Universal Music Canada has partnered with PledgeMusic to give its artists access to the direct-to-fan platform and its team. The deal is the first between a major music company and this type of direct-to-fan service.
Universal and its distributed labels will be able take advantage of PledgeMusic's pre-order platform, social syndication technologies and recommendation engine for both frontline and catalog titles, says PledgeMusic CEO Benji Rogers.
"Love + Fury," the recent release by Canadian rock band Headstones, was the first release of the two companies' partnership. The album debuted on the Canadian album chart at No. 7. Rogers says PledgeMusic accounted for a "sizeable" portion of its first-week sales.
“As we have seen with the success of The Headstones wonderful new album, PledgeMusic is a vibrant new way of artist discovery,” said Randy Lennox, President and CEO, Universal Music Canada, in a statement. “Benji and his Pledge team have developed an artist and music fan-friendly experience and we couldn’t be happier to partner our artists and their assets with Pledge’s exciting direct-to-fan platforms.”
Launched in 2009, PledgeMusic is generally lumped into the same group as crowdfunding platforms such as Kickstarter, Indiegogo and RocketHub. The association is partially correct. Like Kickstarter and similar sites, PledgeMusic enables artists to raise funding for albums, videos and tours. But the company insists the platform is not a fan-funding service.
Instead, PledgeMusic sees the platform as a marketing tool that connects fans with artists. Fans that offer their support receive artist updates and exclusive content until the culmination of the project. A campaign for an album might deliver studio reports and audio or videos of in-the-works recordings to supporters. The platform allows artists to integrate email databases, Facebook fans, Twitter followers and various other social networking sites.
In addition, artists often use PledgeMusic to sell pre-orders for albums that will get a traditional release to retail. This option is well suited for record labels. Frontline releases on record labels don't need funding from fans. Catalog releases, especially expensive items like box sets, benefit by creating demand and reducing risk before the release. "You can assess demand really early," says Rogers.
The partnership shows how large companies are finding ways to use direct-to-fan and crowdfunding platforms typically the domain of independent artists. Kickstarter has partnered with the Sundance Institute to help filmmakers raise money. RocketHub has a partnership with cable television channel A&E that will give startups exposure online and on television.
In spite of the growth in direct-to-fan and crowdfunding, potential seems to be going unfulfilled. A Nielsen study released in March found the U.S. record business could reap up to $2.6 billion in additional revenue if fans are given the opportunity to buy the content they want and connect with artists. "Fans want more," said Barbara Zack, Chief Analytics Officer at Nielsen Entertainment Measurement, at Nielsen's SXSW presentation. "There is an unmet need there. There is a desire to engage at a different level than what they have."