Free music, sell more CDs…

Where Nine Inch Nails’ approach, like Radiohead’s before it, draws fans in with free music and then offers additional music for purchase in more extravagant configurations, is this the answer?  Could this be the new game plan?

From the start, Nine Inch Nails planned to put out some tracks for free and charge for others from its instrumental album “Ghosts I-IV.” NIN began giving away nine tracks on its own Web site March 2 and uploaded those same tracks onto Pirate Bay, where fans were encouraged to share the music. But fans were given other options, too: $5 for a digital version of all 36 tracks from the album via Amazon or nin.com, $10 for a double-CD, $75 for a deluxe edition or $300 for an ultra-deluxe edition that includes a vinyl version and Trent Reznor’s autograph.

In the first week, the band says its release resulted in more than 781,000 transactions, including free and paid downloads and physical preorders. Though NIN didn’t break out sales by format beyond that figure, the band does say that pre-orders sold out all 2,500 copies of the $300 limited-edition release. Sales through nin.com topped $1.6 million in the first week, and digital sales though Amazon on the first day of release totaled $1 million, according to the band’s manager, Jim Guerinot.

No one’s arguing that the changes in the music industry haven’t tipped the scales in favor of the independents. Not only can you lead a path to success without the help of a label, you can choose from a variety of means to achieve it.

As an indie, CD and download sales can be a huge part of the equation in regard to your income. But building a rapport with new and existing fans and widening your reach by means of song giveaways is an easy and obvious way to get people to listen – and isn’t that ultimately what you’re trying to do?

For the indie artist, on the question of free tracks, the scales seem to be tipping toward “yes!”

Your Music Is Your Marketing
Excerpted from Music 3.0, Making Music in the Internet Age, by Bobby Owsinski.

The major marketing tool for an artist today is your music. It’s no longer the major product that the artist has to sell (although it still is a product), so it has to be used differently and thought of differently as a result.

Perhaps recorded music was never the product we were led to believe it was. With a vinyl record or CD, the container that holds the music is the product. While the songwriter always made money when a song was played on the radio, the artist never did, and the artist made only a small percentage of CD and vinyl sales (10-15% of wholesale, on average). [Keep in mind, he’s talking about the major label model here, not the indie model where you’re keeping all the proceeds from your gig sales and 60% or more of your retail sales.]

In fact, the artist made the most money on concert tickets and merchandise while touring. There was a cost involved in the manufacturing of the container that transported the music (physical material costs, artwork, and so on) that had to be recouped, as well as the production costs of the music. But if you look at music in terms of the advertising world, you see music in a different light.

If you’re selling a soap product, for instance, the production cost for a commercial to broadcast on television or the radio is trivial. It’s the total ad buy (the agency purchasing the radio or television time for the sponsor) where most of the money is spent. Even then, it’s considered part of the marketing budget of the product, which might be about 3% of total sales.

If you consider the music-production costs as part of the marketing budget in the same way as a national product, it takes on a whole new meaning. [That’s a mighty big leap, IMO.]. Since the music is considered the major marketing tool for an artist, it should be considered a free product, a giveaway, an enticement. Give it away on your website, place it on the Torrents for P2P, let your fans freely distribute it. It’s all okay. Since most millennials already feel that music should be free and have lived in a culture where that’s mostly so, don’t fight it. Go with the flow! Just as it was during the past 60 years, the real money in the music business is made elsewhere anyway. [Again, not necessarily for the indie artist.]

Further, just because you’re giving it away doesn’t mean that you can’t charge for it, either at the same time or at sometime in the future. There are numerous cases in which sales have actually decreased for an artist’s iTunes tracks when the free tracks have been eliminated.

One such musician is Corey Smith. After six years, Corey has built his gross revenue to about $4.2 million, and free music has been the basic building block of his tribe. You can buy his tracks on iTunes (he’s sold more than 400,000 so far), but when his management experimented by taking the free tracks down from his website, his iTunes sales went down as well! The free music Corey offers allows potential fans to try him out. If they email and ask for a song that’s not available for free, he just emails it back to them. He’s tending his tribe!

Another example of reaping the rewards for giving it away for free is the techno and electronica artist Moby, whose “Shot in the Back of the Head” became the best-selling iTunes track after he gave it away for free on his website for two months! Of course, you can charge for your music with enhanced products like CD box sets, compilations, special editions, and other value-added offerings. But the initial releases for an artist on any level (except for the already-established star) must be free to build a buzz.

Free Music = Free Advertising = Smart Business
Excepted from blog posts by Dexter Bryant, Jr

Free music is free advertising. Think of free songs as product samples: the music-buying public samples your product at no cost. For those who don’t care for your music (no matter what the reason) they can easily sever their relationship with you and your product right then and there.

For the people who like your product, they can easily dig deeper and sample some more of your music to get a better feel for your identity and what your brand represents. From there they can decide whether their values align with yours and if they would like to continue their relationship with you. If you and a potential fan are birds of a feather (so to speak) then chances are they will be ready to forge a deeper bond with you and take your relationship to the next level and buy your CD.

Free music increases the potential for engagement with audiences because anyone can participate. Free eliminates risk and lowers the barrier to entry for consumers. If I may use a food-related metaphor, your songs are the appetizers that will lure audiences to dine with you for a full meal – free mixtapes/EPs/CDs/whatever.

A full meal provides your audience with a clearer picture of your overall vision and your artistic identity. If people really enjoy your meal(s) then they will seek yet another option (or options) for consuming the deliciousness that you offer. These additional options for engagement with you include live music, merchandise, premium products, CD packages, DVD packages and any unique experiences that you can offer your hungry, eager fan base.

In short, free songs lure consumers to sample your free mixtapes, and free mixtapes are the bait to lure fans to spend money on live music, merchandise, deluxe edition mixtapes, and premium-priced music products and experiences. At every stage in this chain your product must gratify whatever desires your audience is seeking to fulfill, otherwise they may be inclined to discontinue their relationship with you.

Give the Customers What They Want. When a song or artist has captured someone’s interest enough that he or she seriously considers a purchase from that artist, many of us will download the music for free before we buy it. This allows us to become intimately familiar with that piece of music so we can be absolutely sure that buying it will be worthwhile. However, as you all know, downloading one simple song can sometimes be a more frustrating process than need be –navigating through treacherous, spam-infested illegal download sites and P2P software for just a few minutes of free music to put on your iPod.

Eliminate this pain point for your customers and you will endear yourself to them. Let your fans have the option of downloading for free or purchasing downloads from you and make it easy for people to download your music for free right from the same online destination they can buy it from: your website.  Always have your merchandise, packaged CD, and premium priced music products ready for purchase and be ready when they are.

Give it away or sell it, it’s up to you…  You conceive it, we’ll achieve it.

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