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Topspin Offers 5 Direct To Fan Lessons From SXSW

image from blog.midem.comBy the staff of Topspin Media.

SXSW is one of the few events that organically blends the discussion of digital/tech business trends/topics, with the actual music and artists they affect. Attendees can spend the day in panels or keynotes, and the evening attending performances from both newcomers and superstars alike. The result is some much-needed perspective into how this new music industry is developing and implicating artists of all stripes. It goes beyond the chin-scratching theorizing of other conferences, and instead shoves the issue right in your face.

So once you get past all the griping about long lines, the big-money branding, and the lack of sleep, there are some real lessons to be learned.

Superserve the Fan

Nielsen issued a report at SXSW indicating 40% of music consumers contribute 70% of the money spent on music and music related products. Nielsen analyst David Bakula estimated that the music industry is losing as much as $2.68 billion in overall value by not better targeting music fans with more creative products, such as bundled content, early access to new music, personalized merch, and so on.

What’s more, Nielsen indicated that music fans who spend the most money on music also take the most free music. That’s not to say they only pirate music, but that they’re more open to accessing new music in exchange for things other than money, such as an email address, a Facebook like, or other such measure.

This puts a strong dollar figure on Topspin’s philosophy that the album is not and should not be the sole “product” of any artist. It’s simply one of many, and the more variety or products (both physical and digital) that artists can make available, the broader spectrum of fans they’ll ultimately serve, and the more money they can make.Topspin-logo

Revenue vs. Value

Not surprisingly, there was plenty of discussion about revenues that streaming services like Spotify and others provide artists. But we’re starting to hear more discussion of the overall value that these services can provide artists beyond a royalty check. This includes not only data on things like fan demographics and usage metrics, but also fan data itself. On one panel, Rdio director of artist relations Adam Rabinovitz told attendees that the No. 1 request artists have is for the email information of fans listening to their music. Now he can’t oblige because he’s not in the position to give away users’ email addresses w/o their permission. But that does indicate that the value of streaming services to artists goes beyond mere dollars and cents.

Topspin has two solutions to this problem. For artists, the email-for-music widget allows artists to offer fans free music in exchange for their email, which they can place on their website, Facebook page, etc. For services like Rdio, our ArtistLink API gives them access to any offers, metadata and media provided by artists using the Topspin platform. You’ll soon see how this will look in the wild when Beats by Dre launches their new streaming service, currently code-named “Daisy.”

The Digital Retail Experience Must Improve

Like it or not, we’re headed for a streaming world. With that comes with financial challenges for artists, labels, and everyone else involved in the value chain. Those challenges will be resolved not only as more fans use the streaming services available to them, but also as those streaming services allow fans to do more with them. Today, these retails “shelves” are rather barren, consisting only of the ability to stream a song. Artists require the ability to acquire fans and present their offers inside of the streaming music services. Fans want to learn more about the artists they discover on these platforms from within these platforms themselves, not be redirected elsewhere. More functionality translates to more value.

Topspin’s GoDirect platform aims to let artists fill those shelves by claiming their profile page on participating music services (such as MTV, and soon, the Daisy service). With it, they can sell music, tickets, merch and more directly to fans, write their own descriptions and submit their own pictures, and collect fan email and social media connections in return for various rewards.

Ticketing Has a Marketing Problem

Touring artists today have two choices before them: take advantage of the scale and infrastructure of major ticketing services, but only get access to at best 10% of their inventory; or try to manage the process completely on their own to access the full 100% of ticket inventory. There needs to be a middle ground where artists leverage their connection to fans to sell more tickets and capture the data from those transactions, yet let the ticket service pros manage the backend process. If artists are directly connected to their fans (16 of the top 20 twitter accounts are musicians) and if promoters frequently urge artists to email their lists and tweet about shows because those messages sell the most tickets, why isn’t the artist empowered to sell more of the ticketing inventory?

What we need is an API from all ticketing services that allows artists to bundle tickets with other goods, create great fan experiences and gather consumer data as a reward for their marketing efforts while keeping the tickets on a proper ticketing system.

Authenticity is a Must

Our own Nicole St. Jean spoke on a panel with the amazing Amanda Palmer on how to manage an effective direct-to-fan campaign. The upshot is that it’s not about the number of followers or fans you have. It’s about authenticity of your relationship to them: of communication, of attention, of message.

Whether the fan is interested in music, film, books, or whatever content you have to offer, the creator of that content needs to be involved or it’s not really direct-to-fan. The artist must be driving the designs, the experience, and the communications at all times. Smaller overall unit sales can translate to higher revenue when artists allow fans to pay them for authentic experiences and products.

Like any other marketing or retail channel, direct-to-fan needs consistent attention. Imagine if iTunes or Amazon went for months without messaging their customers. These are your customers/fans, and you need to stay in touch. Over time your direct channel can become an incredibly powerful outlet but it won’t work as well if you ignore your fans between albums and tours.

Oh and we saw some cool shows too. Our favorites included The Joy formidable, Jim James, St. Lucia, CHVRCHES, Drake White, Emmylou Harris & Rodney Crowell, The Staves, Delicate Steve, and DIIV. And a special shout-out to Topspin client No Ceremony ///—which played their first-ever U.S. shows. Notable films we caught included Act of Killing, A Band Called Death, and The Crash Reel. Keep an eye on all these great talents!