Digital Strategy during a Pandemic

📻Hello! Skim through this, if you haven’t already seen “How will COVID-19 impact the music industry?” and Scott Dougherty’s post on live streaming “The Show Must Go On” as precursors to this week’s post on tips for marketing during this period.

First things first, I’d like to share a bit of good news.

In my second newsletter, I highlighted the losses faced by Austin’s SXSW as their annual conference was forced to cancel in March. Not only did the Austin conference shut down for performing artists, but music venues and concerts shut their doors all over the world.

While automotive giants like GM begin transitioning into manufacturing protective equipment for healthcare workers on the frontline, it has been the production crews behind massive stages for major festivals who are now constructing coronavirus triage tents. That’s a crucial silver lining for the music industry.

Fader Fort, who boasted a large lineup for the 2020 SXSW festival, also went completely digital on 3/31 and 4/1. Digital Fort featured exclusive content and performances from musicians and bands on the original line-up.

In March, Live Nation watched it’s many concert venues close. Unfortunately, this places many production folks out of work who produce the main stages, execute lighting, live sound, and more. It was refreshing to hear this update below from Live Nation CEO Michael Rapino.

If you would like more good news during this period, look no further than Goodable.

In an effort to disseminate information about COVID-19’s impact on the world of music, my first article may have seemed alarmist to some folks. To be clear: nothing shared here is in any way intended to stir the type of panic causing everyone to hoard toilet paper.

After taking an objective look at data from leading health organizations, we can discover the right path forward. The purpose of writing during this period is to get the facts straight and chart a new course for the music industry, not to add to certain media outlet’s fearmongering. So, in an effort to spread awareness from reliable sources, the worst-case scenario tells us the situation we face could stretch into a months-long endeavor to flatten the curve. As testing ramps up, we hopefully won’t reach a worst-case scenario.

Much of what I wrote on March 9th has come to pass. Coachella is postponed to October while Gov Ball is canceled and set to return in 2021. Boston, who has perhaps the most Irish pride in America, canceled it’s Saint Patrick’s day parade. Last week the U.S. became the top country in the reported number of COVID+ cases. Now, the music industry is working on creating new means of income for artists and their teams amidst a loss of touring revenue.

Thankfully, the shifting trend towards virtual concerts is already here. But first, a look back in time.

💭Case Study: History Repeats

The case study worth revisiting right now is Apple delivering us the iPod and the new online-music industry through iTunes.

The situation presented by the novel coronavirus, new as it is, is eerily similar to when Napster destroyed physical recording sales of music in 2001. The music industry was in crisis management mode when Apple stepped in with a strategy better than litigating piracy, the only one being employed at the time.

At the time, CD and Vinyl sales accounted for the #1 source of revenue in the music industry. Now, seemingly overnight, the virus has wiped out a busy touring season, which was far and away the #1 source of revenue for artists.

There are many gatekeepers involved in the relationship between the tech and the music industry. No one in the music industry can go it alone while facing this new problem, just as Apple had to approach their new business model with strategic partnerships at the top of mind.

Partnerships is the first of three P's case refers to in his book, The Third Wave. Success during this period will hinge upon the ability to forge constructive, supportive partnerships with the businesses that can provide the best means of monetizing live streaming.

Companies with credibility behind their name will have an advantage in creating these partnerships, yet we could see lesser-known organizations come to the forefront who create a sense of possibility around the emergence of live streaming and can best support artist’s creative endeavors given the circumstances.

The Berlin-based music streaming company Soundcloud, who not long ago had trouble retaining artists on its platform, forged a strategic partnership with the San Francisco-based live-streaming platform Twitch. It’s a strong partnership for Soundcloud, who currently trails behind Spotify who’s the industry leader in paid subscriptions. At the time of this writing, Twitch has 2.3 million followers in it’s Music & Performing arts category and Producer Kenny Beats had 525,000+ total views in his live stream.

Using this partnership, artists and creators can better connect with their fans, get paid, and promote their “live” gigs. Read more about how the partnership works here.

Additionally, success during this period can be leveraged by any company willing to learn the policy behind live streaming music. Policy is the second of three P's Seve Case refers to in the The Third Wave. 

The Toronto-based singer-songwriter Jessie Reyez released her new full-length album BEFORE LOVE CAME TO KILL US this past Friday with a complimentary live recording on CEEK VR plus an interview with founder and CEO Mary Spio.

CEEK VR was ahead of its time providing an engaging platform for live music to prosper, although they may have grown stronger relationships between artists and fan bases by providing more of the above content earlier. VR hasn’t yet gained mainstream traction, which may restrict users without headsets from the main experience offered by CEEK: 360° content. The visibly small userbase is illustrative of the fact that a great product or service will only get you so far. The third P referenced by Case is perseverance-and if CEEK has any bit of this, they could emerge as a leader in the space. They are going to have to battle the current tech Goliaths who already hold the most attention:YouTube, Instagram Live, and Facebook.

Around 2014 many video platforms emerged, such as Vimeo, yet many failed because it is simply hard to take people away from what they know (ahem, YouTube), so it isn’t 100% likely a new service geared specifically for artists will emerge. Or will it?

Live Nation adapted and overcame the potential of total losses of revenue.

It’s also not hard to imagine YouTube or Twitch emerging as a steady leader for live streams, as their avid user base is already in the millions.

Tik Tok is an obvious platform artists can leverage to support their new releases, getting creative with dances or releasing sound bites of new songs.

Prior to the release of a song, Drake’s music is providing further evidence to the fact that Tik Tok is now a driving force in marketing for artists. His avid fan base is already working on viral dance moves ahead of his new album.

He’s not alone as more artists embrace Tik Tok, as Tinashe has below, to expand a fan base by reaching over 500 million active users.

In addition to using the popular video platform, there are lucrative opportunities beyond free live streaming.

💭 Consider the Passion Economy.

Doing so can bring in new streams of income that can support artists during this period. In a helpful article from the Andreesen Horowitz, the VC firm outlines how influencers can engage their fan base and followers creatively through different platforms to monetize themselves.

Piggybacking off Li’s article covering the Passion Economy, it is worth noting that these tactics can be rolled out together in a digital release strategy.

The aforementioned teaching platforms can be leveraged by artists who are willing to teach their unique production process, from their own home project studio. Melanie Faye, the 21-year-old guitarist from Nashville, is one such artist who teaches guitar using lesson face. That’s a pretty good deal for someone who already receiving praises from John Mayer.

Producers and DJs can convert followers on Instagram by streaming on Twitch to share helpful tips with their following, or to release new original music and mixes. Patreon can also be leveraged by Producers for beat packs and DJs for mixes.

Fans and followers can sign up for their favorite artist’s newsletters on Substack. Substack can also be leveraged for metrics to measure how powerful engagement is. Then the addition of paid tiers, small or large can act as a bonus for superfans. We all know someone who is a superfan. At the end of 2019, a few of our friends shared on social media that they were in the top 1% of fans on Spotify. So, why not leverage Substack for a paid tier with superfans, giving pre-order releases and early access to new recordings? Patreon can be used in a similar fashion, and the two can be combined in a release strategy with virtual concert tickets. My last word on Substack, the platform I’m using to write this newsletter, is that artists can easily embed audio. This can be taken advantage of by making a podcast to promote an album, or by releasing singles to a large email list.

Dan Runcie, the founder of the business of hip hop company Trapital, thinks those with “passion audiences should weigh options” since the IG live stream model works and paid live streaming for concerts has proof of concept from Erykah Badu, who charged a $1 fee per person. Pondering who’d emerge as the leader in this area, I shared I’d love to see companies bundle merch and live streaming into the same price tag, which brought to mind a partnership opportunity.

Shopify can also be leveraged into an eCommerce solution for live stream concert tickets. Used creatively, bundles with merch and digital recordings could be a trend that is here to stay. A business like Fame House can create a solution in partnership with Patreon and Twitch to develop a fully adjusted release strategy. Provide ticket access to live stream and virtual concerts, including higher tiers for exclusive content as Digital Fort has done. For one last tip, I’d suggest artists hop onto Cameo and get paid for 1-on-1 time with fans willing and able to pay for their presence.

Here are some more resources about the Passion Economy and Promotion:

“1,000 True Fans? Try 100,” by Li Jin

“16 Key Metrics for the Passion Economy,” by Li Jin

“The Passion Economy and the Future of Work” by Li Jin

“a16z Podcast: The Truth about 1000 True Fans + Pricing Our Attention” by Kevin Kelly and Sonal Chokshi

“Want to Promote Your Album? Make a Podcast About It” by Cherie Hu

Thanks for reading! I’d love to hear your questions, thoughts, and comments on Twitter. Please feel free to connect on LinkedIn as well.

- Jimmy Seykot