Some really interesting comments in the NYT article this afternoon on Atlantic Records statement that their digital sales are surpassing their CD sales. What really struck me was how Atlantic is going about increasing their digital sales. Good quote here:
“I think we’ve figured it out,†said Julie Greenwald, president of Atlantic Records. “It used to be that you could connect five dots and sell a million records. Now there are 20 dots you can connect to sell a million records.â€
I really think the same can be said for developing artists. A common thread in my course (as well as the other business courses that we’re teaching here online) is that diversifying your revenue streams and engaging in niche marketing is a big part of making it work for musicians these days. Check out what Atlantic is doing:
Replacing compact disc sales are small bits of revenue from many sources: Atlantic Records’ digital sales include ring tones, ringbacks, satellite radio, iTunes sales and subscription services. At the same time, record labels — Atlantic included — are spending less money to market artists. In the pre-Internet days, said Ms. Greenwald, “we were so flush, we did everything in the name of promotion.†Among the cutbacks are less spending to produce videos and to support publicity tours when a new album is released.
The same principles can be (must be) applied to developing artists. Get your music out to Pandora (who accept indie submissions), start selling ringtones, start selling merch off of your own site, use TuneCore or CD Baby to get your music up on iTunes. Be aggressive with your outreach, and targeted with your outlets.
Is selling a million records still the goal? I read the same quote about connecting 20 dots and had chills run down my back! I think it’s great that they are acknowledging the current reality, but it seems to me they are trying to cram a square peg into a round hole.
Not at all Andrew. What I find most interesting about this article is the way that Atlantic is going about generating income now – looking at many diversified means rather than focusing on traditional physical sales. It’s similar to what Nettwerk has been doing for years – except 80% of their income is from non-physical sources! This is where the industry has to be focused, and I think it is a lesson that developing musicians can take as well – diversify your income and engage in niche marketing.
I enjoy your ArtistsHouse blog.
Mike