There have been a lot of developments in the world of music industry analytics in the last six months. The multi-year deal signed by one of the Big Four to a data supplier other than Nielson, being one of the most notable. Yet another signal that the music Industry has well and truly entered the Digital Age, and that the need for comprehensive data is a vital trend signifier.
Industry conferences are rife with discourse on the changing face of the landscape and how best to navigate this new terrain. The rise in illegal downloads, on-demand streaming, physical albums cannibalised by the advent of itunes, all of which mean profits are diminishing in many areas of the Industry. According to the IFPA Digital Music Report this year, the international digital music business grew c25% to $3.7 billion. News, which is more than promising, but isn’t bridging the gap fast enough to bear overall losses.
Add to this the rise of social media and Twitter, and you have a host of areas that traditional tracking systems are ill equipped to monitor. Behavioral changes are the most valuable indication of how the landscape is changing, and there is precious little available that does more than scratch at the surface of this matter.
I asked Co-Founder of Transgressive Records, Toby L, to give a view on a few of the issues facing Indies right now.
M-A) What do you define as the top pressures or concerns for independent labels?
- TL) it’s easier and more direct these days to get your message across, the Internet acts as an equal information exchange. But the top pressures are sustenance and cash flow, as it is currently not very well policed or accounted for… The stress is not just funding artists, but their albums too, and simple label overheads on top for dedicating such time!
There is money being made in this crazy industry, albeit at a slashed percentage of what once was, due to declining physical sales which previously shaped the fabric (and nature of expense) of the current model.
The excitement our end, personally, is tweaking the model into something more progressive and coming up with new plans for our acts that will hopefully not just see returns, but set up further financial options for the future too… 2010 will be an exciting and great year.
M-A) What would you describe are the top things, in light of above, that independents such as yourself could really do with in the current industry climate?
- TL) Just support from media and the government in our bids to promote art and music as cost effectively as possible, without hampering artists’ potential/opportunity for breaking through on a mainstream level. And the public to continue supporting art that they love.
M-A) Do you see analytics emerging as a vital force forecasting for the industry?
- TL) Data is extremely useful for picking up on trends which may lead to growth areas – eg discovering what might work better regionally for some acts in terms of promotion or touring. Likewise, data/charts act as scalability for where everyone is at and what areas need focussing/attention or working on.
That said, I believe in great talent nurturing, being ahead of trends, and attempting to lead and influence, in terms of introducing amazing talent to the world, and subverting people’s attentions toward it. Essentially, data is great to discover reactions, but not always the future – that’s largely down to us as musicians, music fans and individuals to determine.
M-A) Have you been feeling the pressure to diversify?
- TL) We’ve always been fidgety as a company, and wear many hats – at last count Transgressive is either directly involved with, or affiliated to, six different guises, incorporating the label, management, publishing, live events, online editorial and TV production; it’s useful to be flexible and a cottage industry as the industry refocuses and replenishes itself and its options.
The pressure on the indie labels, particularly to find new ways of tracking all these changes is immense. For many independents, the impact of a lot of these changes has hit hardest financially. Finding more advanced ways to gauge reactions to strategies and researching new revenue models is fundamental for them to be able to protect their ability to do the hard graft – discovering and nurturing artists who otherwise may never have had a shot at the mainstream.
Clearly what seems evident to me is that without losing sight of natural gut reactions that are so essential in the Industry, companies need a way to hone their focus amid the myriad of opportunities happening online to stay fresh and keep the cottage industries viable. This may be a technical problem that requires a technological solution.
While the file-sharing debate rages and budgets continue to shrink, it is my belief that before the industry can make sound decisions on the best models needed to move forward, they need to work to bring reliable and more importantly, comprehensive, analytics and data to the table.
M-AC
