As a techie diving head-first into the music industry, I’ve been humbled by the number of amazing humans I’ve met in our journey so far. To date, we have learned from hundreds of independent musicians, artist managers, and other industry professionals. We’ve discussed the challenges they face as well as the opportunities they foresee. The music industry certainly has its quirks, but I feel especially puzzled by some of our recent observations. Thus, I’d like to articulate these learnings here; with any luck, we might even start a discussion below this post.
Online Presence for Today’s Independent Musicians
In our discussions about online presence, we learned that independent musicians stitch together a collection of tools to build their brand and following. The independent musicians we spoke to all spend a significant amount of time building their social media presence. This strategy makes a lot of sense for building awareness, since most of their current and prospective fans already hangout on these platforms. However, having reach alone is insufficient as it does not directly monetize - it merely represents the “top of the funnel” in the life cycle of fandom. Many of our musician friends realize this, so they try to direct their followers toward streaming platforms, where they can start to monetize via their music.
Using the common funnel analogy, a typical fan acquisition journey looks something like this:
Prior to the COVID pandemic, streaming and live music had a mutually beneficial, symbiotic relationship that enabled effective conversion of listeners into concert-attending fans. In this “old” world, the music available on streaming platforms served primarily as a marketing tool to attract fans toward paying for real world interactions with their favorite artists. Using live performance as the centerpiece, artists can additionally monetize via merch or VIP experiences, further increasing their earnings. Needless to say, the pandemic dramatically disrupted this relationship, causing a near elimination of the “live” half of the music industry. It’s hard to predict how things will evolve post-pandemic, but some trends such as small venues closing and people migrating away from cities hint at the potential longevity of some of these behavior changes.
Interestingly, most independent musicians today either don’t have their own website at all, or have one but hardly use it. This fact stood out to us; in the startup world, a website is one of the things that many companies build first, providing a go-to place to capture early adopters and nurture them into diehard advocates down the road. In a Billboard article from industry legend Zach Katz, he echoed a call for innovation to encourage artists to foster organic growth via building a loyal fanbase. We couldn’t help but wonder how we might go about creating tools to align with his vision.
My primary takeaway from the article:
the future of a thriving music industry will be driven by tech-enabled music companies, rather than incumbents who merely allow tech giants to exploit musicians.
This message deeply resonated with me, as it brought back nostalgia from my Redfin days, where CEO Glenn Kelman advocated a similar perspective.
Streaming is Not the Solution for Creators
In the absence of live music, the unit economics of streaming platforms has become more clearly problematic. As industry analyst Midia Research points out, most artists earn well below a living wage from streaming alone. In the US, creators earn $3,527 per million streams on Spotify. Put another way, if an independent artist put $100 into an Instagram ad campaign to drive traffic to their Spotify profile, these ads would need to generate over 28,000 streams to breakeven. These odds are extremely difficult to beat, even with playlist placements as an available tool.
Several of the folks we spoke to see traction on social media and streaming platforms as a prerequisite for getting synch placements or brand partnerships. The idea here is that online presence builds legitimacy around the brand of an independent musician, so they are nurturing a following base purely as a strategic move toward getting the attention of music supervisors, sponsors, or brands. We have heard success stories with this approach from songwriters in our network, some of whom use agencies such as Audio Network to maximize exposure. Personally, I think this is an interesting way to build a musical career, but it’s not clear to me how much of the success still depends on simply knowing the right people in the industry.
Call to Action
Thanks for reading our post! Why do you think the online presence of independent musicians is the way it is? What can we do to help them create a sustainable, full-time career that enables them to own their content as well as their audience? We are still very early in our journey, and we are all ears for any ideas. Please comment below and let’s have a discussion!
Don’t be a stranger,
Nico & Patrick, Founders
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