The music business has had particular trouble adjusting to the realities of the digital age, so I set out to develop a model that fully integrates all of these realities in order to help out artists and labels. Not only is it valuable for the music business, but for many other fields, especially those touched by new opportunities and difficulties arising from the web.
Click any of the links throughout this summary to jump right into the related section of my thesis. The designer, Ryan Van Etten, did an awesome job at creating a great platform for the thesis’ content.
The research revealed that convenience is one of the most important factors for music consumption. Due to the fact that the music industry has lost control over the distribution of their content, this desire for convenience has resulted in piracy. Meanwhile, consumers are replacing traditional media with new media with the percentage of respondents who have never bought a physical CD increasing per generation. People have different expectations as to what price is reasonable for different products. An important trend being that people enjoy consumption that feels like free, which has made that which is easily copied cheaper and that which can’t be copied more expensive. Although consumers like ‘free’, even consumers that frequently pirate music often regularly spend money on music.
As a solution to these challenges, the author recommends that artists and labels starts integrating the concept of the ecosysteminto their communication strategy. The ecosystem is an active fanbase which is interconnected through non-linear communication. This means producing a ‘story worth telling’ to turn the internet’s non-linear communication and loss of control over distribution into an opportunity to get discovered. The second step is retaining the attention by connecting with listeners and connecting them to each other like the host of a party would with guests. Turning the ecosystem into a fun party helps energize the fanbase and amplifies the aforementioned ‘story worth telling’. Marketing opportunities come from listening to the ecosystem and releasing the products they want, as opposed to the classic approach of pushing the product that you want them to buy. Internet-enabled concepts such as pre-ordering and digital releases allow labels and artists to offer the ecosystem abundant choice to play into all the different expectations regarding price and product characteristics. This most likely will involve a mix of (feels like) free and publishing products or services that are better than free.
A while ago I posted a case-study about The Ugly Dance on here as an excerpt of my thesis about marketing music in the digital age. After I published the case-study, the band replied to an email of mine, so I decided to write an expanded version of the case-study for Techdirt.
TheUglyDance.com was actually not a result of some great promotional master plan. It just happened.
On May 17 we released fuldans.se and sent the link to some friends. When I checked the stats a couple of days later a few thousand people had made their own dancers. I could feel something was about to happen. Just the day after someone shared a link on a Swedish blog, and it generated a tsunami of visitors. 30 000 people rushed in in just a few hours. The week after we hade a few hundred thousand hits, and it was a continous struggle to keep the server alive. Two weeks after the release, and 700 000 visitors later, I thought everything was under control. Then the Americans came.
TheUglyDance.com have had 7 milllion completely unique visitors. A few very kind people have donated, but they are very few. If we should have done anything differently, we should probably have sold T-shirts or something. Something real for the massive amount of visitors to buy.
Obviously I have one or two ideas of what they could have done and still can do:
They did a spectacular and exemplary job at getting people’s attention and making the initial connection, but there appears to be no focus at all on retention. There appears to be no link to the band’s MySpace, which they were trying to promote. Due to the fact that most people are on Facebook and Twitter now, I think it would have been a better idea to put those links in the foreground, but most importantly; there has to be a way for people to connect. A simple Facebook ‘Like’ button below the Flash application would have gone a long way.
From a marketing perspective, asking for a donation or getting people to buy your music out of sympathy is a bad business model. As Mike always says, it’s about giving fans a reason to buy. A good thought experiment is to imagine a totally selfish consumer and to see what you could offer them so that they spend money on you. They should spend it for themselves, not for you.
This means making sure you retain as much of the original traffic as you can without getting obtrusive. This means shining a light on the early followers and encouraging them in what they do, because they’re helping you amplify your message and are providing social proof. At the same time you should connect these people to each other, forming an ecosystem.
While I do not know much about the match-industry, I imagine it’s in decline. In societies where easier solutions such as lighters are cheap, why use matches. The other day I had a marketing idea, and since I don’t know anyone in the match industry, I’ll just put the idea up here for grabs.
I think you can mass-market matches and give them a sexy image. First of all, you would use a slogan such as “[Brandname], the original matchmaker” to hook into the singles lifestyle trend, which is part of the greater megatrend of individualization. Then you capitalize on a huge opportunity that I feel has not been capitalized on properly (at least in Europe).
The smoking ban annoyed many, but it also created smoking areas inside or outside clubs. The social dynamics of smoking areas are great; it’s a new and easy way to meet people in bars or clubs. So for your commercial, you show pretty boy/guy and a pretty girl in such a smoking area and one of the two strikes a match… Insert cheesy catchphrase like “Every time a match is struck, a match is made. [Brandname], the original matchmaker.” One should position the match as genuine, fashionable, sexy, original, authentic, individualistic, determined… Let’s face it, typical plastic lighters are just boring.
You can also do a lot when it comes to product design. For instance, on the back of the pack there will be certain instructions (which will differ per pack… let’s say 15-20 different packs). The match will be split into two colours. For instance normal colour on the upper half and blue at the bottom half. When you light something and blow out the match, you break it in two with your match. The one that has the other person’s colour on their half of the broken match, will have to perform the instructions on the back of the pack.
For every one of these ideas, I have another 10 and I didn’t spend much time thinking about this yet.
I think it’s time the match reinvented itself. The next time I use a match, I would like it to be a match made in heaven.
By the way, if anyone in the match industry reads this (I can’t imagine, but who knows)… I’m almost done graduating, so if you want to execute this get in touch with me and let’s work together and let’s turn your industry upside down.
I’ve been writing a lot about the concept of the ecosystem lately (don’t worry if you haven’t been following, it’s explained again in this post), but only applied to the music business. Obviously, this can be applied to any type of brand, service or product which has a ‘fan’ potential.
A good example of this application of the ecosystem is with companies stimulating their employees to blog. In a reply to a question about this on Quora (GO SIGN UP!), I wrote the following:
What has been enabled in recent years, is the socialization of brands.
It’s no longer about one-way communication via TV and other media, not even about two-way communication (like customer service, mail, emails), but about non-linear many-to-many communication. This creates a new situation.
What few companies could successfully do pre-digital age, almost any company can do now. Starbucks had a massive following and ‘fanbase’ before the digital age, but now all of the members of this following (or ecosystem as I like to call it) can be connected to each other.
The following can be turned into a community. Now, why is it good that large organisations encourage their employees to blog?
These organisations have to be part of their own ecosystem. This works best when it’s done authentically and genuinely (such as via employees). This will strengthen the ties between your ecosystem and the brand, which adds tremendous value for the brand (as well as the customers). It’s a bit of a cliché phrase, oft-repeated by ‘social media experts’, but one has to be part of the conversation.
A brand that is well-connected with their users or customers, is a flexible brand. In times of rapid change, the greatest strength if flexibility. No matter how strong your pillars are… If they’re rigid and get torn down, they will break and shatter.
Just to add in more laymen’s terms, a blogging employee adds the ‘human’ element to the ‘face’ of the business, showing a non-corporate means of communicating with consumers, clients, etc.
I firmly believe that anything that can be done digitally will change the system it’s part of, whether that’s a political, economic or social system. The ecosystem is one of the basic rules and models for success in the digital age (if one thoroughly understands the concept, which is easier for digital natives than others). This is not just about the music industry; if your industry has not been impacted yet and part of it is digitizable, then it will be impacted.
When I first heard deadmau5‘ work 3 or 4 years ago, I was immediately excited. Here was a guy doing something new, developing a sound that was completely his own. Even though he was only known by perhaps a few dozen people per country, it was obvious that this guy was going to be influential and blow up.
He has pulled it off in a spectacular way (awesome branding) and when I finally started following him on Facebook, I was thrilled with his level of engagement with his fanbase, or ecosystem (remember?).
In the beginning of December, this interesting development took place, where deadmau5′ marketing team decided they should get involved in communicating to his fans.
Apparently deadmau5 didn’t like the fact that his management was disturbing the trust and rapport he had built up with the ecosystem, because those status updates were followed by deadmau5′s:
Then he checked the backend of his Facebook page…
Excellent choice, in my opinion. This is the best thing he could do to earn back the trust of the ecosystem, because you really don’t want to get on the bad side of the ecosystem. The ecosystem can reject you, the ecosystem can move on, the ecosystem doesn’t need YOU in order to survive.
And the cool thing is, he wasn’t thinking about marketing or self-preservation or strategy in the process of making his choices. It’s just him, genuinely. And I guess the status update he posted 1 minute later shows just that:
Lesson learned: keep it personal and have fun in the process!
Oh, and I do not recommend everyone to get into a fight with their management, because you can get fired from your label, but maybe you’re better off without that particular label anyway.
This case-study is about Shpongle, a much respected group of musicians, in a very specific niche: psychedelic chill-out, but attracting many fans of other genres too and is generally categorized as ‘electronica’.
A while before they released their latest album ‘Ineffable Mysteries From Shpongleland’, it leaked onto filesharing networks and fans of Shpongle started discussing the new album on the internet forum of Shpongle’s record label, Twisted Music. Obviously, Simon Posford, the main person behind Shpongle and owner of the Twisted Music label, was very unhappy about this and lashed out:
“So some fucker has released the album on the internet already…. thanks a lot, whoever it was… Maybe twisted will still recoup, maybe not… all i know is that we are teetering on bankruptcy, and are seeking deals elsewhere…. the 12 loyal fans on this forum are not enough to sustain a record label…. How much do you think Twisted has in the bank account? Have a guess? More than $10,000 ? More than $20,000 ? Well it is actually less than $1,000….. Raj and i haven’t even been paid our advance for this album…. All the artists on twisted are seeking deals with other labels now… We can’t pay a label manager, and we can’t pay the artists…. always putting our hope in ‘just ONE more release’…. “We’ll be ok if the DVD sells”….“Surely the Shpongle CD will sell, right?”
This sucks, for Twisted, for myself and Raj who have spent 3 years working on the album…. Just as i started looking around and posting on this forum again, i remembered why i shouldn’t bother…. I’m outta here… Soon to be followed by Younger Brother [another project by Simon Posford] and probably Twisted…
He got understandably emotional, but misdirected his anger towards perhaps the most dedicated fans: those who really cannot wait until the release and decided to preview it. After all, Shpongle hadn’t released an album in four years and their following is quite fanatical about their music. Later in the same forum topic, he adds some more thoughts which are also relevant to this case study:
“It’s all very well to speculate, but i can tell you as a fact, we made more money before file sharing… we could survive… now not so…. and i think you will find it the same all over the music business… the argument that “file sharing is promotion” is probably valid…. in fact, i agree…in a way it serves a similar purpose to radio…. but the argument that “file sharing is promotion and therefore you will sell more CDs” is clearly absolute bollocks, otherwise the music industry would be booming right now!
Also i’m sorry that “And if it weren’t for the internet, I would have given up on music entirely”…. for me, the internet makes me want to give up music wink But i guess i’m from a different generation…. I started making some of the trance that probably fills your 100Gigs hard drive before i’d even heard of the internet… and i didn’t need the internet to find a deep love of music… the rush of buying a new vinyl, of collecting every release/picture disc by my favourite artists…. discovering new music i liked, all underground, no radio-plugged mix CDs or whatever… ALL without the internet!”
Later on in the topic, which currently carries over 600 replies, fans started to suggest ideas to Simon. They encouraged each other to buy more merchandise, replace old t-shirts or hoodies, buy an extra album to give to a friend and they came up with ideas to help out Simon Posford, Shpongle, and Twisted Music.
And it seems Simon has also learned from the fact that you indeed will not sell more CD’s even when filesharing is good promotion, as he noted. Being a fan myself, I was very delighted to receive a newsletter, one year after the leak, which featured some interesting new business models and experiments. It does a few things very well and I’ll highlight this bit by bit. The opening paragraph is as follows:
“Dear Twisted fans,
The new Prometheus album has been doing very well on Beatport with 4 of his tracks reaching the Top10 of the electronica charts. If you haven’t got your copy yet then Benji and Twisted would be happy if you could get onto Beatport and purchase at least the electronica tracks. We’d love to see him get to Number 1!
Ott is beginning his 6 date tour of the USA starting tonight! You can see and buy tickets to all his tour dates at the bottom of this newsletter. You can also join his Facebook Fan Page here.
We’ve also got two new tracks of Younger Brother and Shpongle available as a free download, keep reading to find out how to get hold of them.”
What a dramatic change of tone, compared to the rants on the forum. This is how you connect with fans! First of all, it acknowledges fan support in terms of chart positions and makes a polite request (as opposed to lashing out or guilt-tripping fans, like on the forum). Also, it tries to unite the fans and give them a purpose; a mission. People love accomplishments, individually or in groups, if only for the little dopamine rewards our brains release.
They then give the fans more information and ways to connect with one of the labels artist’s and finally reward fans with free music. That’s a great way to open a newsletter.
As for the free tracks, the newsletter featured two images with links to the place to download the song. Once on the page, the page showed a download button, which when clicked, becomes a box in which people must enter their email address (as seen on the left). So actually, they can see which email addresses support which artists, but also, when people choose to use one of the share buttons, they help Twisted Music get more email addresses than just the ones they already had for the newsletter.
Younger Brother’s page was a little more complex (see screenshot on the right), with more information, but basically boils down to the same thing.
The newsletter then continues with another exciting way of dealing with the reality created by the internet, which is crowd-funding:
“Many of you have already pledged on the Younger Brother album ‘Vaccine’ . We’re working with pledge to raise money and to set up the best possible foundation to promote and release the record next year.
We’re calling on the loyal and faithful to help. In exchange we’re offering loads of interesting things from studio time with the band to limited artwork and access to rehearsals.”
Again, a great way to involve fans and offer them something exciting. It basically offers them a reason to do it for themselves, instead of telling them to please buy a CD because the label needs it (see forum post). Some of the ‘items’ on the list for people that pledge: signed CD (£15), new album and entire back catalogue (£25), coming to one of their rehearsals (£40), studio workshop (£300), being in one of their videos (£150), a unique personal remix of your favourite track of the album (£600), and much more.
The newsletter closes with more standard stuff, such as tour dates and the like.
The strategy here is simple, yet complex. First of all, the label releases some very unique, high-quality music, which has given them a fanatical and evangelical following (Seth Godin would call this a tribe). Secondly, this following, together with the label, has turned into an ecosystem; when things were not going well, the ecosystem started figuring out ways in which it could survive as a whole. Thirdly, Simon Posford started paying close attention to his tribe and started catering directly to their needs. When reduced to a communication and business strategy, it becomes the formula of CwF (Connecting with Fans) and giving fans a RtB (Reason to Buy).
Giving away free songs is a good example of connecting with fans by rewarding them. The clearest reasons to buy in this mailing are the mission to get one of the label’s artists to number 1, as well as all the rewards for pledging money for the new album.
It is important to note that this should not be done to generate profit, but should genuinely be done to please the fans and to give them what they want. I thoroughly believe that if you betray your fans’ trust, you will lose them and your (potential) income.
I’ll be able to go back to my marketing professor in Holland, after my placement, and tell him I had breakfast (or high tea) with Kotler.
Yesterday as I went to the Philip Kotler seminar I spoke about earlier to interview some of the participants, I was invited to stay and witness the seminar in the afternoon. Sweet.
Note: you can use these pictures IF you include a link to this website. Do NOT infringe copyrights. I will find out.
Then today I went to the press conference, which turned out to be in the panorama restaurant of the Kempinski hotel here in Sofia. Very good service from the personel, as can be expected in a classy hotel like the Kempinski. It was just a round-table setting, everything was translated to Bulgarian also (to my annoyance), but it was pretty informal and comfortable to ask him a question. Also got a Bulgarian translation of Kotler’s book “Lateral Marketing” signed by him. Sweet. Maybe some day I’ll be able to read the book. More content another time, have to get all my stuff through to the radio first. Can’t post any real data on here before then. I’ll make sure to post the links to all the material as soon as they’re up on the Radio Bulgaria website.