Andre Lecointe-Gayle - Revenue Streams In The Music Industry (Darker Music Talks August '14)
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Andre Lecointe-Gayle - Revenue Streams In The Music Industry (Darker Music Talks August '14)
- 2. “I just want to sing and perform.”
- 3. ?So how does one come up with successful business models?
- 6. How does the music industry create, deliver and capture value?
- 7. BUSINESS MODEL CANVAS THE
- 9. to describe, challenge, design, and invent business models more systematically
- 10. 74
- 11. !innovative business models may unlock new opportunities or enable things that were just not possible with the traditional models
- 17. The Music Industry The Music Industry
- 18. A dynamic market a global industry characterized by many players and fierce competition
- 19. ! Companies are quick to adopt technologies that support their business model but are slow to adopt technologies that disrupt it. - Clayton M. Christensen,The Innovators Dilemma “
- 20. iTunes The “traditional” music industry gave us the choice of buying singles, albums or compilations. The digital service most favoured by the music industry gives us the choice of buying…. singles, albums or compilations. In other words, the music industry has offered consumers a ‘solution’ that is most like the one that went before.
- 22. Change in 10 years 2007 2008 2006 2006 2006 2013
- 24. If something is going to happen in the end, you may as well do it in the beginning. - Henry Kissinger “ Consumer trends, such as streaming and mobile phones should be seen and acted upon. Too often companies look to the past and say, “Well, that has worked well for us” rather than in to the future and make the changes that may be necessary to their business.
- 25. The total number of streams (UK) in 2013 (3.7bn) is more than the total number of singles sold in 60 years.
- 26. 26% of all entertainment revenue is now access to content Millions of consumers are showing entertainment industries the way they want to consume their products by signing up with ‘on-demand’ services.
- 27. BrandAmp study, Millward Brown, 2007 “Music is something most people love, that no one dislikes and that touches everyone throughout their lives” The role of music in peoples’ lives
- 28. Who is my customer?
- 29. What does he or she wants?
- 30. What is he or she willing to pay for?
- 31. Different needs
- 34. CUSTOMER SEGMENTS images by JAM
- 37. VALUE PROPOSITIONS images by JAM
- 39. Firms that record, produce, publish, distribute, and market music.
- 40. Shift from ownership to access
- 42. ?what is your main target customer trying to get done?
- 43. CUSTOMER RELATIONSHIPS images by JAM
- 56. RECURRING REVENUES Is every sales a new effort or will it result in follow-‐up revenues and purchases? How evenly distributed are your revenues through the year?
- 60. REVENUE STREAMS images by JAM
- 66. PERFORMERANDRECORDINGARTISTREVENUE 13.RecordLabelAdvance Paidtoartistaspartofsigningadeal. 14.RecordLabelSupport Moneyfrom labelforrecordingortoursupport. 15.RetailSales RRevenuegeneratedfrom sellingphysicalmusicinretailstoresorviamailorder. Paidtoartist/performerbyyourlabel,orserviceslikeCDBabyorBandcamp thathelpmusicianssellphysicalproduct. 16.DigitalSales Revenuegeneratedfrom sellingmusicdigitally/online.Paidtoartist/performer byyourlabel,ordigitalaggregatorslikeCDBabyorTuneCore,ordirectlyfrom fansviaserviceslikeBandcamp. 117.SalesatShows Revenuegeneratedfrom sellingrecordingsofmusicat shows/liveperformances.Paidtoartist/performerdirectlybyfans.
- 71. What do customers want (tomorrow)?
- 72. Spotify
- 74. Spotify aggregates content from right holders, distributes it to consumers through the technical platform and monetizes both through a free, ad funded service, and a subscription service.
- 75. The business model of Spotify
- 76. The Business Model of Spotify OFFER DISTRIBUTION CHANNELS CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS REVENUE STREAMSCOST STRUCTURE KEY ACTIVITIES PARTNER NETWORK KEY RESOURCES Access to music via streaming and download services Pla@orm development and maintenance Licensing agreements SoGware and network engineers Rightholders (labels and publishers) Adver:sers Internet + PC Ad fees Subscrip:on fees PC Subscrip:on fees PC + mobile Royal:es to rightholders Salaries Bandwith costs Automated online rela:onship Global music fans Adver:sing Pla@orm and brand Internet + mobile 3rd party APIs Communi:es
- 77. OFFER DISTRIBUTION CHANNELS CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS REVENUE STREAMSCOST STRUCTURE KEY ACTIVITIES PARTNER NETWORK KEY RESOURCES Mass market Hits and wannabee hits Tours and concerts Huge sales from a few ar:sts’ albums Merchandising Marke:ng & promo:on Detec:ng & building talent Por@olio of star ar:sts Copyrighted content Distribu:on channels Manufacturers Marke:ng & promo:on Subsidizing unsuccessful ar:sts Royalty payments TV Radio Retailers Digital