The ART of Independent Artist Revenue

The music industry has changed so much in the past decade, with the evolving role of major music labels and the ever-present social mediums available, independent artists have so many tools within their reach to get their music out to the masses and build relationships and community with their fan base.  For music artists, with networks like SoundCloud and ReverbNation at their disposal, artists can make their music available to the public for review, build a fan base and then handle their own distribution and promotion.  Sounds like a perfect road to success and revenue generation doesn’t it?  These are opportunities for independent artists to get great exposure and promote their art, but the question is, is it profitable?

Source: www.outsourcing-center.com

 Fortunately, some of these methods are outlined in an article at Hypebot.com, The 3 Most Profitable DIY Revenue Streams And Why Many Artists Succeed At Only One Of Them.  While these mediums have opened up opportunities for independent artists, the earnings remain fairly modest in comparison to the signed artists we often see in music videos and on television living a life that appears to be fueled by millions of dollars with lavish trips and cars.  In fact, the article states the average DIY artist is grossing no more than $50,000, through the distribution of their music, but the article points out that these sources are not the only methods.  So what are the other avenues that DIY artists are generating income?

The article talks about one of the more obvious that I’ve covered previously on this blog, live touring.  While it can be a difficult life, live touring is the lifeblood of many artists, even those that are signed to major labels.  For the independent artist, the increase in “house concerts” have created a similar environment and can yield a several thousand dollars per show depending on the city and how popular the artist is in that location.  These appearances along with selling merchandise can be pretty profitable. 

Another method that has not only been profitable for virtually unknown artists, but has been the source of discovery is YouTube.  There are a number of ways to make a living here.  First, artists can upload their own music directly, with little to no cost involved.  There are companies that can assist the artist in monetization of their content allowing them to yield up to the high five figures.  Also, according to the article, Make Money on YouTube, Film, TV and more with CD Baby Sync Licensing, services like CD Baby and Rumblefish are collaborating with YouTube to create additional income streams that would allow the artist to get paid every time an individual anywhere in the world uploads the video. 

With so many avenues available to DIY artists, the trick really is to determine how to make them successful and which one to focus on first.  Also, as the article points out, it is important to have a multi-focused approach in order to help build and maintain career momentum.  If you have a management or consultative team, these are options you can discuss and start creating a plan to help you move forward.  Do you have some experience with any of these mediums?  Have you experienced any degree of success?  If so, I would love to hear from you.  So these are my thoughts and I’d love to hear yours.  Until then do you and creatively mind your business.  

The ART of the Mega Comeback

You might recall about one year ago that MegaUpload was shut down, creating what might be our very first digital superhero.  Ironically, this underdog is back and possibly larger than ever with its update as MEGA as reported at Digital Music News who recently did a follow-up story on this historical event.  The site announced that MegaUpload Successor MEGA Is Now Officially Live and ready to takeover.

This re-launch will likely be very embarrassing for the FBI and the US Department of Justice and also groups like RIAA that rallied to shut the site down.  It is reported that the new site has the potential to outshine its predecessor and with the support of the public, it is very like to occur.  If that is not interesting enough, there was another component of Mega that was not publicly announced previously that could impact the music industry in a major way.

Source:  www.torrentfreak.com

Along with the development of MegaUpload, was a tool called Megabox, which is described as a music service that could create a dynamic shift the balance of the industry back into the favor of the artists.  According to TorrentFreak, in it’s article, Dotcom’s Megabox to Launch “A Few Months” After Mega, Megabox is scheduled to launch shortly after Mega and will operate using a “free music” model, that gives the public access, while compensating the artists through advertising.  The business logic here is that this approach will help prevent or at minimum reduce the incidences of piracy, while ensure that artists receive payment for their work.  Can you imagine what that will do to other streaming providers who do not currently utilize this model?  For those that are currently operating using an all-you-can use for a flat fee model, but very minimally to the artists, this could create quite a shakeup! 

The technology to support this is called Megakey and requires installation by the user who will receive the music at no cost.  If users opt to uninstall the app, they will be required to pay for the music.  While Megabox will receive a small portion of the revenue generated, it is claimed that the majority will go to the artist.  This potentially creates an environment where the artists will receive up to 90% of earnings and finally tap into the download market that has not previously operated in their favor.  The big question here is will the major labels that benefit richly from the current models allow something like this to happen. 

Given the backlash from the last action against Mega, is it likely that anyone will strike against the brand now?  Not only might this previous underdog come back, if what we hear about this new tool is true, this might represent a major comeback for this tool and the organization.  We will just have to wait and see how this plays out, but this could be an incredible opportunity for independent artists particularly who primarily distribute their music digitally.  Not sure about you, but I’m excited to see how this develop.

These are my thoughts and I would really love to hear yours.  Until then, creatively mind your business.

The ART of the Business Plan: A Creative Perspective

First let me say that for an artist, the process of writing a business plan is torture.  It is a fairly structured process that does not leave much room for creativity, cool graphics or an allowance for flair in its prose.  It is essentially the roadmap for building the entrepreneur’s business and while the process can be useful because it can help you identify flaws in planning or other areas of opportunity, the guidance provided by Carl Schramm helps keep things in perspective.  In an article Carl Schramm – Straight Talk on Entrepreneurship, which was featured in Steinvox.com, his perspective on business plans is that business plan creation itself is somewhat useless because the formalized plan is rarely the actual path the business will take and that by the time the plan is written, it is likely already outdated.  His advice is to not expend energy on writing the plan, get out and start building the business.  He says that the overall major points can be captured on one page and for a creative business that is constantly changing; his advice helps me remember to be fluid and not rigidly focus on the plan as the only measure of success.  This echoes the advice given by Chuck Blakeman, in his article How:  the worst, most asked planning question, that while its great to plan, things happen in life outside of our control and can throw a wrench in even the best plan.  This advice really drives the point to plan for now, not spend too much time on the future, but how the plan can help strategically build the business in the now. Carl also stated during his investing activity and experiences, he has never actually reviewed a business plan, but is usually interested in the person behind the business.

This begged the question for me is if Carl Schramm is right and investors and clients are more interested in the people behind the business than the plan, what attributes should be focused on developing?  According to an article in TheNextWomen.com, which featured an interview with Dale Murray, the Angel Investor of the Year 2011.  In the article The Difference a Dale Makes:  Charlotte Hogg Meets Angel Investor Ms. Murray, we learn first that in addition to being an extremely successful investor, public speaker, mentor and advisor in the universe of entrepreneurial activities, she is also “charismatic, charming” and is said to have secured her first significant contract due to her personal attributes, being a great person to work with.  She does not wander away from or betray her intuition when making business decisions and finds a way to operate from a place of authenticity, which helps others do the same when working with her.    These qualities must continue to draw business partners to her as she continues to be successful, so rather than focusing primarily on the plan, this is a reminder to constantly develop oneself from a professional perspective, while building the business.  This is a reminder for me specifically that as the owner, I am the business. 

This brings me to the last point of consideration in this development process is now to think about the business itself.  Not the picture in the plan, but what will the business really do, what do I want it to accomplish, how do I want to operate?  The advice from Carlos Slim, one of the world’s richest individuals and Mexico’s famous business, is to keep it clear and simple.  In an interview in Second & Park, the article Business Advice from Carlos Slim he advises to be creative, work hard and focus continuously on improvements and building the business.  He also sites flexibility as a strong capability for success, which resonates with me based on the advice discussed earlier.  Based on this advice I will further simplify my business model and focus more on developing services that will enhance the client experience, bringing more value to the market.  This is the area that from my perspective should be of most interest to a potential investor so that the understand why the market needs this business model and how it can be successful.  

These are just my thoughts, but I'd love to hear yours.  How are you coming along with your business plan, do you think you will use it?  Let me know.  In the meantime, here's to creatively mind your business.

Managing the ART of Free Music

Recently, T-Pain released his free mix-tape Stoic, with 22 tracks of new music for his fans with features from artists such as Pitbull, Travie McCoy and others, which represents a strong return to the music scene for him.  What makes this return most notable, is that it comes by the way of a free mix-tape, which can be listened to in full on sites like HipHopDX or downloaded, for free from sites such as Livemixtapes.com.

Back in August, the topic of how digital media is impacting the music industry was covered in my post Music and the Digital Movement, and the discussion around how artists revenue is affected by utilizing digital distribution in favor of cd or album sales.  In follow up to this, the release of free music by well-known artists such as T-Pain brings the new movement into greater focus and causes us to examine how the artist can be benefit from this activity.  Obviously, there is no front-end revenue to be made, so why do it?

This topic was also covered one of my favorite sites, Music Think Tank, where the article Why You Should Give Your Music Away for Free, describes how the advent of digital music is devastating legacy and traditional record labels.  It explores services such as Spotify, my personal favorite, which provide an “all you can consume” for one subscription price model.  Not only does it allow users to access all of their favorite music and create playlists, which can actually consist of entire albums, they can also share their activity on Facebook with friends and share music.  Obviously, users are not going to continue to purchase individual CDs when they can gain unlimited access to music via this type of service.  For consumers this creates a winning solution, especially for proclaimed music lovers and for independent artists, it’s much easier to get music placed on these services.  The downside would be the payout is much less than the artist would make through pay-per services such as iTunes or Amazon, but this again confirms why artists must seek to be diverse in their revenue streams and not rely solely on music sales.  As we’ve also discussed, live performances and the merchandising that corresponds should not be underestimated in terms of relevant income. 

As the digital music landscape continues to progress and evolve, it will be increasingly more important for artists to re-think the traditional way of doing business and operate a bit outside of the box.  In a time when most consumers get their music either through subscription service or through pirated sources, why not just let the fans have the music they love for free.  Also, it can provide the artist an opportunity to test the market and see how their music is performing from a consumer perspective and utilize this knowledge to guide their future projects. 

Giving away music for free, while not profitable up front, can certainly provide artists greater insight into the tastes of their fans and overall consumers and help them make more strategic decisions for music products they plan to charge for. 

These are just my thoughts and I’m anxious to hear yours.  Until then, do you and creatively mind your business.

The ART of Protecting Your Brand

Several days ago, Nelly’s tour bus was delayed in Texas by a search for drugs by local officials.  While this report alone is disturbing because we really don’t believe the hype, but also because we have to question if everything is as the media reports it.  Once the story is told, whether it is right or wrong, how does the story impact the artists’ reputation?

Source:  www.growmap.com

According to an article at LATimes.com, there have been a number of well-known artists like Fiona Apple, Snoop Dogg and Willie Nelson, who have experienced similar issues in Sierra Blanca, Texas. Ironically, according to The Hollywood Reporter, this specific area is so heavily monitored because the goal is to prevent illegal aliens from crossing the boarder near El Paso. While Nelly was not arrested, the investigation revealed that someone close to him confessed to bringing the drugs onto the tour bus and sadly it was someone who Nelly later reported as someone who had been working on his team for a long time.  He indicated on Twitter that while he was sad about the outcome and the impact on this person’s life, that he was also extremely upset that someone close to him would cause him harm and jeopardize their safety.  It is understandable that this incident and the resulting negative press would be a cause for concern by the artist who up to this point, has not had a career troubled with legal issues.

Reading the reports of this reminded me of the important lessons we keep learning about building and protecting our brand.  First, by making sure we have the best product we can offer fans and supporters of our artistic endeavors, then securing good management and consulting so that we make good business decisions as it relates to our creative offerings.  Also important is our social media and marketing and making sure that we have control over the images and marketing that make it out into the universe.  Last, we have to examine a place that hits closer to home, as in Nelly’s situation.  As artists, it can be difficult as we make the transition from seedling artist, to developing even a local buzz, to analyze those closest to us.  Especially, if we elect to hire friends or family members to provide support to us in any professional capacity, we have to be certain that they can be a public extension of us without negative impact. 

As artists sometimes we might find it hard to make sure that the team we surround ourselves with is comprised of individuals we can trust and have our best interests at heart and are not trying to further their own careers with no concern for how we will be impacted.  It is imperative that we make sure to protect our brand, at all costs because it really is the outward representation of our most beautiful, creative, artistic selves.  And that is worth guarding with our lives. 

Those are my thoughts and I’d love to hear yours.  Until then, do you and creatively mind your business.