Erik Gilbert is the CEO of CV America, a division of the CV Group, which comprises of Essential Music & Marketing, Cooking Vinyl Records, and Cooking Vinyl Publishing.
Nearly ten years after Steve Jobs gave us the iTunes Music Store, which kicked-started the digital download market, last week's IFPI report revealed that digital revenues have finally stemmed the downturn from declining physical sales. Global recorded music industry revenues rose by an estimated 0.3 per cent to $16.5 billion in 2012, the first year of industry growth since the heady Napster days of 1999.
The rise in revenues has been attributed to accelerating growth in digital revenues, up 9% as a result of a fast globalizing digital music business.
Stats aside, there are several qualitative examples of digital making the world smaller. For many, this fact was exemplified in 2012 by the success of an artist like Psy. Recently, Gangnam Style was credited with adding some $8 million to Google’s bottom line.
Meanwhile, already this year, a handful of high-profile veteran artists have returned to the fray via some pretty innovative digital marketing – most notably David Bowie, quietly uncorking his first new music in a decade and letting it seep virally onto social networks. Hours later, and "Where Are We Now?" was dominating old school media, with career affirming reviews of Bowie's new album now coming in.
However, digital is not the whole story. This was a point made, ironically enough, by Trent Reznor in October of last year, when explaining his decision to partner with Columbia for his How To Destroy Angels project. Despite successfully circumventing the record label model with innovative digital strategies, Reznor also noted some downsides to a strict D2C approach.
For one, there was an element of ‘preaching to the choir’. And more specifically, when playing a show in Prague, he couldn't find Nine Inch Nails albums in record stores. By comparison, shows for fellow pioneers Radiohead – who had licensed their albums through a label – were being advertised six months in advance. Working with a team of specialists, concluded Reznor, able to deliver expertise on both a local and global basis, did have its advantages.
To me, these words resonated. Digital distribution might have re-ordered the power structures of the music business (mostly for the better) and eroded the whole concept of territorial borders, but the demand for local expertise and intelligence has never been greater.
For US labels and artists, the value of partnering with a local team, be it in London, Paris, or Munich, remains vital and necessary to build upon and expand one’s fan base.
It is not enough to have an intellectual understanding of what works in a territory or market; one has to know the key players and how to get the best services delivered at a price that will generate a profit. To find and build relationships with the right radio plugger, publicist, or journalist, and to know which radio station or TV show will have the necessary impact on sales - and more importantly, when and how to implement the marketing strategies needed to influence that impact, for both physical and digital formats.
Additionally, having the local intelligence and relationships to expand your business beyond sales, to generate revenue from the increasingly important ancillary streams, such as synch licensing, touring and brand associations. Only local expertise can provide that.
Take Amanda Palmer; a fiercely independent artist who releases her own music. Understanding the power of local intelligence, she chose to partner in Europe, on terms that were beneficial to both parties, without giving up any of her rights.
Her UK-based label put together a promo team comprising the likes of French PR specialists Ephelide PR, Community PR in Germany and Italian label partner Edel; together organizing two promo trips before her European tour and a day in France on the eve of the tour - during which she did live performances for National radio station France Inter and Oui FM! This is not something that could have been achieved with anywhere near the same level of success if she had project-managed herself, or if management had coordinated it from New York.
I firmly believe that this now proven local service-style model, moving away from the cookie-cutter approach of a global one size fits all methodology, will play an increasing part of the industry’s future. Every artist or label is unique – cutting the cloth accordingly and offering a suite of services around an individual project ends up benefitting everyone.
For artists, there is the promise of far greater control over their music and careers; while labels and other investors are incentivized to target their resources around the strengths of a particular project.
Ultimately, this also makes the business exciting. It tears up the rulebook. What works for a performer like Amanda Palmer probably won’t work for an up and coming artist like The Allah-Las, for instance, or an established act like Asking Alexandria.
If you are searching for an appropriate international partner, then talk to other managers/labels/artists about what has worked for them. Go to international conferences. Be willing to work in the market. Understand the genres that work and don’t work, and the media that stimulate sales. Above all, take some chances.
Of course success internationally is never guaranteed. Once a suitable partner is found, the artist is going to need to work in the market, doing press, radio, tours and whatever else is needed, before any degree of success might plausibly be forthcoming.
An increasingly connected global world simply compounds the need for local expertise to navigate the noise and build your international fan base. To use the classic environmental phrase: 'think global, act local'.
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