Berklee Today

Top 10 Hits of CD Distribution

Seeking a distribution deal for your indie CD? The McCluskey chronicles provide an analysis of the costs versus the potential career benefits.

 

If you're like me, you want a bigger audience for your music. Building an audience is done by first establishing yourself as a brand name in the marketplace (frequently referred to as "branding”). A national distribution deal that leads to commercial success is a great way to accomplish this. For artists, commercial success is measured by the number of CDs sold, shows performed, and seats filled. Radio airplay and press coverage are also key, but they don't necessarily translate into CD sales. It is branding that will help an artist to increase audience size and boost CD sales.

Despite the importance of the Internet to commerce, CD sales through "brick and mortar” stores are still important. National distribution, rather than consignment, is the only practical way to service the big chains like Borders, Tower, and HMV. Although you must cultivate the relationship between yourself and the stores, successful distribution takes into account the entire marketplace. This marketplace is a fluid set of symbiotic relationships between yourself and radio, press, public relations, advertising, venues, the Internet, distribution companies, stores, manufacturers, vendors, and other musical acts in your genre.

Your job is to create a brand, an image, and a story that will engage all of these elements in the service of finding your audience. There is no guarantee that money invested in distribution will be recouped solely through CD sales. However, the prestige of national distribution is a career builder that will enhance your other efforts to make a living. Work smart, be honest with yourself, and hope for the best. But be prepared for some disappointment and failure along the way.

 

Getting Started

Before seeking distribution for your album, I suggest that you acquire a budget and start your own record label. You'll be dealing with other businesses and it's best to be on equal footing with them. Also, when your employees look to you for daily direction, you're forced to focus your goals. I decided I'd found WaterBoat Music and hired a business-and-marketing team. Kimball Packard came aboard as manager and Louise Miller as administrative assistant. My wife, Jenny Mikesell, an accomplished website designer and graphic artist, worked as the art director.

To record my CD Trust, I hired a production-and-recording team. Berklee grad Dave Locke '93 engineered and mastered the project. Players included other alumni like guitarist Kevin Barry '88 (Paula Cole, Mary Chapin Carpenter) and bassist Mike Rivard '85 (Jonatha Brooke), as well as former Del Fuegos drummer Woody Giessmann. Independent radio guru David Avery of Powderfinger Promotions was hired to work Trust to Triple-A and college radio.

While we made the recording, I searched for a distributor. There where problems. The two elements that distributors look for when negotiating with an artist are extensive touring and a previous track record of CD sales. Because of my commitments to teaching, I couldn't tour to support distribution. And while my first CD This Distant Light had garnered a Boston Music Award nomination, I had no sales record.


Photo by Teresa Izzo

To make up for this deficit, I crafted a marketing plan that highlighted my strengths, drawing upon the entrepreneurial concepts outlined in my book, Making Music Your Day Job. My marketing plan featured a $10,000 budget and focused on national radio airplay, advertising, regional gigs, in-store and in-station performances, and various guerilla marketing techniques. I sent my proposal out to five distributors, and in December of 2000 I signed an exclusive deal with Goldenrod/Horizon. What made them sign me when others had turned me down? In part, they loved my music. But essentially, they liked my marketing plan and our $10,000 budget.

Before signing me, Goldenrod had presented my proposal to their single largest client, Borders Books & Music, to get their opinion. Their national folk music buyer agreed to take an order, and, based on that promise, I got the deal. I had used my powers of persuasion and business expertise to circumvent the key requirements of a typical distribution deal. Would that fact ultimately hurt me? Marketing plans aside, Trust would have to prove its worth at the cash register. If it couldn't, WaterBoat Music would be dropped. I decided to risk it.

 

Be Careful What You Wish For

One day we had no deal and were alone. The next day, we had a deal that involved lots of other people. We now had primary relationships with both the national and regional sales representatives at Goldenrod plus the field marketing manager from Borders. Soon we would develop additional relationships with new performance venues, advertising sales reps, shipping companies, and more.

Click here for a PDF Production, Promotion, and Distribution sequence. If you are asked for a helper application, locate "Adobe Acrobat Reader" on your hard drive.
 

Suddenly, we had to factor everyone's schedules and turnaround times into our own plan and things became very complicated. The radio campaign and retail release dates had to be coordinated with all other efforts, including gigs, advertising, and in-store promotion. But it didn't work out that way. Since we signed the deal in early December, we missed the holiday buying season completely. Major listening rooms book four to six months in advance, so January, March, and April were unavailable to us.

It didn't make sense to do in-stores and in-stations unless we could support the efforts with advertising and we hadn't had time to negotiate ad rates, design our print ads, and produce the radio advertising spots. The listening post program at Borders—a key part of our plan—was booked until at least April. It looked like May 1 was our earliest possible start date, but if we waited until May, college radio stations would be winding down for summer break. We decided to forge ahead with a January radio and retail release and work hard to put everything else in place by May. (see sequence of events below)

Trust went to stores in mid-January and Powderfinger worked radio from January 23 to March 12. All in all, we got the CD played on almost 200 stations nationwide. It was a great start. But managing the details was often problematic. Little things snowballed into an avalanche. For example, our first order was two weeks late while we were setting up a FedEx Ground account and frantically designing our point of purchase (P.O.P.) stickers that said "all profits to benefit the Sierra Club.”

While this minor disaster unfolded, we scrambled to call venues, radio stations and the press, design print ads, fix our computer system, update the website, play gigs, send out packages, do interviews, and book in-stores. We were often completely overwhelmed. Finally, May arrived—a full two and a half years after the recording sessions began—our modified marketing plan was in full swing.

 

Cash on the Barrelhead

The following represents investments I made to support the distribution deal.

  • Recording $30,000
  • Staffing $10,000
  • Radio promo $3,000
  • Radio commercials $1,000
  • Specialty packaging $1,000
  • Total: $45,000

At $7.50 per copy, I must sell 6134 copies to recoup my hard-dollar expenditures. These costs are actual money invested and do not include promotional copies of the CD given to venues, the press, or radio, nor do they include product credit payment of the listening post program at Borders. To date, I am far from recouping my investment via CD sales.

However, all is not lost. My main goal to first establish brand name identity has been successful. Some of the direct, non-sales oriented results of working my distribution deal are as follows:

  • More people have heard of me, and heard my music.
  • My press kit commands increased respect.
  • I'm now able to play key venues and better rooms.
  • I'm playing in new markets, including New York City and London, England.
  • I'm a more informed and valuable teacher to my students.

I set my sights high and have succeeded in some realms, failed in others, but at the end of the day, I asked and answered questions that were important to me. This has clarified my artistic vision, and increased the scope of my work. The process of working my distribution deal changed and challenged the way I felt about my music, my goals and the industry in general. It was exhilarating, frustrating, and a real learning experience.

 

Kevin's Top 10 Hits

1.
Get Radio Active

The advent of low-cost digital recording technology has flooded the market with releases. Radio station music directors now rely more heavily on indie promoters they trust to help them program. Unless you are extremely good on the phone and know the radio business, hire a good promoter. Even though I was a music director at a radio station, I found it was best to let a pro help me out.

Develop an effective mailing package that will help you break through the clutter at radio stations. Use radio airplay to increase sales, press, and touring. We sent the weekly radio airplay reports to Goldenrod so they could service stores in national markets where Trust was receiving heavy or medium rotation.

 
2.
You Can't Eat Good Press

While important, press coverage does not necessarily translate into CD sales. The industry is filled with artists who languish in the "critically acclaimed” ghetto. That being said, you'll need press before you release your CD on its "street date.”

During the production of Trust I invited members of the Boston press to lunch and then join us while we mixed a tune. We also made 50 "one-offs” and sent them out to the national press to get pre-release coverage. Develop a philosophy of consistency when dealing with the press. For example, on the finished CD booklet, incorporate your picture into the cover art. When you start to get press, control your image by only allowing them to use your CD cover. That way, when people see your CD in stores, they'll recognize it from an article they read about it. These concepts are road tested and they work.

We had reviews, profiles, and feature cover stories in Billboard, ASCAP Playback, Gig magazine, the Boston Globe, the Boston Tab, and numerous other publications.

 
3.
P.R. Is Good Business

Public relations is the process of building goodwill for your brand in the public eye. Supporting a good cause is a great way to do this. I decided to donate all profits from the sale of Trust to the American Liver Foundation and the Sierra Club, and this has opened quite a few doors for the project. Because I teach entrepreneurship and career planning at Berklee, we also targeted the business editors of nonmusical publications. As a musician, entrepreneur and educator, I am somewhat anomolous in the nine-to-five world. Go where your competitors aren't and reap the rewards of being a rare find.
 
4.
Get the Word Out

Public-relations efforts go hand in hand with your advertising campaign. We focused our advertising on the listening posts at six Boston-area Borders stores, where customers could listen to the CD through headphones. This type of program is paid for in product credit rather than hard dollars. One month at listening posts "cost” WaterBoat Music $1,071 in product credit. This means that at $7.50 per CD, Goldenrod and Borders keep the proceeds from the first 143 copies of Trust sold.

As part of the Borders listening post program, we also received 15 "free” 60-second commercials on The River 92.5, a great local Triple-A station. We decided to boost the 15 ads with additional commercials to promote gigs and various in-store performances.

To retain control of my image and message, I produced the ads. Berklee alumnus Scott Miller edited cuts from Trust into a commercial bed, I wrote the copy, and station DJs did the voice-overs. For maximized impact, it's essential that advertising be seen and heard in as many different mediums as possible. Our May ad campaign included radio, print, and the Internet, with a focus on live gigs.

 
5.
For Every Season, Tour, Tour, Tour

Marketing efforts, even very successful ones, are no substitute for live shows. David Tamulevich, a prominent national booking agent, suggests a touring schedule of 225 to 250 nights a year. Touring is actually the best opportunity you have for selling your CDs to a motivated, excited audience. Berklee alumnus Bob Malone set up a merchant account with Visa, and his live-show CD sales have increased significantly.

Ironically, great press and radio airplay can help propel you beyond your capacity. As you start to play bigger and better rooms, it's tougher to fill seats. Be realistic: if you need to take a step back and work as an opening act, do it.

If you're serious about a career as an original artist, though, cover gigs can drain your energy and credibility. I strongly suggest making every effort to talk to those in charge of venues before sending your package. Have an honest discussion with them. Don't be afraid to turn down a gig that's not right for you; if nothing else, you'll be memorable! If I were 25, I'd start a band, rent a cheap house in the woods, make a CD, buy a van and hit the road. I'd support the effort with a marketing plan and a great website.

 
6.
Weave a Big Web

Use a professionally designed website that is commercially viable and reinforces your brand. All marketing and advertising should drive traffic to your website. To encourage return traffic, update the site with new songs and new content. The Web is not a static medium. Unless you're getting thousands of hits a month, it doesn't make sense to fulfill your own orders. Link your site to CD Baby or Amazon and let them do it; they have the traffic.

Your site should be easy to navigate and unburdened by huge sound or picture files. I post short Real Player song samples on my site and provide a link to my MP3 page for bigger files. My entire first CD, featuring Ellis Paul, Catie Curtis and Duke Levine, is online. I have only 20 copies left, and rather than manufacture more, I give it away in MP3 format. If people dig the music, maybe they'll come back and purchase Trust.

Put your gig listings in the table format that allows Musi-Cal and other performance search engines to offload the information automatically to save you from duplicated effort. Register your website with the main search engines. You'll have to update it every six months to remain current. The Internet is the ultimate guerilla marketing vehicle that allows you to subvert the status quo.

 
7.
Work for Bananas

Branding efforts that are highly creative and cost effective are an essential part of a guerilla marketing campaign. We made a strategic alliance with Club Passim, which has a 15,000-person mailing list for their music schedule newsletter. In exchange for a discount on ad space, we committed to donating 50 percent of the purchase price of my CD to their music education fund. All a customer had to do was write "Club Passim” in the memo section of their check and send it directly to us.
 
8.
Star Wars, Culture Wars

There is a strong interrelationship between press, radio airplay, touring, the clout of your distributor, the strength of your live show, your "buzz” factor, and that ineffable psycho-sexual, gender-war, political, what-is-hip, who-is-hot miasma of fear and loathing we call pop "culture.” Fueling this hot-rod race of fame seekers is cold, hard cash—the more the better. Be prepared to grease the wheels of commerce in the form of advertising, packaging, videos, shelf fees, touring, product give-aways, and other forms of promo.

Country and r&b music are the big sellers. If you're in these categories, you're competing with serious star power and huge corporate budgets. If not, set your sights on modest sales appropriate to your genre. Selling 20,000 units would represent big numbers for a contemporary singer/songwriter but would get a pop artist canned.

According to the New Yorker magazine critic Nick Hornby, a recent Billboard top 10 list of bestselling albums includes the song titles, "Bad Boy for Life,” "American Psycho,” and "Pimp Like Me.” If you're not writing songs that celebrate rampant consumerism, sexism, and the machismo of violence, your potential audience just got smaller. Way smaller.

 
9.
It's a Big Country, Pilgrim

Remember, it's your distributor who's national, not you. Goldenrod focused their placement of Trust in Boston and in select stores nationwide that did well with folk music. That's fine, because I didn't have the budget to promote every market properly. Initially, I wanted to do the national listening post program at Borders, which has 350 stores. I would have needed 350 listening-post CDs plus five copies for each store for a total of 2,100 CDs. Because I only had 2,000 CDs to start with, I would have had to manufacture 1,000 more to meet my other needs. Borders wisely suggested I start small, and if sales were hot I could grow into a national campaign. Keep in mind that when your inventory goes into a distribution network, it ties up your capital investment for a long time.
 
10.
It's Mine, All Mine!

If you're signed to a label, they will pay up-front costs for recording and some marketing. But they're merely loaning you money that you pay back through recoupables—a convoluted process that never favors the artist. It's better to own your own company. Quite frankly, if you're not willing to make that investment, why should anyone else? Besides, the payback on the other end is potentially better.

Take selling CDs from the stage as an example. If I were on another label, I'd have to pay them wholesale rates for my own work. At a sale price of $15, I might net $7 and pay them $8. But with WaterBoat Music, I get the entire $15. Plus, I have the flexibility to set special sale pricing.

At a recent show, my pricing went like this.

  • $15 - Buy 1 CD, get a free tape
  • $20 - Buy 1 CD, get a free CD
  • $25 - Buy 2 CDs, get a free tape.

That night, I made more on CD sales than I did at the door. And in the End . . .

After working my deal hard for nine months, I continue to build on what I've made. There are no easy solutions and it's definitely a work in progress! Our industry is not for the faint of heart or the empty of pocket. But as long as we're willing to invest in our careers, we'll always have a future in the music business. Only time will tell if it's worth it in the end.