What happened to my radio?: The new profitable tastemakers

In my last post, I alluded to some of my views on licensing songs and the ties (or, more accurately, lack thereof) to Lifetime Value (LTV) of fans, and thus careers for the musicians. Now I would like to clarify my thoughts on ties between bands and brands and give a sense of how I believe the most mutually beneficial relationships can be built.

I believe that bands and brands have very strong natural ties, and that bands should really be thought of as brands in their own right. The key demographic for up and coming bands is generally the teenagers and young adults, which today is Generation Y. Known as the first generation to grow up with a true comfort with technology, having known no life without computers, we are distrustful of advertising and seek deeper relationships with the organizations to whom we give our time and money.

Music is a well-known key to human emotion. It also influences relationships - people who like the same music are almost instantaneous friends, thanks to a connection felt at a more primal level. Friends are also known to enjoy similar products and brands - they make similar connections influenced by shared experiences and compatible ideologies.

The key, then, is finding where these connections (between consumer and brand, and between that consumer and band) have potential overlap, and leveraging that connection to benefit both parties.

Your car commercial has a catchy tune in it, don't you think some folks might catch onto that (don't you want them to?) and want a download of that song? They would, and they would appreciate you for being the one to recommend it to them. You're building customer loyalty among people who aren't even necessarily your customers yet.

Afternoons had a song in a Lincoln commercial that premiered during The Grammys. I would love to have that mp3 by going to LincolnMusic.com, would be thankful to Lincoln for introducing me to it, and while I'm not in the market for a car right now, I'd have a slightly more favorable opinion of Lincoln. Lincoln, in turn, would have my email address (which they could use to introduce me to more music and further build my trust and respect, NOT to spam my inbox with nonstop car ads), my potential to spread the word to more friends (and thus fans of Lincoln), and a potential lifetime fan of their brand (bringing them perhaps as many as five to twenty purchases).

Traditionally, radio has made a living off being intermediaries -- brokering these relationships through their professional tastemaking and controlling the distribution channel (the AM and FM frequencies of our car and personal stereos). Thanks to the Internet and digital music, the distribution channels are no longer restricted -- brands and bands have access to each other and to the fans through a single channel with no need for intermediaries. (In fact, the Gen-Y fans would prefer not to have intermediaries.)

Many brands, of course, will be slow to understand these benefits. Corporations aren't often used to the concepts of direct ROI from marketing spends -- the people working the income sheets and the people spending the marketing money are on different floors and probably have never met. The onus (and thus, business), then, is on consultancies like Brands + Music to show the finance departments why they should be hired to project manage the marketing department's relationships regarding music. In the future, however, it would in no way surprise me to see brands whose target audience is largely Gen-Y starting music departments to help identify and build relationships with bands with similar demographic fanbases.

While brands may be somewhat sluggish to realize the potential of deeper relationships with artists and mutual fans, successful artists (remember, an artist is a brand, too) can coin themselves as tastemakers and built their own brands. You already see it happening, both with an increased number of vanity imprints (artists starting their own labels to help bring legitimacy to their friends and other bands they like) and with artists like Kanye West, whose blog mentions send page views through the roof for anyone fortunate enough to be on the receiving end of a link. In both cases, the artists leverage their existing fans' trust of their brand to become tastemakers and drive benefits for other b(r)ands, and in turn themselves.

The hope, of course, is to be able to automate some of the identification process for all parties involved -- many of the biggest changes to come about in the Internet era have come as a result of taking manual effort out of business processes. The technology will soon exist to have your brand grow many times in size by being the modern equivalent of the cool DJ in town, an opportunity you may not immediately think relevant. Of course, technology is just a tool, and the brands and artists who employ the tools make their own fates and fortunes with their usage -- technology will never be a substitute for genuinely identifying with the brand you sell and using your own passion to connect with the fans of your brand and desire to add value to their lives.



As a side-note, I'm sure questions will arise as to the potential of "regular" individuals to become tastemakers. To some extent, there is, but it will have to be through a channel they define for themselves (generally through blogs), rather than through sites like SUURGE. Musicane's (and many others) original business model presupposed fans would appreciate being rewarded for their music recommendations to friends. What they failed to realize was how pithy rewards from not having a substantially large sphere of influence is actually a demotivator (people would rather recommend out of passion than see a couple pennies). Where Amie Street separates themselves is by becoming a tastemaker in their own right by aggregating fan inputs (their biggest sales driver is moderated weekly emails with personal recommendations) -- their users buy based on their view of Amie St as a tastemaker, and getting small discounts is a nice side benefit that makes them feel good for being a part of the community.

First Aid Kit: A story of discovery

Many folks ask me how I discover music. I wish I had an easy answer. I download a lot of stuff (both albums and playlists, which sometimes inform album purchases) via torrent or other filesharing options, I also read the occasional blog, and hear about a lot of good music from coworkers and friends. I don't use Pandora, I scrobble to Last.fm but never look at it, and I keep the iTunes Genius sidebar open but I'm not sure why (it's not like I look at iTunes when I listen to music--I click once and it plays).
I can speak in broad generalizations all day, but I thought it best to take you through how I found out about a couple teenage sisters from Sweden in a band called First Aid Kit. Every time I play them for someone the immediate response is "Who is this??" (in a good way). But I can't take credit for finding them.
I first found out about First Aid Kit from Peter Rauh via a Twitter message: "Some inspiration for the day: Two Swedish teenagers covering Fleet Foxes in the woods (no lie) http://tinyurl.com/5svkol" The link takes you to this video:


After I told Peter how much I loved the video, he told me he heard about it via Light In The Attic.
I downloaded the mp3 of the song for free, and checked out their MySpace profile. From there, I bought their record from Klicktrack.
After more than a few listens in a short time span, I knew others would enjoy the music, so I published an OpenTape player on my website:

I told a number of friends about the music, and my friend Britti even thought she played them on her radio show. Unfortunately, she had come across another band by the same name, this one from Spain -- goes to show you the importance of picking an original name for a band.
At any rate, I hope you all enjoy First Aid Kit as much as I do. I think they're mature beyond their years, and anyone who fashions themselves after the Fleet Foxes is A-OK in my book.

#1s

Katy Perry's hit single, "I Kissed A Girl," recently tied The Beatles' "I Want To Hold Your Hand" for the longest reign at #1. While we can all sit around all day and all night debating the merits (or lack thereof) of each, I would like to point out the difference in culture surrounding these hits.
Namely, the fact that I eat, sleep, and breathe music, work in the music industry, am young and relatively "hip" (okay, the fact that I just put that in quotes takes me out of the running), yet have never heard this "I Kissed A Girl" song. In fact, every time I hear it mentioned, Jill Sobule's classic 90's hit by the same name comes to mind.
I could rant about how this is a sign of the changing landscape of music made possible by the digital medium and infrastructure, but you know that already. Instead, today I'd just like you to sit back and think about what it really means to have a #1 single these days--Katy Perry has sold fewer cumulative albums in 7 weeks than The Beatles did in 1.
The lowest common denominator will always exist, and will always sell. It's human nature to be attracted to artists and songs that other people like. That market won't disappear. The difference is not that people aren't buying music--music sales are still well above what they were in the 60s (and 70s and 80s and 90s)--it's that not everyone has to buy the same albums. They have different ways of discovering music, and more music to choose from.
As an artist, you should view this change as a boon--you no longer have to conform to a "norm" to get a coveted record deal and thus sell records; you can make whatever music you want and there will, more than likely, be a market for it. In a world where #1 means much less, being down the list a bit doesn't look so bad anymore.

Randomness and Predictive vs Social Forces

In traditional media marketing, there's a sense that one can predict consumer preference (and those who do the best job of this make the most money). Unfortunately for many who have made careers out of this line of thinking, their processes have relied largely upon situational factors that have allowed their success--with few media outlets (eg- TV, radio stations), those who could spend enough money to get placement for their acts would see great returns.
But times have changed. As Leonard Mlodinow says in The Drunkard's Walk: How Randomness Rules Our Lives :

That is the deterministic view of the marketplace, a view in which it is mainly the intrinsic qualities of the person or the product that governs success. But there is another way to look at it, a nondeterministic view. In this view there are many high-quality but unknown books, singers, actors, and what makes one or another come to stand out is largely a conspiracy of random and minor factors--that is, luck. In this view the traditional executives are just spinning their wheels.

Mlodinow goes on to tell of a study in which 14,341 participants are asked to listen to, rate, and if they desired, download 48 songs by bands they had never heard of. Some got to see how popular the songs were, in terms of their peers downloading them. These folks were further divided into 8 groups, and could only see the data from the folks in their own group. Then there was a group that got to see no data whatsoever--this group was considered to be determining the "intrinsic quality" of the music, without any outside influence.

If the deterministic view of the world were true, the same songs ought to have dominated in each of the eight worlds, and the popularity rankings in those worlds ought to have agreed with the intrinsic quality as determined by the isolated individuals. But the researchers found the exact opposite: the popularity of individual songs varied widely among the different worlds, and different songs of similar intrinsic quality also varied widely in their popularity.

One song ranked 26 of 48 in "intrinsic quality," but was #1 in one world and #40 in another. As one song or another, by chance, got ahead early in downloads, it's apparent popularity fueled others to find it appealing.

The influence of others will always be important to us--we inherently trust the recommendations of other humans more than anything else. Traditionally, the only music recommendations we had access to came from the DJs and VJs who played what the major labels asked them to. There were a few "tastemakers." Now we have all the music options we could ever ask for, plus the option of getting recommendations from anyone and everyone--it's a reactive market now where hits aren't made by radio, but by our peers.

Slight Change of Heart: Lala vs Ad-supported music

At first I was totally opposed to Lala's new model of charging $0.10 for unlimited streams of a song--how on earth did they plan on competing against the free streams at imeem? Then my friend Adam started sending me albums to check out on Lala. I could listen to the whole thing straight through for free, no ad interruptions. Had he sent them to me on imeem, I would have had to put up with a 15 second audio commercial every couple songs.
On the surface, this limited interruption might not sound like a huge deal. But let me put this another way: think of your favorite album, the one you loved the second you heard it, that you listened to from start to finish and didn't multitask while doing so. If the first couple times you heard it, a McDonald's audio ad telling you to buy a Big Mac played between every other song, would it still be your favorite album? Would you have listened to it from front to back? I'll give you a "maybe," but in a lot of cases you'd give up or it at least wouldn't have struck you nearly as heavily.
At this point in time, the primary use of streaming services is still to try out music before deciding whether to buy or not. While Lala's model might not make them any money on streaming revenue, the simple fact that you can listen to the entire song or album for free or next to free and purchase it from the same page is genius. Would I like to see them drop the $0.10 rule and eat the extra costs? Yes, from a consumer standpoint, but it wouldn't be a smart business move--by adding the preventative measure of requiring people to pay to keep streaming, even if it's a trivial amount, Lala forces the user to reach for his or her wallet no matter what, and at that point they might as well invest the extra couple pennies in buying the mp3s (the actual revenue generator).
I was thinking about it the wrong way--Lala is not directly competing with imeem, they're competing with iTunes and Amazon. And kicking their asses. At least for now...
(On a side note, I have no idea who has kept Lala funded through all their different iterations (not even a year ago they were strictly a CD swapping broker), but I want them to fund my startup--they sound patient and willing to throw some cash around)

I want a magical jukebox (that doubles as a washing machine?)

The more I pay attention and ask and read (in that order of importance), the more diversity I see in how people discover and consume music. For the first time in history, we have choice. Music is, and the forms in which to consume it are, more abundant today than ever before.
As many online music services seek to refine their methods for our music playing and discovery pleasure, I'd like to offer my own personal ideal:

• I generally prefer my standard listening and discovery modes to be separate. Then again, not always. When I want them together, I generally just have my standard listening device (for these purposes, we'll call it "myTunes") on random. Make me a checkbox when I have random on to say whether or not I want random reccomended tracks inserted (and a slide bar with 3 states: often, sometimes, rarely).
• My friends are more likely to get what songs I'll want than you are or than "other fans" are. And bands I like a lot are more likely still to get it right than my friends. Ask them--they know music pretty well, and I generally respect their opinions. Oh and hey, while you're at it, make sure I can find out why something was reccomended to me.
• Speaking of random, this state (as it has become such, rather than just a feature) should pay closer attention to me. Am I clicking to the next song often? What have I been stopping on recently? Am I clicking off certain songs nearly every time? What songs have I been playing actively recently? Pay particular attention to my reaction (play a lot vs click away from immediately) to reccomended songs and play more or fewer from the source of the reccomendation based on my reactions. Sometimes I like rating things, but not often when random is on.
• I want to be able to share my music from where I am (in myTunes). Sometimes I want to just share one song, sometimes I want to share a bunch of songs at once. The other person doesn't need an mp3, just a stream (a full stream, without having to register).
• Songs like the ones I recently shared or put into playlists or have been playing a lot recently should play more often on random (including, but only occasionally, other songs by that artist).

Get on that. If I was smarter at programming and algorithms, I'd build my own version of Songbird. Perhaps there is a market there? Looking into the future where all music is free and computers are merely portals to the internet where files exist in a cloud, will the market be in custom built music portals, tailored specifically to your listening preferences? Probably not, but it's worth throwing out there--I think you'll see a growing long tail of market-quality music players and reccomendation engines.

Note: Bonus points to anyone identifying the reference in the title.