CEO: YOU. Navigating The Digital Frontier In Today’s New Music Business From The New Music Seminar
If one of your biggest questions as an independent artist is, “How do I break through the noise and get my music heard,” then stay tuned as I outline key take-away components to help your artist career, as presented by CEO’s, Co-Founders, Managers and Partners of some of the hottest music-business technology companies today, who recently attended and showcased their wares at The New Music Seminar that took place in Los Angeles, February 14-16, 2011.
Although day two of The New Music Seminar was lightly attended early in the day, in my estimation it was indeed THE place to be and a hotspot for information and accessibility to some of today’s biggest music tech players—like Reverb Nation, Nimbit, Pandora, Topspin, TAG Strategic, and Sound Exchange, along with artists and managers, like Moby, Lisa Loeb, Mike Posner’s manager, Daniel Weisman, and RuPaul, plus merchandise companies like Jackprints, and artist-entrepreneurs, like Author Gilli Moon, and more—in what is now aptly coined: The New Music Business.
New Music Seminar: The Revolution Starts Here
“The New Music Seminar is a must for any emerging musician. Designed solely for the artist, the New Music Seminar is one of those rare events that delivers on its promise.” –Michael Doernberg; Founder & CEO, Reverb Nation ”
Tips for navigating the digital frontier in today’s new music business:
#1: Today’s New Music Business; CEO: You.
The consistent theme throughout the day, whether spoken literally by Ted Cohen, Managing Partner of TAG Strategic (advisors on digital content), or naturally aggregated in an 18-minute intensive by Ian Rogers, CEO, Topspin (helping artists—Linkin Park, Eminem, Arcade Fire, plus artists like you—build direct and profitable connections with their fans), was that you are in charge of your own operation—you are the boss. So, what does this mean and how does this translate to you?
Well, Cohen spoke about learning the ropes of what it takes to be a boss, whether that was delegating, or determining strategy, etc., while Rogers spoke about creating a business plan for your artist career and presented software tools to help you do so via Topspin.
Cohen also mentioned the biggest challenge was getting people to realize you are out there; i.e. stand out from the crowd, which of course, translates back to CEO: You. Cohen says, “Right now, the blame is on you [to produce, create, market, brand].” That said, the road to CEO: You is ripe with possibility and paved with a variety of ways for you to currently monetize your artist career.
#2: Things will never be the same.
Yes, in regards to the physical distribution and label model that was in place when record stores like Tower Records existed, that is true—the music business will never be the same. The digital revolution has changed the landscape of music-making, street-date breaking, and signing that proverbial “record deal,” but the good news is artists today have more opportunity than ever to make a real living at their art, if they know how to navigate this field.
Who and what are some tools to help that navigation process? Well, people like Constantine Roussos, whom I spoke with at The New Music Seminar, are trying to bring consistency, organization and centralization to the industry, to help monetize music online for everyone, by proposing the creation of .music, a Top Level Domain (TLD).
The .music TLD is being launched as a community-based domain, which means that only members of the music community will be able to register the domain, along with a vision to solve the inefficiencies the internet has created through innovation.
In a recent Billboard article, Constantine Roussos writes:
“My decision to launch .MUSIC as an exclusive, community-based domain was strategic and integral to ensuring that .MUSIC websites create a trusted internet zone for music consumption. An example of a TLD that has enjoyed success using this approach is .EDU for education.”
As well, an online software and direct-to-fan company like ZMX Music is reinventing the sheet music industry—a $600M annual business, according to ZMX founder, Eric Ziering. How does ZMX work? ZMX is offering a new direct-to-fan publishing system that allows artists and songwriters to sell top quality sheet music from their website, MySpace, or Facebook page, and collect royalties of 30-50%, up to four times the industry average! Publishers and Managers can establish a new direct-to-fan revenue stream for their artists, too, as ZMX uses Amazon payments and digital watermarks on every purchase to discourage piracy. Ziering also offers a tip, “Do promote your own sheet music. Your fans only purchase your stuff it they know it exists.”
Wow, that’s all pretty cool and in a time where “things will never be the same” in the music industry—today, and the future, really do look bright for CEO: You.
#3: You are a brand.
Ah, this is a biggie. In addition to CEO: You; one of the most important aspects you are now in charge of is defining your brand—Who Are You? Gilli Moon, an Artist-Entrepreneur (President Songsalive!), and featured author at the New Music Seminar with her book, “Just Get Out There,” talks consistently about defining what she calls an, “I AM Statement.” Another way to look at it, she says, would be to define your USP, or unique selling point.
So with that in mind, one of your first jobs as CEO: You will be to define, in writing, who you are and what your brand entails, as this will be the catalyst for determining current and future fan engagement, and what I call Integrated Lifestyle Matrix Marketing for your brand. Or, simply stated—casting the fishing rod at multiple points in the stream, remembering that the cast of the arc counts, too.
After you have defined your brand, Ted Cohen of TAG Strategic speaks of 1) identifying possible products that fit your brand, 2) identifying merging companies that can assist in making your brand a reality, 3) doing everything you can to protect your brand, while 4) consistently and creatively being unique. A tall order, yes, but there are “fishing-rod” companies to help you. For example, another company that was featured at the New Music Seminar fits perfectly into helping you handle your fishing expedition: Jakprints.
In another 18-minute intensive, Dan Byler (Sales Manager, Jakprints), spoke about The Power Of Merchandise.
“Merchandise helps people remember your music and makes you money,” says Byler.
Byler also speaks of how merchandise can create a connection by bonding the product with an experience, citing an example of a kid who buys a t-shirt while at a concert, grows up, and every time he wears that t-shirt, he is reminded of the experience—the band, your brand.
After speaking with a representative at the Jakprints booth, I learned that they are headquartered and manufacture in Cleveland, Ohio, so yes, a U.S. based manufacturing and make-ready company that helps you produce retail-ready, environmentally conscious printed merchandise with hangtags and more; barcode and poly-bagged, ready for the shelf. I asked the representative about pricing and whether ordering smaller quantities for indie artists translated to a higher per piece price and he said, “No, we have worked for over ten years establishing our distributing partners and therefore are able to provide our end-consumer the same price per piece, whether she ordered 25 t-shirts, or 1,000.” Nice!
#4: Your fans are your customers.
Cohen talked about the acronym, CRM, which stands for Customer Relationship Management, and spoke highly of engaging with your fans, which is not always about selling, more appropriately it’s about cultivating a mutual respect, utilizing creative promotions, and sharing with your fans, yes, even outside of music. Cohen makes a point to say, “It’s not about the numbers, it’s about the quality of engagement.” For example, an artist was cited as having had hundreds of thousand followers on Twitter and he had worked hard to obtain the followers, yet as soon as this artist hit a benchmark number, he began Tweeting only about buying his album, over and over, and in a short amount of time, his Twitter following dropped to 50,000. Why? Because the engagement became a sales pitch.
As well, if you are stuck wondering what your fans like—just ask them. There are three types of fans according to Cohen—1) Passive, 2) Participating, and 3) Passionate. It is important to engage with all three and to remember that all three engage back differently, but they are still there.
#5: Your business is not $.99 downloads.
Ian Rogers of Topsin says,
“Your business is not $.99 downloads. The reason is that the fan connection, generally speaking, is worth way more than $.99 long term. Lifetime, across everything we’ve done, the average revenue transaction is $26.00. When you look at optimized campaigns, the average revenue per transaction is in the $60.00 range and when you add tickets in, the average revenue is close to $90.00. So generally speaking, I would never bring a fan to my website and then ask them for $.99. You’re much better off to give them something for free and then make that fan connection. “
Rogers go on to say, “Even in the best of cases, I’ve seen artists who have something happening on Youtube come and then try to sell that song for $.99, even in the best of cases you’re going to make a few thousand bucks there, but I’d much rather have 100,000 people on a mailing list.
“I always tell the story of The Pixies, who we did, they came to us with a 4-song EP and instead of selling that EP, we gave it away for free in return for an email address and then they turned around and they put on two shows in London that were 100% theirs. We sold 100% of the tickets by marketing via Topspin, sold them via Topspin and we checked everyone in at the door with our iPhone ticket app, and I won’t tell you exactly the check we wrote to the Pixies, but it was a hell of a lot more than they would have made selling those 4 songs on iTunes. I definitely recommend that you think of your website as a high value, high transaction dollar business.
“If more people would just hear what I’m doing they would love it. Obscurity is the enemy here more than anything else. The first thing you’re always trying to do is build awareness. If you’re lucky enough to build awareness, the next step is to build connections with fans, communicate with them, have a relationship and only when you do that can you actually sell something.”
#6: Creativity will trump connections.
Lastly, Cohen says, “Be creative, connections will follow.” What does this mean? Well, simply stated, it means that the bottom line in the new music business still remains the same—music, creativity is king. If you manage to remain true to yourself, create desired content, and hone your craft—the crème rises, people take notice, and connections are a natural par for course to follow.
In conclusion, as CEO: You, if you are serious about your career, believe in the power of networking, along with educating yourself in all facets of the music business, The New Music Seminar is THE place to be. Unlike larger industry events (SXSW Festivals, ASCAP Expo, Taxi), the panelists (“players, conductors and authors”) are more accessible to the audience and easier to approach. Mark your calendar now for next year’s event—you will thank me later!