The New Rules Of Music Marketing 503k3j

The New Rules of Music Marketing

A Guide to Marketing Concepts for Success in Today’s Independent Music Business

©2013 Michael Barry

First Edition 2013

Princeton Creative Marketing, LLC

PO Box 1500

Princeton, NJ 08542

(609) 638-1216

[email protected]

www.princetoncreative.com

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All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the publisher, except in the case of brief quotations embodied in critical reviews and certain other noncommercial uses permitted by copyright law. For permission requests, write to the publisher via email at [email protected] or by mail at the address above.

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Liability Notice

The information in this book is offered “as is” and without warranty or guarantee of any kind. Every attempt has been made to be truthful and accurate in the preparation of this book and the author accepts no liability to any person or entity with respect to any loss or damage caused directly or indirectly by the information contained in this book. The reader is cautioned to seek advice of attorney on any legal or business matters discussed in this book and understands

that the book contains opinions of the author and not legally binding investment or business advice of any kind.

ISBN: 978-0-9895221-1-3

ISBN: 9780989522106

About the Author

Michael Barry, M.B.A., B.A. started his career in music performance and production and eventually moved to the marketing side of the music business. For the past decade he has worked as a marketing consultant for music and arts, small businesses and non-profits. He is currently the owner of Princeton Creative Marketing, a consultancy that specializes in those same areas. In the world of music, he has continually worked to help musicians navigate the uncertain world of today’s independent music business. He has taught marketing, business, writing and music courses at the New School in New York City, Norwalk Community College in Connecticut and at the International Studio of Music. He is a frequent industry ist, guest lecturer and instructor and has published his work in journals, newspapers, magazines and online. Some of his recent marketing consulting clients include ETS, H&R Block, Laughing Buddha Music, the Global Language Project, Studios Rouges, World Music TV, S4 Holdings, and Ahlara International. He can be reached at [email protected].

Thank You

A book like this is the result of input and experiences from so many people that it is impossible to thank them all properly. First of all, thanks to all the musicians who have stuck with it through very uncertain times. I truly hope this book helps you along the way. Thanks to my students, whose challenges and questions got this book started in the first place. To all my many teachers, I owe a debt of gratitude for always being open and sharing all you can. Thanks to Jill, my wonderful editor with her sharp eyes and insightful comments. Thanks to Annabel for always being in my corner and for her excellent work on the glossary. Thanks to Rex for some interesting conversations and for navigating this crazy business with me for the last decade or so. Many thanks and appreciation to David and Wil and all the fine musicians I’ve worked with over the years; long may we rock! Thanks to Mom, Dad, Chris and the rest of the clan for always encouraging my writing. And finally, thanks to Miran, my wife and fellow traveler on life’s journey. Having you as my better half has proved the limitless possibilities that we all have within us, and this book is just one small example of how we can all reach for our dreams.

The New Rules of Music Marketing

A Guide to Marketing Concepts for Success in Today’s Independent Music Business

Introduction

The State of the Music Business Today

The Current Situation

Historical Background

Industry Analysis

PEST Analysis

Industry Segmentation

A Marketing Primer

What is a Market?

Why Study Marketing?

What is Marketing?

Marketing vs. Selling

Marketing Concept Overview

The Recent Evolution of Marketing

Marketing and Music

A Newer (and Better) Concept – The 4 C’s

A Quick Recap

Test Your Knowledge

The Marketing Communications Mix

The Elements of the Mix

Traditional and Contemporary Balance

Sample Marketing Communications Mix

Understanding Your Customer

The Voice of the Customer

Customer Relationship Management (CRM)

Customer Behavior and Marketing Strategy

Building the Value Proposition

What is a Value Proposition?

Market

Value Experience

Offerings

Benefits

Alternatives and Differentiation

Proof

Putting It All Together

Example of a Strong Value Proposition

Example of a Weak VP

Marketing and Distribution Channels

What Do We Mean by Channel?

Different Channels Require Different Messages

Example 1: Customer s from your website

Example 2: Producer licenses your music for use in a film

Social Media and Online Marketing

Digital Marketing Channels

Social Media Strategy

An Easy Social Media Plan

What’s in a Brand?

Branding Overview

Holistic Brand Management

Brand Management in Music

Developing Your Personal Brand

Personal Branding Exercise

Personal Brands Mean Authentic Products

Taking Care of Business

Hope is Not a Plan

Establishing a Business Entity

Dollars and Cents

Teamwork and Delegation

Education

Marketing Plan Template

Outline First

How to Use This Plan

Marketing Plan for CD Launch and Tour

1. Summary

2. Purpose of Plan and Needs Assessment

3. Situation Analysis

4. Goals and SMART Objectives

5. Target Market Analysis

6. Industry Analysis

7. Competitor Analysis

8. SWOT Analysis

9. Product Overview

10. Unique Value Proposition

11. Marketing Strategy

12. Financial Assessment

13. Implementation, Management and Evaluation

Conclusion

Appendix A

Glossary of

Appendix B

Answers to Unit 2 Quiz

Introduction

This book grew out of a need to understand a rapidly changing business and a belief that the way forward for independent musicians lies in understanding both traditional principles and contemporary methods of marketing. Talent, ambition and luck are all still important of course, but as the business changes, indie musicians find themselves in an unprecedented position: they are now, more than ever, in the driver’s seat with regard to controlling the distribution and marketing of their music. But though they may be in the driver’s seat, not everyone’s car is equipped with an engine, so it may not be all that optimistic an outlook. Unless…

Unless we make sure we have a good well-tuned engine, a roap, and yes, we will still need a seat belt, because the ride can get a little wild. To complete the automotive analogy, the engine is sales and the roap is marketing. If musicians are unable to sell their music, they cannot earn a viable living and ultimately they will be unable to continue making music as a career. But as is the case for every business, simply making a product, in this case music, and offering it to the public for sale is seldom a path to success. Marketing is what creates sales, yet independent musicians typically are not experts in marketing. However, due to the changes in the music business, most are now in a position where they must handle a good portion, if not all, of their marketing activities.

Over the last decade and more, as I taught music business and marketing classes, marketed music for my own label and consulted for other businesses to help with their marketing, I began to see where the independent music business had some serious gaps in knowledge. Both my musician students and business clients had many of the same questions, and many of them centered around how to find the right balance of traditional marketing techniques with today’s emphasis on digital and online marketing. In the case of my musician students, many had no understanding of the real concepts behind marketing. And while my clients from other industries usually had a better understanding of traditional marketing

techniques, they were a little lost in the online marketing universe. It seemed that somewhere in the middle we might find some real answers.

So this book is the result of seeking the answers to marketing questions that were troubling the independent music world. Its purpose is to help indie musicians achieve a balanced approach to music marketing; one that is grounded in sound marketing concepts and tried and true methods, and one that puts these to use in the new digital marketplace. When you peer behind the scenes a little bit, you usually find that there are indeed answers to the pressing questions of the business. Things that succeed usually succeed for a very good reason, and that reason is often marketing. To be sure, the business is still evolving, and both our questions and answers must evolve as well. But the principles of marketing are timeless. We just have to learn them and find the right way to use them in the time and circumstances in which we live.

The State of the Music Business Today

The Current Situation

The average independent musician, that is, a musician without a major label or publishing contract, struggles to earn a living even in the best of times. Those lucky enough to be salaried musicians, such as music directors or staff composers, earn an average salary of about $35,000 a year. Of the roughly 250,000 or so who list themselves as musicians on their tax returns, 40 percent are employed only part-time, and almost half are self-employed. About 85% of all CDs released every year sell fewer than 100 copies, and most musicians will never be able to earn a full time living from the music business. It doesn’t really sound like the best business to be in, does it? On the other hand, in May of 2012, without any major label , independent musician Amanda Palmer raised $1,192,793 (in thirty days!) from fans and ers through “crowdfunding” on Kickstarter.com. That same month, thousands of good musicians struggled to pay the rent. Clearly, for many musicians, there is a problem here, yet a handful seem to have found a goldmine.

There are so many terrific musicians who don’t have the backing of a major label or the privilege of superstardom. What enables one of these musicians to pull in over a million dollars in a month, while so many others muddle along for years barely earning a living wage? There is no simple answer, but if I had to choose one factor, it would be marketing. Not talent, not luck, not money. Marketing. Unfortunately, most musicians don’t understand what marketing is. Now I don’t mean to discount talent, luck, or money. You’ve got to have some talent to make it, and luck probably doesn’t hurt, but as the old saying goes, “luck favors the prepared” and musicians need to prepare more than ever before. To succeed in this business, you have to first understand the rules. It would be nice to believe that there aren’t any, but in fact there are. The good news is that The New Rules of Music Marketing is here to help.

With a difficult economy and the music business rapidly changing, the indie musician’s job is even more difficult than it was just a few years ago. Reliable information that helps your career is not only hard to find, but it is hard to interpret, and few musicians have degrees in business or marketing. So even with talent and a quality product, it is likely that most musicians don’t know enough about the business to be fully responsible for their own success.

The industry’s yearly numbers are certainly not encouraging. For example, Billboard magazine reports that the number of new CD releases has been dropping each year: from 106,000 units in 2009, to 96,000 in 2010, and 75,000 in 2011. That last period represents a 22 percent drop in new releases. Articles reporting the drop in industry revenue abound and horror stories about the effects of digital piracy are commonplace. In fact, of the 75,000 albums released in 2011, only about 1,200 sold more than 10,000 copies, and more than 60,000 sold fewer than 100 copies. Please read that line again and let it sink in a bit. I will even make it easy for you:

Of the 75,000 albums released in 2011, only about 1,200 sold more than 10,000 copies, and more than 60,000 sold fewer than 100 copies.

However, there is encouraging news as well. While sales of physical CDs are falling precipitously, sales of digital singles are increasing at an enormous pace and there are more opportunities and distribution channels for independent musicians than ever before. According to the Recording Industry Association of America (RIAA), legal s of digital singles are up 10.9% and digital album s are up around 14% this past year (2012). Furthermore, digital performance royalties paid to musicians and copyright owners for music broadcasts on satellite, Internet and cable TV music stations are up about 17.2% in the same period.

The old business is suffering, but take heart because new opportunities are arising. The real problem in the music community is not only that quality information is difficult to obtain (try finding those statistics I cited above), it is also difficult to interpret and shape into a usable, plain English marketing plan that yields tangible results to your bottom line. If major labels with highly paid marketing and ing teams are struggling with this fluctuating business model, what hope is there for the independent musician or small music enterprise with little or no business acumen? Independent musicians work hard to hone their music skills and have little time or propensity for the business side of music, although there is mounting evidence that they must fend for themselves in the business arena, at least in the early part of their careers. The Do-It-Yourself (DIY) movement has a strong hold on the independent music business as musicians are aware that it is not very likely (nor even desirable) that they will hand their destiny over to a major label to catapult them to stardom. But can you really do it yourself? Not without at least a little help. At a minimum, we all need easy-to-understand information that can be used to help navigate the changing business and make intelligent, actionable decisions.

The Do-It-Yourself (DIY) movement has a strong hold on the independent music business as musicians are aware that it is not very likely (nor even desirable) that they will hand their destiny over to a major label to catapult them to stardom.

While you don’t have to run out and get your MBA, you need to obtain at least some expertise on the business side of music, particularly in the area of marketing and promotions. According to a recent article in Management Decision by Paul Oliver, the DIY musician needs to become adept in three areas: artistic process, managerial skill, and information technology (Oliver, P. G. (2010). The DIY artist: issues of sustainability within local music scenes. Management Decision, 48(9)). Artistic process is beyond the scope of this book. But most of us are OK in that area already, and fortunately, artistic expression is something that has value in the marketplace. In the independent music business,

a good portion of the managerial skill mentioned above centers around marketing and promotions, and information technology is the predominant channel for these endeavors. So it appears Oliver has a good point.

Outside of the music business, when a start-up or existing company hires a marketing consultant or tasks its marketing team with creating a marketing plan, one of the first things that should be done is an industry analysis. This is typically an overview of the industry in which you are operating, although there are other components that can get a bit more detailed as you zero in on specifics. You cannot create a viable marketing plan without a strong understanding of the industry you work in, and that typically includes an understanding of the history, the current situation, the possible future scenarios and the forces and issues that are shaping the business.

It is not enough to simply understand that you are in the music business – that much should be obvious. It is essential that you have more knowledge than that. Do you know the stats for CD sales over the last several years? What about digital singles? Do you know who sells the most music in the U.S.? Do you really understand how the internet affects your business both positively and negatively? What about publishing – long considered the most important part of the business? Do you understand your competition? Do you understand your customers? These are some of the questions you need to have ready answers for as you move forward in this business. , “hope” is not a business plan (more about that later). If you want to carve out your slice of success in this business, you have to think like a businessperson as well as a musician. As you go through this book, you will learn what marketing is all about and how to apply it to the business of music. To make sure that you have a proper perspective, we’ll start with a little history lesson, and then we’ll follow up with the industry analysis.

Historical Background

If we skip over a few thousand years of music history, say from when the first caveman (cavewoman?) orchestra banged rocks and sticks together, right up to the early 1900s, we’ll be ignoring some great music and untold developments in composition, instruments, style, notation, and so much more. But for the purposes of this book and your education as a music marketer, we’re focusing on the history of recorded music; the invention of recording devices was the biggest game-changer since the invention of notation. While we can actually trace the advent of the recording industry to the invention of the piano rolls and other cylinders that reproduced music, it was Thomas Edison’s invention of the phonograph in 1877 that was a seminal point in recording technology. (Incidentally, the piano roll is where we get the term Mechanical Royalty, since composers were paid for the mechanical reproduction of their music.)

Initially, it was thought that the phonograph would be sold to businessmen, government agencies and courts for recording legal proceedings. It was not until a bit later that the device was adopted by the music business of the time. In 1899, coin-operated phonographs began to appear in arcades, with a limited selection of pre-recorded songs. The public was hooked, and the idea that the average household might actually buy one of these things caught the attention of a number of enterprising businessmen. Within a few short years, several million records (initially, discs made of hard rubber) had been sold, and everyone who was anyone had a phonograph machine to play their favorite music on.

Try to imagine how new and different this was. Prior to the appearance of the phonograph, if you wanted to hear some music, you had to go see it performed live. Aside from traditional folk musicians, most concerts were the domain of chamber or municipal orchestras performing the works of the great composers of the day. in the late 1800s composers like Chopin, Liszt and Tchaikovsky (who died in 1893) were still contemporary names. But as the

century turned, tastes turned with it, and the listening public started to gravitate toward singers and shorter songs. Most of the popular singers, like Eddie Cantor and Al Jolson, did not write their own songs. They just sang. This was true then, it was true before then, and it is still true now. In fact, a 2013 article in Billboard noted that fewer than 5% of today’s hit songs are composed solely by the artists who sing them.

With the rise of the phonograph and the change in musical tastes, there was a pressing new need for songwriters. To answer this need ( that word – “need” – it will be central to our marketing discussions), a whole new crop of songwriters arose. Initially, this was a bunch of folks in New York’s Tin Pan Alley (originally West 28th Street between Fifth and Sixth Avenues) and the Brill Building (1619 Broadway, at 49th Street), sitting in rooms with pianos, writing dozens of tunes. These were songwriters of the golden age of music publishing, which pretty much ended in the ‘50s or ‘60s when artists more commonly wrote and recorded their own material. But for the first half of the twentieth century, artists like Bing Crosby and Frank Sinatra and the crooners and warblers who preceded them typically did not write their own songs. The hit songs that we came to know as the Great American Songbook were written by songwriters d with music publishers, who were the businessmen of the developing music business. The writers were essentially employees of the publishers, and it was the publisher’s job to get the songs into the hands of famous artists and their managers or record labels. Hopefully, the result would be a recording, a smash hit, and buckets of money for everyone. The publishers typically retained ownership of the song, at least for a period of time, as dictated by the U.S. copyright laws.

Tin Pan Alley was the center of the popular music universe from around 1890 or so up until the 1930’s, and many would say until the 1950’s, when rock and folk singers really began writing their own music in earnest.

West 28th Street in Manhattan was originally considered to be the physical location, but the term soon became a generic designation for any concentrated area of publishers within a major city. So you will find the term used elsewhere, like on Denmark street in London.

The origin of the term is not 100% certain, but the story is that it was a derogatory term describing the sound of dozens of “song pluggers” playing cheap pianos as akin to banging pots and pans in an alley.

Dozens of great American songwriters including Irving Berlin, George M. Cohan, George and Ira Gershwin and more were part of Tin Pan Alley.

The legal side of the picture looked something like this: The record company would pay the publishing company a per-unit fee, typically just a few cents, for each copy of the recorded song that was sold or distributed. This fee was called a Mechanical Royalty (referenced above and stemming from the first reproductions of music being for piano rolls). The fee paid for the Mechanical License, the actual document granting the right to use the music. The publisher would then split this fee 50/50 with the writer of the song. If the writer and publisher had several songs on a record, or the “B” side of a single as well, there would be fees for each song. To a great degree, this changed in the ‘60s with the rise of rock music and folky singer-songwriters who composed their own selfreflective songs and often formed their own publishing companies. Also at this time, some new jazz composers were gaining notoriety, and their compositions were finding a place in the public ear along with the already accepted works of jazz greats like Duke Ellington. However, for many successful pop singers, then as today, not writing their own material was and is the typical way to go.

This set-up worked fine from the 1960s well into the 1990s, although there were signs that there would be sweeping changes to come. Everyone was making loads of money and the business was thriving. There were still dozens of substantial labels and extravagant budgets for recording, touring and other indulgences of questionable legality. Then the digital revolution quietly began, first with cassette tapes (which, although not digital, were the seed for what was to come), then CDs, and then the explosion of digital formats like mp3’s, and, of course, the internet.

It was largely because the internet changed access to distribution methods that the business quickly began to deteriorate. The big labels will scream and shout

about piracy and file sharing, but that was only one element in a business that had taken a major evolutionary step. The customers’ ability to access music had changed, and their needs changed along with it. The revolution had little to do with the music itself. The new needs were affordability (most folks were tired of the $18.99 CDs), ability to access music on various devices, and the customers’ need to choose how, when and where they made their purchases. Coinciding with this change was a movement away from major radio station playlists replaying the same tired rotation over and over – squeezed in between more and more commercials – with music choices and formats (to some extent) decided by the rs.

There are excellent sources of information about the huge changes in the music business if you a want to explore this topic a little further (which I would heartily encourage), so crank up your favorite search engine and have at it. One of the better books is The Future of Music: Manifesto for the Digital Music Revolution by David Kusek and Gerd Leonhard. But for now, we have a snapshot of how the industry arrived at its current state. Now we’ll take a somewhat closer look at this industry itself before plunging into the essence of marketing.

Industry Analysis

There are several companies that write and publish reports on hundreds of industries from farming to furniture making and yes, even the music industry. These reports are used by investors and researchers when seeking high-level views of an industry, perhaps to decide whether to embark on a new venture or make an investment somewhere. The reports typically include information about industry activities, revenue, rates of growth or decline, key players, and outside factors that affect industry participants. IBIS World publishes several good reports that are specifically about the music industry including the following: Major Label Music Production in the U.S., Independent Label Music Production in the U.S., Global Music Production and Distribution, Music Publishing in the U.S., and Performing Arts in the U.S. While we may think of all these as part of the same industry, it is very helpful to break them up into smaller sub-industries, because there really are major differences in how the participants operate and what the future of the specific segment of the industry holds. These reports can be quite expensive, often over $1,000, but you may be able to access them on your own through your local library or if you are enrolled in college or university. Some companies even have subscriptions, so if you have a day job, perhaps you can check with your employer.

A quick aside: this lack of easy access to information is a good example of one of the music industry’s big problems. I can’t imagine anyone for whom the info contained in these five reports would be more useful to than someone contemplating a career in music, but most of us are not ready to shell out thousands of dollars just for a few reports. However, in many businesses, an industry analysis is just an expected company expense. If you can get a look at one, these reports are interesting reads and nowhere near as dull as you might expect.

Since we’re most concerned with independent labels and artists, we’ll focus on

that rather substantial sub-segment of the music industry. The indie label business is most representative of the business that we are all in. Even if you’re an individual performer, producer or manager, unless you’re working with the big labels, this is pretty much your industry, so get to know the reality – that’s smarter than just relying on what “everyone” says. The following table is a very high-level view of the independent label industry segment intended to provide a frame of reference for our business activities.

Table 1.1 Independent Label Industry Analysis

Primary Activities

Recording, production, sale and licensing of music

Major Products

CDs, Vinyl LPs, Digital Albums, Digital Singles, Digital Performance Rights, DVDs, Music V

Annual Revenue

$340 Million

Annual Profit

$7.5 Million

Active Businesses

800+

Growth Last 5 Years

-1.8%

Projected Growth Next 5 Years 0.4% Life Cycle Stage

Decline

Regulation Level

High

Effect of Technology

High

Barriers to Entry

Medium

Capital Intensity

Medium

Competition

Medium

Key External Drivers

Recession, Disposable Income, Alternatives, Intellectual Property Rights, Population

What does this table with some relevant facts about the indie label business mean and more importantly, what does it mean to you? Let’s take it line by line. “Primary Activities” and “Major Products” are straightforward and selfexplanatory. (And yes, vinyl LPs are still part of this business. In fact, vinyl sales were just shy of 4 million units last year.) The entries that should give us pause are on the next two lines. While there was healthy revenue of $342.1 million, only $7.9 million of that was profit. And on the next line we see that there were 800 or more businesses in this segment. That represents all the companies that showed up on tax returns as indie labels, from very small labels to the large independents. So if you divide profit by number of businesses, you get about $9,000 per business. Not too encouraging, is it? Of course it’s not an even division – some labels make more than others – and there are plenty of other factors, but the point is that this is a rather small pie, and a lot of folks need a slice to earn a living.

Growth rates give us the previous five years and the projections for the next five years, based on financial analysis models run by smart people. There is some good news hidden in there. If we were looking at the major label analysis, the decline numbers would be in double digits and there would probably be negative growth. Indie labels are gradually taking a little more of the market and with it, the available revenue. Still, the same analysts feel that the industry is in a decline stage, although we may just be looking at the rise of a new model as the old one declines. By the way, there are four stages of industry and product lifecycles: Introduction, Growth, Maturity and Decline, each with its own set of do’s and don’ts for marketing. Just about everything follows this arc and it’s better to plan for eventual decline than to pretend it does not happen.

Moving on through the industry table, “Regulation Level” refers to laws that exist to protect creators and customers. It is listed as high because we do have a variety of copyright laws and intellectual property (IP) legislation in place. This does not mean that our creativity is regulated of course, but there are a good handful of laws that you will run into as you proceed in this business. “Effect of

Technology” is high and influenced greatly by the internet. And then of course, digital technology, home recording, file types, and all that other fun stuff. “Barriers to Entry” are medium, meaning that there are some costs, learning curves, competition and a variety of other factors that make this business a little more difficult to enter than say, being an unskilled laborer (but fewer barriers than those involved in opening a nuclear reactor plant). “Capital Intensity” is medium, meaning you have to invest a bit of money to get going. This can be for recording and duplication costs, equipment, lessons, travel, marketing, fees, and anything else that you have to pay to play. “Competition” depends a bit on your frame of reference. If we are truly dealing with only the 816 indie labels cited above, then that is not a huge number of competitors. But if you consider the tens of thousands of musicians who are competing for fans, you might have a different take on the field of competitors. that this analysis represents an average based on businesses that are legally ed as indie labels and therefore, just a general indication, not the last word on the situation.

Last, but not least, are the “Key External Drivers.” These are factors outside of our immediate circle of influence that nonetheless have a very strong impact on our business, such as recession economies, intellectual property rights, demographics like age and income brackets … all big factors in shaping customer habits. , this is just some high-level information to give us a snapshot of the industry we are working in. Full industry analysis reports go into a lot more detail to help businesses decide how or even if they should market a new product, enter a new industry or maybe even close up shop.

PEST Analysis

Now that we have a high level understanding of our industry, let’s dig in a little deeper. Another common tool for examining an industry is a PEST analysis. (No, this section is not going to be about your little brother.) PEST is an acronym that stands for Political, Economic, Social and Technological. These encom the industry-wide forces that affect any large industry, and the music business is no exception. This can also be called a STEEP analysis (with the extra “E” for Ecological). Either one gives you a way of thinking about an industry and offers some clarity about the business climate that will help you define a roap for developing your plan. Too often, musicians are held back by a fuzzy understanding of their business, and not just its marketing aspects (which we will get to shortly, I promise you). We form conceptions based on our own images of success and the emotional attachment to our craft and the music itself, which serve to cloud our judgment. But there is a simple remedy, and that is to be aware of and integrate actual facts into our thinking.

A PEST analysis is a more detailed look at the last item in the industry analysis table – key external drivers – that affect an entire industry, and it’s a very general, broad-strokes look that offers further clarity before you zero in on your own unique situation. It’s not as academic as it may sound, and it really helps to frame your thinking. So as you consider each component below, use this simple device. Before each bulleted item, say to yourself, “Political factors affect the music industry and my ability to earn a living because I am…” followed by the bulleted sentence. And so on for each of the four items in bold and the bullets that follow. Now, a word of caution. Although most of these impacts seem to be negative, that may not necessarily be the case. What we want to get out of this exercise is clarity, not judgment. Some of these forces may affect the industry in a beneficial way, even though the expression may not specifically indicate that. The purpose of the initial PEST analysis is not so much to explain details about how these factors affect the industry as it is to just get them all together in a single place for “at-a-glance” reference. You can certainly (and probably should)

take each item and elaborate on how that item affects the industry even further.

Political

Influenced by new laws that affect copyright, international sales, and even conservative/liberal trends in government and public sectors

Not affected by political parties quite as much as other industries

Potentially affected by censorship laws which challenge freedom of expression

Influenced by politics and some musicians try to influence politics

Economic

Affected by economic downturns and recessions

Affected by Inflation

Affected by piracy because is easier than ever to obtain illegal copies of music

Affected by the reduced need to buy music due to streaming and free internet radio

Social

Affected both positively and negatively by trends

Influenced by subcultures like hip-hop, metal, club, folk, jazz and more

Technological

Greatly affected by changes in technology

Influenced by social networks, digital s, garage band, Pro Tools

The PEST analysis becomes more helpful when you begin to apply it to your marketing strategy. That is not to say that you must abide by the trends that were created by the political, economic, social or technological forces in operation, but you had better be well aware of them, and if you choose to buck a trend, do

so knowingly.

It may seem obvious by now, but selling CDs alone is not the most likely path to success. According to PEST analysis, several forces combined to make the single-song mp3 (or ) the music product of choice. Right off the bat, at least three of the categories above reflect this situation. Economically: people are less willing to spend money on a CD, especially if they don’t know much about the artist. Socially: people like to share music. Technologically: consumers are able to send music files to each other’s phones and devices or simply stream mp3s from a third-party site. Does this mean that CDs are doomed? Perhaps not, but they are not what they used to be. However, let’s say that you are able to create some buzz about your music by giving away a few mp3s of some new songs. If you work the social media angle as much as you can (we’ll talk about that later) and encourage people to share and talk about you, you may get some more folks to your next show, which is a good time to sell the autographedspecial-limited-edition-with-bonus-tracks CD that you probably couldn’t sell online or through traditional distribution brick-and-mortar stores. Also, some musical styles (such as classical music) still focus on CD sales, and some, like club music and audiophile 70’s reissues, even do well with vinyl. Yes, I said vinyl, as in those thin black round things. Again, what’s important is to understand how the factors in the PEST analysis affect you and your unique situation.

Industry Segmentation

To complete our overview of the industry, this section offers a quick look at the different segments; then we can move on to the marketing sections which will be the focus of the rest of the book. Keep in mind that this is an industry segmentation, not a market segmentation, which we will talk about in greater detail later. For now, be clear that the industry operates in various different segments, with the approximate percentages for the major segments listed below.

Figure 1.2

Percentage of Total Revenue per Industry Segment

This might be surprising to you, but : this reflects the entire country. Living in an urban setting on the East Coast as I do, one might think that “Rap, Hip Hop and R&B” would hold the top spot, though if you lived in Carson City, Nevada you would probably think that “Country and Gospel” is the most popular style. ( that great line in the Blues Brothers movie, when Belushi asked a club owner what types of music they play there, and the owner responded: “We got both types of music: Country and Western.” But I digress.) The numbers above are real, so let’s keep that in mind. Now that we are armed with some general industry knowledge, let’s get an education in marketing!

A Marketing Primer

What is a Market?

A market comprises the customers as well as the sales and distribution systems available to reach those customers. “Market” can refer to a place or a group of people or a method of selling. The American Marketing Association’s (AMA) online dictionary defines market as follows (American Marketing Association Online Dictionary; http://www.marketingpower.com/_layouts/Dictionary.aspx):

An actual or nominal place where forces of demand and supply operate, and where buyers and sellers interact (directly or through intermediaries) to trade goods, services, or contracts or instruments, for money or barter. Markets include mechanisms or means for (1) determining price of the traded item, (2) communicating the price information, (3) facilitating deals and transactions, and (4) effecting distribution. The market for a particular item is made up of existing and potential customers who need it and have the ability and willingness to pay for it.

A comparison to another industry will be a helpful further illustration. The airline industry might be segmented into international carriers, national carriers, and local carriers, whereas the market might be segmented into and include any or all of the following: affluent travelers, budget travelers, business travelers, families, or geographic segments such as Asian, European, or Caribbean. Similarly, the music industry is segmented into various sub-industries that produce different types of music (as in Figure 1.2 in the previous chapter), but the market might be segmented into age groups, male and female, income levels, geographic location, language, jazz fans, dance music fans, heavy metal fans, etc.. Each of the segments of the industry might have its own set of market segments and sub-segments.

Why Study Marketing?

As you will learn throughout this book, one of the great issues plaguing the indie music business is a lack of real marketing and business knowledge. This is not so much an issue on the big-label side of things. They can hire the best business managers and marketing teams (not to mention ants and lawyers) and they have done pretty well for themselves over the years, although one can argue that they are not really getting it quite right these days. But what about everyone else in the music business? What about you?

Since you are reading this book, it’s likely that you’re a musician or you have a ion for music, music production, artist management, or some other specialty in the music business. Especially if you’re a musician, you may not have gotten much in the way of an education in marketing or business. But you are definitely in the business of music. And unless you really understand the business you are in, you may be looking at a very rough road ahead. Especially today, a certain minimum amount of business knowledge is a basic requirement. As an analogy, consider the guitar builder. Perhaps he or she has a wonderful vision of a beautiful new design for a high-end acoustic guitar. But unless the builder knows a good deal about woodworking, tool craft, process, and a bit of mathematics, even the best artistic intentions will result in an unplayable instrument. Whether we are talking about a successful artist or a fine guitar, the end product that the customer sees is only the tip of the iceberg. There is a whole foundation of knowledge underneath that the customer need not know about, but the successful music entrepreneur must have at his or her command. Of course, success means different things to different people, and I am certainly not trying to frame success solely in of money, but financial success is a goal that most of us have, so let’s figure out how to achieve it.

Alright then. We can all agree that some marketing knowledge is really important if you hope to market and sell your music. You can have great music

and great intentions, but if you don’t understand marketing principles and know at least the basics, you are unlikely to succeed. To be sure, this is a demanding situation. We not only need to be experts at our craft, but we have to be business people as well. It may not be fair, and it may not be to your liking, but it certainly is real.

In our digital age, there is simply too much information to absorb, and it changes too quickly to keep up with everything. One of the purposes of reading this book is to learn how to discern what’s important. With dozens of companies offering music promotion services, “airplay” channels by the thousands, widgets and apps, blogs and social networks, choosing your battles wisely is a required skill. That’s where marketing comes in. We will define marketing thoroughly as we move along, but first understand that marketing is absolutely not about selling everything to everybody. Quite the opposite. It is a body of knowledge that helps you focus on what is relevant to your specific product or service and the people who are most likely to buy it. A little education in the basics of marketing will help you make good decisions about which opportunities to pursue and which you should not bother with. You simply do not have enough time to venture down so many possible dead ends.

What is Marketing?

Marketing is one of those that everyone is familiar with, but few can actually define. Or perhaps the problem is that there are too many definitions. I recently found a website that lists 72 different definitions of marketing, most from industry experts. (Click the link to have a look.) The subtle distinctions in how people choose to define marketing can be quite informative. Some, looking at geographic populations, age groups, or ethnic characteristics might think of marketing as a field of research. Others may envision ad agencies and television commercials, while still others may think of salespeople or product demonstration teams you might see in a mall. So before you jump right into the music-specific units, working through this unit and taking ownership of some basic marketing concepts will ultimately help you to profit from your music. A clear definition, some key concepts and , and how this all impacts the music business is what this unit is all about. So let’s get down to it, shall we?

Marketing in its most simple form is about meeting human needs.

Marketing in its most simple form is about meeting human needs. And let’s add, in a profitable way, so that we keep our eyes on the prize. But the emphasis should be on “need” which is something that a lot of people overlook, especially in the music business. We can all agree that music is a human need, and it is something we hear almost daily. In addition to what we hear from concerts, CD’s, mp3s, radio, and other delivery formats, we also hear music in our rituals (including weddings, birthdays, holidays, sporting events, inaugurations, etc..) as well as accompanying a large percentage of our media, such as movies and video games. The important thing to determine (and one of the focal points of this book) is who needs your music, and why.

Anyone can sell 100 copies of a CD. You can usually count on friends and family to be at least mildly interested, and even if they don’t particularly care for your style, they will often buy your music out of politeness or as a show of . But unless that hundred CDs is good enough for you, you must find out more than who is just mildly interested in your music, but who really wants and needs it. There are two common reactions you might have in response to the question of why someone might need your music. One: you may feel that people need your music “because it’s really good”; or Two: you may feel that nobody really needs your music. Neither of those answers is helpful, and neither is really true (thankfully). This book will show you why neither of those two options are useful ways of thinking, and it will also show you how to find the right answer to that question.

As mentioned earlier, there are plenty of ways to define marketing, but the AMA offers this concise definition, which is a good starting point:

Fans (also known as customers) have a need for the feelings or experiences that certain types of music or artists give them. Once that need is established, customers seek to fulfill it in a way that creates value for them, and marketers seek to fill that same need and create value for themselves as well. It may be hard to it, but most folks don’t need your music (at least not until they become devoted fans). What they need is the feelings they experience from listening to your music. It’s an important difference – and one that is a crucial distinction for your understanding of how to market. This “exchange of value” based on need is the basis of business. Most often that exchange occurs by trading money for a product or service, but not always.

Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer

relationships in ways that benefit the organization and its stakeholders.

Marketing typically involves an effort that sets up conditions for selling products, services or ideas. Marketing gurus Philip Kotler and Kevin Keller suggest that 10 different types of items are marketed (Kotler, Philip & Keller, Kevin Lane (2009). A Framework for Marketing Management, 4th Edition. Pearson/Prentice Hall . Upper Saddle River, NJ):

goods

services

events

experiences

persons

places

properties

organizations

information

ideas

It doesn’t take a whole lot of imagination (I hope) to see yourself, your music, your band or your services in at least few of these categories. In fact, in the music business we market most of the above pretty much all the time.

So, great…we music business participants fit into some academic definition of marketing. And here we thought we were breaking all the rules! The fact that so many different types of music items actually do sell indicates that at least some parts of this crazy business actually do follow the rules that we are learning here. The real problem is that few of us know the rules, and even fewer know how to use them to our advantage. It’s just not generally part of our education, formal or informal, as we hone our craft as musicians.

There is abundant academic literature and know-how available in the business world, but very little of it addresses the music business. In researching for this book, I was shocked at how little information is actually available. Sure, there are a dozen or so books that many of us have seen, and courses at schools like Berklee, Full Sail and the Musicians Institute, but in comparison to other fields, we have almost nothing that would constitute a serious attempt to study the business. For example, if you want to do some research on marketing for a consumer packaged goods business or a financial consulting firm, you can go to any library and turn up hundreds of scholarly articles written by experts. There will be more than you could ever read. But where is all this info on our industry?

The music business has operated outside the mainstream business models for many years, but that won’t work anymore, and that’s one reason I decided to write this book. The enormous struggle that the business is undergoing indicates that we are in need of information that addresses the needs of the new music business, and helps independents like you.

Earlier, I mentioned an article by author Paul Oliver that discussed the needs of the “do-it-yourself” musician in local markets. After a pretty scholarly review of the topic, Oliver concluded that at the very least a DIY musician must be adept in three areas: artistic process, managerial process, and information systems (specifically technology and the internet). The author’s conclusion was that if a musician was adept at all three, then he or she at least had a chance of creating a sustainable career – and this is the important part – on a local basis only. Any further aspirations, such as national recognition, international touring success, or any sort of grander dreams, would likely require other team to handle the managerial and information systems aspects. (This author never put a dollar figure on what he meant by a “sustainable career,” so we don’t know if that meant living in Mom’s basement or actually being able to afford to live a normal or even exceptional life.)

In any case, we face a lack of good information and very real studies on how this business might actually work. But the good news is, we have finally realized that we need to figure this out. As the saying goes, the first step toward solving a problem is itting that you have one. The business is in our hands now, so it is up to us whether we take it seriously and make it a good business, or whether we just hope for the best (and continue living in Mom’s basement). If we apply sound marketing ideas to the music business model we’ve inherited from the collision of the digital age and the major label system, we may actually be able to do pretty well. Now: let’s talk more about marketing, by first exploring the difference between marketing and selling.

Marketing vs. Selling

Most of us get into this business because we love music; it’s likely that it wasn’t our ambition to become salespeople. We don’t want to sell furniture, we don’t want to sell office copiers, we don’t want to sell mutual funds, and we don’t want to “sell out.” Musicians have a long history of existing on the fringes of society and we don’t want to sully our pure artistic selves with selling. All I can say about that is … it’s the twenty-first century, and good luck with that. Even in the business world there is still a bit of a stigma attached to selling (it’s called “business development” now), but let’s be grown-ups here and not be afraid of mere words. There is nothing at all wrong with selling, unless you are ripping someone off. Selling is essential to our economy, the music business, and our own ability to live and continue to practice our craft.

Although marketing and selling do work hand in hand and ideally are seamlessly integrated, at their core they are not the same thing.

Although marketing and selling do work hand in hand and ideally are seamlessly integrated, at their core they are not the same thing. Marketing builds customer awareness of a product and creates interest in owning that product. Selling continues that process through facilitating situations that ultimately “close the deal” by exchanging value (typically money) for goods. In the online world there are so many options for delegating the selling process to a third party that you ultimately may not have to do very much selling at all. In an ideal situation, you can get to know to your customers and fans (your target market) so well that your music sells easily to those who really value it. And the good news is that recent advances in technology and know-how actually make that very possible. But make no mistake; nothing sells itself unless somebody has done a whole lot

of work beforehand. Most of this work is in building relationships with customers, which will cause them to buy from you. And that is work that musicians can not only do, but do well.

Marketing Concept Overview

Now that we’ve established that marketing is not selling, let’s dig a little further into the meat of marketing. Be advised that we will continue to use examples and language that may not seem immediately related to music, but I assure you they are. Focus your energy on building this solid foundation, so that you’ll have a stronger platform from which to launch your music marketing machine. Let’s get a little historical perspective and then we’ll move on to the direct application of these ideas to music marketing.

The Recent Evolution of Marketing

Our modern concepts of marketing start roughly with the industrial revolution, when the creation of mass production machinery made the selling of large numbers of inexpensive products possible. Many businesses and industries made a relatively quick leap from dealing with a local market (like the general store in a small town) to a regional, national, or even international market. Marketing evolved accordingly. The following concepts defined eras in the timeline of marketing evolution, and are roughly in order of their appearance starting in the early 1900s, although there is plenty of overlap and all of these ideas still have some relevance today.

Marketing has undergone an evolution over the last 100 years or so and there are at least 5 distinct eras that have different marketing norms.

Production Era

Mass production and marketing cheap commoditized goods to large populations.

Product Era

Focus shifted to the quality of the product; customers wanted better stuff, not just cheaper stuff.

Selling Era

Once mass communication took hold (TV’s in every house, radio, newspapers, magazines, mail service) marketers focused on selling more stuff to more people.

Marketing Era

Marketers created products to fulfill needs that were expressed by customers. Market research was born.

Integrated Era

Marketing became more about the whole experience of value between customers and businesses.

Production Era – As industrialization and assembly line manufacturing took hold, consumers began to want inexpensive goods that were easy to get. This “production concept” shaped the early part of twentieth century marketing. It still applies today in some developing countries, and in general it is the foundation for many commoditized products, which music is sometimes in danger of becoming. A commodity is a product that is relatively the same no matter who produces it, usually cheap and easy to get. Examples include basic clothing, packaged food, household goods, even the early auto industry. As Henry Ford said about the Model T: “You can have it in any color as long as it’s black.” During this era cheap goods were manufactured en masse and consumers demanded more. Rather than make their own clothing, furniture or modes of transportation, they began to buy it.

Product Era – As they began to make a little more money and the U.S. moved further away from being an agrarian economy, consumers became more focused on the details of the product itself, and wanted distinctions in quality and features. Think about how better cars, designer clothes, highend appliances, and so on, became popular as we proceeded through the middle part of the century. Quality separated the more desirable products from the commodities; often, success followed for the higher quality product.

Selling Era – Sell more stuff to more people for more profit. That’s what this era was all about. This is common practice with regard to the selling of goods and services that customers may not even be looking for, such as

insurance, get rich quick schemes, subscriptions, Snuggies (those blankets with sleeves!), an even bigger TV, the latest “must-have” toy, etc.. As methods of mass communication became ubiquitous, companies learned that by mass marketing, they could sell even more stuff and make bundles of money. Not our proudest moment in the marketing biz and to some degree it is still with us now.

Marketing Era – This era really had its roots in the 1950s and ‘60s and really took hold towards the close of the century. The marketing concept focuses on determining customer needs, and creating products to fill them. We will definitely be working with this concept since it is about satisfying your customers, fans or clients. Cheap digital mobile technology is a great example. I’m old enough to rotary phones, which sounded great, did their job perfectly, and were so indestructible that they still work fine today. But customers got busier and more interested in mobile digital gadgets, so the industry responded. The same can be said of the digital music , and even the CD, and before that, the cassette. Customers started to demand convenience, low cost and flexibility. The companies that obliged are doing fine. Those that didn’t are out of business.

Integrated Era – We are really going to emphasize this concept – it’s what gives independent musicians and small music companies a fighting chance in this business. This is about making the connections to your customers through communication methods, events, merchandise and anything that is valuable to them. But by managing the whole lot in an integrated way you can develop long-term relationships with a core group of ers who will advocate for you and be lifetime customers. An extraordinary example of this approach is Apple. Say what you will about Steve Jobs – may he rest in peace – but Apple ultimately did an awful lot of things right. We want to model some of those techniques for our music marketing. Think of how engaged, even obsessed, Apple fans have been over the years. From a small core of followers, Apple has grown to be one of the largest companies in the world, and even if you grew up as a PC , you probably own or use at least one Apple product by now.

Marketing and Music

With just this little bit of knowledge about marketing, we can begin to build a better understanding of how this all applies to the music business. We’ll use these and other marketing going forward, and everything from now on will be more directly related to the music business. I will typically give a quick definition of concepts as I introduce them. But if there is some terminology that you don’t understand or from previous chapters, there’s a Glossary of at the end of this book. And just to be clear, I will refer to your music, your band, your service (or whatever it is that you do) – and even yourself – as your product or offering. This is what you are presenting to your target market – your fans or customers.

Let’s apply a classic marketing structure – the 4 P’s – to the music business. The 4 P’s are Product, Price, Place, and Promotion (also known as the marketing mix) and understanding your product in the context of the 4 P’s is step one in creating a clear understanding about what you are offering to the customer. It may seem obvious, but the clearer you are about this, the quicker you can get on to the real business of profiting from your music. If you can’t clearly convey the 4 P’s (not in marketing language; in customer language) to your fans, or to someone who’s thinking of investing some money in your career, then it’s crucial to take a minute for this foundational concept. Let’s use a new CD of your original music as an example.

Product – The product is the CD, of course – or is it? The product can also be the music – and it does not necessarily have to be recorded music. It could be a composition, which is really your intellectual property that you are free to market as you like. The product might also be the band or musical act, or it might be a service you perform in the music business, like producing or artist management. Try to imagine the full range of what the product represents to the customer to broaden your definition. In fact, the

sooner you start to see things from the customer perspective, the better. You might be selling a CD, but the customer is buying an experience or a feeling.

Price – This is not just about the $12.95 that you are asking for a CD, or the 99¢ that you get for a . You have to think a little deeper than that. , you are competing with a lot of other players out there, and every decision counts and has to be part of a unified strategy. You can’t rely on luck. You can choose to compete on price, meaning you offer your music or your services at a lower price than the competition, or you can compete on service, features, benefits, etc. There is a temptation to sell cheaply, but unless you are going to sell zillions of units, that may not be the best strategy. For example, it may be more valuable to portray yourself as higher-priced because you are worth more and your music appeals to older or more affluent customers. You don’t need to decide now, or decide that one strategy is right and the other is wrong for you. For the moment, just be aware that this is a variable and should be considered with an eye on the bigger picture, which will become clearer once you understand your customers better. “Free” is a price too – it’s good to that.

Place – This is about where you sell your music or services. At a gig? From an office? Online? Chances are there is a good mix of “places” – real and virtual – where you will be marketing. In the digital age, it’s more important to find out first where or how your customers want to buy than to create a product and decide afterward where you want to sell it. The diagram on the next page offers an at-a-glance look at the classic marketing mix structure of the 4 P’s.

Figure 2.1 – The Classic Marketing Mix – the 4 P’s

The means by which you market and sell may be referred to by several including channel or distribution channel or even distribution chain. More precisely, it is an organized network of entities (people or businesses) that work together to get your offering from the producer to the consumer. Think of the producer or creator (yourself, probably) as the beginning of the chain, and the customer as the end. The channel is everything between the beginning and the end of the chain. In the past, channels typically included artists, labels, distributors, wholesalers and retailers, but the channels today are simpler and often include just one stop between the creator and the customer. Channels must be appropriate for the customers that you are trying to reach. For example, if your customers are mostly European techno music fans, it doesn’t make much sense to just put a CD for sale on CD Baby.com and hope for the best. If your customers are traditional jazz fans, the online channels may be less appropriate than the channels that actually sell physical CDs.

Promotion – Musicians often have a decent concept of what promotion is all about, but it’s very useful to look at it from a customer perspective. In the music business, we tend to think of a promoter as someone who schedules, publicizes and s, or “promotes” concerts. Or we might think of a radio promotion campaign, where we hire a company or person to pitch our music to a range of radio stations. These are all well and good, but from a customer perspective (which is how we always want to think when we are marketing) promotion is more about how the offering is being communicated to the market. Newsletters, print ads, pay per click, performances, referrals…any of these can be part of your promotional strategy. What’s important is that you consider promotion to be an integral part of your strategy.

I’m not saying that each of the 4 P’s is of equal importance (arguably, the product is the most important of the four), but rather, be aware that they are each crucial elements of your marketing strategy. At any given time one may be more important than another, but in the end they all must work together.

A Newer (and Better) Concept – The 4 C’s

Marketing is part business, part science and part art. And like business, science, and art, marketing is always evolving. And that is some of what makes it both exciting and useful. Today the world of marketing is focused on the customer like never before. Customers are in control of so many aspects of the buying process that marketers simply must sit up and take notice. Customers choose where they want to buy (showroom, store, online, auction, in person, etc.) and when, where and how they want to receive communications. In many consumer packaged-goods companies, customers are even becoming part of the design and development process. Smart product companies know that if they give customers not only what they asked for, but what they had a hand in developing, that will generate loyalty, repeat purchases, and referrals.

To keep pace with change, marketing is developing new models to replace or supplement the tried and true paradigms. There are new models that are particularly relevant to the music business – specifically, the 4 C’s. Sometimes you’ll even see Competition as a fifth C. The 4 C’s, wherein the C’s stand for Customer, Cost, Convenience, and Communication, are a way of reframing the 4 P’s in a way that’s extremely applicable to us indie music folks. The important thing is, rather than focus on the product itself, the focus is on customers and what they want. What are they telling you, either directly or in online conversations? Where do they shop? Where do they get information? How do they feel when they buy your music, when they see a show, when they hire you to produce? Let’s have a look.

Customer – This has replaced “Product” as the first in the series. No longer do we develop a product and then figure out who to sell it to. Instead, we figure out who our customers are and then offer them products that meet their needs. Perhaps you’re thinking to yourself, “I’m a jazz artist. That’s what I do. I can’t modify my style to suit customer needs.” Don’t worry –

that is not at all what I’m suggesting. You don’t have to change anything about your art – but you should shift your perspective for the marketing part of the business. In fact, the more you stick to being exactly who you are, the better you will do. (We’ll get back to that in a bit.) All I’m suggesting here is that you put the customer front and center, not the product.

Cost – As we indicated earlier, cost is more than simply a dollar figure. Again, thinking from the customer’s perspective, what is the cost to your customer in of their expenditure of time or effort? What are they giving up (besides money) to see you perform or buy your music?

Convenience – Are your tunes easily available? Can people find your website, a list of show dates, a rate sheet for your services? The internet has made us all expect instant information. You know as well as anyone that if you can’t find what you’re seeking or figure out what a site is about in less than thirty seconds, you’re probably heading for the virtual door. Convenience replaces the “Place” of the 4 P’s.

Communication – Next to the Customer, perhaps the most important of the C’s is Communication (which takes the place of Promotion). Rather than just blasting out mass market promotions that scream “Buy my music!” the new model dictates that you engage in two-way conversations with your customer base. Let them talk to you – and you must listen to what they’re saying. They will tell you what they want, how they want it, and how much they’re willing to pay. At first, this kind of thinking was very frightening to traditional marketers, and it still is to some. But think about it for a moment. Thanks to technology, you can actually have these conversations, and it is easier than ever to get real information on customer needs and preferences. This priceless information used to cost marketers many thousands of dollars in fees for consultants, focus groups, surveys and the like. Now it’s yours for the asking.

One of the reasons why this could be frightening is that marketers can hear bad news very directly and just about in real time. It used to be somewhat comforting to think that you could just broadcast your ads to the masses, and a certain percentage would buy your product. But with the vast amount of choices available, especially in music, that is no longer the best option. If we accept that we cannot be everyone’s favorite, and we find out who truly does like what we do, we can cultivate those relationships and really create value (which means money, as well as added benefits) for both the music creator and the music customer.

A Quick Recap

Now that you have the concept knowledge to be in a marketing frame of mind, you are head and shoulders above 90% of the music world. To recap quickly: in this chapter we introduced some basic marketing ideas, including a good definition of marketing courtesy of the AMA, and we learned the substantial difference between marketing and selling. We reviewed a little bit of history, and decided that we are going to focus on the “Marketing Era” and the “Holistic Era,” two of the more recent marketing models. We looked at standard frameworks, including the 4 P’s and the 4 (or 5) C’s. Perhaps the two most important take-aways from this first unit are:

Customers have to be the center of your marketing universe

An authentic two-way conversation with your customers is crucial to marketing success

Also that even though we will be using like “target market” and “product,” we are in no way demeaning our fans or our music, or doing anything wrong or unsavory. If we are dishonest in our communications or if we don’t offer our audience something valuable (that doesn’t mean expensive!), then, and only then, are we not doing the right thing. If you know your music or your service is valuable, if it is important to you and at least a handful of other people, then thinking in marketing is simply going to help you do a better job of whatever it is you do. You don’t have to change your music or change who you

are. You just have to do it all to the best of your ability. This book will help you do just that. Before we go on, you might want to test your general marketing knowledge a bit. No more tests after this one. I promise!

Test Your Knowledge

1. In marketing , CDs, s, a band, an artist management service, and a performance can all be considered products.

True False

2. Your target market is another way of describing:

Someone else’s fans/customers

Your most likely fans/customers

People you shoot at

All music fans

3. The 4 C’s stand for:

Customers, Critics, Collaborators and Communication

Customers, Convenience, Cost and Communication

Competition, Customers, Clarity and Cooperation

4. I listed ten “items” that can be marketed. Name five:

1) ___________________________________

2) ___________________________________

3) ___________________________________

4) ___________________________________

5) ___________________________________

5. Historically speaking, the most recent marketing model is the:

Production Concept

Holistic Concept

Promotion Concept

Selling Concept

6. The general term for a place or means by which a customer acquires your music is sometimes referred to as a:

Storefront

Channel or Distribution Channel

Target Market

Promotion

7. People “need” music because of:

How it makes them feel

The experience it produces

The value it creates for them

All of the above

8. In your own words, write a meaningful definition of marketing:

___________________________________________________________________

___________________________________________________________________

___________________________________________________________________

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9. Marketing and Selling are exactly the same thing.

True False

10. Write down any ideas you have now that you think may be important in marketing your music or your service to your customers. There are no right or wrong answers here. This is just to get an idea of your current thoughts and we will come back to this later on.

___________________________________________________________________

___________________________________________________________________

___________________________________________________________________

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(Check your answers in Appendix B)

The Marketing Communications Mix

Here’s a term that’s well understood in the music industry: mix. Most of us are familiar with the idea of mixing a record and just how important a good mix is to the final product. In fact, we typically spend as much or more time mixing a recording as we do actually recording it. I once spent close to three years mixing twelve songs for a CD. But hey – I like mixing and I just kept finding subtleties that I did not hear at first!

By happy coincidence, “the mix” is equally important to marketing, and it refers to the same sort of thing. Just as in a recording, where a balance of the different components is required, we need to balance our marketing mix as well. In recording mix the guitarist might prefer to be just a little bit louder, but if it throws off the balance of the recording, then it’s probably not a good idea. So too with marketing.

Many traditional marketers will simply state that the marketing mix is simply another term for the 4 P’s (Product, Price, Place and Promotion) as discussed in the previous unit, but I’d like to expand upon that thinking a little and focus a bit more on the marketing communications mix, which is a subset of the overall mix. And by communications I mean open communication between you and your customers or fans. Gone are the days when the term marketing communications meant pushing out mass marketing messages such as TV or print ads and waiting for customers to respond. The new models are much more dynamic and happily, a lot more fun.

The Elements of the Mix

There are a huge variety of methods for getting your marketing messages out there and getting from your customers as well. Real communication is a two-way street, so keep in mind that both marketers and customers are vital parts of true and effective communication. Achieving a balanced mix of different communication strategies including advertising, personal and online interactions, public relations, direct marketing, and promotional activities is the ideal. Let’s define each of those in a little more detail, examine their differences, and follow that with some examples of each that you can use in marketing your music.

Advertising – This is perhaps the best understood of all the communications mix categories, since we’ve been exposed to it all our lives. Advertising is typically non-personal, one-way communication – but now with room for some interactivity, thanks to recent technology. Although it is one of the more old school forms of marketing communications, it’s still with us because it works. However, now it’s just one part of the mix, rather than being relied upon exclusively. The main purpose of advertising is to create awareness of the product in the mind of the customer. Awareness is the first step in the customer purchase sequence which we will discuss further in the next unit, but for now, think of it as a kind of background messaging that starts to create the awareness that a product exists. In today’s music business, advertising is most often used to build awareness around a new release.

Advertising can include TV ads, radio ads, internet ads (like Google Adwords), ads in e-newsletters, print publications, direct mail (or email), posters at an event, stickers, flyers… you name it. However, ads typically have to stand on their own and not rely on any particular interaction. Think of seeing a sign or billboard ad for a new CD release (sometimes called an Out of Home, or OOH).

The image is probably what grabs you first, then the slogan or text and the name of the CD or the artist. The problem with one-way communication is that the length and depth of engagement is pretty short. Nobody jumps out of the billboard and starts talking to the customer. But the impression is made, and if the impressions are frequent and impactful, customers become aware of the product.

Personal/Online Interactions – This is probably the strongest of the communication mix tactics. Nothing works better than face-to-face, or personalized, if not in-person, interactions with customers and potential customers. Authenticity is of the utmost importance here, especially when representing an intangible art form – such as music. Customers are intelligent, just like you, and they know when they are being lied to or when the person they are talking to is hiding something. We’ll continue to talk about authenticity quite a lot, so let it be a guiding light for all your interactions. Keep in mind that in personal interactions we do not want to be selling. We are talking about communication, the purpose of which is to build quality, authentic relationships. Forget all you have heard about sales like “closing” and “getting to the ask.” Isn’t it better if someone asks you where they can buy your music, as opposed to you asking them to buy? If you ask, there are only two possible answers, but if they ask, they are essentially giving you permission to sell to them now and to communicate to them in the future. The customer is willingly furthering the relationship.

Just a few short years ago, there was quite a lot of debate about whether or not the internet (and social media in particular) was depersonalizing relationships. The debate continues, and depending on the specific issues, I can come down on either side of the fence. Are Facebook “friends” real friends? Well, for the most part, I rather think not. However, one thing that social media has proved beyond a doubt is that people desire relationships and communities. People still want communication and with others. Whether they ultimately get it online or not may be an important question, but for the types of relationships we’re talking about in the marketing world, the online platforms do a pretty good job.

Certainly you cannot have long leisurely conversations with customers through Facebook, LinkedIn or Twitter, but you can, over a relatively brief period time, start to personalize interactions and develop limited (but authentic!) relationships with your best customers and those who might influence your future customers. For example, let’s say you develop a fan base of 1,000 or so; 500 are LinkedIn followers and 500 are Facebook friends. The LinkedIn group is mostly fellow musicians and music business s, whereas the Facebook group is mostly music fans and friends. It’s not hard to see that you can easily create messages that are different, yet meaningful, for each group. Maybe you’d “talk shop” with the LinkedIn group, whereas the Facebook messaging would be more friendly and emotional. Of course, these aren’t exactly one-to-one private conversations, but it’s still a higher quality communication than an impersonal TV commercial. And over time, as anyone who uses social media (the right way) knows, there will be plenty of side conversations with individuals along the way. You will get to know more about your fans and customers, and they’ll get to know a little more about you – even though you may have never met.

Public Relations – This is an interesting topic and a term that is often misunderstood. Public relations, or PR for short, typically refers to some sort of publicity that you achieve but do not pay for directly – although you may pay for a publicist or a PR service such as an online press release service like PR Web or PR Newswire, for example. Good PR has the appearance of not being directly from the company or person that benefits from it, which lends an air of authenticity to the communication in the mind of the receiving public. PR is usually more concerned with image, brand enhancement, reputation and generating goodwill than with directly selling a product (which presumably will also happen). The AMA defines PR as follows:

That form of communication management that seeks to make use of publicity and other nonpaid forms of promotion and information to influence the feelings, opinions, or beliefs about the company, its products or

services, or about the value of the product or service or the activities of the organization to buyers, prospects, or other stakeholders.

The word “stakeholders” refers to a group that can influence the outcome or objectives of an organization or has an interest in those outcomes (financial or otherwise). It may be fans and customers, but it could refer to a variety of influencing factors from broad groups to specific individuals to music reviewers. For example, a reviewer probably did not buy your music, probably never will, may not really be a fan, but yet can have a substantial effect on your career, the perception of your fans and your bottom line.

Direct Marketing – Direct marketing involves the use of communications sent directly to the customer. It’s a separate concept from face-to-face or inperson marketing, even though the latter is perhaps the most direct of all. The reason we separate these forms of “direct” interaction is because the types of messages are quite different. Direct marketing typically involves collateral (a physical or visual object that delivers marketing messages) that is sent directly to a customer or market segment with the intention of creating some sort of action. In the old days, this was usually limited to postcards or sales brochures that were mailed to a customer’s physical address. These types of marketing communications ran the risk of being rather impersonal, and they could be very costly. But if they were well crafted, they were fairly effective, and there is still a booming business in direct marketing to this day, although physical mailings are now most effective when complemented with online or electronic marketing of some sort.

Messages sent directly to customers via electronic media such as e-newsletters can be included in this category. This can also include social media, which will be discussed in depth in a later unit. For example, if you have a Twitter , you know that you can send a direct message to a single follower or handful of

followers, or you can post a tweet that is seen by all your followers. Both may be direct, to some degree, so there is some gray area in the actual category that a specific social media tactic may belong in. But since social media has a whole additional set of communication factors, that will be a separate discussion.

E-newsletters and email marketing in general are extremely powerful marketing tools. Largely replacing the paper-based mailer that used to be delivered via the post office to interested recipients, it still has many of the same characteristics. And thanks to the dynamic nature of the form, with links that lead directly to websites or purchase gateways, it can be highly effective. In fact, many recent studies and surveys point to email and e-newsletters as the favorite marketing communications vehicle among marketers. Data from the larger world of marketing (not just the music business) suggests that overall, marketers feel that email ranks very high in effectiveness. The following diagram shows the approximate numbers.

Best Performing Marketing Channels

Figure 3.1

Promotional Activities – Promotional activities are somewhat misunderstood in the music business, partly because we are familiar with the “promoter” as a person who promotes concerts and musical events. Although it is not quite the same, the results are similar, as the idea is to sell music. But for purposes of understanding marketing, let’s consider promotional activities to be those activities that affect the consideration and decision to buy a piece of music. For example, if you run a sale or special, for example, “buy one get one free” or “ our new album and get our last album free,” you are engaging in promotional activities. A “sale” in the usual sense of the word implies special limited time pricing (50% Off, One Day Only, Presidents’ Day Sale) and is itself a promotional activity. By the way, the word “sale” does not resonate too well with most music fans, but that does not mean you should not have one from time to time. Just call it something else. Try: Special Offer, Limited Release, Only 100 Copies Available…that kind of thing.

We usually think of conferences, trade shows and public appearances as promotional activities. So if you take a table at the next New Music Seminar to promote your music or service, or you perform at SXSW, or you showcase at the regional NACA conference (National Association for Campus Activities), you’re participating in promotional activities. In addition, we can consider flyers or signage to be promotional items (as well as advertising). So if you put up flyers on all the bulletin boards in a neighborhood where you’re doing a show, you’re engaging in promotional activities. A word of warning here. Flyering public or private property (lampposts, bus stations, building walls, etc..) without some kind of permit is probably illegal. I learned this firsthand one fine night when the NYC Sanitation Police knocked on my door to issue a $50 summons for each of the 70 or so flyers I’d put up in the neighborhood. Needless to say, that was a lesson I’ll never forget.

Now that we have definitions and descriptions of a whole set of items in our marketing communications toolbox, what do we do with them? After this next section, we’ll look at a sample of a marketing communications mix for a new

multi-platform release (digital and CD) of 12 songs from a band with a modest regional following. But first, let’s discuss something that is extremely important: balance.

Traditional and Contemporary Balance

Whenever new technology comes along, we often feel compelled to at least understand it, if not outright embrace it. For marketers, and indeed for most businesses, digital technology has been front and center of so many conversations in recent years that it is impossible to avoid. But how much is enough? Should we all rush headlong into every new online service and tool that comes along? I think not. Although it may seem that everyone is making millions on the net with some new thing or another, the truth is quite different. Many online platforms, including search engines, social media sites, web tools and even entire businesses, have come and gone in the space of just a few years. Many made a big splash and grew rapidly, only to quickly go down in flames.

MySpace, Ping, Orkut and the Hub all jump to mind as examples of once highly touted and popular social media sites that have rapidly fallen out of favor. MySpace, for example, was bought by NewsCorp in 2005 for $525 million – and sold last year for only $35 million. Even though the database of MySpace s that NewsCorp obtained from the purchase is certainly valuable, a loss of close to $500 million is what we in business (or anywhere!) call “a serious problem!” The lesson learned should be that a little caution is good, and just because something appears on the web and is touted as the next great Social Media (SM) platform does not mean we should drop everything and jump on board.

From my perspective at the heart of the issue is time, and not really whether one platform is or could have been better than another. It is simply a matter of how much time you have available. There are only so many hours in the day and you have to use them wisely, according to your priorities. Don’t forget, you still have to write music, practice, perform, eat, sleep and live!

Not too long ago, I went to a national music business conference where a fairly esteemed of pundits sat in front of a backdrop that looked something like this:

Figure 3.2

In truth, there were about twice as many items, but I’ve forgotten what most of them were. I guess they weren’t all that important after all! All but one of the five ists tried to tell us that we had to utilize all of these platforms to really profit from social media marketing! A collective groan went up from the musicians in the audience (about 80% of the attendees) as they imagined their precious writing, practice and creative time going out the window. And the one ist who suggested not being on all these platforms? Well, he was trying to sell his own platform, so you get the picture. And no, I’m not going to reveal any names. Just trust me that it was one of the top-tier annual events and the ists were nationally recognized in their fields.

If you didn’t waste any time in the last decade or so on those platforms whose names I can’t , then count yourself lucky. And you probably only need to really focus on a small handful of the ones listed above. Unfortunately for the music business, platforms like MySpace were pretty attractive as marketing tools for a good while, so the big question is “How do you know?” How can you tell whether or not you should or should not jump on the next bandwagon and embrace some new technology? Even though everyone seems to have a Facebook , for example, it’s still reasonable to ask – for marketing purposes, that is – whether or not you should be on Facebook at all, or have a Twitter or a LinkedIn profile. And just having an means nothing. You have to use it consistently and wisely. Although some SM pundits would have you think otherwise, there is no one-size-fits-all answer. But there are some commonsense guidelines that will help ensure that even if you do devote time to a tool that loses popularity, it will not have been in vain.

The key is in understanding and creating a marketing mix that uses elements of both traditional marketing and contemporary tools, based on where your customers prefer to get information. If most of them are on LinkedIn then by all means, that is where you should be as well. But don’t expect them to go somewhere in the SM universe just because that’s where you are, or because you think that’s where you should be. All the social media sites and analytic tools are worth nothing unless they are based on fundamental rules of marketing. Even

though digital technology is ubiquitous, we still walk down the street, visit the library or supermarket, read our mail and talk to people in person. These are all opportunities for marketers to engage with people in non-digital ways. I have certainly attended numerous events, musical and otherwise, because I saw a sign in the library or got a postcard in the mail, so don’t discount these potent forms of marketing. More importantly, think how much more powerful they become if they are complemented by online and digital marketing tools.

Sample Marketing Communications Mix

Now it’s time to put some of the previous ideas to work so we can see what a communication plan looks like. We’re going to use an imaginary band and their release of a multi-platform collection of songs. Previously referred to as an album or record, since the release is both digital and physical (a CD), we might want to expand our thinking and not necessarily conceive of the songs as specifically part of one album, but rather a grouping of songs that may or may not need to be appreciated together. While the band is imaginary, it is based on reality and experience; I created a composite of several groups so hopefully this will ring true for you at least in part.

I’ll call the group The Imaginary Band (Hey, has anyone used that? Not such a bad name!) and they are from a medium-sized city in the mid-Atlantic U.S., within driving distance of a few universities and other cities where they are starting to develop some fans. They have been together for about three years and this is their second release. The first was a CD that sold a few thousand copies over a two-year period, many at gigs but also many online through CD Baby and other sites. s were available for that first release, although it was not really a focused effort on the part of the band to sell s. They have an email list of 1,200 names and addresses, and the four each have some other form of income, although their jobs are flexible enough to grant them some good quality time to focus on their music.

Next: an overview of the communications mix components that the band might use to market this collection of music, which of course would create further interest and fan engagement for more music, performances, videos and everything else they do.

Advertising – The Imaginary Band, or TIB for short, has played at about a dozen colleges and an equal number of clubs over the last few years, so they decide to make a few hundred 11” X 17” posters (about $150) announcing the release of the new music. It’s an expense, but the band likes the visual imagery they’ve developed over the last two years and they feel it will help create awareness on a local level. The posters go up on university bulletin boards, at a few libraries, coffee shops, laundromats, clubs, and in a few music-friendly gift shops. Of course, the band puts a very visible ad on the landing page of their website, and smaller ads on subsequent pages. The info also goes on Facebook and LinkedIn and they start tweeting an announcement every few days on Twitter. They also pay for a featured listing on CD Baby, Reverb Nation and NuMuBu.

While recording, the band had also been emailing progress reports to the 1,200 names on the email list, and now a special announcement goes out with nice graphics and options to buy the CD or the tracks. They also make a 24” X 36” foam-backed poster (available at FedEx/Kinko’s for about $100) that they can hang or place on a stand next to the merchandise table at their gigs. In addition, they print 1,000 postcards (about $250 online) with the album design and easy instructions on how to buy. They each plan to have a stack of cards on hand to dole out to folks they meet, or to selectively leave at well-chosen locations where they won’t be thrown away.

Personal and Online Interactions – There is an old saying in business that if you can’t sell your own product, nobody can. This does not necessarily mean that you should personally be the sales force for your product. What it really means is that the description of a product, the emotion, the benefits, the reasons why it should be bought, all need to emanate first from the creator. That must all be transmitted to the sales force – if there is one. In the case of the indie musician, the product creator and the sales force are usually one and the same. But that’s actually not bad news, unless you’re hoping to sell several million copies of your CD. In that case, you will need some help.

what we’ve been saying about how important authenticity is? This is where it really will show its worth. In the case of our enterprising band and its , they will have ample opportunity for personal interactions during which they will transmit their enthusiasm for their new release. Conversations at their day job, in the clubs at gigs, on their Facebook pages and to their Twitter followers: all these present opportunities to create awareness and interest in the new release.

Never appear to be so desperate to make a single sale that you miss an opportunity to make a friend and fan instead. It is certainly better not to alienate a potential long-term fan than to make a quick $14.95 on a CD sale. The lifetime value of a fan may be worth much more.

Keep in mind, though, that although the temptation may be great, personal interaction time is usually not the best time to be selling. Fortunately, our intrepid band are playing it cool and trying to first create some real interest and a little bit of buzz, and then trust that the sales will follow. They know that they should never appear to be so desperate to make a single sale that they miss an opportunity to make a friend and fan instead. It is certainly better not to alienate a potential long-term fan than to make a quick $14.95 on a CD sale. The lifetime value of a fan may be worth much more.

The band has been smart and created pages on online interaction sites like Facebook and Twitter for the band, keeping their personal SM presences separate. Since they learned the very important lesson of authenticity, the personal presences and the band platforms should work quite nicely together, because neither one is portraying any kind of false image.

Public Relations – PR is important to the band’s communications mix, and almost all opportunities for PR will be explored and utilized. There’s an old saying that there is no such thing as bad publicity, and short of a really bad review of their music by an influential reviewer, that holds mostly true for TIB. There are plenty of PR opportunities for the band, from playing at a fundraiser for an area non-profit to getting their music reviewed and having articles placed in media. The band have decided to each contribute a few hundred dollars to hire a publicist to help them get some media placements, such as articles in regional papers, or on a website that covers the band’s style. Publicists will know the right influencers who might be interested in blogging or writing about the band, and they can have a lot of sway in getting good online conversations started in social media groups or the appropriate circles of fans.

As you are no doubt starting to notice, the band is spending a little money. A good publicist may charge anywhere from $500 to $1,500 (if they are hungry for the business) but some established firms can run into tens of thousands of dollars. Also, the band incurred some printing costs (posters, postcards, etc..) and of course they spent a good chunk of change recording their music in the first place. Hopefully, I don’t need to mention this, but marketing does cost some money, although you shouldn’t have to mortgage your house. But it’s still surprising to see how many musicians expect something for nothing. You would not open a restaurant and expect customers to pay you for food even though you have not yet spent any money on tables. Business requires investment, and music is a business.

Direct Marketing – There will be plenty of direct marketing via eNewsletters and a small mailing to a core group of fans via good oldfashioned snail mail. Over the years the band has identified about 200 fans who have bought their previous CDs, always open their email newsletters and have come to plenty of shows. And yes, they even supplied their physical address when the band asked for it. These fans get a special marketing piece by mail inviting them to purchase a limited edition CD

signed by all the , plus they get some free VIP es to the next few gigs. The email marketing campaign mentioned above in the advertising category can also fall into the Direct Marketing category.

Promotional Activities –The band is doing a free gig for a local weekend event that they know is well-attended each year, and they are doing some acoustic sets for an outdoor lunchtime concert series, in addition to their usual busy schedule of gigs. One of the last surviving record stores in town is allowing them to set up a table one Saturday afternoon to promote the new CD and meet with area music fans, and they have arranged a handful of appearances on a cable TV “arts around town” type of show. Their well planned email campaign will also include some special enticements to buy the CD, like extra s for free within the first two weeks of release, free gig es for referrals and just about anything they can imagine that is not too far out or likely to rub anyone the wrong way.

As you can see, many of these items overlap a bit, so an item can easily be in both an advertising and a promotional category, for example. That’s not a problem, and in fact it may be a good indicator of a well-integrated marketing communications mix. What is important, though, is that all the categories are considered and connected to each other. Different categories may have different means of communicating the marketing messages, and by considering all the possibilities, you can arrive at a much more integrated and impactful marketing mix than if you left out some categories from your mix. To revisit the earlier analogy of a music mix, if you work on all the elements of the mix, paying attention to EQ, levels, tone quality, placement and panning, etc., but you don’t do any of this for the bass part, you will not only have one unhappy bass player, but you will also have a sub-par mix. The same is true for your marketing.

So now we have a decent idea of what might constitute a good marketing communications mix for The Imaginary Band. Now let’s put our attention on who receives those communications: The customer.

Understanding Your Customer

“The customer is king.”

“The result of a good business plan is a satisfied customer.”

“Right or wrong, the customer is always right.”

What these maxims all have in common is that they consider the customer to be front and center for business success. It seems obvious, right? Without happy customers spending their money on things they consider valuable, you cannot have a successful business. And yet the music business often tries to operate in blissful (or not) ignorance of the needs of the customer. Musicians often think only of how good their music is, how hard they worked, and how much they deserve success – and then there can be plenty of bitterness when it does not materialize, especially when we observe musicians of “lesser talent” earning buckets of money. The simple truth is that your music may not be for everyone. In the traditional music industry, certain styles like jazz and classical rarely sell millions of copies, and of all the music released on CDs, the vast majority sell less than 100 copies! The chart below shows the unfortunate breakdown.

Figure 3.1

2012 CD Releases

But before you panic, that these figures, although recent, are for the traditional music business and for people who don’t understand all the good stuff that you’re learning now. The following numbers are for CDs, and since CDs are not really what most customers are demanding these days, it should be no surprise that the numbers are so bad. We would expect the same if we were looking at a chart for rotary phones or black and white televisions. It does not mean that music is dead. It just means that CDs are dead, or at least dying. By the way, the blue bar for “500,000 or more” is not missing. It’s just so small that the chart would need to be about five feet long for you to see it. There were only 34 CDs last year in that category and that includes the 10 CDs that sold more than a million copies.

In order to know your customer, you have to listen first. You have to find out what they are truly interested in. Then, give it to them when, where and how they want. Knowing a little something about music customers (for instance, what we see in the above chart), it would probably be a bad idea to try to sell only CDs and expect any real success. , marketing is largely about relationships, and if you don’t listen in a relationship… well, you know how well that goes.

There are two very important in marketing these days: Voice of the Customer (VOC) and Customer Relationship Management (CRM). The names are somewhat self-explanatory, although CRM is often taken to mean a software system like SalesForce, Microsoft Dynamics CRM or Oracle’s Siebel CRM products. More than the products themselves, which can be helpful (although costly), we are more interested in why they exist: to better serve customers.

So how do we get to know our customers? For starters, just ask. Of course, there is plenty more that you can do. Let’s build this discussion around the first concept: the VOC.

The Voice of the Customer

The Voice of the Customer, or VOC, is a catch-all phrase that encourages us to frame our marketing initiatives in that are meaningful to the customer, in a style and language that they will understand both emotionally and intellectually. It’s surprising how often this idea is ignored. The VOC is ultimately how you want to express your Value Proposition (the subject of the next unit) to the public, so it’s an important idea to explore fully. Messages to the customer should be in language they themselves would use, but all too often communications are in the language of the company or the marketer. For example, a company with a very technical product can get lost in citing specs that are highly meaningful to them, but maybe not so much to the customer. Consider the difference in the following messages:

A 5.2 litre engine delivers 425 horsepower and 390 lb-ft. of torque delivered with an 11:1 compression ratio and cylinder heads designed for optimal airflow.

Feel the exhilaration as you hit the gas and hear the distinctive growl that only a Mustang can deliver.

While statement # 1 will probably attract a handful of gear heads, it is the second statement that will actually have people picturing themselves behind the wheel of that totally cool new red Mustang…the car they always wanted when they were sixteen…while they drove Mom’s hand-me-down Pinto instead. Similar text can be found on the Mustang website, but I guarantee that the second is the one that sells more cars. The language is meaningful, and even better yet,

emotional for the customer. Of course, muscle cars attract a certain number of folks who know what a compression ratio is, so that language is included – and important – as well.

How can we apply this to the music business? Well, all too often musicians and marketers in our business fall into the trap of describing music in that are important to them and not the customer. On the other hand, think of how effective like “alternative” and “grunge” were in selling rock music, back when those styles were breaking big. What young rock fan didn’t want to see him- or herself as “alternative.” It made you feel cool, outside the norm, someone who goes their own way. And “grunge” was a direct reaction to the over-polished acts that had dominated for many previous years. Grunge was mostly about guys who played loud and wore old flannel shirts and torn blue jeans, but it would not have sold as well if it had been described as “rock songs not too different from stuff you’ve heard before by guys who look like they should be in the audience at an Allman Brothers concert.” Not nearly as impactful, but that’s not an incorrect description. It sold in part because it had a description that was meaningful to the customers. The real point is that when we use that are immediately meaningful to the fans, and these make them feel a certain way, we are more successful in getting them to listen to what we have to say and ultimately, buy what we have to sell.

I am not necessarily advocating coming up with a catchy word to describe your music. That typically happens organically and will more likely backfire if you try to force it. All I’m saying is that certain can be important because they express the voice of the customer.

Let’s say you play a style of music that is not quite as mainstream as grunge or alternative. Let’s say you have a bassoon quartet. Images of well-schooled musicians are probably popping into your head and you’re imagining some horribly boring intellectual music funded by a tedious grant-making foundation. But no! Not the case for the Breaking Winds Bassoon Quartet!

I stumbled upon this group quite by accident while helping a client market a project and get it funded on Kickstarter. The four ladies of this quartet are all well-trained classical musicians, but instead of taking the highbrow road, they decided to have a little fun – with their instruments, with the name of the band (perhaps having something to do with how the uninitiated may describe the sound of the bassoon), and just about everything else they did. The truth is, they were a fun, personable group of women, and rather than try to hide that, they used it to their advantage. They looked at themselves honestly and marketed their music in the best way possible. To make a long story short, they were shooting for a funding target of $5,000 on Kickstarter to make their album. They got 961 backers to contribute over $27,000. Not only did they make their album and have plenty of money left for marketing, they found their 1,000 true fans as well (more on the concept of 1,000 true fans later).

Why did this work? Expressing their marketing messages in the language of the customer certainly helped. If they’d tried to launch the same project with an academic, dull history of the bassoon and a recommendation from John Spknyskyzty, the first bassoonist of the Vladivostok Symphony Orchestra, I doubt they would have fared as well. (I hope that made-up name did not accidentally offend any real person.) Too many classical artists have tried this dry academic approach only to find that few people really cared. But by speaking in a more customer-friendly language, the quartet broke through to new fans, funded their record and showed people what a great instrument the bassoon is and just what it can do in the hands of skilled players. So in a nutshell, if you’re sending out flyers that label your music as “post-industrial psychedelic trance hop” but all your fans describe it as “freak out” music, then start calling it freak out music.

Customer Relationship Management (CRM)

Please take note of the used in the CRM acronym: Customer Relationship Management. earlier when we decided that a large part of the marketing formula is about relationships? What kind of relationships? Relationships with your customers. And what do you do with relationships in business? You manage them. And what does manage mean? Working with a set of factors in order to create maximum benefit. Note that I did not say profit, I said benefit. And that means for both customer and company. CRM is often mistakenly understood to be a group of software products, and yes there are certainly a number of good software products that are labeled as CRM products. But true CRM is so much more than that.

CRM should be viewed as a comprehensive business strategy, not simply a technology solution to manage existing customers.

CRM should be viewed as a comprehensive business strategy, not simply a technology solution to manage existing customers. The strategy can include identification of potential customers, understanding their needs, differentiating profit levels, increasing product usage, up-selling and cross-selling, increasing referrals, and more. Up-selling means selling more expensive products and cross-selling is selling additional products to your existing customers. For example, if someone is buying a CD , a prompt might suggest a limited edition signed CD, or previous recordings from the back catalogue. Amazon.com and others do this as a rule (think of that section on the product page that informs the buyer “people who bought this item also bought…”), and it works pretty well for them.

The focus has to be on understanding the customer and managing the relationship for mutual benefit, much the way a married couple or successful sports teams manage their relationships on every level. It is certainly not a oneway street. As you’ll , we discussed the older 4 P’s marketing structure, and how that is being replaced by the 4C’s. The 4 P’s were entirely appropriate for the older mass-advertising American packaged goods industry, which predominated until just a decade or two ago. But the internet and changes in customer value systems have drawn a new landscape. As we know too well, CD sales are slipping dramatically, but just as dramatic is the rise of digital sales, including s and digital broadcasts. The customer still prizes a relationship with a content provider, an artist, a radio station and anyone who provides them with something they value. We, as artists, labels or service providers, have to do the same, and value the relationship with the customer.

Let’s look at some specific ways we can do this in the music business. Think about how you’ve started other relationships in your life. Maybe an early romance where you gave the person whose affections you sought a small gift: a flower, a mix tape, a seashell. Think about how you once made a friend. Perhaps you gave them some of your time and listened to them when others wouldn’t. What does all this do? It makes the other person feel valued, and it doesn’t cost you anything at all except a little bit of time. So give some stuff away. Give your time as freely as you can because everyone knows time is valuable. I know it may be a bit hard to swallow, since you are trying to sell music or services, but give a little away first. Some free s, a conversation, a bit of advice, a free guitar lesson. All these ideas, when put into practice, work like charms. If you give something of value, you will get something of value in return. That’s an important concept in the value exchange that is the basis of business, so read that last sentence again.

Dating back many, many (many) years, artist fan clubs were of critical importance to the success of artists in the music business. This was customer relationship management at its best, before the term was even coined. In fact, performers understand that fans invest or project certain characteristics on the

objects of their fandom (the performers) to legitimize fan behaviors such as excessive devotion. Those who knew this was happening often took advantage of it, fanning the flames to build fan fervor. Even back in the days of Paganini and Liszt, performers and their inner circles welcomed and even facilitated stories of the unusual behavior of artists with tales of demons, possession, magic and anything else that made them more spectacular and worthy of some fan obsession.

Although some of this fantastical imagery certainly still exists, the good news is that there’s been a shift to authenticity, and a performer who lets you into their real lives often garners more fan than those who put on airs and try to appear removed or above it all. Sure, the brooding genius or flamboyant celebrity will always have some appeal, but leave that to the brooding geniuses and celebrities. If that is not you, then that is not how you should attempt to appear to your audience. Reality forms the best basis for the relationship with the customer that you want to manage. And , manage is not a negative word here. We are not talking about Customer Relationship Manipulation. The word is management, and management, as we said before, has as its end goal a mutual benefit and exchange of value. That’s a good thing!

Customer Behavior and Marketing Strategy

Customers are people, and people behave in a variety of ways, but not in as many ways or as unpredictably as one might think. In fact, much customer behavior can be pretty easily understood (although we might wonder why the heck millions of people bought pet rocks back in the 1970s). But putting the occasional aberrations aside, it’s safe to say that most people react to external stimuli (and that means your music) by either affective behavior, cognitive behavior, or some measure of both. Affective behavior is behavior that is largely controlled by emotions. You react to something in a certain way because you feel a certain way about it. Affective behavior can be broadly viewed in four main categories: emotions, feelings, moods and assessments. Emotions are at the high end of the scale and are the most potent, whereas assessments are less potent and really are closer to cognitive behavior. Cognitive refers to the mental processing system of understanding, assessing, planning, deciding, etc..

Let’s revisit the descriptions of the Mustang:

A 5.2 litre engine delivers 425 horsepower and 390 lb-ft. of torque delivered with an 11:1 compression ratio and cylinder heads designed for optimal airflow.

Feel the exhilaration as you hit the gas and hear the distinctive growl that only a Mustang can deliver.

Clearly, the first message taps into cognitive responses, while the second one taps into affective responses. I hesitate to even call the affective responses “thinking,” since it is more about feeling. Mustang has always sold a lot of cars and chances are they know what they’re doing, so please note that they opted for both types of statements. Certainly, the affective is the more powerful of the two. People ultimately buy largely on emotion, but the cognitive is there to back it up with facts if the need arises.

It is largely the cognitive aspect of customer behavior that we are concerned with when we discuss the purchase sequence, or “funnel” as it is often called. Different models offer quite a variety of takes on this sequence ranging from three to six steps, but the sequence that makes the most sense to me is the following:

Figure 4.1

Although much of this process is cognitive, meaning that there are intellectual decisions involved, there are sections where affective behavior comes into play as well. Let’s say you create Awareness using a good campaign that mixes traditional and contemporary advertising techniques. For some customers Interest may then be spurred by either a consideration of features (the CD is well priced, has good artwork, contains twelve songs) or a more affective thought process (these songs get me really pumped up, or the artwork makes me feel serene). In fact, any of these stages can be influenced by strategies that tap into either affective or cognitive processes or both. But perhaps the most important part of the picture is the last item: Advocacy. In most cases, this is all about tapping a customer’s affective behavior. Only if a customer is truly excited about what you are doing will he or she go out there and advocate for you, telling all their friends about how great your new music is and drumming up for what you are doing. This is where we all want to get – to find those 1,000 true fans.

If you’re not familiar with the idea of 1,000 True Fans, me on this short detour to explain the concept. Around 2008, Kevin Kelly (editor of Wired and formerly the Whole Earth Catalog) first put this label on a phenomenon that some artists were already discovering on their own. But as is often the case with the esteemed Mr. Kelly, he found a way to frame the idea in of creative people doing business in the internet age. Kelly reasoned that somewhere between the top handful of artists and the “long tail” (the thousands of artists who make just a tiny bit of money here and there) exists a model for actually making a living. His idea is that all you need is 1,000 true fans, fans who will buy just about everything you do and really you with enthusiasm. If each one of the thousand bought items from you over the course of a year, maybe $100 total per year, then you would earn $100,000, which is a reasonable living for most creative folks. So rather than shoot for that very unlikely top spot on the charts, find those 1,000 true fans, communicate with them regularly through whatever methods make sense, and maintain that base. You can try to add to it gradually, to replace fans who fall off through natural attrition so you always keep that number at around 1,000.

Easier said than done, of course, but it definitely can be done. And once you have those fans they will work on that last item, advocacy, on your behalf, and help you bring in more fans and sell more product. , a personal endorsement of a product is a virtual goldmine and worth more than a whole bunch of advertising. Why? Because it hits those all-important affective buttons. If your friend communicates genuine excitement about a product to you, to the point where you are excited as well, isn’t it more likely that you’ll buy the product?

OK, so now we know a little something about consumer behavior and a few fancy psychological sounding like Affective and Cognitive. How exactly does that help you? I’ve built a little table below that should help. Most of us can easily think of a product’s features without any problem, but translating that into language that means something to a customer often eludes us, if only because of our nearness to the creation and marketing itself. Features are not quite as important to customers as benefits, that is, what they will get out of something. People don’t buy a coffee because it’s brown (a feature), they buy a coffee because it wakes them up in the morning (the benefit). So I’ve taken a new collection of songs available as both a digital and hard copy CD as an example, listed the features in one column, and then the corresponding benefit statement that you can use in marketing communications in the next.

Table 4.1

So hopefully you can see how different the above two columns are. The features, while informative, sound pretty dull and don’t really speak to the feelings of the customer. But the benefits, without the backup of the features, don’t quite stand on their own either. Certainly, the combination of the two will produce the strongest marketing messages for this particular item.

Building the Value Proposition

What is a Value Proposition?

Whether you’re trying to market a new product, an old product, a service, or just about anything that requires an exchange of value (which is typically money), you would be well served by building a strong Value Proposition (VP). We frequently hear the term “value proposition” in marketing conversations, although it’s often used interchangeably with “unique selling proposition,” “customer value proposition,” “benefits statement,” “benefit proposition,” “unique selling advantage,” or any number of other . The Value Proposition is really all of those and more, but just the alone do not quite capture the full scope of the idea. So what exactly is this concept all about, and why does everyone think it is so important?

If you look up the term in your typical business dictionary, you’ll likely find a terse statement along the lines of “The statement of goods and services offered by a company to its customers in exchange for payment.” Sorry. Not good enough. In fact, if you stop there, you’re falling short of the full power of the Value Proposition and limiting its use in marketing your music. The term has its roots in a 1980s movement in the business world, largely pioneered by Ray Kordupleski, a well-known business consultant, president of CVM, Inc., and veteran of the telecommunication industry’s most tumultuous era (which led to the break-up of AT&T). The VP concept was further refined and developed into a six-step system by Cindy Barnes, Helen Blake and David Pinder in their excellent book Creating and Delivering Your Value Proposition: Managing Customer Experience for Profit. The six-step process I discuss here is based on their handiwork, and I strongly recommend their book for a more in-depth exploration (Barnes, C., Blake H., Pinder, D. (2009) Creating & Delivering Your Value Proposition. Kogan Page Limited ISBN-13: 978-0-7494-5512-5).

Through the work of these writers and others, the VP has evolved into a very powerful tool; it is far more than a short statement or any kind of concise

customer message. Ideally, it is a guide to developing an effective marketing plan. By looking carefully at the following six steps, starting with the market – the customers themselves – you can develop a one-page document that serves as both an internal guide to marketing your music as well as a blueprint for messaging and marketing tactics. The VP is a type of playbook, and like a coach or a quarterback, you can always reach for the VP to make sure you’re using the best tactic for a particular situation. It can provide suggestions for ad copy, newsletters, posters, and other messaging that is relevant to the customer. It can even serve as a framework for the development of new ideas and future music projects.

Let’s dive into the six steps, and then look at some examples of both strong and weak Value Propositions. The diagram below provides a snapshot of the six building blocks.

Figure 5.1

Adapted with permission from Creating & Delivering Your Value Proposition: Managing Customer Experience for Profit by Cindy Barnes, Helen Blake and David Pinder.

Just one caveat before we launch into the six aspects of VP: Don’t be tempted to lump them together. For example, don’t think about including “benefits” in another category such as “offerings” or “value experience.” While there certainly can (and should) be overlap among these categories, it adds to the clarity and focus of your in-house thought process and external messaging to consider each of these six categories separately. Read on and you’ll see what I mean.

Market

The “market” is the specific group of customers you’re targeting. The more specific the better, and if you think your music should be targeted to “everybody,” stop right now and call your friendly neighborhood marketing advisor for help. Almost no music (or any product, for that matter) can or should be marketed to everybody. You have to focus. Limit your scope and get as many details about your ideal market as possible. Factors like age groups, income levels, geographic location, online habits, buying behavior and preferences, communication channels and more all help to create segments and sub-segments to fine-tune your marketing initiatives and messages. Know as much as you can about who is in your market.

Value Experience

The “value experience” is broadly defined as benefits minus cost, as perceived by the customer. But that might be a little confusing if you think it means you have to subtract a number (cost) from a quality (benefits). But “as perceived by the customer” is the key term here. A customer does not only consider cost in numerical or financial . They also think in of convenience, time spent to acquire the product, or perhaps the cost (in time or money) of creating a new to buy your music from a provider. Surveys, customer interviews and other kinds of research can go a long way to determine how customers experience the value of your offering, in their own . It may not be what you expect, so keep your ears open!

Offerings

Consideration of the “offerings” should entail more than just the product itself. For example, are there extras available, such as different mixes, bonus tracks, acoustic versions, outtakes, or any kind of content? Are there elements of your offering that are free or might be added on later? Again, try to view this from a customer perspective. Let’s say you have a “buy ten tracks and get two bonus tracks free” offering. Maybe you’ve worked it out so that there is no real cost to you in making this offer, but the customer is certainly going to factor those extra tracks into their calculations and decision to purchase. The “offering” includes everything you offer, which might be more than just the most obvious or basic form of the product itself.

Benefits

“Benefits” describe how your music delivers clear customer value. , just because it’s good music doesn’t necessarily mean that it has a benefit for the customer. The Berlin Philharmonic recordings of Beethoven’s symphonies may be some great music, but if you are into Drum n’ Bass music, the symphonies don’t really offer you a benefit. Furthermore, benefits should be thought of in four sub-categories:

3. Core Benefits – These are the main functional benefits of your product. For example, the core benefit of a Ferrari (or a Hyundai, or any car) is that it provides a way to get from one place to another. The core benefit of your music may be that it provides a listening experience for the customer.

4. Expected Benefits – These benefits are often unstated. Using the Ferrari example, it is expected that the car is fast, stylish and expensive. Relating this to music, it is expected that the music is well recorded, has a certain amount of form, melody and rhythm and creates the type of listening experience that the fans of the style expect. It may be stating the obvious, but a reggae fan expects music from a reggae artist to be reggae. Imagine their disappointment or confusion if they purchased a Bob Marley tune and got screaming headbanging metal instead. Could be cool – but probably not.

5. Augmented Benefits – These are benefits beyond the expected, and may offer added value, surprise or excitement. For example, a Ferrari is safer and holds its value better than any other luxury sports car – and most folks don’t know that, at first. Back to music: we might find that certain types of music produce effects beyond the expected. all the buzz a few years ago about the “Mozart effect”? This theory held that playing classical music to children, even to babies

in utero, resulted in brighter children with higher math scores. You’d better believe that the marketing folks at the classical labels used that augmented benefit to their advantage.

6. Potential Benefits – These benefits are often more implied or imagined, and create emotional reactions in the customer. For example, a customer imagines him/herself gaining status owning a new Ferrari, getting the girl/boy, impressing the CEO and getting that promotion, and so on. Going back to music, a customer might imagine that purchasing certain music will result in feelings of bliss, physical excitement, relaxation, sexual excitement or any number of emotional states. They also might imagine that it could make them appear cooler, more attractive, more intelligent, and so on.

Alternatives and Differentiation

Consider alternatives and differentiation from the customer’s perspective. Are there easy alternatives, like generic sound-alikes, used CDs, free s or other viable substitutes? For example, a consumer may need a cell phone, but do they need a particular cell phone? It’s the same with music. No one would argue that we all need music, but why does anyone need your particular music? Also, have a good look at your competitors to find out what they’re doing and how can you differentiate yourself from them. Differentiation can occur by price, features, benefits, perception, free tracks – any number of ways. Bear in mind that if the differentiator is not apparent to the customer, then you are just hoping and gambling that they will choose your offering over your competitors.

Proof

As soon as you can get proof of how good your music is, get it and use it. Proof can be in the form of reviews by professional music critics or writers, but customer reviews are just as important and perhaps even more effective. For example, think of how powerful those customer reviews can be and I don’t think it’s an accident that my label’s best selling music on CD Baby are the CDs that have the most customer reviews. By the way, it does not hurt to ask permission to use someone’s comments (and their name) in your marketing materials. In fact, most fans will be flattered. On the other hand, it’s common practice to use professional reviews, typically in fragments, without asking permission, although credit should always be given to the writer and the publication.

Putting It All Together

We’ve covered a lot of ground in the above six points, and of course, much more can be written and discussed about each one. I strongly recommend that you develop two value propositions: one that is detailed and covers as much of the above as possible, and one that is short and somehow distills as much of the above as possible into a single sentence or two that is expressed in the language of the customer. We’ll look at some examples in the following pages. Again, as I noted in the introduction, the value proposition (VP) is often confused with the unique selling proposition (USP), in that many consider it to be a short sentence you use in your advertising to communicate the value of your offering to customers. And yes, I do recommend that you have a concise statement like that.

However, if you go through the above exercise and write down what you would like to communicate under the umbrella of each of the six topics, and then distill the result into a short blurb, you will find that you have created both an internal guide and an external message. While many marketers can recite their company’s one-sentence blurb on cue (the so-called “elevator speech” – named after the thirty seconds you might get in an elevator ride to pitch your product to a potential buyer), it’s surprising how many do not have the deeper knowledge discussed above. The full range of value of any product should be completely understood by marketers so they can communicate that to the customer in the most meaningful and compelling possible.

Of course, it’s not absolutely necessary to express all six factors in the short version of the VP. That would most likely be too wordy and awkward. But if you have the concept of the six factors understood and at the ready, then the shorter messages you use in marketing communications will be more impactful because they are backed up with a solid and well constructed VP. As a quick analogy, consider a skilled writer or a musician. The writer knows her vocabulary, and the musician his scales and chords, but they don’t use them all in one essay or any

one song. But the knowledge exists in a subconscious reservoir and infuses whatever is written or played with authenticity and authority. It’s the same with marketing.

Example of a Strong Value Proposition

Let’s look at an example of a strong VP including both the long form, which can be used as an internal guide for the marketing team, and the short one- or twosentence blurb (or elevator speech). I prefer to write the VP in personal , as if the artist is talking about his/her music to potential buyers. Okay – I’ll play the part of an artist who produces ambient atmospheric instrumental music. We’ll start with the long form and then extract some ideas to create the short form. Here goes…

Market: The target market for my music is male and female music fans, 35 to 55 years old and of moderate to high income levels. Although they may have broad musical tastes they share the common feature of using music from time to time as a way to relax or create a mood. They might be interested in some sort of spiritualism and they might attend yoga classes, visit spas or participate in other activities that can be enhanced by unobtrusive music with no distracting lyrics. They are most likely Democrats, somewhat liberal and interested in culture, ethnic music and food, and mind/body experiences.

Value Experience: My customers are less concerned about price and more interested in the nature of the experience they have when listening to my music. They are also interested in both purchasing and listening convenience, so it’s crucial for my music to be available through a variety of sales and distribution channels, as well as in a variety of formats. While my customers’ focus is on the atmosphere provided by the music, they are also interested in art, so a creative CD design that expresses some spiritual or mystical elements would add to the perceived value of the music.

Offerings: The offerings include a typical CD of 12 songs attractively packaged and available both on- and off-line. In addition, the album as well as single tracks are available for via iTunes, CD Baby and other online distribution channels. To add value to the offerings, my personal website also features suggested groupings of able tracks from this new release as well as from the existing catalogue, so that customers may choose a selection of songs grouped together under titles like Relaxation, Meditation, Peaceful Dinner Music, Sleep Sounds, etc.. Customers who purchase the full 12-song set of new music will receive a coupon redeemable for an additional 3 free s of their choice.

Benefits: My music offers serenity, warmth and feelings of well being. It is the perfect accompaniment to a dinner with friends, a peaceful afternoon with a good book, or as an ambient soundscape for meditation and yoga. Customers can choose custom groupings of songs to suit their needs, and the variety of purchase options and formats insures that they can purchase and access the music in whatever way makes them feel most comfortable.

Alternatives and Differentiation: I know that there are a lot of choices of music, but I think customers will find that my music is a cut above the rest. A lot of ambient music is simply droning synthesizer sounds, but I always use acoustic instruments mixed with electronic sounds for the best of both worlds. Of course, recording quality is top-notch, and I always strive to use the best of modern digital technology in conjunction with warm, analog vintage recording equipment. My melodies are sparse enough to be unobtrusive, but still engaging enough to draw you in, if that’s what you want. Also, as a world traveler and fan of all types of ethnic music, I often use unusual instruments or fragments of traditional melodies to make my music resonate with authenticity and the soulfulness of people and places from exotic lands.

Proof: My customers and fans have offered their opinions, so by visiting my website, potential customers can see for themselves what others think. The

comments include statements like “lush and evocative” and “transporting beautiful sounds ideal for relaxation.” My customers are confident about buying my music as a gift, with one customer saying “Rest assured that this is quality, elegant music that makes an ideal gift,” and a number of yoga teachers have written to me saying that they use my music in their classes.

That’s the long form. Each of the major points that matter to the target market were covered and as much as possible, the language should be easily understandable by customers. Notice the lack of jargon or technical details, and the inclusion of evocative phrases like “a peaceful afternoon with a good book.” Now that is something that this target market should easily appreciate and even more importantly, it’s something they should be able to feel. what we said earlier about affective behavior? Customers buy with their feelings more than with their intellect, so that’s what you should try to tap into when writing your VP.

Now that the imaginary musician described above has written the VP, it’s easy to refer back to it. Your VP is a good source for your marketing messages, and those messages certainly should include affective messaging. Examining your VP for a supply of short quotes or blurbs to use in postcards, emails, web copy – and even in conversation – should yield an abundance of material.

And that brings us to the short form of the VP, which can also be used as the elevator speech. You needn’t try to condense and capture all the points mentioned in your long form VP, but you should go back, read through it a few times, and decide on a few sentences that can pack the most punch. So here is what our musician friend came up with for the short form:

“I offer lush instrumental music that combines modern technology with traditional acoustic instruments to create a serene, ambient soundscape that provides the perfect mood for relaxing activities and the simple pleasure of listening. You can create your own playlists and the music of your

choice, or buy the latest releases in a beautifully packaged CD. Fans of my music have called it lush, evocative and transporting and I believe you will find it to be a cut above any other music of its kind.”

And of course, like any other speech, your elevator speech should be practiced and memorized so that it flows naturally. , if you’ve only got 30 seconds in an elevator, make it count.

Example of a Weak VP

Since I firmly believe that you can learn as much from mistakes as successes, we will now turn our attention to an ineffective VP. In reality, most bad VP’s are really just poorly thought-out and overlong versions of the short form. The very act of thinking through the six steps of a long-form VP should at least result in a halfway decent VP, but many marketers skip this process and go directly to a VP that is somewhere between the short and long forms, and the result is not at all compelling to the customer. Since someone writing a deficient VP probably would not go into much detail, this version will be a bit shorter than the thoughtful version above. We will once again use an imaginary artist who produces ambient atmospheric instrumental music – but this musician obviously hasn’t read this book!

Market: Everyone who likes good music and needs to relax from time to time.

Value Experience: Since my music is priced more cheaply than others who write in the same style, my customers will feel that they are getting more value for their money.

Offerings: Everyone buys music online these days, so I am only selling my new album digitally. I will offer 12 songs together and add some artwork and production notes in case anyone wants to print or that kind of thing.

Benefits: My music is better than plenty of other artists since I use real

instruments mixed with electronic instruments. It will help you relax.

Alternatives and Differentiation: Acoustic instruments mixed with electronic sounds. Most relaxing music is all electronic.

Proof: My friends and fans all think it’s great.

And then the short form would be something like this: “Relaxing instrumental music recorded with both acoustic and electronic instruments.”

See the difference? This artist stopped short of including details that matter to customers, confused benefits and alternatives, comprehended value in of money, and assumed that everyone who likes good music should like this music. This musician will be mystified when the music doesn’t sell. As a matter of fact, both the weak and the strong value propositions describe the same artist’s work… it’s just that the first “incarnation” of our artist knows a thing or two about value propositions and customer language, whereas the other version of our musician does not.

With this in mind, I would like to rephrase an old truism that used to be especially valid in the music business. We have all heard “It’s not what you know, it’s who you know,” and maybe somewhere in the dim and distant past (also known as the seventies) meeting Mr. Big might actually have resulted in a lucrative record deal and international stardom. But that has always been an unlikely dream, and it’s even more unlikely now. Even if it were to happen, the dream is just as likely to turn out to be a nightmare. The music business is littered with musicians who thought they had it made when they landed a record deal only to find that it’s often not as lucrative or liberating as they expected. Putting aside social media and networking for a moment (where “who you

know” is very important), I’m going to flip that old saying around and say “It’s not who you know, it’s what you know.” And if what you know is the new rules of music marketing, which includes how to write a good Value Proposition, then you are well ahead of the rest of the pack.

Marketing and Distribution Channels

What Do We Mean by Channel?

A musician can use different methods to get their products into the hands of customers; we’re going to discuss those, as well as the corresponding marketing that complements these approaches. The method or system whereby you get the music into the customer’s hands is called the distribution channel, and the method of delivering the marketing messages to or enhance that distribution is called the marketing channel. that marketing and distribution, although related, are two different things. And “channel” can also be a broad term with multiple uses. Earlier in the Marketing Primer unit, we talked about the term “channel,” which we defined roughly as “an organized network of entities (people or businesses) that work together to get the offering from the producer to the consumer.” Essentially, a channel is a system of related parts that works together, and it can be quite simple or rather complex.

For example, if you do a performance and you give your friend twenty CDs to sell at a table in the back of the club, then your friend and the table are components of the distribution channel. If you send out email messages before the gig that CDs will be available and you put some posters around the club and make some announcements about the CDs, that all constitutes the marketing channel. On the other hand, you might release a able album of new songs and make it available on iTunes, iTunes Europe, iTunes Japan, CD Baby, Pandora, LastFM, Rhapsody, internet radio, Sirius XM and more. These are all distribution channels in their own right, and the sum of all the parts makes up a distribution channel which we might refer to as “the worldwide digital distribution channel.” Of course, putting the effort into getting your music broadcast is also a marketing strategy with an objective of encouraging people to listen and hopefully buy, so there is some overlap in how we use these . The typical and more traditional example of a distribution channel is selling CDs first to a distributor, who then sells to a retailer, who then sells to a customer, although this channel is not nearly as relevant as it used to be. As you can see, a marketing channel and a distribution channel are intimately related and need to

complement each other to be effective.

Perhaps it’s better to conceive of a channel as a process. We are all familiar with the idea of a channel being a number that designates a specific communication frequency – like WXYZ broadcasting on 104.7, or maybe Channel 12 on your television – and those are certainly vehicles or methods of communication. However, the similarity to the kind of “channel” we’re concerned with ends there. Once again, a distribution channel is really a process by which a product moves from creator to customer, and the marketing channel is the process whereby the messages move from creator to customer. Subtle difference, but one worth noting.

Why do you need to think about this fairly commonsense stuff any further? For one thing, you need to be aware of the vast array of channels open to you, and then make informed decisions regarding which ones you will use. As you’re beginning to understand, it doesn’t make good marketing sense to think you should use all of them. But more importantly, each distribution channel, or at least each category of distribution channels, has a corresponding set of marketing channels and thus requires a certain set of marketing strategies and messages. These messages might need to be communicated to those who control the distribution channel (such as distributors, buyers at CD retailers or program directors at radio stations) as well as to the end s: your fans or customers. In more complicated channel structures, this can take some planning and ongoing adaption and tweaking of the message to suit the channel.

Different Channels Require Different Messages

The classic distribution channel structure in the music business used to look something like this:

Figure 6.1

In this classic structure, musicians deliver their music to the record company, who then contracts with a distribution company (in the case of the big labels, the label may also be a distribution company), who might then work with a regional or specialty wholesaler, who sells to retailers, who then sells to customers. While some parts of this arrangement still exist, most of it has changed substantially and unless you are a big-label act, very little of it applies to you. An increasing percentage of music income now comes from digital distribution of some sort, whether s or licenses or digital broadcast, and many of the “middlemen” listed above are no longer needed.

Let’s say you record a new album, perhaps ten tracks of previously unreleased material, and it’s properly mixed and mastered and ready for the world to hear. In the new music business, you can go from the first step in the diagram above (Musician) to the last step (Customer) without all the interim stages, all of which previously had sub-stages, marketing messages and concerns of their own. To be sure, the fact that this has changed dramatically is good news for indie musicians – but it still takes work to get there. There are numerous possible distribution channels, depending on your particular customers. (We’ll go over the corresponding marketing channels in a moment.)

Customers can buy s (or for free) directly from your site.

Customers can buy CDs directly from your site.

Customers can buy s or CDs from another site such as CD Baby, Amazon or iTunes.

Customers can buy CDs or a card at a performance.

Customers can buy your CDs in a store. (Really? This still happens?)

Customers can listen to your music on satellite radio, for which they pay a fee (and you get your share).

Customers can stream your music from a service, pay nothing, but the service pays you because they sell ads or otherwise monetize what they do.

Producers, directors or music supervisors (these are still customers) can purchase a license to use your recording in a film or other media.

Other musicians can purchase a license to use your composition (but not the actual recording) and make their own version of your music.

Labels can purchase the rights to use your master recording (the actual “physical” embodiment of your music) to use as part of a compilation.

Customers can listen to your music for free on YouTube, Soundcloud or Vimeo (and perhaps pay you nothing directly).

Customers can share your music with each other (and definitely pay you nothing).

There are certainly other channels, but these are a good basis for discussion. Many of the middle steps in our earlier diagram have been eliminated, and more than half of these channels only have one intermediate step between you and the customer. That is good news, because you have more control and keep a bigger percentage of revenue, but there is still some substantial work to be done. So let’s use two of these channels as examples and discuss how you might determine and use the correct marketing channels to reach the end and sell your music.

Example 1: Customer s from your website

Assuming you have done the legwork to make your music available on your own website, and through iTunes, Amazon and CD Baby – the distribution channels – then you’re ready to get messages to your customers – via the marketing channels– to motivate them to buy your music. (Of course, you may choose a different array of distribution channels than those listed above.) And since you have done some homework and considered your 4 C’s (see unit 2) as well as some work to create your Value Proposition (see unit 5), then you will have chosen the appropriate distribution channels for your various market segments. Right? Are you starting to see how all these concepts connect and work together to make the big picture?

Since you’ve determined that a reasonable percentage of your customers are online and prefer to buy s (that’s the “Convenience” C of the 4 C’s), you should be able to choose the marketing channels that would work best for them. It’s likely that the proper channels are online channels as well, including enewsletters, some good graphic ads on your website, and social media messages. Non-digital marketing can offer extra , so if there’s an opportunity, such as a gig or event where you will physically be in front of a large number of potential customers, then a simple postcard with a nice graphic element and a call to action can work quite well. “Call to action,” by the way, is a term often used in marketing. It has to do with giving customers a very clear direction on what they should do and why. Something like “Visit mywebsite.com to my latest music and get 3 free tracks when you use promotional code XYZ123” is much more purposeful than the same postcard with your web address but without any direction for the customer to do something specific.

In all your digital marketing (newsletters, tweets, blog posts and so on), make sure you include a link that gets people as close as possible to the point of purchase. This is likely not to be your home page, and may not even be on your

site at all, if you don’t have the capacity to sell directly from your site. Convenience is key, and the fewer clicks it takes for your customers to buy something, the better. There are books, consultants and entire businesses devoted to facilitating online purchasing through thoughtful design so if you can, consider hiring someone to help you in this area. If you can’t afford that, do some homework and look at a few successful sites to try to figure out why they work.

Bear in mind that most successful sites will display evidence of some or all elements of the six-step value proposition, in language that will make sense to the customer. Let’s take a little detour and look at how the value proposition becomes part of the marketing message on a particular distribution channel; then we’ll get back to creating the proper message. CD Baby provides a good example.

On the top of an artist’s CD Baby album page you’ll see the album design, a brief description, some information on the genre, and of course the price, typically for both the physical CD and the mp3 . Also there is a section on the right that reads “Recommended if you like…” where the artist can help customers by comparing his or her music to other known artists. There are samples of all the tracks for listening, often a free track or two and hopefully, a bunch of good customer reviews.

Take a look to see for yourself, and try to relate what you see to the six parts of the value proposition as well as the 4C’s. Of course those specialized marketing don’t appear anywhere on the website, nor should the language used on an artist page ever be as academic or marketing-specific as the language we’re using in this book. The language must always be meaningful to the customer. But somewhere on the page, there will be evidence of the six parts of the VP: Market, Value Experience, Offerings, Benefits, Alternatives and Differentiation, and Proof.

By listing the genre and even the similar artists to suggest who might enjoy this music, the CD Baby artist page by default defines the Market – part 1 of the VP. Since the price is listed and customers can sample tracks before they buy, the Value Experience, part 2 of the VP, is present so that the customers can decide for themselves about the product’s worth. And if they don’t already have a CD Baby , they’ll decide if the tracks are worth buying, and whether they actually want to take the time to create an . Obviously the Offerings, VP part 3, are all on display, and it can be smart to offer a track or two for free so the scope of the offering appears larger or more valuable relative to the price. If the music description is worded well then the Benefits (part 4) should be clearly spelled out, and hopefully some of the reviews will add real customer experiences of the benefits in their own words. Alternatives (part 5) are listed in the “Recommended if you like” section, and the artist, with an understanding of marketing has used that to their advantage to illustrate Differentiation (also part 5) from comparable artists. And of course part 6 – Proof – is present in customer reviews. All six parts of the VP have been covered, in ways that are easy to understand and meaningful to the customer.

Let’s turn back to the actual messaging that an artist might use to reach this online-savvy customer segment. Not all customers are alike, so messages that work for one type of customer may not work for another. However, you can’t have a different message for every potential customer, so you need to segment your customers as much as possible. At almost any point in your career, you’re probably going to have some customers who are already in your camp – your true fans – and some who are just becoming aware of you (or are already aware of you) but need some convincing before they’ll buy anything. These are probably the broadest customer segments we can define, and each will have subsegments.

For the purposes of this illustration, we’ll just consider the two broader segments of the market: those who are already fans and have bought from you, and those who are not “true fans” yet, but may consider buying from you. If you use an email service like MailChimp or Constant , you can and should segment your mailing list into “fans” and “potential fans” or whatever categories are appropriate to help you deliver more precise messaging. Even if you don’t use a

service, figure out who has bought from you in the past and/or who you know to be a good fan, and separate that group from those who have been on your list for years but may have never bought anything or come to a performance. Again, your list may not be 100 percent accurate, but that doesn’t mean you should not try. Eighty percent is quite good enough in this situation.

Here is an example of how you might message a “true fan” via the marketing channel of an e-newsletter, blog posting, or a LinkedIn or Facebook posting:

Hello John/Jane! [ideally you will want to address by name if possible] My new album XYZ is finally finished and ready for your ears! But first, I’d like to thank you for your over the years. I’m lucky to have great friends and fans like you, and I appreciate the you’ve shown by buying my first CD, coming to my shows, and ing my Kickstarter campaign. So if you’re ready for a little more, you can the album by clicking here [insert your best link!]. Don’t forget to claim your free tracks, and click on the picture below to see some special “for fans only” photos of the recording sessions. Thanks again and enjoy!

Notice how this message is personal and makes the fan really feel appreciated. Post some fun photos or videos that only fans can see, give them a few tracks, and you can even send a personal note where appropriate. You can’t do too much to take care of your best customers, so give them the royal treatment whenever possible.

To the segment of your list that includes people who may not have bought from you, who have been on your list for a while or just recently signed up for your mailings, you might want to send a slightly different message. This could also be appropriate for some LinkedIn groups that you belong to, especially if they are less personally oriented and more professionally oriented (as opposed to your

Facebook friends, who tend to be more fans and personal friends than business acquaintances). Here is a possible message for this segment:

“Greetings! I am happy to announce that my new album, XYZ, is finally finished and available on your favorite site! As you may already know, my music is an eclectic blend of hip hop beats, great soulful vocals and unusual acoustic instruments. Fans have said my sound is something like Aretha Franklin meets Eminem in a Greenwich Village folk club! But you can hear for yourself with a free by clicking here [insert your best link]. Of course, should you decide you like my music and want a little more, you can it through secure sites like iTunes and Amazon.com and your info will always be kept confidential. Thank you for listening!”

See the difference? This version is just a bit more formal, offers some interesting comparisons to pique curiosity, and gives the newcomer a sense of security and professionalism. Both messages contain calls to action and links that bring customers one step closer to purchase, but both should resonate with different customers for different reasons.

Example 2: Producer licenses your music for use in a film

Although still a customer, a film producer is a very different type of customer for whom you will certainly use different marketing channels and messaging. For one thing, depending on the film, you may be dealing with either a producer, a director or possibly a music supervisor. These are all busy professionals who care about how well a piece of music suits their film, and how easy and costeffective it is to license. Sending these folks a message like the fan example we saw earlier, with access to fun photos and info on how to tracks, is largely meaningless and will probably do more harm than good. They don’t care what you look like, where you live, or when the band is performing, and they won’t contribute to your Kickstarter campaign or pay to your tracks. However, they just might pay you a good chunk of money to license your song for a film. License fees range widely from free to thousands of dollars, but in all cases there are different types of messaging required to reach these customers.

Let’s say that you ed the Film Music Network (not a bad idea, by the way) and purchased their list of music supervisors. (Music supervisors are the people that film producers or directors hire to find and license music for a film. They often work closely with the producer or director to craft the sound and thus the feeling of a film.) Happily, they are usually pretty approachable folks and their emails and phone numbers are readily available. If you have good music, they want to hear from you, but you can expect them to be direct and to the point and unwilling to waste any time trying to fit a square peg in a round hole. Email is probably the most appropriate marketing channel for your first , and soon after initial many of these folks will want to access a site with at least samples and possibly full s of your music. They are not going to pay for the privilege, so don’t send them to iTunes.

If you want to pursue this type of business you may consider having a protected FTP site, or some sort of non-public service to host your music. Many music supervisors still want CDs sent to them, and a good number prefer the oldfashioned plastic cases with spines so they can add a label to identify it on their shelves, which are full of thousands of CDs. They don’t care about whether or not it’s a commercially-released CD or not. It’s more like a library item for them that they want to be able to refer to if a need for a certain type of song arises. There’s plenty of general info available about trying to break into this business (I recommend the Film Music Network and Taxi), so let’s get down to the marketing messages.

Your first email marketing message is more likely to sound like a business letter than the examples above. You have to assure this type of customer that you have top-quality music, ready to be broadcast in a film or on television. They’ll want to know your credits (if you have any), what type of music you specialize in, and what rights you control and are thus able to offer.

That last bit about rights is really important, and indie musicians have a decent shot at getting in the door if they can provide one-stop shopping, since one of the major concerns of a music supervisor is expediency. Decisions on music for film, TV commercials, TV shows and other media is often left to the last minute, so music supervisors are often tasked with getting music and all appropriate licenses quickly. There are a number of licenses needed to use music in a film, including the right to use the actual recording in the film, the right to use the intellectual property that the song embodies, and possibly a few other rights as well. If you own the master recording, wrote the music and you’re the featured performer, and you can offer one-stop shopping for all these rights, then you should express that in your marketing messages. A good message might read something like this:

“Hello, Mr. Smith, and thank you for taking a few moments to allow me to introduce myself and my music. My name is John Jones and I am a jazz pianist and composer. I am familiar with some of the work you’ve done on films like

(add a name or two…assuming you did your homework!) and I have a collection of solo instrumental pieces that I believe you might find interesting for future projects. I control both the compositions and the master recordings, and I can offer complete rights and licenses, including synchronization, master use, performance and blanket. I would be happy to send you some tracks on CD, but if you prefer, you can access my music library by visiting the following site (insert link). I would also be happy to compose music to your specifications if you have such a need. Thanks again for your time, and I look forward to the possibility of working with you.”

Quite a difference, isn’t it? Obviously, this is much closer to a business letter, but it is an important part of marketing and may represent a more lucrative stream of income than selling individual track s to fans. In either case, you are expressing your message through a marketing channel and in a language that is meaningful to the customer, and that is a significant part of what marketing is all about.

Social Media and Online Marketing

Digital Marketing Channels

Even though the online world and social media are just channels in the overall marketing mix, this subject still warrants a chapter all its own. While there are plenty of books and consultants with endless information about this everchanging field, we can get the most value from these marketing channels when we narrow our scope and balance digital marketing methods with more traditional marketing methods. In fact, a sense of how to balance your marketing is one of the most important concepts I hope you’ll take from this book. It is very easy to get lost in the myriad choices that the online world has to offer, and the result will only be frustration and time and money wasted. No one can doubt that the web is a very important marketing channel, so let’s take the broad view first and then get down to specifics.

Although many millions of dollars are made on the web every day, there’s a bit of a paradox here, because it also seems like you can get so much on the web for free. This is especially true for intellectual property like music, writing and video. Pick an artist. Chances are you can see at least some decent video of that artist for free on YouTube, if not on the artist’s own website. Pick another artist. It’s very likely that you can one of their songs for free. So how do musicians make a buck when our customers know that they can get our products for free?

Certainly this has caused some consternation and depending on who you talk to, has cost the music industry billions of dollars in lost revenue. But there is a silver lining, especially for independents. With a good decade or two of the internet behind us, there is no question that we have been going through an unprecedented restructuring of not just the music business, but of most businesses. New models are replacing old ones, and the way we engage with customers and the things that customers consider valuable have both changed. For the music business, this does not necessarily mean that customers have

stopped spending money – but they do spend it differently. Customers still want to artists, and believe it or not, many are looking for ways to do so. We just have to give them what they need. We can’t expect them to buy our CDs quite the way they used to, because they simply don’t place as much value on that exchange as they used to. Just as the rotary land-line phone is no longer the preferred product in that market, the CD is no longer the preferred product in our market.

What do today’s customers value? They still value art, creativity, and something unusual or unique. But what may be more relevant to this discussion is that they value relationships, customization, immediacy, participation, community … and those are some new twists, for sure. It’s not all about stuff anymore (although when I look in my basement, I have to question my own statement). We have moved to a more experience-based and emotional marketplace. Consider this: why did we want that CD, or earlier, that LP, in the first place? Was it for the thing itself, or for the music that it contained? Perhaps even more important than the music it contained, our interest was in how that music made us feel. Certainly there’s something to be said for the item itself and I, for one, lament the loss of the big LP covers with some really fantastic artwork. But ultimately, it’s about the music and the feelings that come from it.

What is starting to become obvious is that the web facilitates this experiential marketplace model. At first, this seemed not to be the case. In fact, it even seemed like a contradiction. How can something digital, like the web, be experiential and emotional? Aren’t experiences and emotions “out there” in the real world and not in some virtual form of reality? To be sure, that was, and in some ways still is, a legitimate argument. But what we are finally starting to learn from the web is that customers still place value on art and music, relationships, experiences, feelings and all the usual human interests and needs. It’s really only forms, delivery methods and communication channels that have changed.

The web is just a technology that we have to understand

before we can find the right place for it in our lives and put it to proper use. It is not the be-all and end-all, as some tech-centric folks would have us believe. Nor is it to be ignored just because it doesn’t match our old ideas of how to do business, or because we might have phobias about technology.

The web is just a technology that we have to understand before we can find the right place for it in our lives and put it to proper use. It is not the be-all and endall, as some tech-centric folks would have us believe. Nor is it to be ignored just because it doesn’t match our old ideas of how to do business, or because we might have phobias about technology. Way back in the ‘80s there was a real fear in the music business that drum machines were going to replace human drummers. It seems silly now, but I can assure you, it was a real concern. And for a time it did seem like the fear would be realized. But eventually the drum machine found its place. It exerted some influence on style and method of making music, for sure, but it certainly did not replace a good drummer. Nowadays it’s not at all uncommon to hear both a drum machine and a live drummer on the same track.

The same is true for the web, social media, digital marketing and all the new technology that has so greatly affected the music business. We have to find where it fits in our little corner of the business, and neither get too absorbed by it, nor pretend it isn’t there.

Over the last several years I’ve been attending music business conferences and marketing summits, and similar fun events. Social media and digital marketing have been the topics du jour for years now, and I think we are finally getting a handle on it. By that I mean that we are finally understanding that not everything is for everyone! Not every digital platform or new web marketing concept should warrant your attention. Most will come and go and an equal number,

although they may stick for a while, are nonetheless incompatible with your needs as a music marketer. So how we can we find the right place for the web and social media in our marketing plans and get the most benefit from it without losing our minds and spending twelve hours a day online?

First and foremost, I caution you against jumping in blindly and just starting without doing some research. Please, please don’t throw a Facebook page up there or create a Twitter unless you first spend some time with the platform, learn how people use it and start to imagine how it might be useful to you. Despite what the online platforms promise, you are never “up and running in minutes.” It takes time to understand the platform and how people use it for business. For example, I strongly urge you to take at least an hour a day for a week or two before starting a Twitter to just check it out. Watch some s in action, do a little reading on the subject, jot down some observations and start to get a clear picture of how it works before you dive in. Although it’s ultimately pretty easy, the jargon and the methods of use and their relative benefits are not obvious at first glance. The first time I looked at a page of Tweets I said to myself, “What the heck is this mess?” It was only after poking around for a week or so, then starting an and slowly dipping my feet in the water that I began to see how this might be used in my business. Without going into too much detail, I learned that for me and for what I do, one or two Tweets a day for four or five days a week was plenty. Rather than tweeting about everything I do, I use it to connect with others as part of establishing my brand reputation, and as just one of many components of building long-term relationships – both in cyberspace and in the flesh.

If you want an excellent guide to the world of social media, I highly recommend Dave Evan’s book, Social Media Marketing: An Hour a Day. It provides a threemonth program of daily observations and actions to help you understand the entire suite of marketing channels that comprise the social media universe.

As you probably know, the big platforms at the moment are Facebook, LinkedIn, YouTube and Twitter. When combined with a robust website, an email

newsletter campaign, and an active presence in the offline world, you can create a tight and effective marketing campaign for yourself and your music. Sure, there may be other channels you might want to try, such as ReverbNation or NuMuBu, but the big four mentioned above are essential. The important thing is that they be integrated and balanced in your marketing plan. You must streamline the way you use them so that you spend most of your time creating good music or performing or whatever you do, rather than spending your entire life ricocheting around the social media universe.

Let’s get back to an important term I just used about these SM platforms: integrated. What that means is: none of these marketing channels exist in a vacuum. They should all be used together to reinforce each other, and no single one of them should take up all your energy. Integration has always been important in marketing, and even with the different methods now, the basic concept remains the same. In the old model of music marketing, for example, there was typically a six-week promotional window accompanying the launch of a new album, and everything was integrated and scheduled for maximum impact within that window. Let’s say a new release was scheduled for an October street date. Months before the actual date, the marketing and PR teams would line up promotional appearances for the artist, send out advance copies for review so that reviews could be published to coincide with the release dates, promote the release to music directors and DJs at radio stations, create TV ads, arrange the tour dates to start in a major city, create posters and printed materials for the stores, get the distribution engine oiled to make sure the albums were in the stores when the whole machine started chugging ahead, and so on. A long list of items that all had to work together!

While some of that still holds true, much has changed. Many musicians don’t sell their music via brick and mortar retailers anymore, DJs are not as relevant as they used to be, print ads are less important, and the whole process and timeframe of marketing and promotion has changed quite a bit. What has not changed is that coordination is still essential. The term that marketers prefer to use these days is integration, and sometimes they use the term holistic marketing, implying that all the parts are interrelated. In any case, the basic idea is that your marketing efforts need to be properly dispersed among the

communication channels that you choose to work with and coordinated to make maximum impact and provide customers ample opportunity to find out about, consider and purchase your music. A well-integrated social media strategy can be an enormous help in promoting your music and ultimately generating sales.

Social Media Strategy

We’ve already established that gobs of time can be wasted on the online world. Until recently, a lot of music marketers were still testing the waters, trying out various platforms, deciding on whether or not to Tweet, and in general, doing what amounts to research on this still young marketing channel. A social media marketing strategy needs planning and integrating, and the particular messages themselves can occur (or be written) quite organically. Personally, I don’t (in the traditional sense of paying for placement) or hit people over the head with messages to buy from me. I just open up conversations and plant seeds that eventually grow.

Facebook is less professional than LinkedIn or Twitter (and perhaps YouTube also) and I typically use it to post messages about friends or clients doing a show, or to let people know if I am doing something business-related that may be of interest. I seldom use this channel for anything personal, and since that’s the opposite of what most Facebook s do, I favor this channel less than the others. I use Twitter to deliver links to info that can be of use to my target market, and YouTube helps to drive people back to my website. You may find that a different mix works for you, but you should endeavor to find a good balance that doesn’t require your having to use too much of your precious time.

As we have already discussed, good businesses and marketers listen to the Voice of the Customer so that they might hear the expression of a need – and of course marketers at social media sites employ this concept as well and listen closely to customer needs. Individuals and businesses using social media for business purposes started asking for a service that saved them time and would allow them to post to their various SM presences from a central location or service. And services like Hootsuite.com emerged, allowing s to do precisely that. These types of services essentially offer the a dashboard from which they can control and monitor their SM campaigns. Not only can you create a single post

and blast it out to your various s all at once, but you can also track mentions of your band or name and monitor social media activity around your messages. This is a tremendous time saver; you don’t have to to three different SM profiles to post a message, and you get from the SM universe to boot. This is an integration tool that makes your marketing life a whole lot easier.

An Easy Social Media Plan

It can still be daunting to get started in online marketing, especially if you are new to this type of marketing channel. To ease your transition into the SM universe, here’s an approach that involves a few simple steps. I recommend you take each of these steps in sequence and apply them to each of the big four SM platforms. Once again, the Dave Evans book mentioned earlier really spells this out nicely, but here is a very condensed version that you can get started on right away. If you really explore each step to the best of your ability, you will certainly learn a great deal.

Step 1. Listening

For each of the big four platforms (Facebook, LinkedIn, Twitter, YouTube), start out as an observer. Create your where necessary. Don’t worry too much just yet about developing your profile; just start poking around and reading posts and following conversations of people who you think might be interested in what you do. Since I am recommending that you not worry just yet about completing your profile, I would suggest that initially you resist the temptation to participate actively. (It’s not the best idea to have people checking out an incomplete or a poorly thought-out profile. Even online, it is still true that you only get one chance to make a first impression.) If you visit other profiles and take some notes, you can get some helpful ideas on completing your own profile.

Although not a social media platform in the same vein as the others, YouTube is one of the most important marketing channels on the web. Obviously, for artists who want to post their music and images, this is a great platform. But more importantly, by searching topics that interest you, you will find visually-

ed information and you will probably find your way back to someone’s website – so imagine it having the same result for you. Don’t limit your thinking to music videos. You might post tips on amp settings, a little lesson on jazz history, clips of recording sessions – anything that provides s with something interesting. It doesn’t need to be pro quality, but it does have to be interesting or engaging. So for the “listening” aspect regarding YouTube and Step 1. of this plan, we are talking not only about listening to music, but listening and learning about what others are doing.

The Three Main Steps to a Social Media Plan:

Step 1. Listening

Step 2. Engaging

Step 3. Marketing and Promotion

Another set of tools for listening that can supplement what you learn from the big four includes RSS feeds and alerts. By setting up alerts for items of particular interest, you can be notified by email whenever your subjects come up in a news item or on a particular website. For example, I have Google Alerts set up for music marketing, music licensing, ASCAP, BMI, Sound Exchange, my business name, and a handful of other items I want to be informed about. Rather than scouring the web for information, it’s delivered directly to my inbox.

Step 2. Engaging

Once you understand the language a little better, you can jump in and start participating in conversations and engaging your potential customers. You should start posting frequently on each of the big four. Don’t forget that there are services like Hootsuite that make this a whole lot easier and less time-consuming by allowing you to post content and monitor various SM s simultaneously. Also, you can visit blogs and drop in comments here and there. Don’t spend an inordinate amount of time in this channel, but it is a good idea to start regularly reading and commenting on blogs that interest you and relate to your interests in music.

As you start to frequent blogs, take note of what works for you and what does not, because it is time to start your own blog on your website. Very simple, clear blogs with relatively short posts and some graphic elements keep the eye entertained and keep the reader engaged. Clutter is a real turnoff for most folks. Your blog should be integrated (there’s that word again) into your website and not hosted separately. Most social media platforms can and should be used to drive people back to your website so that they can find additional content and sign up for your email list. Once you have someone’s email you pretty much have permission to market to them, but as I hope you are now seeing, marketing is at its best when it takes the form of two-way communication, relationshipbuilding, and supplying relevant, engaging content in addition to the music you are offering.

To restate what should (hopefully) be obvious by now, you should always provide links back to your website whenever you post, send an email or otherwise communicate in the online world. There are two good ways to do this. One is to add a hyperlink to a message in the body of the content itself. But make sure this is not forced, unnatural or excessive. So, for example, if you are replying to a blog posting or a LinkedIn message, and in the course of your

message there’s an opportunity to mention one of your songs or your website, add a hyperlink back to that item. No need to sell. Just provide the link, which will appear to readers as almost as a matter of courtesy. The other natural place for a link is in your signature. Make yourself a simple text file containing your name, your email address, your phone number, and a link to your website. Put it on your desktop or wherever it’s always easy to reach, and cut and paste it into just about every online communication you engage in.

In the world of music and especially in the online world, you can often sell better by not selling at all. Offer some free content, even if just a word of advice. Visit a blog, drop a comment with a friendly piece of advice, use your signature with links … and let the other person make the first move. Sure, there are places where the call to action is necessary and expected, such as in announcements of a new release or emails telling people how to buy tickets to a show. For the most part, social media has to be social first and business second. But if you do it right and consistently, that can be a very significant second.

Step 3. Marketing and Promotion

Only after you’ve spent some time both listening and engaging should you dive headlong into comprehensive social media marketing. Once you’ve absorbed the protocols and best practices, which you can do in the space of a month or so (with Steps 1 and 2 above), you’ll be better equipped to have an intuitive and practical understanding of what works and what doesn’t. This does not mean it’s time to stop pursuing the first two steps. You should make sure to keep educating yourself and refreshing your awareness. But there are only so many hours in the day, and some of them must be spent on very direct social media marketing. Much of this will still take the same form as Step 2 above (Engaging), but it will be a little more purposeful, perhaps even scheduled, and with more clearly defined marketing messages.

Say you decide that every other Tuesday morning, you’ll send out an email newsletter with recent news about your recording or gig, or if you don’t have any news, something about a topic that will interest your subscribers. Incidentally, research shows that Tuesday morning between 10 a.m. and 11 a.m. is reportedly the best time for emails to get opened and read, and for links to get clicked. On Mondays and Thursdays you might post a general music news item on Twitter and LinkedIn. Even if the item is not about you, the link in your signature goes back to your site, or at least your profile. Each month you might offer a “first of the month” track . This can be a free track of some outtakes or a live performance or even an old previously-released track. The important thing is not the track itself – it is the continued engagement with your audience and the opportunity to stay on their minds (“top of mind,” in marketing speak) and offer them opportunities to connect back to you.

That should be enough to get you started! I must re-emphasize how important it is not to get too immersed in social media and online marketing, because it is just a tool and should never become an end in itself. Because if that happens, you will pretty much be giving up music. As independent music marketers, we do have to be good at SM, but it is not our core business. Music is still our business, and if you find yourself losing that focus, you have to discover what is distracting you from your primary focus and find ways to minimize the distraction. Of course, it will take some time to get up to speed on marketing channels and marketing in general. But it’s better to devote some time to it now, and make a short-term but concentrated effort on getting the basics under your belt so that you can integrate them into your normal stream of doing business. This way, it doesn’t become a long-term diversion from what you are really supposed to be doing.

What’s in a Brand?

Branding Overview

We hear plenty of talk about how important branding is, but beyond the product name and logo, what does it really mean? Our good friends at the American Marketing Association define “brand” as follows:

A name, term, design, symbol or any other feature that identifies one seller’s good or service as distinct from those of other sellers.

Hmmm. Not so helpful. But then, just a little further down the page, they define brand once again, going into a little more detail:

A brand is a customer experience represented by a collection of images and ideas…Brand recognition and other reactions are created by the accumulation of experiences with the specific product or service…A brand often includes an explicit logo, fonts, color schemes, symbols, and sound which may be developed to represent implicit values, ideas and even personality.

Now we’re getting somewhere. Words like “experience,” “ideas” and

“personality” really resonate nicely with musicians and these are the types of concepts that we want to transmit to our customers via our marketing. So if that is what branding is all about, then bring it on!

Going forward in this unit, we’ll use “brand” to mean the collective experience that customers have of you and your music, and not simply your logo. Thinking of it this way gives you the advantage of seeing yourself and your music more completely from the customer viewpoint. Of course, your name and logo are important, and certainly some of the ideas and personality we want to transmit to customers can be contained within them. A band with an aggressive sound will typically have an aggressive logo, and a mellow folk band will have a more folksy, peaceful image. But you can’t stop there. As a musician, you may be marketing yourself and perhaps your band or group, but you also are marketing your products: your recordings, performances and merchandise. It goes without saying (but I’ll say it anyway) that these must all be consistent and project the same ideas and personality in order for your brand to be clear to customers.

To ensure consistency, companies often have branding guidelines (sometimes called the brand book) that describe how to use their logo, company name, colors and any other elements that may be needed for any type of marketing collateral. (Collateral refers to just about any media used for marketing, from postcards to emails.) It is quite useful to have all your branding information collected in one place and at your fingertips, especially if there are other folks who may be creating marketing collateral on behalf of your brand. For example, if you ever do performances at a venue that handles their own marketing, you will most likely need to supply them with some of this info, or risk the misrepresentation of your brand. It’s a good idea to have all your branding materials together and at the ready in your own brand book – both electronic and printed versions will be helpful. Ten minutes before a deadline is no time to be looking for the most recent version of your logo or a web-ready headshot.

Let’s consider a musical act’s typical branding needs. Here is a list of the components that help create the brand, and may need to be included in your

brand book:

1. Name – Musician or band name

7. Logo – The logo should be rendered and available in both black and white and in color, as well as a black version with a white background and a white version with a black background if possible. You will also need several different formats like JPEG, PNG and EPS, and a printed reference sheet showing how the logos should look.

8. Color scheme – Choose a group of colors that you will use in designs, websites, postcards, newsletters, and all your other marketing collateral, including any items that contain, or somehow reinforce the logo. Of course, almost everything should contain your logo, so be sure you make wise choices here. These colors should complement the logo and not distract from it or overwhelm it. You should include both RGB values (for web) and CMYK values (for print) for these colors, so if someone other than you or your designer are creating something that involves your brand, they will know exactly what to use. These “values” are sets of numbers that are essentially proportions of certain colors – Red, Green and Blue for RGB, and Cyan, Magenta, Yellow and Key (black) for CMYK – that when mixed, result in a specific color. Talk to a designer about this. It can get a little technical, but it really is important.

9. Font – You may have a custom-designed font (which may also just be an illustration of your text) as part of your logo, but you probably can’t use that for the rest of the copy on a web page or marketing piece. Only certain fonts can be used on the web, and if anyone else is deg a marketing piece for you, they won’t have the ability to use your custom font. Select only a few standard fonts that work well with your logo and your overall imagery. If you are a speed metal band, you probably don’t want “Curlz” or “Lucida Calligraphy” as your primary font.

10. Usage guidelines – Don’t leave this up to chance. If someone who is not on your team is deg something that will promote your brand, give them some guidelines, such as “don’t skew the logo,” “the logo should only appear once per page,” “use only Calibri fonts,” etc.. Again, a few hours with a qualified designer will really pay off if you want your branding done right.

11. Photos – A good photo is essential and you should have both black and white and color versions. High-res (for print) and lo-res (for web) are both needed frequently, so have them on hand and ready to go. Also, if you have several in your group, be consistent. All the pictures should be in the same style and ideally from the same photographer, although I have seen some very different “personality” shots work together as a group, though that’s uncommon. We’ve all seen examples of websites or posters where three people have nice pro quality headshots and the fourth has a picture taken by a friend with bad composition, bad lighting and worse. One bad apple can indeed spoil the whole bunch.

12. Boilerplate – This is a short blurb that you can use to describe your brand, which should be quite similar if not identical to your short-form value proposition. Have a Word or Text file ready to go that you can easily email to designers, clubs, promoters, agents … anyone who might need a quick description of your act. that in order to control how people perceive your brand, you have to control the words, images and everything that is commonly used to represent your brand. Don’t leave it to chance. Without your help, you can’t rely on the hope that a club’s poster designer will describe your group in the words you prefer. Don’t let them call your group a “modern jazz band” when you really are a “New Century Free Jazz Quartet.” It’s up to you to give them the right words to use.

Holistic Brand Management

Most of what’s been just described has to do with the visual representation of a brand, but that’s just the tip of the marketing iceberg. Market-savvy brands know that customers can be reached by more than just visuals. There are entire narratives about brands that engage customers over time and create brand experiences that resonate with the customer on a deeper level. In an earlier unit we discussed both affective and cognitive reactions to marketing, and learned that affective reactions are those that are more emotional and thus typically more powerful than the cognitive (intellectual) reactions. Doesn’t it make sense that the brand should consistently engage with customers on the affective level, and not just leave affective engagement to occasional marketing messages? Think of how successful brands like Apple, BMW, Coke, Harley-Davidson, Nike and others have been engaging customers with their brands for decades, and in so many different ways.

Some marketers talk about the brand narrative, the brand story, and brand equity. These are just different for describing the collection of associations that a customer might have with a brand over time. That might include everything from a customer becoming aware of the brand’s logo and products to a customer developing associations between a brand and their own special occasions, rites of age, relationships and other life events that are imbued with personal meaning – for example, all of us certain periods of our lives partly by ing the music that was important to us at that time. Our affective memories can also be attached to a first car, the string of iPods we bought, the sneakers we wore in high school, our TVs, phones … just about anything. The more positive associations customers have with a brand, the longer they remain engaged with that brand and the more they will buy from the brand. Even more importantly, if the experiences are good and the brand has fostered a natural development of the relationship, a customer might go even further and become a brand advocate or ambassador.

A key word in that last sentence is “natural,” and that’s where the holistic concept comes in. The term “holistic” has been popularized especially in the fields of health and medicine and refers to treating the mind and body together and not just addressing symptoms in isolation. To recast this term in a marketing framework, if a brand not only makes a customer aware of its logo and products, but also stirs emotions with its color scheme and imagery, provides continuity of memorable messages, asks for occasional , provides a reward or thankyou for loyalty, does something just to be nice without the goal of selling… this can be extremely effective in creating engaged customers. But this all must proceed in a fairly natural way. If a customer feels coerced or pressured into advocating for a brand, then they probably will resist and even worse, they may bouth the brand. But with a holistic brand management approach that cultivates multiple points of engagement with customers, that simply won’t happen, and the whole process will appear to be quite natural.

Brand Management in Music

Without going further into branding theory or psychology, let’s have a look at how branding and brand management can apply directly to music marketing. We will take the holistic approach discussed above and try to engage the whole customer. Therefore, we will look for elements that engage the mind, the emotions, the spirit, the body, and as many aspects of the customer – a living breathing human being – as possible. Fortunately for us musicians, our product naturally engages customers through multiple senses and taps the affective process of decision-making more so than the cognitive, so we have a little bit of an advantage over more utilitarian products.

To manage your brand well, you must be aware that a customer has different levels of meaning associated with your brand. In the unit on Value Proposition we discussed four types of benefits associated with a product: Core, Expected, Augmented and Potential. Similarly, brand meaning or the brand story has different levels of meaning in the eyes of the customer. If you understand this, you will be able to manage it. , the term “manage” implies creating value for both the customer and the brand.

First of all, a customer will derive meaning from the brand’s physical attributes. In the case of music this will include both the sound of your music and the format in which it is presented, so that might include CDs, mp3s, and even vinyl. A less common format like vinyl automatically suggests certain meaning about a brand. But it is up to you to manage the physical presentation to most accurately convey the brand meaning you want customers to perceive. The choice of vinyl can mean that the artist is old-fashioned, or an audiophile purist, or simply that they offer dance music, much of which is still made available on vinyl. Again, it is up to you to help the customer understand what brand meaning is represented by the physical attributes of your product.

Related to the physical will be the functional. How does your music function in the eyes (or ears) of your customers? Does it make them feel happy, rebellious, excited, relaxed? For more utilitarian products (paper plates, desk chairs, copy paper) function is a lot less emotionally charged and more … well … functional. But music has the advantage of being more affective and emotional than most products. This is a big reason why most people are typically very attached to the music of their past. In your marketing efforts, you should do whatever you can to help your customer understand and accept how your music was designed to function.

We must also consider the social meaning that customers associate with a brand. Does it make them feel that they are part of a group? Cooler than other folks? More sophisticated than other folks? Less sophisticated? These social meanings are extremely important in music, especially with younger fans who may be establishing a significant part of their identities by way of their music choices. So make the social meaning that you believe customers will derive from your music as clear as possible without pandering or insulting anyone’s intelligence. Headbangers, hip-hoppers, and opera fans are all part of different social groups by way of their music choices, and the successful musicians in each of those styles reinforce the meaning of their brand through well-defined marketing messages.

While much of this might be quite obvious, it is important to keep putting the brand narrative not only in front of our customer’s eyes, but in front of our own eyes as well, especially if we are in charge of our own marketing. It is surprising how far off track we can get if we don’t continually remind ourselves of what is important to customers. Basic concepts might seem so basic that we think we can just learn them and forget them, but experience proves that we have to be more vigilant. While marketing is both an art and a science, as in the case of market research and statistics, for example, most of the marketing we’re talking about is more on the art side. In fact, it’s not at all hard to understand and much of it may seem like restating the obvious. But like most arts, and musicians know this well, practice of the fundamentals should be with you throughout your life.

And so it is with marketing: the idea of the brand narrative reminds us to keep telling the story, even though it is often the same story.

Developing Your Personal Brand

Although it may be tempting to consider a musician and their music as one and the same thing, that is not exactly accurate. If the people behind the music and the music are very much on the same page, then that’s great and as mentioned earlier, consistency is important. But while we expect some consistency between a musician and his or her music, that may not always be the case. For example, if a metal musician is actually very mellow, but their music is aggressive, then we need to separate the musician and music brands just a bit. Keep in mind all our earlier thoughts about authenticity. It is important to project the real you, even if it does not exactly match the image of the band you are in. In order to do that, you have to develop your own “personal brand.”

In developing a personal brand, you need to create a brand personality and a customer experience that a customer has any time they connect with you. Marketers often refer to the idea of touch points – instances of interactions between a customer and a brand, or between a musician and a fan. We are not just talking about transactions or financial exchanges here – far from it. The idea of creating a personal brand is more about interaction and communication than any specific transactions. And the good news is – and you are going to like this – you do not have to be anyone but who you are to do this effectively. Let me explain.

Many of us grew up with a music scene that was extremely over the top, pretentious and all about image and showmanship. While showmanship certainly still exists, it is far less important now than ever before, unless you are hoping to be the next Lady Gaga. Now, nothing against Gaga, but her type of brand could only be authentic and truly representative for a small number of artists

Like Lady Gaga, the top echelon of mega-stars have their own marketing machines in place, and I am more concerned with how the other half million musicians (who will never be anything like her) can make a living. And if you happen to ever become a huge star like that, then good for you. Send me a thank you card if I helped in any way! But let’s face facts. Gaga’s last album went platinum in the first week. There were only about a dozen or so platinum records last year, although there were over 70,000 released and tracked by Nielsen SoundScan. Point taken, I hope. I digressed a bit but we need a reality check if we are going to do this right. The point I was getting to, is that this level of album sales and the “brand success” of someone like Lady Gaga, or even Eric Clapton or Pavarotti, is reserved for a very, very few individuals in any decade.

The good news is that, today, you can be whoever you want to be or better yet, whoever you already are, and find a way to create a personal brand. So before we move on, I’d like you to do a quick assessment of who you are – that’s who you are right now, not who you would like to be. Take a minute to answer the questions below. This may seem silly and obvious, but be honest and give it a whirl. With the good dose of marketing knowledge that you now have, I am hoping that this will help you to imagine your personal brand and its marketing messages more clearly. Bear with me if this feels a little like a quiz from a selfhelp book. On the other hand – we are talking about helping ourselves, so maybe that’s not such a bad analogy.

Personal Branding Exercise

1. I am __________ years old.

13. I am a

(male/female/LGBT/grandma/metalhead/hippy/hamster/republican/democrat/anarchist/com ____________ and an aspiring or actual

(musician/songwriter/manager/lawyer) __________

(I’ll leave out the suggestions from here on. You get the idea.)

14. To pay my bills, I have a day job as a _________.

15. I like to read about _________.

16. I like these kinds of movies: ________.

17. My non-music hero/heroine is _________.

18. Three things I love about music are __________

__________

__________

19. My most distinguishing feature is _________.

20. When I am alone, I often think about ____________.

21. My temperament can be described as __________.

22. The thing I value most in life is __________.

23. One thing I’d like to change about the world is __________.

24. I want people to understand that I am __________.

25. When I hear my favorite music, I feel ____________.

26. I get really angry at ____________.

27. My favorite recreational activity is ____________.

28. My best/worst memory from high school was ____________.

You can add to these questions if you like, and to really explore yourself, you probably should. The very act of making your own quiz will be quite instructive. But the important thing is to discover some things about yourself that you can and should use to develop and communicate your personal brand. Now keep in mind – and this is very important – that these things need not and most likely should not be anything earth-shattering, unless there is really something earthshattering about you. Being weird or dramatic just for its own sake may be fun, but it gets old quickly and customers can only be fooled for so long. The people you want to connect with, those that will most resonate with your personal brand, are not likely to have any spectacular characteristics themselves, and they may even find it difficult to connect with someone who does. Once again, there will always be a Lady Gaga and a Pavarotti in every generation and in pretty much every style of music. But the arc of recent music history has largely demystified the “rock star” mythos. These days, stars are often quickly revealed to be rather ordinary people, due in part to the wealth of information we have at our fingertips. Over the years, I’ve met a handful of the big stars of styles I really like and found them to be pretty darn normal. That forced me to reflect on my perceptions, and rather than diminish those people in my eyes, it gave me a deeper understanding about why I liked their music so much. Their music became somehow more real to me because they were real people I could connect with and they were making this great music! Anyway, I wish you abundant courage to be who you are and to start using what you find out about yourself to build your personal brand. It’s the right way to go and I promise you that you will appreciate the results.

Personal Brands Mean Authentic Products

The brand represents a product, and in this case that’s you. to emphasize things that are genuinely you and that you are comfortable with. Give yourself time to make sure you understand this. A hot pink guitar may look pretty cool (maybe) but if you make it part of your brand simply because it draws attention and you are really not comfortable with it, eventually it’s not going to work; it may even backfire.

Of course, you will most likely change as you mature, and that’s all well and good. Consistency is important, yes, but rather than tie consistency (and your brand) to any one thing, one look or one sound, let it be tied to you, the person. Eric Clapton is a great example. If any of you don’t know who that is (alas!) stop right now and hit the web to find out. Clapton’s personal look and style of music have been through a dozen or so mutations over the years, but none of it ever seemed forced. It was always him. There were some elements of consistency, like his usual choice of a Fender Stratocaster guitar, but the man evolved and his audience accepted every new phase because it was always the true expression of who he was. So in 1969, we may have seen the heavy-rock hippie Clapton wearing a dashiki (and playing a Stratocaster) and last week we may have seen the elder statesman of blues-rock Clapton wearing an Armani suit (and playing a Stratocaster), but it was all real and authentic. So…be the product – and be real!

Taking Care of Business

Hope is Not a Plan

Many musicians, and creatives in general, have an aversion to planning. For the most part, we are quite comfortable with improvising, trusting luck and making it up as we go along. But while those characteristics may be desirable in the creative process, they do not help very much in business. There is too much competition, too small a pie and quite simply too much at stake to trust your music career to hope. , hope is not a plan. We’ll get to the actual marketing plan in the next unit and you can use as it as guide for creating your own. Or you can just copy the main headings and sections and fill in your own information. Keep in mind that in addition to a marketing plan, you might want to consider a larger business plan, of which marketing is a significant component. Or you may just want to do a really good marketing plan and perhaps discuss a more comprehensive business plan with a business manager or someone else who is knowledgeable about the business of music. Whatever you choose, your plan should make sense, not only to you, but to an objective reader as well. While it is business plans, not marketing plans, that are typically presented by entrepreneurs to banks and venture capitalists to secure funding, it is still helpful to imagine that a person with a critical eye for business will read your marketing plan. Will it make sense to someone who is not as close to the project as you are?

Too many musicians confuse a plan with a goal. “I’d like to sell thousands of CD’s” is not a plan, it’s a goal. To really move an idea from being an aspiration or fuzzy goal to an actionable plan, one device that both business plans and marketing plans make use of is the SMART Objectives. SMART stands for Specific, Measurable, Achievable, Realistic and Time-bound. Sometimes the word Goals is substituted for Objectives so be warned, not everyone uses the in exactly the same way. In my view, the Goal should be a much higher level target, like “I want to live a happy and successful life as a musician,” and the Objectives should be part of the plan for reaching that goal. So for example, if your objective is to sell lots of CDs and become an international music

sensation, that is not a SMART Objective. However, if your objective is to sell 2,000 CDs and 3,000 s in six months – that is specific, measurable, presumably both achievable and realistic, and certainly time-bound, so it fits the definition of being a SMART objective. Marketing plans should start with the goal and the SMART objectives, and proceed from there. You will see an example in the next unit.

The plan should be written down and function as a reference document for your marketing activities. Don’t think that because it’s written down it can’t be changed. In fact, it can and should change as new information arises and as you learn from experience and by trial and error. A plan does not eliminate error, but it should substantially minimize the likelihood and effects of error. This should be a living document, and one that grows with you. I like to compare it to a good music teacher: the best teachers are good guides who have the ability to be flexible and react to your needs as a student, while facilitating your ability to learn by doing. They help you learn how to learn. A marketing plan should do the same thing. The marketing plan does not do the work for you, nor does it provide a magic formula for you to follow. You must still do the work, but the marketing plan helps you minimize errors and wasted time.

The very act of writing something down allows us to think more deeply about the subject. Even better, once we read something back to ourselves or others (and I mean out loud) we experience it on an even deeper level. If something does not make sense when read aloud, then it does not make sense. Period. This simple trick of reading things aloud can make better writers of us all, and it helps with creating any kind of document, including marketing plans. Above all, marketing is about communication, and if our marketing plan does not communicate our thoughts back to us clearly, then it could probably use a bit of a rewrite. In short, get your plan together, make it look good, keep a print version and an electronic version handy at all times and give it a place of honor and influence in your career. It can make all the difference.

Establishing a Business Entity

You will almost certainly need to create some sort of business name in order to accept payments, open a bank , file taxes and take advantage of the benefits of having your income and expenses flow through a business. If you are going to open a business with a bank they will require something on paper saying that you, John Smith, are doing business under the name John Smith Music, Inc. or the John Smith Band, or whatever you deem appropriate. Even if you are just a solo artist, you will probably want to form “John Smith Music, Inc.” or some such name under which you do business. In many cases, filing a fictitious name certificate or a “doing business as” certificate (DBA) is sufficient. The titles of these documents vary from state to state and may be filed at county clerk’s offices or other town, city or state offices, so check with your town or your bank as to what type of certificate they require.

Note that the business of bands is a bit more complicated than for individuals, and most likely should be incorporated either as a Limited Liability Corporation (LLC), a partnership, or an “S” corporation. This is something you need to discuss with your bandmates and a trusted advisor or attorney. Also, just as you copyright your music for protection (you do copyright your music, don’t you?), you should also protect your business name. This is done through filing a trademark (not a copyright) with the United States Patent and Trademark Office. Visit them online here: http://www.uspto.gov/. You will have to search first to make sure your chosen name is available, and then there is a filing process and a fee (of course), but you want to make sure you do this properly, before you have years invested in establishing a business name only to get slapped with a lawsuit because someone else owned the name before you.

The above possibilities all involve filing different registration forms, and of course, different tax forms. Each approach has pros and cons regarding how they affect your tax liabilities and even in how you much exposure you have to

lawsuits. It is important stuff, and although not terribly complicated, it is well beyond the scope of this book to cover, especially since these rules vary by state. I strongly urge you to speak to an attorney or someone knowledgeable on doing business in your state. To get familiar with the terminology and differences, the IRS provides good resources on their small business pages at the following address: http://www.irs.gov/Businesses/Small-Businesses-&-SelfEmployed/Business-Structures

Also, the Small Business istration has great resources to help get you started at www.sba.gov. Both organizations are surprisingly helpful over the phone as well, so don’t be afraid to give them a ring. The government is very happy to help you form a small business because it helps the economy – and, of course, they will get their share in tax revenue.

Dollars and Cents

Once you have determined the best business entity for your needs, you have to start taking care of the business itself. This is beyond the creative and day-to-day needs of making music. This is about the business, and the lifeblood of any business is cash flow. Income and expenses need to be tracked and available for your ant at tax time, so get used to keeping receipts and logging what comes in and what goes out. Unless you can afford a frequent visit from an ant or bookkeeper, you will want to learn how to use bookkeeping software like QuickBooks, and it does not hurt to get friendly with Excel or some other spreadsheet program.

All the marketing knowledge in the world will not help if you don’t tend to your finances. You don’t have to become an ant or hire one full-time (although hopefully you will need to soon because you’ll have so much money coming in!), but you do have to know a few basics. Again, the SBA offers some good advice on bookkeeping and ing for small businesses so at the very least, get to know a thing or two about this very important topic. That said, if you can swing it, hire someone to help you with this, especially if you are numerically challenged like I am. However, I am very happy that I worked through my trepidation and learned about this subject anyway. Now, even though I do hand much of this over to an ant, I can still speak intelligently about the subject and I can handle my own bookkeeping without a problem.

Teamwork and Delegation

If you haven’t gotten the idea that this is all a good amount of work, perhaps you should review what you’ve already read here. I’m not going to lie to you. It is a lot of work. As we said early on in this book, musicians today need to have more business knowledge than ever before, and that is in addition to knowing their craft. We need to know how to write music, play an instrument, perform, and so much more. But we all have limits, and despite what the DIY enthusiasts seem to suggest, you cannot do it all yourself. Hopefully, this book has given you enough knowledge to make intelligent choices about what you’ll handle yourself and what you’ll delegate. And you must get comfortable with delegation, even if you know how to do something yourself.

Think of successful teams. Do you think a successful race car driver like Jeff Gordon knows how to replace a spark plug? Of course he does, and he knows a whole lot more about cars than most folks. But to create a winning team, he leaves the spark plugs to others while he focuses on what he is best at: driving. Most football and baseball stars can play a variety of positions with a good deal of proficiency, but they divvy up the responsibilities and thus, the whole becomes more powerful than the sum of its parts. And any successful business has people who specialize in different areas: ants, HR, marketing, istration, facilities and so on. You may not have the luxury of delegating all of your tasks, but you should start as soon as you are able. Time is worth an awful lot in the indie music world, so if you can afford to pay someone ten bucks and hour to help you with a task, or if you can offer a manager 15% of your revenue, then by all means, consider doing so.

Teams vary in size according to needs and budget, but all the roles must be covered. A successful music act needs writers and performers, a business manager, a personal manager, a marketing manager, a road manager, a stage manager, a road crew, an agent, a stylist, a producer, an engineer, a designer, an

attorney, an ant, a web manager, a CD manufacturer, a publicist, and the list goes on and on. It’s unlikely that an indie musician can afford to hire different people to fulfill each of these roles, nor would that be absolutely necessary for every act. But at some point, almost all of these roles will need to be covered by somebody, and typically one person will cover a number of these roles. Often, that one person will be you. Ignoring your needs does not make them go away, and it is better to be informed and make conscious decisions about what you will handle and what you will delegate. Knowledge is power!

Education

Getting to the end of this book indicates that you believe in educating yourself. Don’t ever stop. Pursue your education on subjects that matter to you and your career as vigorously and as often as possible. You don’t have to become an MBA or a A to run a good music business, but you will have a distinct advantage if you at least know a few things about the important aspects of the business you are in. Aside from knowing how to make music and perform, it is my personal belief that marketing is the next most important thing to know. Some good people-skills and a dash of psychology don’t hurt either.

Oddly enough, the more educated you become, the more able you are to decide what you don’t have to learn. When you approach the music business as a business person (versus as a musician) for the first time, it can seem quite daunting. Even the list we just discussed of all the different roles needed for a successful musical act can seem a little scary at first. But the quicker you learn what it is that you do and do not need to know, the better off you will be and the more time you will have to focus on creating and performing music. So take classes, read books, go to industry events, watch videos, visit websites and blogs, and make learning a steady part of your diet. But, always, of course, make sure you leave enough room for making music!

Marketing Plan Template

Outline First

An effective plan usually starts out as a draft. Good usable creations of any kind (songs included) seldom arrive in your mind fully formed, like a divine instant message. By creating a simple outline, you can easily focus on only what is relevant to your plan. If you start with a basic structure, you can fill in the missing parts and make it better as you go along. You might decide to use the headings in the sample plan that follows to create your own outline –you’d fill in the details to suit your needs. There is no “one size fits all” marketing plan. I’ve seen usable marketing plans that run from a page or two up to forty pages or more. In any case, what is most important is that the plan is a flexible, living document, always at the ready – but always ready to be changed for the better.

How to Use This Plan

Hopefully, you won’t create your marketing plan by just filling in the blanks and then filing it away somewhere. You should be making changes to it continually as you work through the launch, growth, maturity, and even decline of your current offering. I know no one wants to imagine that their product will decline, but few things go on forever – and that’s not a bad thing. Better to plan for it than to be surprised when the fall-off inevitably occurs. Besides, change creates room for new ideas, and thus growth, and an expansion of your product line. Create a good, strong first draft. Then keep making improvements. Even if you think of something that seems like a small thing, put it in the plan, save the plan with a new date or draft number, and keep at it.

What you have in the following pages is a marketing plan for our old friends The Imaginary Band. To recap, they are getting ready to release a second CD with s available (of course), they’ll do a little touring, and somehow they intend to significantly boost their career level and income. In the interest of trying to represent the “middle” of the population that is likely to be reading this book, I have made the following assumptions:

The band are not beginners, nor are they where they would like to be in their careers.

This is their second CD, financed mostly on their own.

They have a manager – a well-intentioned friend with some business skill, but

not very many useful connections or real music business experience.

They will handle most of their marketing chores and expenses on their own.

They are planning a regional tour covering the mid-Atlantic states, roughly from Virginia up into New York, and doing most gigs on weekends so they can keep their day jobs.

The plan is written from their perspective, in the first person plural, so you will read things like “We have just completed recording 12 original songs…” and so forth.

They have read this book and realize that having a plan is a really good idea.

This may sound familiar to a good number of you, I would bet. Okay – off we go!

Marketing Plan for CD Launch and Tour

1. Summary

The Imaginary Band (TIB) has been together for about three years, and we have just completed recording twelve original songs of completely new material. TIB is preparing to release the music in CD format as well as in digital s, and the music will be made available to the public via a number of appropriate channels. The group is also preparing to tour the mid-Atlantic states on a limited basis, and to cover expenses, we will be using the group’s modest savings, revenue from CD sales and performances, and where needed, supplying money to cover expenses via ’ contributions.

2. Purpose of Plan and Needs Assessment

The purpose of this plan is to act as a reference for the marketing activities that will be ing TIB’s CD release and tour. Needs assessment is always difficult in the music business because it is hard to establish an actual customer need for any particular type of music, and there are so many available substitutes. However, people do need to feel good, forget about their troubles, and enjoy periodic indulgences in musical “journeys of the imagination” – a term that we use to describe our music. The group believes that its imaginative yet approachable music style resonates with a reasonable number of customers (as discussed below in the target market section).

3. Situation Analysis

Company/Band Analysis

The band has been together almost three years and we have developed a decent following in our home state of New Jersey. Capable of filling modest clubs in the area once or twice a month, the band has also been performing at mid-Atlantic colleges and clubs periodically over the last several years. An email list of more than 1,200 names is kept current, and the monthly newsletter keeps fans up to date. Performances and website traffic typically yield another 20 to 50 names per month. Commitment among is good, but all of us are also obligated to full-time jobs, although there is some flexibility to take time off for tours that may extend past the normal weekend hours. In addition, the group has business guidance from our manager, who is currently working for 10 percent of our earnings. We also enjoy occasional promotional assistance from a core group of fans and family who have pledged their in “spreading the word” at no cost. The band is organized as a Limited Liability Corporation (LLC) under the laws of the state of New Jersey.

4. Goals and SMART Objectives

The high-level goal of the band is to make a very good living from music and enjoy careers as active creative musicians. To that end, we have established the following SMART objectives, which are expected to help achieve the goal.

SMART Objectives

Specific – This plan is to help activities over the next year. TIB expects to sell 10,000 full CDs and 25,000 s of single tracks. In addition, we will perform at a minimum of 30 new venues (at least 60 shows) during the course of the year.

Measurable – The numbers above can be easily measured and will stand as evidence of success. In addition, revenue generated by the sales and performances should be about $250,000, which would be significant progress towards the higher level goal of the four earning their living completely from music.

Achievable – The above results are within the realm of reason and adherence to the plan, along with any necessary flexibility, should make the outcomes achievable.

Realistic – Many other bands and individuals have achieved results that are

comparable or even better, and our band has a good platform from which to start, as well as some funds, strong member commitment, and assistance from our manager and team.

Time-bound – The plan is to be executed over the next twelve months, so it is neither too ambitious nor will the execution and success be allowed to wait for a “more convenient” time.

5. Target Market Analysis

a. Market Overview and Demographics

After observing fans over the last several years (including obtaining information from both informal and written surveys), TIB has determined that our market is predominantly in the 18-35-year age range, about 60 percent male and 40 percent female, mostly urban with mixed ethnicities, and typically middle-class with aspirations to have decent jobs and raise families. Since we have yet to perform outside of the mid-Atlantic states, our market is geographically concentrated in that area, although online sales have enabled reaching some customers both across the U.S. and internationally.

b. Values and Needs

Although it is hard to establish an absolute need for music, or for our music specifically, the customer base does have some recognizable values and associated needs. People need music to have a transporting effect and offer some relief from the daily grind. At performances, most of our fans want to cut loose and have a good time, but they still need to get up the next morning and either work or pursue their daily lives. Our fans are not likely to be prone to extremes of behavior, and they have inclusive if not decidedly liberal values. They enjoy fun, imaginative music, and they are willing to get “out there” a little bit at a show, as long as they’ll be able to come safely back home.

c. Customer Lifecycle and Buying Decisions

Our customers find us in a variety of ways, including at performances and via the internet. Referrals from existing fans are also a strong source of new followers, so these will be cultivated to the fullest extent possible. In almost all cases, a customer’s buying decision is made after hearing our music. At that point they may try a few songs via . Many will purchase an actual CD only after coming to a live performance; we offer signed copies and band are available after performances to make personal connections with fans.

Naturally, some customers will drop off as time es and tastes change. We expect a natural attrition rate of at least 20 percent per year. Also, for the long term, it will be challenging to keep customers engaged for five or ten years, so the band will have to be mindful of changing customer tastes and make an informed decision regarding whether or not to change with our fan base, or try to remain the same. Since change is inevitable, it seems to make sense to us that we will evolve, although there are many examples of bands that have done pretty much the same thing for decades, with continued success.

6. Industry Analysis

PEST Analysis

The following PEST analysis describes some Political, Economic, Social and Technological factors and trends that exert both positive and negative influences on the music industry and therefore on the success of this marketing plan.

7. Competitor Analysis

TIB must contend not only with competition from dozens of other bands in a similar situation, but also with competition from major label acts in our style. Customers have limited money to spend, and they will spend it first on music that they know and already follow. Also, since music is largely an optional purchase, the band realizes that it is competing with other necessities of life. Lastly, we understand that we are also competing with free or discounted versions of our music available on the internet through both file-sharing platforms, YouTube, used CD resellers, as well as illegal music distribution methods.

Regarding price competition, since most music is priced at similar levels, there are few distinctions to be made. However, many competitors use value-added strategies like free tracks, -only discounts and exclusive offers, pricing and other strategies, all of which will be explored as the plan evolves. We have made a conscious decision not to be too low priced in order to influence the customer perception that we are a quality band worth paying for.

8. SWOT Analysis

The following is a high-level view featuring only some of TIB’s perceived Strengths, Weaknesses Opportunities, and Threats.

9. Product Overview

The product line consists of several key items:

A physical CD of new TIB music

s of the new music available online

Back catalog of previous CD, previous s, and several unreleased tracks that may serve as bonus tracks or added-value content

The band’s live performances

T-shirts for sale and free buttons and bumper stickers

10. Unique Value Proposition

After completing the six-step value proposition builder, the band has distilled its value proposition into this short statement, which can be used as the basis for copy and marketing messages:

The Imaginary Band takes you on a journey of the imagination with music that reaches beyond the formulas to find sounds that are sensual, atmospheric, exciting, and yet still somehow familiar. Flavored with sounds from distant lands, our music offers an escape from the mundane, yet we always bring you back home. Our lyrics reflect experiences common to us all, and our mix of electronic and acoustic instruments gives your ears, your heart and your body a delicious treat that will leave you satisfied, yet always ready for another journey. When you listen to our latest recordings, there are no artificial production gimmicks to hide our true sound. So come to a show, some tracks or buy a CD, and have a pleasant trip!

11. Marketing Strategy

a. Market Segmentation

Our market is generally comprised of 18-to-35 year olds, mostly mid-Atlantic state residents with some customers extending along the East Coast, and isolated online customers from throughout the U.S. and abroad. While we might be able to segment further, for the purposes of this plan, we do not believe there is a need to create different messages for sub-segments of our target market. When the band decides to pursue markets with different characteristics or in different geographic areas, we will amend our plan and strategy accordingly.

b. Market Mix Strategies

To reach our target market, we will use the following mix of strategies and tactics:

Email newsletter 2 X per month

Press releases through PR Newswire

Solicit local press through existing relationships

CD and performance reviews

Weekly Facebook and LinkedIn updates

Daily Twitter posts when touring

New photos on Facebook and Pinterest

Weekly blog posts on our band website

Ads on friend and partner websites

Ongoing performance schedule; at least 60 shows this year

Customer Relationship Management (CRM) activities to encourage advocacy

Interviews on college radio

YouTube videos

Contests and giveaways

“ only” content for long-time fans

12. Financial Assessment

a. Financial Assumptions

For the purposes of this plan we are looking at the financial assumptions and projections relative to the CD only. There will be other income and expenses related to the band’s performances, but that will fall under the larger business plan for the band and not this plan which is specific to the launch and marketing of our new CD. The plan is for the next five years, although it is certain that we will have to adapt and adjust the plan as needs arise and new information becomes available. To that end, we have made several assumptions which will be reflected in the spreadsheet below.

CDs will be sold at $14.95 with a manufacturing cost (Cost of Goods Sold or COGS) of about $1.20 per unit (see COGS and duplication costs on accompanying spreadsheet).

Operating expenses will increase each year and the tax rate, which is for an LLC will remain constant at 9%.

We are assuming sales of 10,000 CDs and 25,000 s, which is expected to decrease by half during 2014 and then again by half in 2015 after which we expect sales to remain constant while we release another CD.

Most of the marketing expense will be in the first year, and then there will be a decrease as less is spent exclusively on this CD.

Our greatest expense is travel and lodging, and we have assigned roughly half of that yearly number to this marketing plan. The other half is assigned to our performance expenses.

The bottom line result of an expected net income of $118, 491 is the result of CD sales only and not revenue from performances. It is yet to be decided how much of our net will be split among the band and how much will be reinvested in the band’s activities.

b. Pro Forma Income Statement

13. Implementation, Management and Evaluation

Any plan is only good if it is put to use, managed and updated in a consistent fashion. The band will hold monthly business meetings with our manager and all to discuss progress on the plan and any changes that may need to be made. In addition, we will hold quarterly meetings to look at financials in more depth and to make any major revisions in strategy. The band and our manager have all agreed to hold each other able to the plan, and we have agreed to be open and honest in our assessment of ourselves and each other.

Assuming the plan is well-executed, we expect to have strong cash flow at the six-month mark. At that point we will consider investing in additional promotion and marketing, including hiring a marketing consultant, a PR firm and possibly contracting with a booking agent or tour manager to develop performance opportunities. We will evaluate how best to utilize revenues, and we will conduct honest evaluations after important performances and promotional events to determine what worked well and what did not.

Conclusion

There you have it. If you build your plan with an eye on both your unique situation as well as the principles outlined in this book, you are going to be in better shape than most of your competition. By the way, this might be a good time to revisit Question #10 in the short quiz at the end of Unit 2 just to see how your ideas may have changed.

As you can plainly see, a marketing plan does not contain any magic formula or mystical revelation that will guarantee success. In fact, it may seem like a collection of statements of the obvious. The language can be very formal or very personal; use whatever style works for you. In the previous example, I used a mixed tone…informal but still about business. If you were to bring this plan to a potential investor as part of a larger business plan, you might want to adopt a more formal tone. Again, the real magic formula is not in the plan itself, but in what you do with it. It should be something that you keep coming back to. It should be something that makes you continue to question and probe deeper. It should help you to ask yourself important questions: Why do I think 18-35-yearolds will like my music? Why will they buy it? How can I help them to make that decision? How can I keep them interested over the next five years? Should my music evolve with my audience, or should it always stay the same? Should I try to branch out to other audiences? Do my marketing materials really reflect who I am? How can I make them better? How can I make this plan better?

Get the idea? The marketing plan is just a tool, but it’s a really good tool and it’s one that should grow and change over time. Just don’t forget – as with any tool, if it just sits in your garage and you don’t use it, nothing happens. Good luck out there and feel free to drop me a line anytime. I would love to hear about your adventures in music marketing.

Appendix A

Glossary of

Adoption – The 5th stage in the customer purchase process of awareness, knowledge, evaluation, trial and adoption, wherein the customer adopts regular use of the product.

Advertising – Use of announcements and influential messages purchased in any media by businesses or individuals who seek to inform and persuade of a particular target market to purchase their products or services.

Advocacy – A 6th stage which is now commonly added to the customer purchase process wherein the customer is so pleased with a purchase that they become a “brand ambassador” and help to market the product by speaking positively about it and encouraging purchase by their friends and s.

Affective Behavior – The emotions and attitudes about a brand, ad, salesperson, etc.. that influence consumer behavior.

Marketing – A type of marketing in which online businesses or rs share revenue with online publishers/sellers (“s”) who promote their products. The s can earn money through various performance metrics such as sales, clicks, or registrations.

Awareness – The 1st stage in the customer purchase process and a way of talking about and analyzing consumer knowledge about a brand.

B2B – “Business to Business”: A company that sells its products and services to other businesses.

B2C – “Business to Consumer”: A company that sells its products and services to consumers.

Brand – The symbols and ideas that represent a company and/or product.

Call to Action – A phrase and/or graphic prompting someone to take a desired action, such as purchasing a product or opting-in to a mailing list.

Cause-Related Marketing – A promotional strategy in which a company pledges to a non-profit organization when a consumer buys a given product or service. It usually involves a promise by the seller to make a donation to the cause for each purchase.

Click-through rate (CTR) – The percentage of times people click on an ad per ad view (aka impression).

Cognitive Behavior – A consumer’s intellectual attitudes, beliefs, perceptions and reactions in response to a persuasive message.

Competitive Advantage – Something that makes a company’s products or services significantly more attractive to consumers than those of its competitors. It can be in of price, quality, performance, service or some combination of those.

Cooperative Advertising – Advertising placed by a local seller that is partially or fully paid for by a larger national seller whose product or service is featured in the ad; also advertising bought by a group of businesses to share in the cost.

Cross-Selling – Offering products and services related to a product a consumer has used or purchased.

Customer Benefits – The value that a customer receives or experiences from a product or service. This value can be either concrete, such as the resolution of a problem, or perceived, such as a feeling of prestige.

Customer Lifetime Value (CLV) – The expected amount of net profit over time a company can expect to make from a given customer. It’s calculated using metrics such as the company’s customer retention rate (how long people tend to remain customers), average sales per customer, and the retention cost (the amount of money the company spends to keep a customer).

Customer Relationship Management (CRM) – Providing a personalized experience for customers often with the help of database and computer technology that keeps track of a customer’s personal and demographic information, buying history, etc..

Demographic – Relating to the characteristics of different population segments, such as age, gender, income, career, marital status, number of children, etc..

Differentiation – Communicating to customers the uniqueness of a product or service over its competitors.

Distribution Channel – An outlet through which a company’s product is sold, such as wholesalers, retail chains, individual stores, online sellers, etc..

E-Commerce – Selling products and services over the internet.

Experiential Marketing – Inviting prospects to participate actively in your marketing efforts by offering them direct experience with your product and other relevant and engaging activities such as games and contests.

Four C’s – A modern customer-oriented marketing model designed to replace the Four P’s (see below): Customer (find out what your target market wants before developing your product), Cost (in setting a price for your product, you must also consider the cost of acquiring and retaining customers), Convenience (making it easy and convenient for prospects to find you, get information about your product and buy from you), Communication (it’s not just a one-way broadcast from you to prospects, you want to give them opportunities to interact with you).

Four P’s – Traditional marketing model: Product, Price, Place and Promotion. Also sometimes called the marketing mix.

Frequency – A measure of how many times a person, household or target market has been exposed to a particular piece of marketing (such as an ad) during a given time period.

Guerilla Marketing – Marketing through low-cost unconventional means that require more time, energy and creativity than money.

Hit – Each file sent by a web server to a browser. One webpage can consist of several files (pictures, graphics, html, etc..) and hence generate several hits when loaded. (See also Page Views and Visit)

Impulse Buy – A unplanned purchase made on a whim, without research or deep thought.

Industry Analysis – Analyzing the factors contributing to the complexity of a particular industry, including existing competitors, customer attitudes, suppliers, etc..

Influencer – A person who influences the buying decisions of people within a target market.

Integration – In marketing, this refers to the process of creating a marketing plan and marketing communications strategies that reinforce and complement each other.

Interactive – Engages with customers as individuals, encouraging and incorporating their into future marketing, using information about them such as their buying history to provide personalized recommendations.

Keywords – The words or phrases people type into search engines related to a product, problem, or topic.

Landing Page – A single web page, usually a sales page, which people are taken to after clicking on a link within an email, ment, or search engine result.

Licensing – The holder of an intellectual property (such as a song, patent, trademark, copyright, logo, or design) allows another company to use that intellectual property for profit typically in exchange for a percentage of revenues or a flat fee.

Lifestyle Marketing – Marketing to specific niches within a market based on their beliefs, values, and interests.

Loyalty – When a customer keeps returning to a company or brand to buy their products over a period of time.

Market – A group of people or organizations that have a need for or interest in a product, as well as the resources to buy that product; also a place (not necessarily physical) or means by which customers interact with a brand and purchase a product.

Market Share – The percentage of sales within a market that is earned by a particular company over a period of time.

Market Test – Testing a marketing action with a small selected segment of the market in order to predict possible sales and profits.

Marketing Audit – A comprehensive analysis of a company’s marketing, taking into both external (competition, economic and legal factors, and the market environment, etc..) and internal (sales, costs, market share, profits, marketing mix, etc..) factors.

Marketing Channel – Refers to the various sources from which a customer can learn about and buy a product.

Marketing Mix – The mix of elements (either using the 4 P’s or the 4 C’s) that go into marketing a product. Can include the problem your product solves, the cost of ownership, advertising, email marketing, ease of finding and buying the product, etc..

Media – The various vehicles that carry your marketing messages to your target market. Can include online advertising on blogs, pay-per-click ads, Facebook ads, email, YouTube, etc., and traditional media such as magazines, radio and TV.

Mind Share – How much a brand or product is referenced by people or in the media.

Mission Statement – A summary of the purpose and values of an organization.

Needs – A basic human drive that people can satisfy by buying products or services. Can range from basic survival needs such as eating, to social needs such as prestige.

Niche Market – A small, specific subset of a larger market. For example, in the clothing market a niche market could be socks. One can even drill or “niche” down further and specialize in socks for hikers.

Online Conversation – An exchange between two people or between a marketer and a prospect or customer that takes place via blog comments, email, chat, twitter, Facebook, etc..

Open Rate – The percentage of recipients on an email list who open or view a specific email campaign.

Opinion Leader – A person who is influential within his or her community or group, to whom other people look for advice and opinions.

Page View – Each time a page on a website is viewed by a visitor, regardless of the number of hits. (See also Hits and Visits).

Peer-to-Peer – Aka P2P Marketing: when customers are encouraged to promote a product or service to their friends and acquaintances.

PEST Analysis – Political (e.g., tax policies, legal restrictions), Economic (e.g., the economy, interest rates, etc..), Social (age and income of the market, attitudes, etc..) and Technological analysis, giving an overview of external factors affecting a business. (See also STEEP Analysis).

Positioning – The unique place a product or brand occupies (or attempts to occupy) in the mind of consumers (for example, McDonald’s = family friendly vs. Burger King = young male, a little edgier, vs. Wendy’s = somewhat more health conscious adults).

PPC (Pay Per Click Advertising) –Creating ads that will appear for search of your choice and for which you only pay when a person clicks on the ad and goes to your site.

Private Label – A brand owned by a reseller but actually manufactured by another company. For example, Gibson strings are a private label of strings actually manufactured by D’Addario.

Product – Can consist of an idea, a thing (aka a “good”), a service, or any combination of the three. Sometimes used to refer to a tangible good, as opposed to an intangible service.

Promotion – A promotion consists of some combination of advertising, personal selling, sales promotion, direct marketing, and publicity. A promotion can also refer to some kind of special offer.

Public Relations – Aka “P.R.” The use of article writing, interviews, and other kinds of publicity and information to influence people’s beliefs, opinions or feelings about a product or service, a brand, or a company.

Publicity – Information about a product or company distributed in the media through press releases, articles, interviews, etc.., as opposed to paid advertising.

Pull Marketing – Building up demand for your product by providing prospects with valuable information (e.g., guides, articles, etc.) and making yourself visible in the places people search for information about your product (optimizing your web pages for popular search related to your product, guest posting on related blogs, etc.) thus “pulling” them to your site or product.

Purchase Intention – The combination of need, attitudes, and perceptions that combine to make it likely that a person will buy a particular product in the future.

Push Marketing – Giving s, resellers, or customers incentives for them to promote your product, such as discounts, commissions, and bonuses, thus “pushing” the marketing outward towards consumers.

Reference Group – The group against which a person compares his or her own beliefs and value. Can be either positive (the person aspires to emulate that group) or negative (the person wants to avoid being like that group).

Relationship Marketing – Marketing with a focus on long-term customer retention and repeated purchases, often with the help of CRM technology. More expensive in the short term, but tends to generate a higher ROI.

ROI – “Return on Investment”: The amount of benefit (whether in profit, new customers, repeat purchases, etc..) received for a given investment of money or time.

Sales Funnel – A metaphor (wide at the top, narrow at the bottom) to understand the sales process. For example, out of the many prospects you bring in with your marketing, a percentage of those will sign up for your mailing list or ask for information about your product and then a smaller percentage of those will actually buy your product, and a smaller percentage of those will become fans who buy everything you put out.

Segmentation – Dividing a broad target market into subsets of people who have common needs and preferences so that you can better tailor your marketing to them.

SEM – Search Engine Marketing. Includes both SEO (search engine optimization) and PPC (pay per click advertising).

SEO – The process of optimizing webpages results for specific search (“keywords” or “key phrases”) so that the pages will appear high in search engine results for those .

Service – An intangible product, usually consisting of an action performed by the seller for the buyer (such as housecleaning, bookkeeping, or

providing entertainment).

Social Media – Websites and Internet apps that allow people to interact and communicate with each other. Also refers to blogs, podcasts, Internet radio and video sites (as opposed to traditional media like newspapers, TV and radio).

Social Network – A group of friends, colleagues and acquaintances or websites like Facebook and Twitter that allow groups of people to stay in touch and share links and information.

STEEP Analysis – Analysis of the Social, Technological, Economical, Ecological and Political Factors affecting a business. (See also PEST Analysis).

SWOT Analysis – An evaluation of the Strengths, Weaknesses, Opportunities and Threats involved in a project or business.

Target Market – A group of people that have a common problem that you can solve or desire you can fulfill with your product or service, and who have similar demographics (age, location, gender, income level, education level, family status, occupation, ethnic background, etc..) and psychographics (values, interests, lifestyle, behaviors).

Touch Points – All the ways in which a customer is in touch with your brand and by which you interact with your customer which can include your website, your emails, your purchase thank you pages, your blog, your social media s, etc..

Trade Show – An exhibition at which sellers display their products for potential purchasers.

Transactional Marketing – Marketing that focuses on getting as large an amount of people as possible to buy from you once, without concern for developing long-term relationships (as in relationship marketing).

Transformational Marketing – Associating the use of your product with meanings, images, or feelings that affect the customer’s experience of using the product.

Unique Selling Proposition (USP) – A product’s unique benefits that differentiate it from its competitors.

Upselling – Offering a customer upgrades, add-ons or more expensive products.

Value Experience – What customers in a given market value the most about a product and how they perceive the product benefits versus the cost.

Value Proposition – The promised value that a customer will receive upon purchasing a product or service. Also a multi-step process for creating customer benefit statements.

Visit – When a person or a web robot visits a website, generating one or more page views and hits. (See also Hits and Page Views).

Voice of the Customer (VOC) – A market research technique with the goal of drawing up a prioritized list of a customer’s likes, dislikes, wants, needs and expectations. Also, expressing marketing messages in that are most understandable and meaningful to the customer.

Appendix B

Answers to Unit 2 Quiz

1. True

7. Your most likely fans/customers

8. Customers, Convenience, Cost and Communication

9. Goods, Services, Events, Experiences, Persons, Places, Properties, Organizations, Information & Ideas

10. Holistic Concept

11. Channel or Distribution Channel

12. All of the Above

13. Written answer – up to you!

14. False

15. Written answer – up to you!