Apple iPhone5s showing its screen with popular music applications.
From the time we popped in our first set of earbuds and spun our finger around the dial of our pocket-sized music players, we understood that music had indelibly changed. It’s hard to believe that was two decades ago. The iPod turned 20 this year.
In addition to changing consumer music habits, the iPod also effectively disrupted the traditional retail model for music overnight. Where record labels had been used to selling full physical albums, Apple introduced the sale of individual songs for $0.99 to entice consumers toward iPod sales. This essentially devalued the music in service of selling the technology, and it paved the way for streaming platforms like Pandora and Spotify.
Now, labels and other music “rights holders” can expect around a penny per stream from Apple, and half of that from Spotify, the largest music-streaming platform. What does this mean for artists? There are typically still third parties like labels and publishers that collect their cut from streaming first. Often, the result is negligible earnings for artists for their music.
In 2020, revenue from digital album downloads amounted to $319.5 million, which was less than half the figure recorded in 2016. Subscription and streaming revenues have been increasing annually and reached $10.07 billion in 2020, making up the vast majority of revenues for the entire music industry.
Photo Courtesy of Statista
Photo Courtesy of Statista
Many well-known artists make more on merchandise, performances, and acting, than on their music, and with live performances still in a precarious state thanks to the pandemic, it’s more important than ever for artists to understand how to bolster online sales.
For artists to be successful in 2022, they need to dial-in their e-commerce strategy – let’s take a look at how they can do that.
Get Intentional About Revenue Streams
Decide prior to a release whether music streaming is the right avenue. It’s a decision that shouldn’t be taken lightly, since streaming has benefits like artist discovery and social proof. If you decide not to stream, you’ll have to work extra hard to engage a large population of the consumer public, since most listeners are used to experiencing music via streaming services.
Do you have other ways to monetize your music? Events are popular sources of income for artists and musicians, and even though in-person concerts are uncertain, a number of technological solutions have popped up to fill the need. Platforms, such as In the Room, connect artists with fans based on a listening algorithm, and then facilitate a private virtual concert that viewers can attend digitally with friends.
You can look at streaming as just one revenue stream for your brand, in addition to a marketing tool. It will help you with consumers at the top of the sales funnel, by building awareness around your brand and your music, that you can then leverage with various digital touch-points and purchase opportunities.
Build A Direct-To-Consumer Audience
Creating a direct relationship with fans is an essential feature of an artist’…….