Are you a musician feeling frustrated by the gap between your artistic dedication and financial rewards? You're not alone in this struggle. In today's digital age, the traditional paths to music monetization have dramatically shifted, leaving many artists confused and discouraged. But there's hope - understanding the real reasons behind this financial disconnect and learning how to adapt to the modern music industry can transform your career from a struggling artist to a successful entrepreneur. Let's explore why the old models aren't working anymore and, more importantly, discover the strategies that will help you build a sustainable music career in today's landscape.
Your Expectations are Outdated
Current artists desire to have the monetary and material reality that artists of the physical era had back in the day. Because of this, many artists rely on Spotify by default to achieve this result. It's only because physical albums generated so much money back then that the stigma still remains when comparing successes of artists from the physical era to today. Your expectations are outdated because the mediums have shifted and the costs of consumption have drastically decreased. This shift makes albums more of a promotional tool in the beginning stages and a financial asset to be leveraged years later down the line. Many musicians don't have the patience to wait for the financial gain down the line.
What is a medium and why did it change?
A medium, in our case, is a particular form of storage for data consumption. It is the instrument required for data to be produced on one side and consumed on the other. Mediums change due to technological advancements and consumer demands. Humans create new technology, and customers begin to demand better value, meaning "customers want as much as they can get, for as cheap as they can get it, as easily as they can get it." On the other side, tech creators want to solve a production problem to "create as much as they can create, for as cheap as they can create it, as easily as they can create it." This leaves the artists to use the tools that techies made to produce music that consumers want.
The digital age turned music into a lost leader
A loss leader is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services—in our case, merchandise, concert tickets, and outside brands. The purchasing of music is no longer the primary income source but rather a tool to build an audience. So, as I've said before, you are the Pied Piper that draws money out of the pockets of the mice that follow you, and you use that money as leverage to do something else with.
The Streaming Revenue Trap
Many artists desire to make money from their music, as it was in previous eras, and they run to Spotify and the likes to get their money. However, without a physical medium to buy and use to consume music, music has become cheaper to consume. The streaming revenue trap is a mental hypnosis trap, and your mind is still trying to make logical sense of what happened in 2006. Your mind says, "A million streams generates $3,800 on average, which would have been roughly 380 CDs sold at $10 wholesale! It's unsustainable for the amount of time, money, and effort I have to put in! Wait, this can't be right—I'm trapped! What is this?!! Where's the money?!!!"
How do I make money?
You're going to build three things in your career and leverage them for money: Catalog, Fanbase, and Revenue. If you build up these three elements, you'll have no problem in this business. Talent builds the catalog, personality builds the fanbase, and from that, the catalog and fanbase build the revenue.
I just want to make a product and sell it!
You are making a product and selling it—it's called your brand, and people want to experience it. The moment this sinks in, the easier this business becomes. We're no longer selling CDs, vinyl, and cassettes as the norm. Instead, we're licensing our brands for millions and billions. Content creators understand this from the start; they went straight for the brand value, bypassing talent. However, you have an added advantage: talent!
I don’t have anything to leverage!
You'll have leverage as soon as you build up demand for your presence and music. As you earn revenue, that too becomes a leverage-able asset!
Here's what you can do
Focus on serving fans and supporters first at all times. Build a direct-to-fan strategy. Monetize through merchandise. Develop live and virtual performances and experiences. Seek sync licensing opportunities. Diversify with brand partnerships.
Tools to support your journey
If you're a music creative or executive looking to build your label or publishing company in 60 days or less, with a step-by-step foolproof process, Grab the 60 Day record label course and get it done today! You gain the ability to get real funding, prevent yourself from getting screwed contractually, and keep the middleman out of your pockets. Click the link below to get started right now! If you’re skeptical grab the free guide, "10 Ways to Increase Your Record Labels Profits," a free split sheet comes with the download!
If you focus on Fans first
Then automatically your catalog, fanbase size, and revenue will follow suit by growing to massive proportions.
If you focus on streams first
you won't last long in this business because you're chasing a debt-inducing business model.
At the end of the day
Ultimately, you will become a musically talented influencer who leverages your skills and assets for significant financial gain.
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