Retail for musicians: harnessing the power of direct-to-consumer sales
With streaming providing less than ideal income, direct sales of merchandise to fans is a particularly important source of income for artists who take the time to do it well, writes Tommy Stalknecht of Single Music.
Through Tommy Stalknecht, CEO and co-founder of Unique music
When it comes to how artists monetize their recorded music, the discussion often centers around streams. The number of streams a song earns correlates with money for the artist, after all. But when different streaming sites offer different payouts – with varying levels and fractions of differences – musicians focusing only on streams will find themselves fighting for pennies.
The answer lies in connecting fans directly with Direct to Consumer (D2C) sales. To thrive in the industry, artists need to take ownership of their audiences and think more like large retailers. Since artists are considered LLCs by law, they can just as easily embrace this business mindset and get down to business. It might not sound cool, but artists who think like retailers – who analyze consumer data and put that information to work – are going to find themselves earning more with the same effort they could put into increasing their feeds.
Streaming vs sales: knowing which game is worth playing isn’t a fair fight
The factors involved when considering payment flows are complicated. For starters, each streaming platform offers different fractions of a penny for streams. This number is always subject to change, as well as any other payment agreement. Additionally, pricing can be affected by where in the world the song aired and that person’s subscription plan.
Ultimately, however, the differences don’t matter. Even if an artist does mathematical work to determine their optimal gains, it’s a lot of work to fight for crumbs and that’s really all they do. In short, they waste energy on a losing game, when they could win another.
“merchandise, concerts, tours – these are the money generators”
That’s not to say the feeds are bad, of course. In fact, streaming is a revolutionary and necessary gateway for artists to find new fans in the digital music age. More engagement is never a bad thing. This is how an artist uses commitment that matters. Merchandise, concerts, tours – these are the money generators. Direct sales to fans put more money in artists’ pockets and are far more worthy of the time and effort of statistical analysis. While it might also seem like a lot of work, technology is making it much easier and more efficient than ever before.
Find your true fans
A touring artist can get a good idea of the products their fans love and the must-see cities. Usually t-shirts, hats, tank tops. Concerts in Nashville, Austin, Chicago, etc. But what if artists had a more accurate breakdown of their sales data and their fan demographics? What if an artist could find out who their best fans are and what part of the country they are in, if you sell more X-Large t-shirts or hoodies, and what time of year Tokyo fans? are more likely to buy jackets? Single’s dashboard makes this knowledge possible.
“It’s important for artists to know who their best fans are. “
It is important for artists to know who their best fans are – demographics, regions, even the time of year they buy certain products. Single’s Fan Insights includes data on revenue and fan location, a heat map of global sales, trends in buying activity, sales breakdown by type, and more. If an artist wants to know what items and what sizes to store at their next gig in Nashville, they can use the data to see what was most popular after the release of their last album, for example. If a group needs to know where to plan their tour stops, the data here could, and should, guide that decision.
To further engage fans, an artist strategizing for a release date might identify superfans – those most likely to support them and spread the word – and plan an early release exclusively for them. All information gleaned from Fan Insights is genuine. These are true artist fans, not scalpers who skew the data, taking the guesswork out of sales planning.
Ultimately, artists should take e-commerce as seriously as department stores. There is a lot of data out there. Having this data, updated in real time, gives artists the power to make decisions just like department stores. Merchandising has long been data driven, and Single gives creators the tools to make it work for them on their own online storefronts.
Additionally, Single now allows all users to add videos to their Shopify storefronts – via live events and content rentals – further illustrating a leap in the creator economy and an improved ability for creators to earn real money with their digital and physical products. packages directly by themselves. And with Spotify’s recent integration to Shopify, creators can manage their sales directly from Spotify and benefit from Single’s data dashboard and content monetization.
By bringing the whole operation home, so to speak, artists realize an even greater reduction in income than even traditional D2C avenues.
D2C sales have never been easier for all designers.
D2C’s place in the industry
For so long the narrative in the music industry has been that artists have to suffer and struggle to “get out”. And while everyone has their own idea of what ‘doing’ looks like, musicians certainly shouldn’t have to fight for fractional percentages to make a living in this industry which, as time has shown, provides a vital service to people.
Rather than an industry obsessed with streams, let’s imagine one where artists see themselves more than just musicians, but also retailers and marketing professionals. Artists have always been those, after all.
Now is the time to bend over.