Monday, January 21, 2013

How To Make Money In Music

We have all seen (and heard) an extreme saturation of available music. Just about every artist that makes music is giving away music through free downloads, free videos and free listens. Stop and think about it for a moment; Does GM give away the vehicles they build? Does a contracter build a house then just give it away? If you spend time and money making music, then why would you just give it away?

A product that is "better" than all others will stand alone. Yes, advertising and promotion can increase sales and exposure, but in the case of music, unless you have a never-ending supply of money to advertise and promote, 99.9 percent of the time, you are just wasting your time and money if you are advertising or promoting your product. Why would you spend money to buy the newest release from an artist when chances are you can hear it free anytime you want?

So how do you make money releasing music? The vast majority of people making money in music these days are doing so by ticket sales and merchandise such as clothing, perfume, etc. and yes, many people still buy music so they can get a better quality playback, but there is no doubt that giving away products are hurting the bottom line. Giving away your music also demeans the product by saying "It's not worth anything" and if the product is superior, it does not need hype to prove itself.

Before the days of digital downloads and online videos, people spent much more on the product and piracy was more difficult. There will always be pirates, but there are many methods of loss prevention. Advertising and promotion is important to "get the word out" and branding is also important, but if you give away the products you are trying to make money on, you will never profit from your endeavors. I am reminded of what I consider to be the best Italian Restaurant in the world....They don't advertise and have been making tons on money since the 1920's and they NEVER give away free food.