This seminar discusses the changing music industry and business models for artists. It uses the band Enter the Haggis as a case study to examine how they have adapted their strategy over time. The seminar covers the evolution of how consumers access music and the rise of free streaming options. It also evaluates whether Enter the Haggis would have been better served pursuing a major label contract in the past or continuing with their independent approach emphasizing free music and touring revenues. The session solicits participants' thoughts on alternative strategies for the band.

1. Principles of Business
Seminar:
Build a band then a business
Topic Number:2

2. 2
Overview
This case looks at the changing nature of the music industry and how
artists need to adapt from the traditional business model to “make it”.
It looks specifically at one bands journey and critically evaluates their
strategy and approach as well evaluating what they could have done
differently.
This seminar will get you thinking of the many different types of
business models one can consider within the music industry and
evaluate how best to navigate through its complexities.
We will also look at the changing ways consumers consume music and
the new providers that currently cater to this.

3. 3
Learning outcomes of this seminar
• Determine and articulate the changing nature of the music
industry
• Describe the traditional and new business model of the
music industry and how technology has impacted it
• Be able to determine and discuss the role of ‘free’ music to
help a band success more widely
• Be able to anticipate and articulate the future state of the
industry

4. Agenda for this seminar
Would it still make sense to stick with an indie label, or should the
band pursue a major label contract and all the potential marketing
exposure that comes with it? Explain your answer.
How many ways you can listen to the band’s music for free. Why is it
in the group’s longterm interest to make its music available for free?
If the band had begun its professional existence 10 years earlier, how
might its business strategy be different from the path it took?
Consider if you were ETH what would you have done differently?

5. Structure for the session
You will have
15 minutes to
discuss each
question
We will have a
de-brief at the
end of each 15
minutes to hear
your thoughts
on each area
Feel free to ask
questions but
please do not
have separate
conversations
‘we are all in
this together’!

6. Advice from the top?

7. How has the music industry evolved?

8. But formats are just the start
What does all this mean for the business model?

9. Pursue an indie
label or
mainstream
contract?

10. Who are Enter the Haggis?
Enter the Haggis is a Canadian Indie/Folk Rock world-fusion band
based in Toronto, Canada. Commonly called ETH, the band has
been playing and recording since 1996. Their latest studio album,
"The Modest Revolution" is the band's tenth album.
Since its birth in 1996, ETH has kept a rigorous concert schedule,
playing in wide ranging venues in Canada, Europe, and the United
States.

11. A growing disconnect in the music industry
Millions of music
listeners were fed up
with the business
model that had been
in place for
decades…forced
customers to
purchase albums for
$15 to $20
Thousands of
musicians were fed
up with the
model…industry
dominated by a
small number of
large record
companies
Who are the real winners here?

12. What do the two routes have to offer?
• Potentially more lucrative
but fewer opportunities
• Less control over decisions
making
• More exposure and greater
distribution
• Potentially less lucrative
but more opportunity
• More control over decisions
making
• Less exposure and limited
distribution
“Success is making any kind of a living doing the thing you love”
ETH

13. Self publicity is key for ETH

14. How many ways you
can listen to the band’s
music for free?
Why is it in the group’s
long-term interest to
make its music available
for free?

15. ETH Offers Free Music

16. Listen for free or buy tracks/albums: A hybrid

17. But why?
Raise initial awareness
with their target
audience
Get listeners hooked and
become fans with no
need to purchase
Draw them in to concerts
to drive revenue
Make revenue through
ancillaries
How sustainable is this approach?

18. If the band had begun its
professional existence
10 years earlier, how
might its business
strategy be different
from the path it took?

19. Would they be where they are today?
Do you think a big
label would have
signed them?
How would they
have made a name
for themselves
using a non-free
model?
Do you think they
would be
successful?

20. Going down the traditional route
If they got
signed
they would
have to fit
the mold
Traditional
paid for
music
route
Traditional
advertising
media
Traditional
concert
route
Label gets
most; ETH
gets little
Competing
with many
brands for
few contracts
Limited
ability to
self promote
Competing
with many
brands for
few contracts

21. Consider if you
were ETH what
would you have
done differently?

22. Would you have gone down this road?

23. Would you have signed up to a music sharing?
Sales
Revenue
Costs
Sales-
Costs

24. Appendix – Sources for illustrations
Slide 6:
www.dailymail.com
Slide 7:
www.wikipedia.org
Slide 8:
Virgin, Napster, Spotify, Tinie
Tempah and Soundcloud Websites
Slide 11
www.jasonderulo.com &
www.emi.com
Slide 12
www.emi.com & www.ufo.com
Slide 22:
X Factor, American Idol and Britain’s
Got Talent websites

25. End of Seminar
Note: This recording is for your
personal use only and not for further
distribution or wider review.
© Pearson College 2013