A couple of weeks ago, I was reading yet another insightful article by my esteemed colleague Patrick Clifton, and this extract struck me:
““𝗜𝗻 𝘁𝗲𝗿𝗺𝘀 𝗼𝗳 𝘀𝘂𝗰𝗰𝗲𝘀𝘀𝗳𝘂𝗹𝗹𝘆 𝗹𝗮𝘂𝗻𝗰𝗵𝗶𝗻𝗴 𝗻𝗲𝘄 𝗺𝘂𝘀𝗶𝗰 𝗳𝗿𝗼𝗺 𝗻𝗲𝘄 𝗕𝗿𝗶𝘁𝗶𝘀𝗵 𝗮𝗿𝘁𝗶𝘀𝘁𝘀: 𝘁𝗵𝗲 𝗼𝗻𝗹𝘆 𝗨𝗞-𝘀𝗶𝗴𝗻𝗲𝗱 𝗱𝗲𝗯𝘂𝘁 𝗮𝗹𝗯𝘂𝗺 𝗶𝗻 𝘁𝗵𝗲 𝘁𝗼𝗽𝟮𝟬𝟬 𝗶𝗻 𝟮𝟬𝟮𝟰 𝘄𝗮𝘀 𝗳𝗿𝗼𝗺 𝗧𝗵𝗲 𝗟𝗮𝘀𝘁 𝗗𝗶𝗻𝗻𝗲𝗿 𝗣𝗮𝗿𝘁𝘆. 𝗜𝘁 𝗶𝘀, 𝗶𝗻 𝗳𝗮𝗰𝘁, 𝘁𝗵𝗲 𝗼𝗻𝗹𝘆 𝗱𝗲𝗯𝘂𝘁 𝗮𝗹𝗯𝘂𝗺 𝗶𝗻 𝘁𝗵𝗲 𝘁𝗼𝗽 𝟮𝟬𝟬 𝗿𝗲𝗹𝗲𝗮𝘀𝗲𝗱 𝘀𝗶𝗻𝗰𝗲 𝗝𝗮𝗻𝘂𝗮𝗿𝘆𝟮𝟬𝟮𝟯.””
Frankly a shocking and deeply saddening insight. Nevertheless this sad inditement got me thinking about the origins of where we find ourselves and what we can learn and apply to artist strategy.
LET’S GO BACK TO…
Late summer 2014 and the music business is on its arse, physical is tanking, digital transition dawdling, piracy is rampant and there’s a big question over a thing called Streaming. It’s easy to forget, some ten years later, that there was a lot of suspicion and outright hostility to Streaming. Yet some of us thought differently having a hunch that Streaming could solve a few ongoing issues, not least the age-old problem of piracy and, perhaps…ultimately save the music business?
“there was just so much we still didn’t know about streaming – principally, the human component.”
Remember Big Data? Well, back then Major record companies were already dealing with a deluge of digital data delivered by various sources. Now we needed to get our head around what all this added Streaming data meant too. The problem was that despite all that WHAT data, there was just so much we still didn’t know about streaming – principally, the human component - consumer understanding of it, how/when did they use it, probability to pay for it and what it would mean long-term for the business and artists?
So, my team decided we’d undertake a Global Streaming Study across several global markets spread across several continents. The project used a mixture of quantitative research (for breadth) and qualitative research (for depth) aimed at filling the yarning knowledge gaps in our collective knowledge.
WE SAW THE FUTURE…
The project was enormously successful and immensely beneficial in helping us formulate a med-to-long term strategic direction, for the business. Because amongst all the amazing insights into real people’s understanding, behaviour and motivations we could see the way that the music business would broadly evolve over the next 5 – 10 years.
“we could see the way that the music business would broadly evolve over the next 5 – 10 years.”
We took the massive treasure trove of golden insights, distilled them into pertinent decks relevant to each part of the business - label marketing, A&R, Digital Account management, Biz Dev etc, etc and our team went out and spread the word. I spent six weeks living out of a suitcase, while hoovering up the airmiles and caning my carbon footprint as I flew to almost all our global offices (it was a different time) presenting what Streaming meant for our collective futures.
As I said, this was a huge piece of work, with a myriad of valuable learnings, too many for this short newsletter, but most exciting was that we could see how Streaming was going to cause the record company business to broadly morph into two areas:
Track Based Business – where consumers select what to stream based on mood & occasion and not artist name or song tile and,
Artist Brands – identifying artists we can work with who have the potential to build strong, multifaceted careers (brands) developing enduring fanbases.
Oh…as an aside, yes, we saw that Streaming could almost totally eradicate piracy. So that was nice wasn't it.
…APPARENTLY SOME DID'NT LISTEN
The response to our findings across the company was incredibly positive, with labels to central support services changing the way they were structured and developing rosters. We’d met with artists managers, to workshop what it could mean for them. Even some of our DSP partners benefited from user insight into their own platforms, helping them to tweak strategy and planning.
Well, I say all that, but there was just one little, erm…blind spot, because in an absolutely fantastic example of “not reading the room”, I didn't notice that when I was presenting to many of the illustrious, highly paid, senior bods in the company, that they kind of ‘switched off’ after I discussed point No.1. Or perhaps it was just my presentation style? Whatever it was, the business then decided to go all-in to the Track Based Business and basically ignore point No.2.
So, what happened over the proceeding years, after we presented our vision of the future?
A lot of very experienced and talented ‘music’ people, those who knew how to discover, develop and break acts, lost their jobs
Knowledgeable Exec’s who knew how to market an artist and build a fanbase were let go
A&R guys were told to focus on data, stop using their ears and sign tracks…lots and lots and lots of tracks
Artists Manager found themselves increasingly ‘picking-up the slack’ for labels as they shed experience and heads
Labels struggle to discover, break, and sustain artist ‘brands’
And now a Major record company makes upwards of 75% of its revenue from Catalogue instead of Frontline!
As Patrick highlights in his article “there are 63 albums in the top 200 released by British-signed artists in 2024, i.e. 32%; compare this to 2004 when the figure was 46% and 2014 when it was 53%”.
WHAT HAVE YOU LEARNT, IF ANYTHING?
This all reads like some elaborate ‘we told you so’ piece, but I assure you it’s not. Well…perhaps just a little. Ultimately this story ends up being a lesson in the value of WHY data, oh and having the foresight, imagination, desire and ambition to act on it of course. No amount of transactional data, or vanity data - streams, Likes, Shares, Follows, Comments - would ever have shown us how Streaming was going to change the music business or the record company, the way that the WHY data we reaped from the Global Streaming Study insight project did.
WHAT DOES IT MEAN FOR YOU?
So, what does it mean for you - the artist, the manager, the rights-holder? Do you want to invest in what you got? Are you interested in growth? Do you want to connect with more humans, in more ways? Are you in this for the long term? Because amazingly you can get this type of game changing insight yourself. In fact, the methodology that Sound Effects uses today, is the same as that Global Streaming Study, although it has come on leaps and bounds since then. It’s not limited to isolated bespoke projects. We also now establish infrastructure for our clients that delivers ongoing WHY data that helps them week in, week out.
Unlike the myriad of cheap ‘silver bullets’ apps, Sound Effects works in partnership with you. What we discover together through this WHY data, informs, inspires and shapes what we create and develop for your artist to generate incremental revenue and enduring fan relationships.
Hey, while I’m thinking about it, if you're serious about unlocking revenue from fandom, I mean actually, truly serious, then get in contact. If not, well…I hear there’s a few different super fan Apps out there.
Time next time mi amigo.
Philip