Fandom Pitch


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The live online music streaming service and go-to site for anyone attending music events.
Fandom by Team Marconi for Google Squared.

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Fandom Pitch

  1. 1. Live Concert Streaming Fan-to-fan services for those attending gigs Fully interactive with up to date info from your favourite artists, fan forums and exclusive extras – MARCONI TEAM – SHAHZAD AKHTAR / MARTIN COOK / ELENA D‘AMECOURT / SUSANNAH HOWARD BEN NEWTON / CHARLIE SIVELL / ANDREW STRANGE / VIJAY TENNETI WE ARE SQUARED – MODULE 2 ASSIGNMENT – OCT 25, 2013
  2. 2. TEAM MARCONI Broad range of digital marketing, planning, financial and general business acumen. This experience, together with such diverse backgrounds and international expertise, makes Team Marconi an exciting and innovative group to do business with. With shared passions for music, tourism, consumerism and digital progress, we believe that Fandom answers the need of the consumer whilst allowing artists, producers and venues to increase revenue from the limited audience of a live show. Charlie Sivell Ben Newton CEO Communications Manager Shahzad Akhtar Susannah Howard Brand Manager Senior Business Analyst Martin Cook Elena D’Amecourt Chief Web Designer Management Controller Andrew Strange Vijay Tenneti Digital Marketing Manager Corporate Strategy / Risk Management Leader
  3. 3. FANDOM – A BREAKDOWN • Fandom allows fans that can’t attend their favourite artist‘s concerts, because of geographical or economical reasons or limited ticket availability, the chance to watch live high quality streaming of the gigs, interact with artists and fellow fans and purchase official merchandise or music instantly • For fans that are lucky enough to be attending the events, the ‗Are You Going?‘ section offers specially targeted information, services and offers, some of which are offered by fellow fans in the area, such as accommodation and car sharing • The European market lacks a reliable, interactive, high quality streaming service and general ‗one stop shop‘ for fans of all genres of music • For artists, Fandom is an opportunity to open up sold out or in demand concerts to the masses, creating increased exposure, interest and additional revenue through merchandise and downloads • For advertisers, the ability to know their audience and target accordingly (through the membership profile questionnaire) and an un-rivalled knowledge that the audience being served ads on certain sections of the sight will be in a particular location on set dates, requiring certain products and in a spending mind-set as they travel and attend the events • This opens the site up to international, national and local companies
  4. 4. HUGE DEMAND FOR LIVE MUSIC 7.7 million Visits to major music concerts & festivals in the UK each year (1) £1.4 billion Spent at these events (1) UK Music Attendances International audiences means global demand (1) $27 billion The global live music industry worth in 2013, according to PwC $30.9 billion Tickets and sponsorship of live events will generate in 2017 Secondary economic effects of music events On related services (tourism, restaurants, transports). Ancillary items is a source of additional revenue: +12,6% to tickets price (2) (1) (2) (data for Germany
  5. 5. MUSIC IS AN INCREASINGLY ONLINE BUSINESS 189,000,000 Sales of singles in 2012, 99.6% of which were digital (1) 938,000,000 + Digital tracks sold in UK in 2012 (1) 3,700,000,000 Audio streams in UK in 2012 (1) £49,000,000 Value of streaming to British record labels (2) 80% Proportion of people who are aware of streaming services (3) 1 million Number of people that watched the live streaming of California‘s Coachella festival. 7 Of Top 10 Most followed people on Twitter are pop stars (1) Official Charts Company (2) BPI (3) Kantar
  6. 6. STREAMING BUSINESS MODELS ARE NOT YET ESTABLISHED Streaming music revenues up 40% globally in 2012 70% of paid streaming revenue Streaming is thus the fastest growing sector in music industry (1) 20 million (+44%) paying streaming subscribers in 2012 globally is spent by Spotify for content acquisition alone Streaming platforms must create added value for their paid offerings > Subscription rates to digital music streaming services were initially slow to take off. > 20% of Spotify users are converted to paid users. In France 25% of streaming users already used paid streaming > France is a second European market for streaming after Sweden > 100 000 are Spotify subscribers > 300 000 are Deezer subscribers Otherwise the subscription rates are low Spotify spends 70% for content acquisition alone and experienced net losses due to these costly operating expenses “Oligopoly” Majors Vs Independents 90% of the market is controlled by Universal, Sony and Warner but the new digital business models challenge them (1) (2) (3) (4) (5) (3 March 2013) International Federation of Phonograph Industry, Digital Music Report 2013 Houghton, Bruce. ―Spotify Asks Labels To Pay Less, Expand Free Mobile,‖ hypebot, 2013, .html (12 March 2013). Nielsen, 2012, music-360.html (12 February 2013)
  7. 7. GRASPING OPPORTUNITY Rise in popularity and globalisation of music festivals Forbes: Global increase in live music streaming US festival Coachella added a second weekend to its lineup, pulling in a record breaking $47 million gross Need to be step ahead and offer original content Many festivals have expanded outside of their home region, such as Lollapalooza and nar (Spain) In UK a demand of new festival experience as there is market oversaturation and many festivals closed lately (1) (1) New business models in the music industry ‗Producers quickly adopting… in effort to increase social media engagement, attract advertisers, strengthen brands and ultimately grow revenue‘
  8. 8. BUSINESS MODEL Key activities Revenue streams Platform development and maintenance Live events streaming Community management E-commerce Partnerships/negotiations with local trades (restaurants, accommodation, transp ort) and gigs promoters Value proposition Opportunity to watch the events one can‘t attend with flexible streaming options Tips and discounts allowing the best gigs experience for low prices Customer segments Paid option for Premium streaming Commission from local trades (average of 5% on performance basis for successful bookings) Non excusive gigs tickets and ancillary items sales People who can‘t attend the live event but want to watch it Local trades looking for customers Advertisers Advertising on the platform Customer relationships Cost structure Content buying, providers payment for streaming Self service on site with the possibility to contact the customer service Human Resources and other operational costs Newsletters Platform maintenance, IT Marketing Access to a community sharing the same interest People attending gigs (4 core target groups) and looking for the best prices to organize their trip International payment solutions Channels Online - Site, Mobile, Blog, partners websites Offline - gigs and local trades physical sites Growth drivers: user acquisition, existing users average basket increase, international development
  9. 9. COMPETITOR LANDSCAPE Venue-specific sites Apple iTunes festival streaming original content e.g. BlueFrog Player (India), Moshcan (Australia), Gigviz (Utah) (Spotify have similar festival) Overview: Broker site & database of live internet concerts Aggregates live music streams & lets consumers subscribe / be notified when favourite artists are streaming. Focused on events in the U.S. Advertising on site Original content from specific venues Generally professionally-filmed, free to users Revenue from venue (e.g. Gigviz offers additional revenue stream) and/or targeted advertising Annual music festival at Roundhouse venue in London, sponsored by Apple to support brand Free tickets via lottery for iTunes customers, & performances streamed live for free on iTunes, App & Apple TV USP: Single site for most streamed music events (US) Fully integrated – own events, content, venue, distribution. Exclusive to them. Own events / content, and major bands. Exclusive to them Offer free gig tickets by lottery TV stations Concerttv Vevo Air BnB Overview: Promoters sell rights to concert footage to TV companies •Broadcasts recordings of live & ondemand gigs Distribution contracts with major cable, satellite & IP TV operators (‗close to 30m American households‘); partnerships with MTV & BBC. ―The definitive concert destination on TV!‖; High quality streaming service & database of ondemand music videos No original content; partners with contentcreators & sponsors Part-owned by Sony Music & Universal marketplace for people to list, & book accommodation directly with each other — online & mobile USP: Upfront revenue stream for artists / promoters Contracts in place with major TV channels (incl internet TV) Relationship with labels Database of reviews & trusted safeguards – hosts & guests
  10. 10. TARGET AUDIENCE FUN LOVERS Aged 16-35. Consumed by music. Digitally savvy. Disposable income Pop and rock fans Regularly attend gigs. May want budget accommodation. GUITAR HEROES Aged 35+. Prefer older bands. Less digitally savvy. Attend gigs less frequently. Limited finances. Want cheaper accommodation. SOPHISTICATES Aged 25-40. Affluent. Attend rock and pop gigs but may also enjoy jazz and opera. Like good food and nice hotels. OLD TIMERS Aged 40+. Financially well off. Not digitally savvy. May go to the biggest concerts by older rock and pop bands. Infrequent attenders at gigs.
  11. 11. USER ACQUISITION STRATEGY YEAR 2 vs YEAR 1 +14 039 users >>11 801 USERS = MAINLY ONLINE ACQUISITION >>2 238 = MAINLY OFFLINE ACQUISITION YEAR 3 vs YEAR 2 +17 443 users SEO >>15 728 USERS = MAINLY ONLINE ACQUISITION >>1 716 = MAINLY OFFLINE ACQUISITION Promotion via local trade partners Emailing to existing users: invite a friend and get a Premium streaming test for free fandom Traffic acquisition and lead generation online games Banner ads on gigs tickets distributors websites Promotional actions in the gigs area (demo and data collecting on the iPads)
  12. 12. REVENUE & EXPENSES, £
  13. 13. EXIT STRATEGY – POTENTIAL BUYERS Big (Universal, Sony, Warner) • Live streaming distribution integration • European streaming market development • Diversification, competitive advantage vs other majors • Spotify Potential platform for live gigs ticket sales • Is planning to extend its presence in Europe • Is planning to enter the European live streaming market (e.g festival streaming in France) MTV • • • • Looking for the new opportunities in order to adapt itself to the development of the digital in the music industry Is trying to position itself on the digital content creation The streaming of live events is a logical compliment to recorded music broadcasting Community/new users acquisition
  14. 14. IN CONCLUSION STRENGTHS (internal to Fandom) • Experienced founding team: -Led several businesses and projects to profitability -Proven technical, marketing, sales & financial management skills WEAKNESSES (internal to Fandom) • Gaps in teams experience to be filled by Advisory Board: - Direct industry experience (e.g. Nick Watt / Spotify experience) -Legal -High quality streaming infrastructure • Community needs critical mass – need fast growth, to generate press interest with initial gigs • No existing database of reviews (host / guest) on Fan BnB site – need safeguarding measures to generate trust quickly OPPORTUNITIES (external e.g. customer, market) • No existing company profitable from streaming alone • Artists / promoters need new ways to monetise music (as recording sales decline) • Artists who want to be innovative (e.g. Radiohead / Prince free download or donation for new album, creates exposure) • Music fans looking for convenient & interactive experience e.g. exclusive video content, select views, merchandise purchase • Music fans used to online communities; familiar with concept of peer accommodation matching • Local businesses not maximising value of sold-out gigs; music fans looking for local deals when travelling to a gig THREATS (external e.g. customer, market) • Low barriers to entry • Competitors already in space could replicate USP (fan community / local business promotion) • Artists may prefer guaranteed upfront revenue (selling rights to TV) vs. variable revenue from streaming at low cost to potentially massive online & mobile audience – focus initially on innovative artists seeking press attention • Sony / Universal control % of industry & have stake in competitor Vevo