As traditional business models and routes to market fall apart, the music industry provides invaluable lessons to marketers everywhere – a useful “canary in the coal mine”.
The music industry continues to suffer – and sometimes benefit – from the combined assaults of technological innovation, always-on (mainly millennial) consumers, the degradation of legal controls and copyright, start-ups and acquisitions, and the random interventions of creative egos. No industry has been disrupted so deeply or frequently, or indeed contains as many lessons or inspirations for brands and marketers in all sectors. The music industry is proving to be the preeminent crucible of disruption, with a wealth of innovations and experiments in marketing (both successful and otherwise).
Originally, live music was abundant and the recorded form was scarce, but comparative supply has resulted in the value equation being totally reversed. Recorded music has become a loss leader, with successful artists now making their money through advertising, brand partnerships, sponsorship, live concerts, and merchandise.
This shift has led to growing opportunities – indeed active invitations – for brands to partner with the music industry via promotional campaigns and bespoke platforms (such as Amex’s UNSTAGED, Red Bull’s Music Academy, and Converse Rubber Tracks). For all its attractions, it’s still a moving target, with the last couple of years teaching us that the marketing rule book can be chewed up and spat out before a new one is written.
By looking at four moments that occurred in 2015, we can begin to understand the volatility and opportunity that exists within the industry, as well as broader lessons for brands in all markets as they address their own particular challenges.
In the midst of a seemingly “sinking industry”, an unlikely record was broken in the form of Adele’s album 25, which successfully sold 3.38 million copies in a week (more than any album before). Possibly more impressive than the scale at which 25 was sold is the fact that consumers were still willing to fork out $15.99 for an album. An incredible feat considering that the album was deemed dead in 2014 in shadow of the track.
The album was not the only blast from the past making a revival in 2015. Apple Music provides a radio service (through Beats 1) that allows music lovers to rediscover the rewarding experience of discovering new music from behind their radios; interacting with the DJ and with each other on various channels; and creating a network of music lovers on a journey to find, share, and enjoy their next 3-minute fix.
Making the best track or album of the year may not be enough for artists to establish and distinguish themselves among the highly saturated and nomadic music industry landscape. Artists find themselves having to diversify and find new, innovative ways to stand out and profit. Telecoms provider O2, for example, has captured the music-hungry audience by offering tickets for live concerts at the O2 arena, 48 hours before general release and exclusively to their mobile customers. Scottish rock outfit Idlewild, on the other hand, hope to mirror the success of their return to the charts after six years by accompanying their new album release with Scottish Fiction IPA – an Idlewild-branded ale.
The open slugfest between Taylor Swift, her label, and Spotify shines a harsh light on the fairness of Spotify’s business model, artists’ rights, the value of music, and hypocrisy. Artists have fought Spotify’s pari-mutuel payment model before, but none with such a large army behind them. Taylor Swift has a combined Facebook, Twitter, Instagram, and YouTube audience of more than 140 million, with her YouTube views in the billions. And while Spotify begged for her to come back to the platform, Taylor sold over a million albums in the first week away. Taylor was able to leverage her enormous following and intimate, social media-enabled relationship with her fans – a strength that not too many celebrities can boast.
Although our access to music has grown and improved over the last few years, measuring an artist’s impact consistently and accurately across these various channels still leaves something to be desired. It has become increasingly difficult to aggregate all available and wanted measurements in a way that’s truly representative of an artist’s or song’s popularity.
Towards the end of 2015, Drake was hoping to claim the enviable top spot on the Billboard Hot 100 with “Hotline Bling”. His smash hit was ringing out everywhere and anywhere, making it the clear favorite to top the pile. However, since Apple – who Drake exclusively released his video with as part of his deal – doesn’t report music video views to Nielsen Music, the company couldn’t incorporate the video into the streaming calculations for the week. Hence, Drake lost the Billboard top spot.
In a “disrupt or be disrupted” world, the music industry can provide plentiful stimuli and lessons for marketers in all categories.
In seeking to innovate and remain ahead, it is always instructive to look at the music industry and ask, “What are the equivalent opportunities and risks to think about in our market? What if we did that or, indeed, new or existing competitors did?”
The music industry has also never been more open to brands nor presented with more opportunities for mass or targeted engagement. Brands and media owners increasingly compete with the music industry to present artists online or live.
The final lesson for brands from the music industry in 2015 is a simple and important one: Great music has always been viral. From Elvis Presley to Kendrick Lamar, hits are still hits and fans always decide.
Curious to find out more? Download the full article PDF to see the disruptive analytics of the music industry, along with more detail around the “what ifs” that marketers and brands should know.