2020 was a historically difficult year for artists. And while 2021 saw some good developments, making money as an artist or brand in the music industry is still uncertain.
According to research by PwC, the music industry suffered from the most dramatic decline in global revenue in its history, falling by 63.8%. This number is not expected to return to pre-pandemic levels until at least 2024. It’s truly shocking.
This marks the first time since 2000 - when touring overtook physical music sales as artists’ main revenue source - that the recorded music industry is worth more than the live music industry. The decline in revenue is felt throughout the whole music industry.
1. It is time to reinvent business models
But times like these always bring great opportunities to those who are optimistic and adaptable to change.
The cancellation of shows and festivals worldwide left a gap between artists and fans. Artists promote themselves through music and social media presence and then use ticket sales for live shows to make money from their fanbase. But this is also where that magic connection between artist and fan takes place. And the possibility to make money, but especially that magic connection, was suddenly lost.
But truth is, true fans still want to financially support their favorite artists, live show or not. So, you need to find creative ways to monetize your fanbase.
The pandemic has actually pulled forward the future of technology, as consumers’ readiness to engage with digital media experiences has accelerated - also in music. Give Fangage a try and see how technology has opened the way for artists to reinvent how they make money online.
Artists must adapt and use owned marketing channels to have a sustainable income in today's music industry.
2. Social media is changing
And it is not for the better.
Social media platforms have, and always will be great channels to build a following, but reaching your real fans through social media is getting harder every day. The big social media platforms are increasing advertisement revenues and you need to pay for advertisements to reach your fans. But these platforms are still widely used, and with the introduction of 5G, the global demand for content will only increase over this decade. As a result, these platforms will be oversaturated with creators competing for people’s attention.
However, the increase in demand for content means that there are many opportunities to build a fanbase. That is if you focus on sharing the right content on the right platform - meaning the one where your audience can be found.
It is getting more and more important, especially for independent artists, to cultivate a small army of dedicated fans on the platforms you use. You need a steady stream of engagement on social media because you are more dependent than ever on this small army to get a steady income.
3. Short-form videos and user-generated content are becoming increasingly popular
Short-form videos and user-generated content are becoming increasingly popular. TikTok and Instagram’s Reels were a huge trend in 2021 and we believe they are here to stay. And you should be aware of the opportunities these platforms offer for marketing your music.
TikTok has been responsible for the rise of several chart-topping hits over the past years. Through creative marketing efforts on platforms like TikTok, you may attract a group of new fans as an artist.
Drake famously collaborated with TikToker Toosie for the promotion of his ‘Toosie Slide’ song.
And guess what?
It topped the charts because the ‘Toosie Slide Challenge’ went viral on the platform. Imagine if he didn’t put in the extra effort to create a partnership like this. Imagine if he had only put a post on his Instagram announcing the new single. Do you think the song still would have topped the charts?
Creative artists and their innovative marketing teams are leading the way, so get creative with the marketing strategy of your releases! Remember, you only need a fanbase of 1000 true fans to make a living as an artist, and you can only win their attention with engaging and valuable content.
Another way to engage with fans and provide them with a valuable experience is to simply go out and chat with them. This is a great way to showcase your personality and maintain that connection with your community of true fans. Show them that you care about them so they will care when your new music or product drops. A lot of artists are seeing the value of these artist-fan connections, and use Instagram DMs or Discord as a way to chat with their core fans.
5. Exclusive content
While it is essential nowadays to upload great content consistently, it does not always pay off in revenue directly. A way of monetizing your great content is by making it exclusive and selling it to your true fans.
For artists, exclusive content for monetization could be any of these things:
- Radio shows
- Video content
- Tickets to live events
6. Live streaming
Live streaming has skyrocketed as a result of the pandemic. No other content is as engaging as live streaming is. And some fans truly seek this live experience, especially now that live shows are off the table.
Live streaming is also a great way of creating content. You can save your live stream after you are finished, and create content for other platforms with the footage.
The music industry has relied on live performance revenue for far too long and because of this, a lot of artists are having trouble reinventing their business models and making money in these uncertain times.
The trends named in this blog were long on the way, but now you don’t have a choice but to adapt quickly if you want to have a steady monthly income. If you build an owned audience now, you will be the big winner once live shows come back. You will be able to sell the most tickets because you maintained a close relationship with your fanbase.
Innovate now! Invest time in your fanbase and find new ways to monetize it. Try out Fangage now to to build an owned audience and start monetizing today.