11 Ways Digital Will Shape The Music Industry in 2013
11 Ways Digital Will Shape The MusicIndustry in 2013 • The changing nature of copyright • The Long Tail • Niche labels • The Expanding digital revenues digit • tren al The importance of engagement ds sh • The importance of branding mus apin g • Evangelists ic in 2013 • Branded labels • Freemium pricing models • Mobile apps • The Cloud and LockersMillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Only one thing is impossible for God: To find any sense in any copyright law on Mark the planet. TwainCopyright, the foundation of the musicindustry, is under threat in its current form Copyright is the legal right to make a copy of a work, e.g. a song, a video or an image. A record label or publisher buys the right from an artist to create copies of their work. This is the essence of all entertainment businesses. It enabled companies to invest in artistic works and make profits, which they could share with the artist and grow their business. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Now almost every digital device has the abilityto make a perfect copy, every time, built in The Internet has copying built into its core. For instance, browsers create a cache copy of everything they download. Every copy is identical in quality to the original and can be sent virtually anywhere since borders are meaningless. Copyright holders have maintained their position that the Internet does not fundamentally change the rights they own. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
For the first time in history, hits and niches are on equal economic footing Chris AndersonThe Long Tail has made millions of nichesaccessible expanding people’s music tastes The theory of The Long Tail can be boiled down to this; our culture and economy are Example: Movimientos is a London increasingly shifting away from a focus on a based label who specialise in a Latin relatively small number of hits at the head of American niche. They sign UK artists the demand curve, and moving towards a who play Latin American music, they huge number of niches in the tail. This is run club nights, have a publishing arm and are a booking agent and good for aggregators of large volumes of hire DJs. www.movimientos.org.uk music but individual tracks and artists will only sell in small quantities. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Technology is opening up multiple revenuechannels for music distribution Devices such as TV’s, digital radios, mobile phones, game consoles and even watches are able to stream and store music and therefore Example: TV set top boxes, such as Virgin Media’s Tivo, now feature Apps becoming distribution and revenue channels for such as Spotify, enabling subscribers music. Subscribers can save and share playlists to listen to their playlists through their between different devices, e.g. Spotify can be TV. Since many people have their TV accessed via laptop, mobile and TV. However, linked to a home cinema surround people now need to choose which platform sound system, this can result in the TV they want to subscribe to since they are rarely taking the place of the traditional music system. interoperable. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
As media channels increase and fragment,engagement with your audience is vital An engaged audience is less price sensitive, buys more frequently, is more loyal, is more Example: Lady Gaga is a prolific user likely to recommend products, and is more of social media. She Tweets apt to provide useful feedback. An artist constantly and often replies to who is engaging on their website and questions posted by her 31m+ followers. Her Facebook is updated through social media is more likely to make daily and she uses Instagram and revenue through their interactions. YouTube to post new videos and photos – many less than flattering. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Unaware!There are three stages of fan engagement. Fansin the middle are the most valuable The goal for the musician is to move fans from being unaware of them to being Example: Jamiroquai push music and engaged. Once a fan is in the centre circle, video to the public using their website a band should consider giving free product, and channels such as YouTube, because what they gain in terms of Facebook and Soundcloud. However, evangelism is worth more in the long term they gave away their single, Smile, to the core fanbase as a Thank You for than the product itself. Fans move through the support they received on the 2011 the circles by watching and hearing content European Tour. they like. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Branding is an evolving science that media,including music, needs to be aware of in 2013 Modern branding is a complex science. From identifying a gap in the market to the design of the product, how its presented, It isn’t what they where it is sold, the advertising, promotions, say about you, web site, tone of Twitter messages and it’s what they colours - everything is planned, plotted and implemented according to a brand whisper. Errol strategy. Flynn MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Finding and nuturing evangelists is a vital partof marketing in a connected world When we buy something, and it product repeatedly gives us works or doesnt break, we are satisfaction then we may even merely satisfied. The product has become Evangelists - telling people done what it was supposed to do. about a product as a personal Which may lead to a repeat statement about ourselves. This is purchase and more satisfaction. This Brand Nirvana, when large numbers means we are prepared to tell our of people are singing the product’s friends about it, since we are praises to their friends - the more confident the product works. If the powerful form of marketing. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Brands want to engage with a music audienceand some are developing their own labels Brands have always used music to attract Example: Red Bull launched a record label in the UK and US. Their artists are and create an affinity with their audience, featured on its sport videos, adverts, especially the youth market. Playing the YouTube videos and play at Red Bull right music can create a strong bond and is events. This helps to promote the artist a powerful aid to recollection of a product but also saves Red Bull vast sums of or service. However, music is expensive to money in licensing since they no license and brands feel they can now use longer have to pay other labels or publishers for the rights to use the digital to develop artists and save costs. music. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
‘Freemium’ is a popular way of encouragingpeople to try a service before subscribing Many services offer a Pricing Table to entice Example: Nine Inch Nails offered fans customers. The free offer provides the customer their ‘Ghost’ album for free and with a basic level of service to become hooked. charged different prices for improved formats and additional products. Then, different payment levels are offered that provide more features. Spotify offer something similar with their freemium model. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
Mobile Apps are constantly evolving and mayeven become the next format of the ‘album’ Mobile applications will enable artists and labels to promote and sell music, tickets and videos direct to fans. Applications can be distributed Example: Bjorks Biophilia album was either for free, a one-time charge or a released as an application that enabled the artist to gradually subscription. Using the ability to offer music release content, including new throughout the duration of a campaign offers a remixes, tracks, images and videos new and compelling way for artists to package, as the campaign unfolded and present and sell their music. evolved over time. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
The Cloud and Locker Storage mean peopleincreasingly value access more than ownership Cloud storage and ‘Lockers’ enable people to keep their music, videos, images, Example: Google, Amazon and contacts and files on a remote server, Apple are vast companies investing significant amounts in to their Cloud meaning they no longer need to store them storage solutions as people move on their own devices. This results in people away from ownership towards an needing less hard drive space. However, it access model. Music, in it’s digital also results in a reduced need for actual form, is simply treated as another file. ownership and an increased value in access. MillionMedia.com The Impact Of Digital! theartistnetwork.ws!
How Digital Will Impact The Music Industry in 2013 This presentation is based upon the eBook and online learning course, “How Digital Will Impact The Music Industry in 2013”. To buy the book, subscribe yourself or company staff members to the course, visit: www.millionmedia.com & www.theartistnetwork.wsMillionMedia.com The Impact Of Digital! theartistnetwork.ws!