An Introduction to the Music Industry – Part 21 Comment
Catch up on part 1 here and find out how you can make money from the rights you own.
Unlike copyright, which can be harder to understand, the are two other forms of revenue streams that artists will use. These two forms of making money are Live Performance and Fan Relationship.
To make money from Live Performance is to simply monetise live performances in front of people. However, ticket income is not the only stream of revenue within the live performance setting, for instance money can be made from:
- Ticket commissions
- Ticket resale mark-ups
- Food and drink
- Other services – i.e. cloak room, parking, VIP.
- Sponsorships – the live sector has the most revenue wth brands (i.e. O2, branded beers at gigs).
As a an artist’s fan base grows and have greater success and exposure, the live setting will change (naturally getting bigger). Here are the steps that most artists and bands traditionally follow as their live setting changes:
- Self promoted gigs, pay to play.
- ‘Gig’ or ‘Club’ nights, festival new bands stages.
- Club and pub venue touring, festival stages.
- Theatre venue, festival main stages – this is the stage where artists will start to make ‘real’ money.
- Arena touring, potentially headline slots at festivals
- Stadium touring, headlining festivals.
In the digital age, as record sales diminish and the popularity of streaming services have drastically increased, using a fanbase as a source of revenue has become a major focus for new bands and artists. With the use of social media, artists now have a way of communicating with their fanbase and to get to know them better. This means that artists can find out what the core fans want, and consequently, can find out what to sell to them.
As an artist, once you have an engaged, growing fanbase, you can start to sell them products and services, such as:
- A subscription service (i.e. an online fan club)
- Signed records
- Deluxe records (with extra content such as, B-sides, demos, acoustic versions etc.)
- Premium merchandise
Using the combination of you (the artist), your music and your live shows, you can sell content, experiences and a relationship to your fanbase. In addition, if a sizeable fanbase is created, brands and companies may want to start a partnership with the artistic order to reach that audience, as well as exposing you to their customers.
These three revenue streams are all built on and rely upon building a group of core fans. To provide them with content, different experiences and an ongoing, engaging relationship, artists will usually have to depend on creating partnerships with other roles within the music industry.