The music industry struggles with ways to leverage social media to their benefit, the labels and artist. Social Media has the secret sauce for the music industry to increase their return from the “market of conversations.” After all music is a conversation.
Conversations are now enabled to create new markets, raise market awareness of a label or an artist value proposition and convert the conversational currency into revenue.
The marketplace is changing and the methods of getting a market’s attention, attraction, affinity and audience have changed as well. A strategic investment in doing social media right and doing the right things with social media provides the music industry with an opportunity for tremendous returns.
We’ve developed a four part system and the related activities which are based on our study of “best in class” and our ongoing work with local and global firms. Each part is designed to systemically incorporate social media as a core competency of a music brand’s relational efforts. The parts include an effective web design, social media, a branded rewards card and managed services to optimize the sum of the parts.
Generating Revenue from Online Social Currency
The design of an effective social media campaign should aim at leveraging the music brand online and subsequently generating revenue greater than the cost of the campaign. This can be accomplished by the design, the reach and value proposition to the marketplace with chosen sponsors of a program.
In a recent article titled Social Media Networks Are Music’s Curse and Salvation written by Eliot Van Buskir of Epicenter states “These networks represent something of a threat to iTunes, the labels and their record-store-style pay-per-download music sales. But a new report says the same social media sites that threaten the old-school, sales-based approach will eventually save whatever’s left of the music business. “Social music may not generate much revenue now, but monetization’s effectiveness must — and will — improve,” writes Mark Mulligan of Forrester Research. “In doing so, it will become an increasingly important revenue stream that helps fill the gaping hole left by lost CD sales.”
The above analysis represents a paradigm shift in the way labels and artist monetize their brand and engage their audience. Given the reach and richness of social media combined with an interactive and integrated web presence with an offer for a branded debit card one can envision the new model of social currency for the music industry.
Brands continue to make significant investments within the social media space. Brands want to reach their audience and with the affinity of a music lable or artist offering direct access to an audience, brand sponsors for a well designed social media campaign by a music artist or label is ripe ground for harvesting.
Besides gaining economic support for the program with chosen brands there also exist opportunities for additional revenue from direct sales of artist branded merchandise, concerts and downloaded music.
For the music industry it is time to shift your thinking to Music 3.0, a conversation. Based on an quick analysis of the music brands activity on Twitter the first thing they need to learn is how to be social. Follow back those that follow you. Get it? Conversations and relations are two way not one way.
What say you?