever made an in-game purchase? Do you consider pre-roll, banner or in-game advertising acceptable? Do you think buying video games online or on a mobile device is normal? Has the video game industry turned social networking into a revenue generator through multiplayer gaming?
Every day, I’m meeting people who could answer “yes” to all these questions - which raised a very important question in my own mind: if we replace the word “game” with “music,” why aren’t these answers still “yes?”
The music industry has a lot to learn from the video game industry. We’ve finally gotten past the “save the CD” era, but the music industry is still lagging when it comes to proactively developing new business models. Just as the video game industry has continually adapted and reinvented itself in the last few decades – arcades to consoles to mobile to online to apps to ad-supported and so on – the music industry must learn to quickly spot new consumer trends and behaviors, and then adapt the technology and business models to turn those trends into new revenue streams.
After traveling to eight countries this year, teaching master classes and speaking on panels the thing that stands out for me is:
How hard we can be on ourselves.
It’s almost the end of the year, and it was a crazy year for most of us. Musicians and colleagues alike tell me that they were busier than ever before.
We have all had to come up with more creative ways to stay relevant and vital in the current music business either as musicians or entrepreneurs, so, this busy-ness makes a lot of sense.
You constantly have to stay on top of not only your creative journey and output, writing, rehearsing, booking, touring, marketing, and managing all of your social media, recording and releasing music, not to mention keeping balance in your personal life as well.
In the spirit of holiday gift giving, I’d like to give you a new, six-page report called “10 Success Strategies for DIY Musicians, Managers, Promoters and More.”
Use this direct link to the PDF file to open and print it. (If you want to access it later, be sure to save the file to your hard drive or favorite ebook reader.)
I encourage you to share this free report with anyone you feel could use it. After all, that’s why I published these 10 DIY music strategies - to inspire and empower music people who really need to GET these principles.
I just got home from a wonderful Thanksgiving dinner with my mother, sister, brother, niece and nephew in Franklin Park, New Jersey. The roads were slick from an early snow shower that turned to freezing rain. As I was driving home it dawned on me that I haven’t written a blog post (on any topic) in over a month. But tonight I suddenly found the inspiration to present…
A Sample Music Business Plan for Your Band
For those of you who haven’t read my previous posts on this topic, I’ll briefly bring you up to speed. I wrote a post on Music Think Tank Open that was transferred to the main page (an honor in my book) called How to Write a Music Business Plan. It was a bit fluffy like this one might end up and one of the MTT readers called me on it. The first comment was, “Would have been stronger with a template or sample.” I got pissed off and created a template. Thanks again Justin.
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(Updated Feb 25, 2014)