Musicians Are Natural Entrepreneurs
Responding to customers’ needs, Nimbit developed a powerful promotional tool that integrates seamlessly into customers’ platforms. “It’s amazing how giving away a free track and following it up with an offer for something else will get a response as opposed to giving away a free track and just watching it go into the ether,” Antoniades says. “So we built a tool that automatically follows up with a promo. Whenever you promote something, it has this extra follow-up that gives that subset of fans—which is pretty large—another level on which to engage. A lot of artists think, ‘That’s asking for money. That’s begging.’ But it’s really not. The psychology is that you’re engaging your fan. Music is still one of the very few things that your customer gets an emotional attachment to, and that’s valuable!”
As with CD Baby, Nimbit artists retain information about its customers. “When you put your music on iTunes,” Antoniades says, “you never know who bought your stuff. You get no relationship. Artists need that contact information. They need to know the buying habits of their fans.”
“Artists generally fall into two camps,” Faucher says. “Some are into it for the art and want success, but see the artistic and the entrepreneurial processes as incompatible. They want to get with a label and have them deal with all of that. The other camp, generally younger, understands how the entrepreneurial and artistic processes serve each other. You make your art. You don’t tailor it to your market, tailor your business model to where that market lies—these are your fans. You aren’t going to hand those relationships over to a label or a retailer. This second group of artists has a much better chance for sustainable careers. We are looking to support that model with our platform.
“The majority of label deals today are partnerships, which is how it should be. Now artists have some bargaining power, especially if they show up with a complete market already in tow and they own the customer list. I think the next generation of artists will understand that on an intrinsic level. The most successful artists [have always been] equal amounts artist and entrepreneur: Ray Charles, Madonna, Prince, Lady Gaga—they’re moguls.”
In 2012 Nimbit was acquired by PreSonus in what both principals say is a fantastic partnership. The first thing PreSonus did was build a connection between Nimbit and PreSonus’s Digital Audio Workstation. Among other things, this enables artists recording a live show to immediately make tracks available to their fans.
Pledging Allegiance to the Fan
If you don’t have a deep understanding of the pain or passion of your target customer, you have no business talking about your solution.
—The Lean Entrepreneur
Created in 2008, PledgeMusic is a passionate direct-to-fan music business solution by Benji Rogers ’92 and Jayce Varden ’92, who started a musical partnership at Berklee in 1991. “When the idea for Pledge first came up, I had it in my head that I would carry on playing music,” Rogers says. “I suddenly realized that my actual gift was being able to help artists navigate the fiscal and social media worlds and earn money that could sustain their careers. One of the first people I called was Jayce because he had a business mind-set. I said, ‘I have this idea. Do you think it will work?’ He said, ‘Yes, and I want in!’”
PledgeMusic provides artists with the tools to understand and connect with their early-adopter, superfans, bringing them into the experience of creating a full music campaign from preproduction to commercial release.
“What fans really want to experience in a world of on-demand access is being a part of the music as it is being made,” Rogers says. “The focus is not on the transaction, but the experience, and making sure that the value proposition put in front of the fan is something they will respond to,” Varden adds. In a recent study, the Nielsen Company estimated that $.5 to $2.6 billion is left on the table every year in the U.S. music industry because fans are not offered that musical experience. “Fans know where to get the products,” Rogers says. “They want the experience. That’s what’s missing.”
Artists keep fans in the loop by producing transmedia updates that can be made available to the general public or only to pledgers. Pledgers receive special packages and artist access for their participation in the presale campaign.
PledgeMusic campaigns don’t end when they reach the 100 percent level. Often they exceed their initial goals. “We estimate that after 60 days of a campaign going live, an artist will make 37 percent of their income,” Rogers says. “So why close it and make it just about a funding period?”
One of the unique aspects of PledgeMusic is its focus on social marketing. While not a requirement, artists are encouraged to give a percentage of the money they raise to the charity of their choice. “About 98 percent of the artists add a charity,” Varden reports. “It’s very personal. It’s not something we dictate, but something we certainly encourage. It’s an amazing thing to be able to pay it forward that way.”