I am currently writing a business plan for one of my classes (COMM493, not really sure why this is a communications class…) and I wanted to share with you guys the basic idea my roommate (@Johnny_OKeeffe) and I are developing.
According to statistics provided by the New Music Seminar that I attended this past summer, there were only 5,945 artists able to sell over 1,000 copies of their albums in 2008. And only a mere 110 of these artists managed to sell over 250,000 albums (the majority of which are signed to major record labels). These numbers prove how rare and difficult it is these days for an artist to get their music heard by the masses, and how incredibly slim a band’s chances are of getting major label representation. The problem in this case works from the top to the bottom; the top being the corporate interests with the money and control and the bottom being the artists. Often is the case that the talent works for the talent agency – this situation should be reversed. Record labels shouldn’t have artists on their payroll; instead, the artists should have a slew of passionate, focused and talented people providing services for them based on their individual needs and desires.
Artists are becoming smarter and want to be more proactive about the business decisions surrounding their music. There are a wealth of artists out there recording great quality music for cheap in their basements, garages, bathrooms, friend’s houses, etc. Once this music is recorded, however, many of these ambitious young people don’t have a clue how to spread the word and start living their dream. Instead of sending their music to record labels in hopes of “getting signed,” artists can opt to have a team of motivated individuals work for them; all the while maintaining complete creative control over their music.
To reverse the tides and help empower artists, the business idea is an all-inclusive service team specifically geared towards unsigned and independent musicians and performers. Essentially, the business provides unsigned musicians with many of the services they’ll need in order to achieve their professional goals. These include consulting, marketing, booking, promotion, public relations, and much more.
The concept fundamentally functions as a record label “in reverse”. The business is working for the artist(s) and not the other way around. Traditionally, a label seeks out artists who can potentially sell a lot of music and solicit a large fan base. The traditional label will produce, promote, sell and distribute the artists’ music and give them a small percentage of the profit. In many cases, that percentage is less than 10%—which is a very small payout considering the effort put in by the artist to create that music. I mean, the music wouldn’t even exist if it weren’t for the artist in the first place.
The reverse record label’s primary revenue stream would come from the payment plans negotiated with each artist/band. The payments can be made upfront, in monthly/yearly installments, etc…whichever model seems to serve the relationship best. These prices would be flexible depending on the artists’ financial situations. In turn, the reverse record label provides the services (with some sort of a guarantee) and receives no further compensation. The artist collects 100% of the benefit from that point on. Most importantly, however, the artist maintains full control of the rights to their music regardless of the service(s) they seek—which is rarely the case at the typical “record label.”
The reverse record label aims to serve the prevalent but struggling independent music culture. Unsigned and independent artists need organized, determined, and talented individuals to help them create and sustain long and successful careers. Any independent act can have the opportunity to receive consulting and development advice through the reverse record label at an affordable rate. The core focus of the business’ services is to increase overall exposure for its clients in their target markets, thereby providing them with future opportunities that will help to enhance and uphold their musical careers. By exposing clients to their target markets, this can also indirectly enhance the quality and diversity of local music everywhere, and help the previously unknown, but truly excellent talent rise to the top.
The reverse record label would compete alongside traditional artist public relations, marketing, management and consulting firms, as well as traditional record labels. However, what differentiates it from the rest of the pack is that it provides a customized combination of all these services, geared towards individual artists and bands, in one convenient and affordable package. These packages will be unique and tailored to each specific artist. The reverse record label would take the time to research an artist’s target market and develop a strategic plan based on the services the artist requests. And if an artist does not know what to request, the reverse record label can offer them the proper consult to guide them in the right direction and give them several options to consider. With this business, artists no longer have to spend countless hours of research to find a publicist or manager that would suit them best. They no longer have to send promotional CD’s—which cost big money and rarely make it much further than the office garbage can—to record labels in hopes of getting a dream record deal. The reverse record label’s services would provide its clients with the essential knowledge to achieve success in their independent music careers. And once again, it would not take any rights away from its clients, so the artist(s) will always be in control of their most important asset: their creativity.
This is an idea I had a few months ago. But at this point, it is just that – an idea. I’m sure somebody has thought of the same thing/something similar at some point in time. At the end of the semester my roommate and I will have written a full-length official business plan surrounding this idea. I would love to hear any feedback/discussion arise about it. Thanks!