Five Degrees of Separation in Music Income

After reading too many posts by non-musicians about how musicians should give their recorded music away for free and then make their money selling something else, I decided to create a "degrees of separation" chart. If you create music and also have an income stream from something, you are likely to fall somewhere along this continuum.

At one end, you make music and profit directly from it. And at the other end, you make music and don't make any money from it. Both of those options, and everything that falls in-between, are acceptable.

If you look at your two goals (to make music and to make enough money to pay your bills), you can combine them into a variety of different ways. Ask yourself (1) what allows you the most time to make the music you want to make and (2) what allows you to make the most money. What mix of skills can you bring to your career planning which will provide you the optimum level of creative activity and income?

And if you have a spouse and kids, you've also got to factor in those obligations. Maybe you would love to travel the country to expand your fan base, but if you aren't making enough money to take your family along, you may find the sacrifice is too great. So between music, income, and personal goals, you've got to combine them in some mix that works best for you. More than likely, you'll compromise somewhere, but that's what this blog post is about. It's okay to compromise. Most people do.

Here's my chart:

No degree of separation: Sell your music.
This includes selling your recorded music, performing live, working as a studio musician, and so on. You are being paid directly as a musician.

One degree of separation: Sell stuff related to your music.
A lot of people talk about this as a way to make a living in today's music environment. The idea is that your music will make you a brand. Then you'll use that brand to sell goods and services around your music. If you are popular enough and good enough at marketing, this might work for you.

Here are two examples:

Jimmy Buffett’s Business Empire

Sammy Hagar's Tequila Dreams

Two degrees of separation: Use your existing music to sell other people's stuff.
Using your music for marketing doesn't have to be limited to items you're selling directly to fans. After all, a lot of musicians don't want to bother with developing a line of products to sell. An alternative can be letting your music sell another company's product. Often what happens is that you have a song already out, the company likes it, and you make a deal. But you could also approach a company and work out a partnership where you provide the music and they provide the goods and services to sell.

This level of music income covers everything from licensing your music to having corporate sponsors. But in each case, you've already written the music for your own use and then you use it to market someone else's goods and services.

Some examples:

Olympics GM Commerical with Brandi Carlile

"Bacardi approached us and, we found out later, they had tried so many songs for that commerical. A slew of tons, and songs, and knew 'Daylight' was the one which stood out and worked more than any others." "Interview: Matt and Kim," Alter The Press! 2/6/09.

More stories of bands whose songs have been used in commercials: Selling Out to Survive.

Three degrees of separation: Write music specifically to sell other people's stuff.
While people have gotten used to artists having their music licensed for ads, it's still not as common for artists to write music specifically for commercials. Of course, there have always been people who do this for a living (one of the more famous musicians who was also a jingle writer was Barry Manilow) but it's not nearly as common as just having a pre-written song in a commercial.

Two examples:

Robert Schneider, singer/songwriter for The Apples in Stereo, also does commercial work-for-hire.

For Schneider, who's worked both sides of the fence, he relishes the opportunity to release his inner Tin Pan Alley songsmith and write on demand. "It's like, 'Oh, now I have to write a song about having fun in a new pair of shoes!'" he laughs. "To me, that's a legitimate song topic. Fun in the sun? I'd write a song about that anyway.""Songs that sell," 'boards, 6/01/08.

Recently the band Franz Ferdinard was commissioned to write a song for an elaborate promotional campaign by Dior.

Four degrees of separation: Play music. Use your visibility as a musician as a way to promote your real profession.
Now we are into the grey areas of new music business models. Some of the examples being used to illustrate how musicians can make a living are stretching the connection between music and income rather thin. I mentioned some of them here. Musicians are auctioning off their possessions, selling lunch dates, and so on.

Basically the concept is to use music as a way to generate attention and relationships, but then sell non-music goods and services to fans. Given that concept, why stop at selling your time as a lunch date or selling stuff out of your closet? A lot of goods and services are fair game. If you have skills as a lawyer, or a plumber, or a caterer, you can use your music as your positioning and then sell services and items that people want to purchase anyway. Instead of just being a singer, or just being a plumber, you become the singing plumber. Plumbing, after all, is something people need more than having lunch with you or getting an extra t-shirt. This way you are selling something of real value, and making it more distinctive because it is coming from you, the popular musician.

Examples:

A musical doctor.

Carl Ellenberger, who has managed to combine a successful medical career (as a neurologist) with enough musical skill to have been principal flutist in several orchestras, beginning when he was preparing for medical school. As a student of Joseph Mariano at Eastman School of Music, Ellenberger never thought of giving up flute for medicine or vice versa. Medicine, he says, allowed him to avoid teaching music to “indifferent students” (among other things musicians do to pay the bills). And music helped him survive the stress of medical school.

In addition, he has told me, “As a tenderfoot doctor at the bottom of the medical hierarchy, when the vast universe of medicine seemed overwhelming, regular calls for my services as a professional musician did wonders for my self-confidence.” "Musicians with two careers: Pro or con?" Broad Street Review, 12/22/09.

A musical priest. "Baton and Sacrament, Tools of Dual Career"

Blair Tindall, who interviewed a number of dual career musicians, points out, for example, that "mathematics and proportion learned through musical form may plug directly into another field, such as architecture or computing. Other musicians find more abstract uses for their musical training, citing the competitive nature of performing, the discipline of practicing and flexibility learned from irregular scheduling as among their professional assets."

"Counseling is much like playing a symphony," says Rae Ann Goldberg, a Bay Area violinist who is also a certified marriage and family therapist in Oakland's Early Childhood Mental Health Program. "There's a rhythm. There are silences. Intensity and release."

Goldberg completed her master's degree at the California Institute of Integral Studies after her orchestra, the Sacramento Symphony, folded in 1996. With a full schedule and increased income, she now cherry-picks only the gigs she really wants instead of accepting everything in order to survive. "Musicians add second careers to their repertoires," Los Angeles Times, 1/11/09.

Five degrees of separation: Play music. Don't mix it with any money-earning activity. Keep your hobby and your income-generating activities totally separate.
This is what many "amateur" musicians do. They don't play music for income. Just for fun. And there's a lot to be said for this approach. If you don't play music for income, you don't make decisions about music based on money. Which also means, you may be more realistic about your day job, too, if that's your sole means of financial support.

The reason I want this discussion out in the open is to get us past the idea that today's musician needs to concentrate on fan purchases for financial support. It's certainly one way to survive as a musician, but not the only way. If you can find a non-music day job that pays well, it may be far more time and cost-effective to do that than to jump through hoops looking for music-related projects you can do. Don't assume that being a musician means everything you do for money somehow has to point back to your music.

To illustrate where I am coming from when talking about the "new music business model," let me point you to some comments I made on this MediaFuturist blog post, "Content 2.0: New Ways to Monetize," which was looking at ways to make money if you are giving away your content (which, for musicians, is usually recorded music).

I have several thoughts in regards to music:

1. Labels are in the content business because they already own content. But for individual musicians, it isn't really about the content business anymore.

2. Musicians are in a relationship or service business these days. While they can sell merchandise, all the emphasis on social media plays up their relationships with fans. However, lots of other people (the vast majority of them non-musicians) are also in the relationship business and can deliver many of the same services (e.g., community).

3. Music is a powerful force and the people who make it have something to offer. But as we pull away from selling the music directly, that means other companies can grab on to that music and link it to what they are selling. Unless there is some special reason for the fans to connect directly with the music creators, then they can have access to exactly the music they want and exactly the "reasons to buy" that they want, but not necessarily coming from the same sources.

In essence, what I am trying to say is this:

Just as it is possible to couple your music with non-music goods and services to generate income, it is also to possible to decouple your music from non-music sources of income.

And this means that while you can bundle your music with t-shirts or online fan communities, so, too, can non-musicians bundle your music with their t-shirts and communities. (Even if they don't have an agreement with you, there are multiple ways to tie your music to their stuff, which most musicians like anyway as a way to get extra exposure.)

In other words, there's no rule that says a musician's music is going to automatically be linked with the musician's source of income. They can, and often are, two entirely different worlds. And sometimes it makes financial sense to approach it this way. Don't get so caught up in what you can do to make money from your music that you fail to see what you can do to make money from any source. Don't let people convince you that if you aren't making your living from your music, you aren't a REAL musician. Do what you have to do to survive.

@slainson on Twitter

UPDATE, 2/17/10
I wanted to move one of my comments from the comments section into the blog post itself to further explain my reason for writing "Five Degrees of Separation."

Some of what is being called Music 2.0 isn't really about music. When Amanda Palmer auctions off her personal possessions, it isn't any more about music than having a day job selling stuff on eBay. True, music has made Palmer a celebrity, but what she is doing to generate income can be done by anyone, in any profession, who has a degree of fame.

So I'm trying to explain that in situations like this we aren't talking about music, we are talking about marketing and celebrity. Getting a spot on reality TV is probably a faster route to celebrity than doing music. That's the reason for the "degrees of separation." At each stage you get further and further from earning your living directly from music. So at some point it makes sense to accept that the money isn't coming from music and quit trying to pretend that it is.

UPDATE, 3/9/10
While owning a restaurant might not necessarily be a more profitable side business than music, here are some people who are doing that.
Ten Musician-Owned Restaurants

The Lure of the One-of-a-Kind Item

I plan to write more about developing limited edition items for musicians to sell to their hardcore fans. But before I revisit that, I want to post a few thoughts about another trend I'm currently seeing: the one-of-a-kind item. Of course, many artworks and craft items are marketed this way, but examples are popping up in less traditional places, too.

For example, I saw this on Carly Simon's website.

Each limited-edition, Carly Simon Heirloom Box includes one unique item from Carly's private career archives, personally selected by Carly herself.

No two Heirloom Boxes will receive the same original item. Each Heirloom Box is made by hand and includes a Certificate of Authenticity.

And at the upcoming Winter Olympics in Vancouver, each medal will be a unique, hand-cropped section of a larger work.

...each medal will include its own signature elements of the orca and raven artwork, such as the suggestion of the orca’s eye, the curve of its dorsal fin, or perhaps the contours of the raven’s wing. A silk scarf printed with the master artwork will be presented to each Olympian or Paralympian with their medal enabling them to see how their medal connects with those awarded to other athletes at the Games to make the whole design. "Vancouver 2010 medals each a one-of-a-kind work of contemporary Aboriginal art," Vancouver2010.com, 10/15/09.

The concept is also being used for running shoes. New Balance has a new handmade shoe, the 574 Clips. Only 480 pairs will be made and each pair has a unique identity.

The campaign will be centered around a website that will feature 480 short videos. 480 video clips were recorded of each of the shoes’ unique experience before reaching the consumer. These videos were shot at locations throughout the US including Los Angeles, New York City and Lawrence, Massachusetts, where the shoes are manufactured.

To compliment the 480 short films, a Polaroid photo has been taken of the shoe’s experience and placed in the corresponding shoe box, conveying a trading card collector feel. The back of each Polaroid will indicate the shoe’s limited edition number (example: 017/480), size and color. A find tab will list the ten retail locations where the collection can be purchased. Consumers can then visit the 574 Clips website and search for the exclusive video created specifically for their shoe. Once the consumer has found their “clip”, they can watch the short video featuring their pair. After the video is finished playing, the Polaroid will flip over and the owner has the option to “claim” their shoe by entering a unique 5 digit code and their name. Once clips are claimed, they can still be viewed, but the owner’s name will be shown at the end of the short. "New Balance 574 Clips Campaign," Hypebeast, 9/15/09.

What's interesting about this campaign is that even though these are limited edition, handmade shoes, they aren't being sold at a premium price.

The individual attention is meant to underscore the unusual, all-American lineage of the shoes: Each are composed of leftover material clippings in New Balance's Lawrence, Mass., factory, (hence "Clips.")

The 574 Clips will sell for $75, so the goal is not so much related to revenues from the line, but to creating a positive buzz among sneaker bloggers or "sneakerheads" as they're known in the industry. "New Balance Woos the Sneakerheads," Brandweek, 9/17/09.

Another example of one-of-a-kind-ness comes from Sufjan Stevens, who gave one fan his own song. Other songwriters have done that too, but the interesting part is what the fan has chosen to do with it.

Mr. Duffy, a 33-year-old theater director, owns the song. He won the exclusive rights to it in a contest that the singer held in 2007.

... after a year of wondering just what to do with the song, Mr. Duffy decided that putting it on the Internet wasn't special enough. He wondered: What if the only way the song could be heard was in person, in intimate gatherings?

"This is the finest way we felt we could curate this song," Mr. Duffy says. "It brings people together," he adds, rather than "being lost among 14,000 iTunes."

The experiment lures strangers to Mr. Duffy's living room about once a week, to "recapture an era when to get one's hands on a particular album or song was a real experience," as he says on an invitation posted on the Web site of his theater company. ... He doesn't charge them to hear it. ...

From a goldenrod wingback chair, Mr. Duffy passed around the package sent with his prize. A personal letter from Mr. Stevens describes "hibernating bears trapped in our imagination" and the "muffled insulation of snow banks on either side of you" as inspiration for the song. There's also a Christmas card from Mr. Stevens -- which arrived in January.

To prevent recordings -- and, ultimately, dissemination -- of the song, listeners don headphones hooked up to Mr. Duffy's iPod or laptop. "Not-So-Easy Listening: It Takes a Trek to Hear This Track," Wall Street Journal, 6/12/09.

An older, but wildly successful example of giving each customer something unique was the Cabbage Patch doll.

With great flair for merchandising, Xavier [Roberts, the creator] announced that every doll was different and dreamt up the cabbage patch story line. Perhaps the biggest selling point was that each baby came with an adoption certificate and its own special name. Millions of people were enthralled by the idea of owning a unique cloth baby, and little girls were enchanted to know that their doll was the only one of its kind in the whole wide world. World Collectors Net

For the most part, artists and marketers will promote one-of-a-kind items as more expensive than their mass-produced counterparts. But there are inexpensive one-of-a-kind items. For example, fortune cookies and Cracker Jacks prizes. Well, these aren't actually one-of-a-kind items, but there's enough variety that among a group of people opening cookies or boxes together, each person is likely to get something different.

Musicians who want to intrigue their fans with one-of-a-kind items can either go the Carly Simon route and make them part of expensive packages. Or they can go the fortune cookie route and create items that are very inexpensive to produce, but fun to provide at shows. Some ideas for low-end giveaways or in exchange for tips or signing an email list:

Printed items that fans can draw from a bowl (e.g., fortunes; trivia; ID cards or wearable labels with silly personalities or quotes). I can say from personal experience that it works. I went to a party thrown by an ad agency and all the guests got to pick out name tags that had fake, but very clever descriptions that we could choose from. It made for far more interesting conversations than if we identified ourselves with our real names and companies.

One-of-a-kind buttons created from clip art or other sources of images. If you have your own button maker, produce lots of different buttons rather than just one or two designs.

One-of-a-kind magnets. (You can buy sheets of magnetic paper and print them yourself. You can either get sheets that snap apart into business card-sized pieces, or you can buy unscored sheets and cut them yourself into whatever sizes and shapes you want.)

Grab bags or small boxes with individualized collections of inexpensive favors. (You can find sources under party favors and vending machine supplies.)

One-of-a-kind temporary tattoos.

This is not to say that every band/artist must or should go the one-of-the-kind route. But it is currently being done to create a stronger connection to fans. I think most of us are at least a little intrigued or amused when we get something unique and can tell our friends about it or compare it to what they received.

Suzanne Lainson
@slainson on Twitter

Can Music Learn from Comic-Con?

As recorded music becomes a promotional tool to sell other music-related stuff, bands are moving into limited edition and collectibles territory. Generally as fans become collectors, they like to communicate and meet up with other collectors.

Although there are groups for vinyl, poster, and music memorabilia collectors, nothing exists on the scale of Comic-Con.

... the term "Comic-Con" doesn't even begin to describe the diversity of SDCCI's [San Diego's Comic-Con International] wall-to-wall programming. Aside from comic books, the convention's schedule includes events devoted to contemporary comic books (and their creators), vintage comic books (and their creators), original artwork (from both categories), science fiction and fantasy literature, animation (both domestic and foreign), genre television shows, pulp magazines, weaponry (both real and faux), genre theatrical (and direct-to-DVD) films, role-playing games, action figures, vintage toys, old time radio shows, video games, glamour art, costumes -- and, oh, I give up (in much the same way I'm now forced to give up my hopes of navigating the con's entire exhibit hall.) Let's just say that, if a topic is considered to be somewhat dispensable and silly in real life, chances are, it's considered to be of primary importance at SDCCI. "The 'Secret Origin' of San Diego's Comic-Con International," Jim Hill Media, 7/7/05.

The original concept behind Comic-Con was to promote comic book art and the professionals who created it rather than to create a merchandising and marketing event.

“I just felt that the cartoonists who entertained the popular masses were not getting their fair share of recognition,” [creator Shel Dorf] said. A convention would celebrate their many contributions.

Dorf, who was 36 then, also remembered what it was like to be a kid burning with a desire to become an artist, and not really knowing how to get there. A convention, he believed, would be a way to let youngsters meet pros, get some advice.

They held a one-day test fair in March of 1970, then the first three-day convention later that summer, in the basement of the U.S. Grant hotel. About 300 people came. "Comic-Con's Dorf watches sadly from the sidelines as T-shirts trump talent," SignOnSanDiego.com, 7/16/06.

The convention has grown into San Diego's largest [attendance capped at about 125,000]. But it was a tough go in the beginning.

The confab itself was so strapped for cash that each year the artists donated work -- which they dutifully sketched out on easels as a small crowd watched -- that were auctioned to help support the gathering. "The early days of Comic-Con," Variety, 7/11/08.

Comic-Con has always appealed to passionate fans, though who they are has expanded considerably.

"We always knew our audience was limited, but I personally felt it was limited not because only those people were interested," [David Glanzer, the organization's director of marketing and public relations] said. "I always felt that our audience was limited because we didn't inform a wider audience about what it was that we had."

He credits the convention's exponential growth through word of mouth buzz, and noted that most people come to the show more than once in their lives....

A 13-member board of directors, most of whom have been long-time fans of the show and were nominated to join the board, officially runs Comic-Con. The convention's office in La Mesa staffs 16-20 full-time and temporary workers, and about 80 volunteers work on various committees that help organize the show. "Charting Comic-Con's Hulk-like growth," San Diego Source, 4/18/08.

In addition to the San Diego event, there are now others around the country.

Gareb Shamus, CEO and founder of Wizard ... tells Marketing Daily that Comic Con started 40 years ago as small events in San Diego and Chicago. Wizard bought the Chicago show 15 years ago, and has been able to grow that from 5,000 to 70,000 attendees in a four-day event. Now, Wizard runs five of the events that bring in some 250,000 people to Toronto, Philadelphia, Chicago, Anaheim, Calif., and New York.

He says that among 700 vendors, Disney, Lego, Hasbro and Wild Planet will be on hand to show new products. "From the toy perspective, the fourth quarter is especially important," he says. "For companies to display their products to fans -- let them see them in a fun, family, cool environment -- is critical." ...

The fan demographic of Comic Con fans has grown beyond its 18- to-34-year-old core. "Now it's growing because as guys are getting older, they are not giving up enjoying these characters they enjoyed as kids -- whether video games, toys or comics -- and as they age they are getting their kids involved, so we are seeing older guys bringing their kids," he says. "Comic Con Is Coming To N.Y. Next Week," MediaPost, 10/12/2009.

While I am raising the idea that if musicians are now in the "stuff-selling business," they might want to have their own version of Comic-Con, Publishers Weekly has asked the same question about book publishing.

Has the San Diego Comic-Con become a possible model for what a contemporary publishing/media convention should be?

Although focused on comics—a sometimes tenuous connection in a show that could easily be called the San Diego Media-Con—the San Diego Comic-Con has emerged as the perfect example of the convergence of all manner of pop cultural phenomena under one roof. It's a big tent, a four-and-a-half-day carnival of panels, press conferences, business meetings, previews and bare-faced hype that has become so popular that San Diego fire marshals were forced to cap attendance at about 125,000. It's not simply that San Diego Comic-Con is popular—it's wildly popular. "San Diego Media-Con: One Big Size Fits All," Publishers Weekly, 8/3/09.

The idea is also catching on with other industries. While there have been sports collectible conventions for a long time, now more teams are getting into the act.

In Denver, the Broncos held their sixth annual Fan Fair in Invesco Field at Mile High this past June. Tickets for a family of five cost $50 total, or adults could procure a weekend pass for $25. What did fans get for the price? They chatted with coaches, players, cheerleaders and even the team mascot. They got autographs, took photos and purchased memorabilia. "Fan conventions on the rise," msnbc.com, 1/15/09.

Since so many people are suggesting that the future of music business involves selling merchandise and limited edition products, I'll be exploring more on that later. Based on what I have already read about collectors/fans, most of them develop an interest in something first, start collecting objects related to that interest, and THEN seek out groups of collectors. But on the other hand, having a place to buy and trade seems to turn these niche interests into more of a pop culture phenomenon. So it will be worth looking at the value of creating music collectible events to give some significance to the direct-to-fan experiments.

But for now, let me close with a few examples of fan conventions. Reading those articles, I've drawn up a list of common elements that seem to go along with launching fan conventions:

1. Have enough fans (generally willing to spend lot of money in pursuit of their hobby) to justify having a convention.
2. Have fans wanting to seek out others with similar interests.
3. Have fans willing to travel to a convention.
4. Have a person or group of people who will organize a convention and, if necessary, nurture it until it reaches a critical mass to maintain some level of momentum.

The book/movie series, Twilight, has generated a devoted group of fans who now have their own convention.
'Twilight' fans bring 'Trek'-like frenzy to conventions

Here are two music-related conventions.

Fans flock to 24th annual Queen convention

5th Annual International Tropical Music Collector’s Fair

Two articles about the Barbie convention.

Two Words: Barbie. Convention.

Collectors Revel at Barbie's 50th Birthday Convention

Suzanne Lainson
@slainson on Twitter

More on Sharing the Artistic Process

Amanda Palmer has tossed out another interesting blog post.

i am shameless, and fearless, when it comes to money and art.

i can’t help it: i come from a street performance background....

if you think i’m going to pass up a chance to put my hat back down in front of the collected audience on my virtual sidewalk and ask them to give their hard-earned money directly to me instead of to roadrunner records, warner music group, ticketmaster, and everyone else out there who’s been shamelessly raping both fan and artist for years, you’re crazy. "Why I am not afraid to take your money," Amanda Palmer blog, 9/29/09.

I've written about Palmer a lot. I particularly like to reference her as someone who is raising issues about the artist and her community. Here's my most recent blog post about the subject: "The Artist and Her Fans." You can also click on the "Amanda Palmer" tag to see other posts where I have used her as an example.

Zoe Keating, another musician using the Internet to increase her visibility, is also contributing to the discussion.

What is great about Twitter is that, like I said in the interview, it allows me to be myself to as many people as possible. Me and my music are the same thing and I've always had this stubborn, egotistical belief that if I just had a chance to get the real me across....people would be interested. The belief that what I'm doing is worthwhile, even if no one hears it, has sustained me through a lot of rejections and hard times. ...

Because there aren't very many mouths to feed, I don't feel any pressure to continually be selling more, more, more. I have never done an ounce of official marketing or publicity. I make enough to pay the mortgage, the bills, go out to dinner and a movie every now and then, go on vacation and save money for the future. I'm not rich, my car is old, but I have enough to live well and not be continually worried about money. That's really all I want. I want to exist and keep making more music. I'm in this for the long haul. Slow and steady is fine by me. "Deep thoughts on my music career," Zoe's Incredibly Interesting Blog, 9/27/09.

Keating has talked how Twitter has increased sales for her.

Keating says that the long-term effects of this rapid ascent in the Twitter-verse are yet to be determined, she did see an immediate jump in business. "Around the time that I went on the [Twitter] Suggested User list, my CD ['One Cello x 16: Natoma'] went to No. 1 on the iTunes classical chart, and it's stayed in the top 20 ever since," she says. "I've also gotten a lot more sales from my Web site, and I get lots of fan mail that says, 'I found out about you from Twitter.'" "TWEET CHILD O' MINE," Billboard.biz, 5/30/09.

And I have also cited Imogen Heap using the Internet to connect with fans. "Fan Interaction the Imogen Heap Way." Here's additional info from her about the process.

"We live in this instant world. It feels wrong to not play anything and keep it all secret," Heap states between sips of water at Toronto's Intercontinental Hotel. "I wanted to share the process in the same way I would with a friend who drops in at the end of a work day; I'd want to play them what I'd been up to." ...

"That turned out to be brilliant for me to look back on and feel my process," remembers Heap, "otherwise one day to the next just feels like you haven't done anything, so it's great to look back at blog No. 1 and see the state of my studio and then see blog 19 when it's finished. The Twitter thing was just my way of filling in the gaps." "Imogen Heap Twitters her way to world dominance," MSN Canada, 9/8/09.

With so many people now attempting to sell themselves and their music via Twitter, I'm not sure there will be enough money to go around. But I do like exploring how all these communication tools might be changing our perception of what it means to be an artist and to create. Here's a relevant quote from an author who interviewed thirty "visual artists, comedians, animators, documentary filmmakers, musicians, writers, and others who’ve pioneered new ways to build a creative career online (and off.)"

[Q] New media is a constantly evolving landscape from trends to platforms, do you expect a few standards to come out of this or are artists forced to constantly change their game plan? And is it important for them to?

[Answer from Kirsner] I think there are some things that are constants, like making people feel like they’re part of your process, involved, and are in some way supporting what you’re doing. But I do agree that there’s a constantly-evolving landscape out there. MySpace was once much more powerful than it is today. E-mail newsletters were once more effective than they are today. And you always have new things, whether it’s Twitter or live video Webcasting from mobile phones with services like Qik, that can be effective ways of communicating with your fan base. "Interview with Scott Kirsner on Fans, Friends & Followers," CineVegas Blog, 3/31/09.

Some people are pointing to interactivity as a way to evolve the art itself, not just as a way for artists to talk to fans.

Media used to be made at what could be described as the “front end” of the process. I produce a song or book and release it to the market where it is consumed and talked about.

A product leads to a conversation…

But now that my cost of experimentation is zilch—and networks enable me to be in constant communication with people who share my interests—the diagram can just as easily be flipped and start at the “back end.” I can talk about and share my ideas with you, and once we have a collective vision of the “thing,” I can produce it (to then have you consume it).

A conversation leads to a product…

Furthermore, if the thing I produce (or we produce) is dispensable (like songs or stories), you might consume more of it and the process can stop being linear altogether… "From product to process," The Storybird blog, 5/28/09.

Looking for more discussion about how the artistic process might be changing, I found this from Scott Adams, creator of the comic strip Dilbert. It doesn't directly address fan input, but it brings up the idea that the creator may put forth a starting point which can then be refined over time.

If you are planning to create some business or other form of entertainment, you will need quality at some point to succeed. But what is more important than quality in the beginning is some intangible element that makes your project inherently interesting before anyone has even sampled it. That initial audience will give you the luxury of time to create quality. "Quality Follows Popularity," Scott Adams Blog, 2/13/2009.

He's essentially reversing the artistic process. Rather than coming up with a wonderful creation first, he's saying, "Come up with an idea, build an audience around it, get their input, and THEN make it better."

As I find more discussions about interactivity and the artistic process, I will add them here or do additional blog entries. I'll close with an excerpt from an interesting article exploring the history of Western art and its relationship to money.

In Arts & Consciousness we have always taught our students that art is intrinsically valuable. We haven’t emphasized the commercial aspects of art, but have instead focused on art’s connection to self-affirmation, health, cultural identity and spiritual truth. We have proceeded from the assertion that if these things are adequately achieved, then money will be received by the artist as a natural and inevitable result of having created new value in the world....

When the recovery from the current crisis occurs, it seems possible that the world will re-discover the value of art as an essential part of culture – not as a coveted object but as living and breathing part of everyday life. "Post-Modernism, Economic Collapse and the Search for Value in Art." Arts and Consciousness, 2/4/09.

If this becomes the case, we may end up not valuing the art as an object or even as an experience, but for its contribution or effectiveness.

And here's a good resource. This paper was published in 2001 to foster a discussion of Silicon Valley as a creative community, but it covers creative communities throughout history. Some of the same concepts can be applied to creativity and the online community.

Suzanne Lainson
@slainson on Twitter

Selling "Stuff" Part Two: Fulfillment

If you are going to get serious about selling products online, you'll have think about how you'll get them to your customers. To give you an idea of all that goes into the process, here's one company's list of steps. Fulfillment Services

If you are doing a relatively low level of business, you can handle the shipping out of your house. The popularity of eBay has turned a lot of people into shipping experts. From-the-home shipping as been facilitated with priority mail and free priority boxes, labels you print yourself, scales that calculate postage, and so on.

To give you a sense of what you'll deal with if you do your own shipping, here is what Yahoo has made available about using UPS. Shipping Manager Overview

If you need bulk shipping supplies, you might want to check Sam's Club or Costco. You can also comparison shop for supplies online. Here are several sources, though you should do your own search once you determine what you need.
ULINE
PackagingSupplies.com
Papermart

There are a lot of tricks that online commerce experts have learned over the years which you can apply. For example, it used to be that direct marketers would offer attractive product prices and then inflate shipping charges to pad the sale. Now that free shipping is popular, the products might be priced higher to cover the difference.

Here's a resource specifically directed to musicians. Should you handle fulfillment for the merchandising webpage yourself?

If you decide your merchandising business is big enough to outsource fulfillment services, you'll find many companies that do this. For example: Fulfillment by Amazon - Let Amazon Ship for You

Some companies specialize in working with bands. Here are two examples.

Musictoday

Musictoday couldn't possibly coordinate orders of this scale, complexity, and precision without state-of-the-art warehouse-management software and equipment, such as handheld scanners and a $200,000 automated packing machine. The logistics are made even gnarlier by the special offers that bundle in exclusive knick-knacks and routinely turn the sale of a single CD into a shopping spree. It's a fine example of Capshaw's vision of the symbiotic artist-fan relationship--fans get special items, the artist gets the profits. But that kind of customization creates a fulfillment nightmare that would challenge any retailer--and bring a hungover band to its knees. All the more amazing that Musictoday boasts 'a 98.4% to 99.8% accuracy rate,' according to COO Del Wood.

The other side of the warehouse is like the stash of some obsessive-compulsive collector: 30,000 items from about 400 clients. The shelves, lined with different-colored bins, keep going and going. Ramones flip-flops. Cans of Arnold Palmer iced tea. AC/DC boxer shorts. And behind a locked door, pricier items, like a $5,000 lithograph signed by the Stones. The inventory, too, is organized for maximum efficiency, with the fastest-moving items on the front racks, within easy reach--"nose to knees," as Hubbard says. "Way Behind The Music," Fast Company, 12/19/07

Factory Merchandising

In traditional online merch contracts, the band authorizes the merch company to sell an exclusive item, and that company then pursues sales online. The merch company manufactures the merch and/or receives the merch from the band, then sells it and takes a percentage of the total sales. The usual rate is around 30% of the total sale. With our arrangement, the band retains complete control over what is being sold, and how the sales are made. The products are sold through the bands own website, so there is no need to license the merchandise rights to another company. The band simply decides which items to list for sale, and our fulfillment company fills the orders made through the band's website.

... The fulfillment company charges exactly HALF of what most companies charge for fulfillment services: only 15% of the total sale. That means on a $15 t-shirt sale, they only take $2.25 to package and ship the order and handle all payments and returns. Secondly, prices at Factory Merchandising are consistently lower than those of other merch companies. Even though this arrangement is made available through Factory Merchandising, we will not charge an additional fee for the service. The manufacturing costs are the same as they are for tour merch. In addition, since we already have the screens for the band's designs, there won't be an additional set-up fee to make the merch for the store. As an example, suppose you sell a t-shirt online for $15. The manufacturing cost for a one color shirt is only $4.25, and the fulfillment company only takes $2.25 to ship the order. That sale returns $8.50 to the band, a much higher return than most bands receive for their online merch.

Here are other companies that provide music merchandise and fulfillment.
BUYSWAG
nimbit
Zambooie
Audiolife

Here's another list. Fulfillment | The Indie Band Survival Guide

My discussion of music merchandise fulfillment is by no means comprehensive. There are many resources available from experts in direct marketing, online commerce, and retailing. My purpose is to make people aware of the complexities involved. This is important if everyone in the music business heads this direction.

Suzanne Lainson
@slainson on Twitter

Selling "Stuff" Part One: Direct-to-Fan

Artists/bands have traditionally made their income from three sources: recorded music, performance, and merchandise.

Because digital music can be copied so easily and fans can find ways to get it for free, recorded music is no longer as reliable as a source of income as it once was. To make up the difference, bands are now looking to sell more goods/services/experiences that can't be easily copied.

For the next few blog posts, I'm going to be exploring different aspects of hard good sales.

Let's start with what is now being called "direct-to-fan" marketing. It's not exactly new. Some bands have been doing this since the earliest days of online commerce (and, of course, at shows well before that). They have been selling T-shirts, CDs, and merchandise from their websites. What appears to have changed is that rather than this being a side business, some artists/bands are viewing it as a primary business.

Lately I have been telling people that direct-to-fan sales is just another name for direct marketing. Why? Because there are already significant resources available within this sector. If the future of the music business is selling stuff directly to fans, music marketers should take advantage of the decades of experience and research already out there. Whatever merchandising and marketing services, products, or advice you may need, you will likely find it in the direct marketing industry.

Sure, there are some areas of direct-to-fan marketing that are more music-specific (e.g., music files, fan communities and interaction, ticket sales). But other tools (e.g., email marketing, shopping carts) aren't industry specific.

One topic which gets discussed a lot within direct marketing circles, but not so much during direct-to-fan discussions, is database marketing. Much of music marketing still operates at a basic level (e.g., capturing fan names, addresses, and emails). Music business articles and conferences aren't addressing more complex issues (e.g., purchase behavior, lifetime customer value, retention rates). One reason for this, I am sure, is that a lot of bands have short life spans, so people aren't thinking of selling to fans over a period of years.

But a few music marketing companies have grown into fairly complex operations that can outlive individual bands. Therefore they have reason to develop relationships with fans that might last for years and to utilize more sophisticated tools.

Madison House, for example, started as a booking agency. It expanded into a management company for String Cheese Incident. Over time it created a record label, a ticketing agency, a merchandise company, a travel agency, a design company, and a PR firm.

An even bigger operation is Musictoday, which was started in 2000 by Dave Matthews's manager, Coran Chapshaw.

Along the way, Capshaw built the mechanism for recording live shows (ATO Records, which now boasts more than a dozen acts, including David Gray and My Morning Jacket) and selling shirts, CDs, and tickets (Red Light Management).

Those early CDs contained the seed of what Musictoday would eventually become, in the form of a mail-order insert for merchandise. Capshaw and the band were designing and selling their own goods and pocketing "the retail spread." As that business expanded, it outgrew the spare room at Trax. Then, in the late 1990s, they began offering items online--and the bigger picture revealed itself. The infrastructure had fallen into place for a much bigger operation. "I realized that we could do it with more than just Dave Matthews," says Capshaw. "We had the potential to help other bands." "Way Behind The Music," Fast Company, 12/19/07

The article describes what the company does: "Musictoday's 200 employees are responsible for emailing fans, processing orders, printing tickets, mailing merchandise, fielding complaints, monitoring message boards--all of it."

What distinguishes Musictoday's approach from more traditional direct marketing is its emphasis on band personality.

"We believe that direct-to-fan relationship is stronger, more loyal, more long lasting,” says [chief of staff Nathan] Hubbard. “Coran had the vision to say, ‘Passionate music fans want to interact directly with the artist, both at the show, but also online,’ and so built the infrastructure to help not just the Dave Matthews Band fans, but ultimately fans of all kinds of artists.”

Part of what appeals to artists in this deal is Musictoday’s discretion: Rarely is it obvious that some company in Crozet is running the online store. Look carefully on the official Internet stores for artists as diverse as Bob Dylan, Eminem, Christina Aguilera or Le Tigre—scroll to the bottom and you’ll find an unobtrusive tag, “Powered by Musictoday.” That’s it, though. There’s no other evidence that the poster, the t-shirt, the cd you bought will be shipped to your door from the humble ConAgra building. "The music machine," C-Ville, 8/28/06

Still, even with the personalization of marketing services, Musictoday is about database marketing.

... there's a compelling lesson here for any company that makes a product: If you control a piece of the transaction, you understand more about your customers. By aggregating fan data that artists haven't usually been privy to, Musictoday can help shape decisions such as where to tour, advertise, or deploy superfans to evangelize. Considering that an estimated 60% of concert tickets typically go unsold every year, that kind of targeting is no small contribution. "We're able to say to artists, 'We know more about your fans than you do,'" says Nathan Hubbard, 31, who runs Musictoday as Capshaw's chief of staff. "'Let's put our heads together and figure out how to monetize this relationship.'" "Way Behind The Music," Fast Company, 12/19/07

Live Nation wanted access to those fan relationships and databases, so it bought 51% of Musictoday in 2006. Said Live Nation CEO Michael Rapino:

We're doing more consumer segmentation. We know that the average fan went to one or two shows last year, and the avid fan went to five. We know 30% of the population attended a live show. Who are they? What's the commonality between the teens and 40-year-olds? What else do those fans want to consume? "The Music Man," Fast Company, 12/19/07

A new company that is also going after some of this market is Topspin Media. It's developing online tools to help artists/bands to do more direct marketing themselves.

But unlike Musictoday, it doesn't mail out packages. According to its website, "Topspin is more about demand generation than demand fulfillment. We approach marketing on three fronts: direct (email and the like), viral (quality driving organic person-to-person marketing), and targeted (such as targeted paid placement)."

I will be covering fulfillment and other aspects of hard goods sales in upcoming blog entries.

Suzanne Lainson
@slainson on Twitter

New Music Business Models

Here's a dance I've seen conducted quite a few times in the past year:

An artist experiments with a new way to make money and has some success. This innovation is cited by some industry observers as an example of the future of music business.

Skeptics respond by saying the idea isn't scalable and won't work for most artists. Therefore it isn't really any sort of new business model at all.

The observers counter it was just an example, not a blueprint for every band.

Then I respond (I can be a skeptic) by saying that for them to expect every band to come up with an original money-making idea is not realistic. Bands look to each other for any promising ideas. For example, if one has success with giveaways, they all do it. If one has success with street teams, they all do it. (Speaking of which, how come we don't hear much about street teams anymore?) If one has success on a new website, before long millions of bands will be there. What was once a clever idea becomes standard operating procedure until it doesn't work anymore and everyone moves on in search of the next great music promotional idea.

Therefore, to spare people a lot of wasted effort, I'll explore some of the ideas currently being tossed around as new music business models and discuss their limitations.

1. Give music away for free to fans who buy an item (e.g., a collectible box, a T-shirt, a poster).
In other words, sell "stuff" fans will buy. Forget about selling the music.

This can make sense for some musicians, especially those who have the talent to design the "stuff" themselves. But other musicians shake their heads and say, "What does selling 'stuff' that have to do with music? If fans don't want to support the music itself, then what's the point?"

This is such a big topic, I plan to go into it in more detail in future blog posts. Suffice it to say that selling "stuff" is a separate business from creating music, so it's not a business that comes naturally to all artists/bands.

2. The special event.
Some artists are offering special events for a fee. Here are two widely cited examples.

Jill Sobule posted this as one of her sponsorship levels. "$5,000 — Diamond Level: I will come and do a house concert for you. Invite your friends, serve some drinks, bring me out and I sing." Jill's Next Record!

Josh Freese offered low end packages that included a phone call or a lunch all the way up to $10,000, $20,000, and $75,000 packages. “Josh Freese. What are you doin’? This summer,” Topspin, 2/20/09.

Freese was so successful that he found he was spending a lot of time on these events and not so much on his music itself.

I’m driving back to the Cheesecake Factory for the 11th time this month, and I’m turning down other work because, yeah, I’ve got a guy flying down from Canada. People will call me for a session, but I can’t show up because I’ve got to give someone a tour of the Queen Mary and a drum lesson, and then they gotta come over and pick stuff out of my closet. "Drummer Josh Freese Sells Himself, Famous Friends, Dinner at Sizzler to Promote His New Album," OC Weekly, 6/25/09.

To make this strategy work on an on-going basis, you've got to calculate what your time is worth. You don't want to price a special concert less than what you would normally charge to play a private party anyway. On the other hand, if you want encourage people to book you for private events, packaging the concept as a sponsorship and charging the same amount or a little bit more might be a good marketing tactic.

3. Rent-a-friend.
Some musicians have become known as personalities as much or more than they are known for their music. Amanda Palmer has become the role model for this. (I've cited her a number of times, so search for her name in this blog to see what she has been up to.)

In many respects it is the essence of social marketing. The artist cultivates a group of fans who are more than happy to chip in (via sponsorships, purchases, or subscriptions) to keep things rolling.

The primary limitation for this is personality. Some artists are social and know how to keep a crowd happy. Think of them as cheerleaders. But other artists are more introspective and can't engage in multiple conversations with fans.

Again, an example of musicians moving away from the music itself and into another occupation which may or may not be more lucrative than what they are currently doing for financial support.

4. The garage sale/auction.
Palmer pulled this off quite well. She held a three-hour online auction of random stuff and made $6000. Amanda Palmer Made $19K in 10 Hours on Twitter

There's really nothing stopping every band from doing this online or offline. People have garage sales and auctions all the time. But generally two things have to happen for this to work. One, you've got to have some level of fame or some exceptional junk to sell. Two, this has to be an infrequent occurrence to be special. Otherwise you're basically in the eBay or resale business. If you are holding a sale on a weekly basis, that IS your job, and your celebrity cache is likely to go down.


So there's a look at some of the new music business models making the rounds. With the exception of the private concerts, these ideas aren't really about music. And that can be a major dilemma. People who took up music because they wanted to write songs, sing, and play instruments may feel like they are spending too much time on non-music projects. And if it comes to that, maybe they should just look for the most lucrative day jobs they can find (which may have nothing to do with music or fan management) and use that income to support their music. It's not as glamorous as running an online party, but it might make more financial sense.

Another issue that has been raised by the skeptics is the whether these new music business models are gimmicks. The topic doesn't come up so much when we're just talking about music. Music delivery systems themselves remain relatively static (i.e., CDs, MP3s, vinyl, live shows). People aren't trying to come up with new products every week. There is variety, but it comes from the music itself.

However, when bands/artists feel pushed to come up with non-music ideas, there probably will be a high level of churn as innovators experiment and then move on to something else. So every time a new marketing technique gets touted, we'll ask if it is here to stay or is just a gimmick to generate some publicity.

Suzanne Lainson
@slainson on Twitter

UPDATE 7/14/09
Here's a great example of why the Amanda Palmer model probably won't work for most artists. She just posted this on Twitter.

"what was s'posed to be 1 benefit show @ #comiccon has turned into 3 signings, a naked drawing class, a perfume unveiling & a ninja uke gig."

UPDATE 7/27/09
I missed this article until now, but it confirms what I am saying.

After a series of re-tweets, many more followers, who may or may not have known she was a musician, were following the conversation. Palmer got 400 pre-orders - 200 that night, 200 the next day - for a T-shirt that had nothing to do with music (it read, 'Don't Stand Up For What's Right, Stand Up For What's Wrong' ... a phrase that is all but certainly not part of any merchandising contracts, by the way). Proof that people responded to Amanda for reasons other than her music can be seen in SoundScan sales data for her September 2008 solo album, Who Killed Amanda Palmer. Since the May 15, 2009, Twitter conversation and T-shirt sale, there has been no discernable effect on album sales. "Lessons Learned From Twitter Windfalls," Billboard.biz, 7/01/09

UPDATE 7/13/10
About the site RentAFriend:

While some of the suggested uses for the site do seem pretty practical (having someone show you around town or teach you a skill), many of them seem a bit like a crutch. Has social networking changed real-life interaction to the point where we need to pay someone to be a real-time friend? "Stuff We Didn’t Know About Until Today: You Can Rent A Friend," TIME NewsFeed, 7/6/10.

Some of what musicians are encouraged to do for income seems very close to the RentAFriend concept.