The increasingly broad definition of today’s dance fan and where to reach them was a frequent topic of discussion throughout the first day of panels, including a presentation of exclusive research on the EDM audience recently conducted by Nielsen. Though the top-level findings were not surprising (EDM fans are still predominantly millennial, under-25-year-olds who are 50% more likely to buy energy drinks and over-index in their ability to set trends than any other age group), some of the nuances were eye-opening.
For example, the sixth largest U.S. market for EDM fans and listeners is Asheville, North Carolina -- which indexes higher than Miami, Chicago and Los Angeles in terms of fan density. New York is still the number-one market, but Boston, the Bay Area, San Diego and Denver all rank in the top five. “If you’re thinking of other markets to break an artist, there are some great places for you,” said Tatiana Simonian, Nielsen Entertainment’s VP of branded content.
EDM fans also stream music more than fans of other genres, a behavior that several label execs still don’t think has achieved critical mass. “The average music consumer spends 40 to 45 dollars [a year] on recorded music,” said Robb McDaniels, CEO of independent distributor INgrooves. “So if you get the average spending $120 on streaming subscriptions, that’s three times the size of the pie that we all get to share and the artist gets to share. We just gotta get to that tipping point, which is about 6 to 9 months away.”
And with EDM artists like Calvin Harris, Zedd, Avicii and Tiesto starting to get a larger share of Top 40 radio airplay, labels will continue to scour platforms like Beatport and Soundcloud to discover the next breakout stars. Recognizing this crossover trend, Sean Glass, founder of dance boutique label Win Music, took a mainstream approach in breaking his U.K. artist Duke Dumont last year in the States. “Kid Kelly played the record for me before Geronimo did,” said Glass, referring to Siriux XM’s top 40 and EDM programmers, respectively. “I treated it like a pop record, not an EDM record.”
M&A activity in EDM has reached a frenzied pace over the last two years, and strategic partnerships like Insomniac and Live Nation or SFX and Clear Channel continue to proliferate. As the wave of consolidation continues to take shape at the major promoters and entertainment companies, senior execs debated what was next – including the role of promoters as record labels, as evidenced by Insomniac’s recent partnership with Interscope, which will release its first EP from “G-house” artist Destructo later this summer.
“The SFX rollup has really changed the way we have to move, and to a certain degree it affects everybody on this stage,” John Boyle, Insomniac’s chief growth officer and interim CFO said in a panel of heavy-hitters from the top promoters. “There’s a land grab happening right now -- and so if we don’t do something, someone else will. Launching a record company is interesting, growing a business is interesting. We’re kind of having to do it at a pace that might be faster than it would be if it was organic.”
Boyle nodded to Rick Stevens, CEO of Y Entertainment Group, whose company just announced three Isle of Dreams festivals in Turkey, Israel and Switzerland for later this summer. “You’re launching three festivals – those are territories we’d like to be in,” Boyle said. To which Stevens wryly replied, “We beat you to the low-hanging fruit.” He then noted that Y, a division of billionaire Ron Burkle’s Yucaipa, has an investment strategy that aims to let indies thrive. “Our style has historically been to empower the entrepreneur with additional capital and advice and support, which empower them to do a better job than they did on their own, rather than change what made them successful.”
But as the top promoters continue to expand, Goldenvoice COO Skip Paige considered “the jury’s still out” on the growth of promoters’ media platforms -- the recently re-launched Insomniac.com among them. “Nothing is more important than a person buying a ticket,” he said. “If the media platform is the way you really wanna sell tickets, then it’s probably a good business model. If you think you’re gonna build a good media platform and it’s gonna be separate from your core business and it’s gonna generate a lot of money, the jury’s still out for me. However, diversificiation is what it’s all about – we own the ticket company, the VIP company, the food and beverage company. These are the things we’re doing to diversify…our company used to gross $50 million a year, now our whole company grosses $500 million a year.”