In the past, money was a huge barrier for musicians, and one of the main reasons many were forced to tie themselves to a record label. Today, many musicians are finding their own ways to creatively fund their albums and tours, with the most popular option being crowdfunding. Crowdfunding is a huge undertaking, but, if done correctly, you can come out of it with a whole lot more than just money. It also presents dedicated and creative artists a chance to connect with their fans in a whole new way.
Learn how to run a successful crowdfunding campaign with these 5 tips:
1. It takes a crowd.
I think a lot of people mistake crowdfunding for an endless well of money, but, the sky is not the limit. The amount of money you can raise is entirely dependant on the size of your fan base – your crowd. Generally, the more fans you have the more money you will be able to raise, although there are other variables like fan dedication and income level. Amanda Palmer was able to raise upwards of a million because she has a huge, dedicated fanbase with spare cash to throw around. Pretty much the perfect scenario.
There’s no way to tell exactly how dedicated your fans are and how much money they would be willing to donate, but you can look at some figures to get a better idea. Look at how many people you have on your email list, how many people come to your shows, and how many people you have following you on social media. Don’t assume that every one of your fans will donate – even the most amazing musician in the world couldn’t accomplish that.
On the heels of Google wading into the music streaming waters with its Google Play Music All Access service, with a $10 fee for all-you-can-eat streamed tracks, the indie music agency Merlin has today published results of a recent survey of its 20,000-label member group, plus an analysis of 6.5 billion music streams over the last year, which spell out where the money is coming from today. Streaming services are making increasing headway as a revenue driver for musicians, but digital downloads — specifically Apple’s iTunes — are still ruling the roost.
Worldwide, iTunes has held on to its spot as the single-biggest source of revenues for Merlin’s independent label members, both across key markets like the U.S. and UK, as well across Europe and globally. Interestingly, Spotify is securely in second position, underscoring just how popular both Spotify and streaming services have become — second has been a place held by Amazon for some time prior to this. Amazon’s MP3 download service subsequently slipped down to third place across the board, while Deezer and eMusic are split regionally in terms of their influence and in grabbing fourth place.
We’re reaching out to Merlin to see if we can get a specific percentage breakdown here. Typically iTunes has been estimated to hold around 60% of the digital music market by revenues; NPD put its share at 63% in April 2013. (Update: A Merlin spokesperson says those breakdowns are not being disclosed.)
“The new generation of digital services has created a new dynamic of consumer freedom, limitless choice and myriad paths to discovery,” Charles Caldas, the chief executive of Merlin, said today in a speech at the Great Escape conference in Brighton. “Our numbers illustrate that this dynamic is bringing incremental value to the market, and the demand from music fans for the music being released by our independent members is higher than ever before.” However, in what might be a swipe not just at big labels but big players like Google jumping deeper into the market, he also cautioned against companies that might be trying to apply legacy music royalty concepts to digital.
“The ecosystem is fragile: power is more concentrated than ever, and we are seeing an attempted land grab by the largest companies for digital market share as they try to recreate the old-market advantages they are clearly losing in the digital space,” he noted. Merlin, despite its tens of thousands of indie label partners, only makes up about 10% of the world’s music market, so it has a place continuing to rage against the machine.
It will be interesting to see whether Spotify’s (and streaming’s) rise are eating into that 60% marketshare for iTunes. But the research from Merlin suggests that if this is the case it’s not a watershed moment quite yet: both formats appear to still be growing, even if streaming is growing more.
Some 92% of respondents in the survey said that streaming and subscription revenues (based on streaming) grew in 2012 compared to a year ago. One-third said the rise was as much as 100%.
The rise in downloads was less pronounced: around 66% said a-la-carte download sales grew alongside that streaming rise. Only 8.4% said the rise in download revenues increased by 100%.
In terms of what the growth in streaming means for actual businesses, the takeaway is still marginal.
Merlin’s members say that they expect royalties of $65 million or more for 2013 from streaming services, but if you just do the math and divide that among 20,000 members, that works out to only $3,250 per label. Considering that Merlin claims that its members’ share of streaming services is typically 12-20% higher than those of other major labels — included in Merlin’s counts are acts like The National, Grizzly Bear and Bon Iver, as well as labels like Domino and Beggars Group — it sounds like streaming, despite all the advances and popularity, remains for now just an opening act, and not the main event.
Full results of the report can be seen here.
Source: TechCrunch (by Ingrid Lunden)
DBEATE: Are Music Fans Still Being Left Out of the Conversation?
As involved in the music industry discussion we like to consider ourselves, too often the dialogue aims at the worries and ailments for musicians and record labels, and as Hypebot points out, music fans need to be considered too. After all, they are the ones buying the music, t-shirts and concert tickets. So what’s the deal?
The truth is, like any industry, the ones with profits at stake tend to get too involved in their own problems, instead of considering the customer. Right now, the feud between masters of the music universe and musicians is really a battle for fair royalties and monopoly control by the mega record labels. All the while, labels and musicians complain about piracy, when it’s not the fans and users aiming to stick it to the industry, the culture changed and it’s irreversible.
In the new version of the music industry, the pillars have become crowdsourcing, concerts, mobile apps, streaming sites, slapping logos on artists like NASCAR cars, etc. Spotify and other sites are partnering with major non-music companies to benefit their own agains, not the music fans. Labels and music-tech companies feel very nervous about music fans, thinking they’re going to get screwed over again somehow; there’s a lack of trust and hostility to some degree. Frankly, the industry just thinks the fans just want everything free and don’t care about the business model. We can’t assume that’s the case.
Music tech companies need to be more mindful to what fans and users want if they want to really change the business for good, or else there won’t be much of an industry left. Musicians are cutting away labels and making do on their own. Direct-to-fan will be the doctrine of the future, and that’s fine, but the industry’s well-being is way better off if the business heads could build a constructive dialogue with the fans to make music better for the future.
The music industry didn’t want to know what fans thought before the 90s, and now that they need them more than ever, it makes sense to change the politics, right? Artists have already begun to embrace their fans more closely; it’s time for business to take notice.
ALBUM HIGHLIGHT: A Night Like This by AtM
TuneCore Change-Up Reminds Us What Really Matters with Distribution
In shocking fashion, DIY distributor TuneCore let go their CEO and founder, Jeff Price on July 22, as reported by Billboard. Price was kicked out along with co-founder Peter Wells by the board as well. The article details that the fallout had to do with Price’s controversy with Amazon in Europe among other internal issues involving not achieving financial goals.
While it’s unknown what this drastic change at the top means for the company’s plans going forward, the news is setting a fire in the blogosphere. One commenter on Digital Music News made a sticking point:
Really? If you are truly in this as a pro, you know that getting on iTunes is not the tough part. Look at the stats: 28MM songs made it on in 2011. 94% of those sold 100 units or less, roughly 8MM songs were downloaded just once! This is the legacy of Tunecore and others like them. You can’t release music and hpoe that it goes viral on its own. Get a team, get a clue, get real!! - commenter named "Realist"
Going forward, artists need to learn it takes a lot more than getting your music on a store to succeed. It’s what happens after getting your music on iTunes that truly matters most. TuneCore has been a stalwart in the distribution game for a long time, but at the pace of the changing music industry, more needs to be offered to DIY musicians. Artists need a full-service option to reach their full potential. In today’s day and age, post-release promotional support and high-impact features help a lot more than just an upload service. Take what we did for Basement Batman as an example, and we got nothing but great feedback. ONErpm believes in empowering artists, but that they also need that extra support.
DEBATE: Are DIY Musicians Better Off in the Mp3 World?
Admit it, when you saw that headline you immediately thought: how is any musician better off in the post-mp3 realm? Everyone takes a hit in this music culture, and it’s no longer a viable option to make a living strictly off music unless you’re on the major festival circuit, get months of radio time and land on the cover of at least one major magazine. Everyone is making less money and it’s harder for everyone to break through the noise, but while the digital space is a hardship for musicians overall, DIY musicians have more to gain in this world than the big fish.
The simple answer is that musicians have never had so many marketing tools and reservoirs of fan communities at their disposal. Big artists are improving their direct-to-fan experience, but they never really needed these social sites and interactive tools before the web was created. The web creates a slightly more fair playing field for the DIY artist who have never been more intimate with their fan base before. As we’ve seen over recent years, small artists can create quite a storm with a passionate niche fan base and sites like Kickstarter, Twitter, Tumblr make all the difference. You can rise and fall 50x faster on the web, and that’s a lot more advantageous for baby bands than being on the big stage in the first place.
DEBATE: Is Turntable.fm the real deal for bands after all?
When Turntable.fm launched last year, it caused a divide in the online music community mostly because some thought it was really cool, while the other half thought: “why would I want to sit through some random person’s terrible playlists?” Months after the May 2011 launch, most pundits were already hailing the site as a short-lived fad, and yet it continues to grow and stay in place and strong. It’s even become a common marketing tool for entertainment agencies who want to preview an artist’s upcoming LP, so clearly Turntable.fm has some stickiness to it. And then a musician friend shared an interesting story…
We won’t name our friend, but he plays in two notable garage rock bands that have done some serious touring in the east coast, and he joined Turntable.fm on a whim only a couple days ago. All he did was slip into the genre rooms that pertain to his two bands, casually sharing his bands’ music with links to their respective Bandcamp pages. The beauty of Turntable.fm is that it’s completely democratic and you will get booted for poor music taste, and while that’s true, the musician did the smart thing to share some other music not belonging to him. In the end after only 2 days, his Bandcamp pages record over 137 plays and 10 paid downloads.
Before learning this, we weren’t big believers in Turntable.fm, but this tale has us re-thinking the site. What say you?
Marketing Tip: Does Size Matter?
Now more than ever, bands need to be thinking about their marketing edge before they start making music, for most bands unfortunately. Hands down, if you’re good, you’re good, but look at the landscape of indie/DIY music, and a lot of bands have a shtick or a gimmick to make them stand out, i.e. Insane Clown Posse, Atlas Sound, Crispy on the Mic, etc. This doesn’t mean every band looking to make an impact has to dress like a chicken or strictly rap about potatoes; sometimes the size is all it comes down to.
Music Think Tank argues that it either comes down to having a really small band, 1 or 2, or a really big band, 8+. Arguably, when you think about the small bands, it’s really the girl-boy duo (Phantogram, Purity Ring, Handsome Furs, We Are the Wilderness etc) that’s really hot, but that doesn’t really make a difference if you can’t play a lick. Same goes for the super bands like Broken Social Scene or Arcade Fire, so you can’t say size really makes that much of a difference. What makes more of a difference is the presentation; band themes, color coordination, instrumentation, politics at hand, fashion sense, etc. The abundance of two-piece bands mostly has to do with the saturation of synth-pop anyway.
What the article is really saying is the average 4-piece band has been done before and looks average at first glimpse, but a two-piece or an 8-piece might garner a second look. Is it valid? Barely, but it certainly doesn’t hurt.
Airmodular was easily one of the nicer surprises in May-June. We’ve been trying to get all of our friends to listen to Vindication Day, and we can now only hope they play for us in our office sometime. We talked with them about the misperceptions about being a musician and got some insight how bands get help with their music videos.
DOWNLOAD: Vindication Day
What are some keys to your marketing plan for your latest release and how has the buzz been so far?
I am currently working with a PR Company, Tinderbox Music. They are pushing the CD to College radio nationally. I also am finishing a video for the single “Tremor In The Heart” and will be promoting that as well.
How do most DIY bands complete their music videos? It seems like every band in NYC has a friend with nice editing skills.
Which leads into the question of making videos. I have self-produced my own videos with other artist friends helping me with the editing. I also have been lucky to find filmmakers who have charged me reasonable rates. The video im doing now is with an young filmmaker.
It says you’re from NYC/Jersey City…where did you find yourself playing most of your shows?
Currently, I am not playing live shows but will so in the near future.
Do you agree that music needs to be viewed as more of a service and community rather than just a product?
Yes, in some way I believe music has a higher calling than just making money. It’s a vehicle for expression and a way to communicate issues about the world to a mass of people in an artistic fashion.
What’s the biggest fallacy about making music that fans don’t understand?
That it’s easy.