Planning Within Your Means
|Fair Wend||Apr 12|
One of the biggest mistakes I ever made in my music career took place right at the beginning of my journey.
It was the summer of 1999 and I had all the songs chosen for my debut project, a producer who was ready to work with me, and a studio all lined up. Everything was falling into place perfectly, and I was super excited about working in a professional recording studio with a well known producer.
I had a short term plan in place which included booking gigs, delivering two singles to radio and getting 1000 units manufactured to sell from the stage and in local stores.
I sourced the budget I needed and saw the project through, started touring, mailed my album out to stores (thanks Mom), hired a radio tracker and delivered the first two singles to radio. Both singles charted Top 20 on Mediabase, resulting in some nice royalty cheques and my first BC Country Music award nomination. I was off to an impressive start, but here’s where I missed the mark.
Although I had a decent startup plan, I didn’t account for possible marketing costs beyond the first 6 months of my album release. By the time my 2nd single had run its course on radio, my entire startup budget was spent, leaving me unable to leverage the momentum that I had gained.
Granted this all happened well before the digital age when the music business, and how we consume music, looked quite a bit different, but after a decade of working with over 100 artists, I see that these are common mistakes. And I can explain why. We aren’t making these mistakes because we’re artists, we’re making them because we’re artists. Get what I’m saying here? We don’t start out business savvy. We’re creators, so we create, then dive right in to get the music out to the people. We make mistakes and learn along the way.
Hopefully ‘music matters’ sheds enough light on a few things so that you don’t have to bump into as many walls as I did along the way though. Being informed out of the gate will likely save you time and money!
Planning within your means, will yield you an eventual return.
If I had known then, what I know now, I would have put 40% of my budget into recording a 6 song EP instead of an LP, 10% toward manufacturing 300 units instead of 1000, 40% toward a full year of marketing and promotion initiatives, and the remainder in the bank to cover unforeseen expenses. I would have also set my 10 year goals to be sure that my one year plan was aiming toward my trajectory. Had I done this, I would have been prepared to follow up the 2nd single with a 3rd, book more shows due to hype around my album, recoup on my manufacturing costs much sooner, and be operating from a place of profit, instead of a debt.
Money doesn’t come easy for most, and the return in this business is small until you have a large dedicated following, so it’s very important to be mindful at every turn and make informed decisions along the way.
Whether you’re operating on a loan, angel investment, grant, your savings, your profits, or drawings from the income from our day job, (or a combination of these), prioritizing your costs, setting realistic goals and working within your means are essential to realizing success.
Create like an artist, think like an entrepreneur.
For the past 100+ years there have been two primary revenue sources for artists - live performance and product sales.
Live performances and merchandise sales go hand in hand, and both depend on records being released to the market. In order to keep these revenue streams going, you’ll need to be releasing new music fairly consistently.
As for the merch, remember to work within your means and only order the product you can afford. It’s better to sell out fast and re-order from your profits, then to end up overstocked, never recoup and have to give away your outdated stock.
Other excellent revenue streams include royalties from Film/TV placements and satellite radio (SiriusXM) airplay. It’s highly competitive and it takes a lot of work to get there but it’s entirely possible.
Further revenue streams come from streaming, sponsorships, features and other high profile opportunities such as influencer marketing and appearances, but the returns here are very small to none until an artist reaches midway levels to establishment.
With social media and analytics at our fingertips, artists and bands are in a perfect position to profile themselves quickly. The key is to stay authentic, create from a personal place, put on one heck of a show and be smart with your business decisions and money along the way.
Now that we’ve covered the fundamentals of artist entrepreneurship, we’re ready to look at marketing.
In next week’s issue I’ll be providing an overview on marketing plans and outlining how artists can use them to benefit their music careers.
Have a great week!