11 Digital Trends Shaping the Music Industry in 2013

11 Ways Digital Will Shape The Music
Industry in 2013
•  The changing nature of copyright
•  The Long Tail
•  Niche labels
•  The
Expanding digital revenues digit
•  tren al
The importance of engagement ds sh
•  The importance of branding mus apin
g
•  Evangelists ic in
2013
•  Branded labels
•  Freemium pricing models
•  Mobile apps
•  The Cloud and Lockers

MillionMedia.com The Impact Of Digital! theartistnetwork.ws!

Only one thing
is impossible for
God: To find any
sense in any
copyright law on Mark
the planet. Twain

Copyright, the foundation of the music
industry, is under threat in its current form
Copyright is the legal right to make a copy
of a work, e.g. a song, a video or an image.
A record label or publisher buys the right
from an artist to create copies of their work.
This is the essence of all entertainment
businesses. It enabled companies to invest in
artistic works and make profits, which they
could share with the artist and grow their
business.


Now almost every digital device has the ability
to make a perfect copy, every time, built in
The Internet has copying built into its core.
For instance, browsers create a 'cache'
copy of everything they download. Every
copy is identical in quality to the original and
can be sent virtually anywhere since borders
are meaningless. Copyright holders have
maintained their position that the Internet
does not fundamentally change the rights
they own.


For the first time
in history, hits
and niches are
on equal
economic
footing Chris
Anderson

The Long Tail has made millions of niches
accessible expanding people’s music tastes
The theory of The Long Tail can be boiled
down to this; our culture and economy are Example: Movimientos is a London
increasingly shifting away from a focus on a based label who specialise in a Latin
relatively small number of hits at the head of American niche. They sign UK artists
the demand curve, and moving towards a who play Latin American music, they
huge number of niches in the tail. This is run club nights, have a publishing
arm and are a booking agent and
good for aggregators of large volumes of
hire DJ's. www.movimientos.org.uk
music but individual tracks and artists will
only sell in small quantities.


Technology is opening up multiple revenue
channels for music distribution
Devices such as TV’s, digital radios, mobile
phones, game consoles and even watches are
able to stream and store music and therefore Example: TV set top boxes, such as
Virgin Media’s Tivo, now feature Apps
becoming distribution and revenue channels for
such as Spotify, enabling subscribers
music. Subscribers can save and share playlists
to listen to their playlists through their
between different devices, e.g. Spotify can be TV. Since many people have their TV
accessed via laptop, mobile and TV. However, linked to a home cinema surround
people now need to choose which platform sound system, this can result in the TV
they want to subscribe to since they are rarely taking the place of the traditional
music system.
interoperable.


As media channels increase and fragment,
engagement with your audience is vital
An engaged audience is less price sensitive,
buys more frequently, is more loyal, is more Example: Lady Gaga is a prolific user
likely to recommend products, and is more of social media. She Tweets
apt to provide useful feedback. An artist constantly and often replies to
who is engaging on their website and questions posted by her 31m+
followers. Her Facebook is updated
through social media is more likely to make
daily and she uses Instagram and
revenue through their interactions.
YouTube to post new videos and
photos – many less than flattering.


Unaware!

There are three stages of fan engagement. Fans
in the middle are the most valuable
The goal for the musician is to move fans
from being unaware of them to being Example: Jamiroquai push music and
engaged. Once a fan is in the centre circle, video to the public using their website
a band should consider giving free product, and channels such as YouTube,
because what they gain in terms of Facebook and Soundcloud. However,
evangelism is worth more in the long term they gave away their single, Smile, to
the core fanbase as a Thank You for
than the product itself. Fans move through
the support they received on the 2011
the circles by watching and hearing content European Tour.
they like.


Branding is an evolving science that media,
including music, needs to be aware of in 2013
Modern branding is a complex science.
From identifying a gap in the market to the
design of the product, how it's presented, It isn’t what they
where it is sold, the advertising, promotions, say about you,
web site, tone of Twitter messages and
it’s what they
colours - everything is planned, plotted and
implemented according to a brand whisper. Errol
strategy.
Flynn


Finding and nuturing evangelists is a vital part
of marketing in a connected world
When we buy something, and it product repeatedly gives us
works or doesn't break, we are satisfaction then we may even
merely satisfied. The product has become Evangelists - telling people
done what it was supposed to do. about a product as a personal
Which may lead to a repeat statement about ourselves. This is
purchase and more satisfaction. This Brand Nirvana, when large numbers
means we are prepared to tell our of people are singing the product’s
friends about it, since we are praises to their friends - the more
confident the product works. If the powerful form of marketing.


Brands want to engage with a music audience
and some are developing their own labels
Brands have always used music to attract Example: Red Bull launched a record
label in the UK and US. Their artists are
and create an affinity with their audience,
featured on its sport videos, adverts,
especially the youth market. Playing the YouTube videos and play at Red Bull
right music can create a strong bond and is events. This helps to promote the artist
a powerful aid to recollection of a product but also saves Red Bull vast sums of
or service. However, music is expensive to money in licensing since they no
license and brands feel they can now use longer have to pay other labels or
publishers for the rights to use the
digital to develop artists and save costs.
music.


‘Freemium’ is a popular way of encouraging
people to try a service before subscribing
Many services offer a 'Pricing Table' to entice Example: Nine Inch Nails offered fans
customers. The free offer provides the customer their ‘Ghost’ album for free and
with a basic level of service to become hooked. charged different prices for improved
formats and additional products.
Then, different payment levels are offered that
provide more features. Spotify offer something
similar with their freemium model.


Mobile Apps are constantly evolving and may
even become the next format of the ‘album’
Mobile applications will enable artists and labels
to promote and sell music, tickets and videos
direct to fans. Applications can be distributed Example: Bjorks Biophilia album was
either for free, a one-time charge or a released as an application that
enabled the artist to gradually
subscription. Using the ability to offer music
release content, including new
throughout the duration of a campaign offers a
remixes, tracks, images and videos
new and compelling way for artists to package, as the campaign unfolded and
present and sell their music. evolved over time.


The Cloud and Locker Storage mean people
increasingly value access more than ownership
Cloud storage and ‘Lockers’ enable people
to keep their music, videos, images, Example: Google, Amazon and
contacts and files on a remote server, Apple are vast companies investing
significant amounts in to their Cloud
meaning they no longer need to store them
storage solutions as people move
on their own devices. This results in people away from ownership towards an
needing less hard drive space. However, it access model. Music, in it’s digital
also results in a reduced need for actual form, is simply treated as another file.
ownership and an increased value in
access.


How Digital Will Impact The
Music Industry in 2013
This presentation is based upon the eBook
and online learning course, “How Digital Will
Impact The Music Industry in 2013”.
To buy the book, subscribe yourself or
company staff members to the course, visit:
www.millionmedia.com
&
www.theartistnetwork.ws


11 Digital Trends Shaping the Music Industry in 2013

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