D.I.Y.

Why (not) Bandcamp? [Emily White]

BandcampBy Emily White of Whitesmith Entertainment & Dreamfuel

Bandcamp is a platform I came across by accident in 2008.  A platform I was seeking nonetheless, by asking everyone around me “Why isn’t there a way to sell music directly to fans easily in a way that makes sense?”  A colleague had mentioned a platform with the name Band in it.  I googled like crazy until I landed on Bandcamp (only to find out later the colleague had been referring to something else altogether).  I emailed the contact on the site and instantly receive a response from Bandcamp’s founder, Ethan Diamond. Ethan had built a platform because he too was frustrated with how to compensate the artists he loved directly.  Similarly, his musician friends were equally frustrated.  Thus, Bandcamp was born.

For those of you that Bandcamp is new to, it is a seamless platform in which artists can sell their music to fans for any price; a price that they set.  Meanwhile, users can stream select or all tracks, depending on what the artist stipulates.  The result six years later from my fateful introduction to Ethan?  Read it for yourself on Bandcamp’s homepage (which will most likely increase by the time this piece is public): “Fans have given artists $88 million USD to using Bandcamp, and $3.1 million USD in the last 30 days alone.”

This is not surprising to me.  What IS surprising, is that recently I’ve started to realize that there are many folks in the music industry who have never heard of Bandcamp, or may have, but don’t use the platform or really know what it is.

Let me make it clear, I have nothing to gain by writing this post.  I don’t consult on or work directly with Bandcamp on any of their business efforts.  What I do want to make clear is information on what I have observed over the past 6 years, and in particular over the past 6 months.

20130409-bandcamp-home2When an artist is brand new, breaking and/or buzzing; it has been my experience that if their music is anywhere, it’s on Bandcamp.  Why?  Because it’s seamless to use and makes sense to artists.  They can upload their material in various high quality formats and set the price or set no price and make it purely donation if they want.  The result?  Paypal donations in which the artist knows exactly who the fan is and how much they purchased their music for.  The response?  Half the time when I respond to a fan who donated $100 for an album, the artist says to me “I saw that! And already wrote them back.”  Recently during an album release, when donations continued to roll in for much more than $9.99, producer Josh Shapera said to me: “This has restored my faith in humanity.”

To recap: Bandamp is easy for artists to use on the tech / music end and generates instant income as well as e-mail addresses and data.

Now onto the industry.  As Bandcamp is clearly a large community of passionate music fans, I want to ensure my artists’ catalogs are represented there.  We believe that music should be available in all formats possible and not limited to a select few.  I took this idea to what I consider to be a very forward thinking indie label.  A label with a great roster of like minded artists and styles.  A label who LOVES email addresses and prides themselves on it and gets really excited about any sort of email and data collection.  Their answer to me asking if I could put a band’s years old catalog on Bandcamp?  “No.”

Luckily, I understand where they are coming from.  The idea is that their relationships with iTunes, Spotify, Rdio, Amazon and other platforms are so key, that they cannot rock the boat with any of those outlets.  And I get that from a big picture perspective.  But from the individual artists’ point of view, does it really help them all that much to have a featured placement on iTunes?  It’s cool and fun for a week or a day, but goes away and doesn’t really “move the needle” all that much.  And ultimately Apple keeps the data, takes 30% and knows exactly who the user / fan is while the label and artist are kept in the dark on this info.

It made me realize, why aren’t labels like the one above LEADING with Bandcamp on their content rollouts?  They take a smaller margin (15%; going down to 10% over 5k USD in sales) and you collect data including contact info on the fan from purchase one.  Artist aside for a moment, what a no brainer for a label that has a particular brand and vibe of like minded fans to build their business with this key contact information from each purchase.

And because the label described here is smart and modern and forward thinking, they listened.  They may have also really perked up when I mentioned the $82 million dollars that has flowed through the platform; but they were open minded nonetheless and asked for a meeting with the folks at Bandcamp.

Yay.  Peace in the world between artists, tech and their labels.

BANDCAMPUntil I had another recent release in which fans were asking if the album was on Bandcamp (many of the fans had discovered the artist there via a previous EP the artist had uploaded to the platform before the artist was signed).  And the artist was asking me the same question.  All quite logical of course.  Why wouldn’t a label want their music sold / streamed any and every place legally possible especially when excited fans are ready and willing to pay for the album?  Meanwhile, the artist pointed out “If a fan wants to give $100, why would we limit their price point to $9.99?”

The label’s response “I would suggest just adding the [iTunes / Amazon] purchase links to the Bandcamp page.” 

Ok, so they don’t know what Bandcamp is.  It’s not a social networking profile or website, it’s a digital sales platform.  No problem, we’re all here to educate and help each other out for the greater good of the artist.  My response?  “I don’t know if it makes sense to post an iTunes link to Bandcamp. Bandcamp is a place to sell digital music and many of the fans are there because they aren’t fans of the iTunes experience or model. I’m happy to put it up ourselves and give you guys all of the revenue [until we are recouped] as well as corresponding statements if that works for you. We can also share the email addresses if you’d like as well.”

Their response?  Silence.

And I’ll stay on top of it as that’s my job.  But what a bummer part of the job.  Thus, I wanted to put this info out there and ask the question to the industry as a whole: Why (not) Bandcamp?  I believe that for the first step outside of Direct to Consumer, Bandcamp is the best option for artists and labels right now. Artists and fans love it, the platform’s take is smaller than other outlets and you collect contact info on fans who have purchased from Day 1.  Therefore why aren’t we all leading with Bandcamp for content releases?  They of course do promotions as well.  It’s a question I wanted to pose and will continue to try as right now, what Bandcamp is doing makes the most sense for fans, artists and the industry at large with regard to modern music releases.

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17 Comments

  1. There is a point when selling to a fan directly can interfere with a release this has made it to the stores. We’ve recently watched recording artist that have product in a large chain promote going to this site to get product that many people has to work on to make happen. Now the large chain is competing with this release and we’re asking ourselves how this is even possible since we have an exclusive agreement. And, releases that don’t sell though come back as returns.

  2. fun fact: same catalog, same amount of time (self released)
    Spotify has paid out 23x Bandcamp to rights holders.
    Bandcamp has paid 5x Spotify to my label.
    Bandcamp pays ~82cents on the dollar
    Spotify claims “nearly 70cents”
    My thought is that the zero sum game of Spotify’s model favors binge listening of international hits. however those hits are major label where the artist doesn’t own the master and complains about their BMI, ASCAP writing royalties.

  3. I like Bandcamp, they’re one of the few music busineses that have a realistic and honest, down to earth approach ( we’ll help you sell stuff, we’ll take 15% ) rather a pyramid scheme have-no-real-business-plan-and-con-everyone-until-we-get-the-big-WallStreet-IPO-and-make-a-killer-exit-with-a-few-billions-in-the-pocket kind of business, like uh.. what is it called… Spitfall ? Streefail ? Spotfail ? SpitAndFly ? mmm… can’t remember..

  4. Bandcamp is what Bjork is compared to LadyGaga (sub madonna etc.). Great but not as successful. LadyGaga is terrible (music “industry”, huge dollar)… but who knows Bjork, finally ? (considering money… and stadium success).
    I made my choice… what’s yours ?

  5. Well you’re going to have some real choices soon. An Australian site http://www.openlive.com.au will give fans access to high-quality FLAC downloads too. Look that up.
    Also – for a music only social network that connects original bands, fans and venues, plus gives bands an awesome landing page where they can link to all their social media and iTunes, BC etc … plus they can publish their gigs to the web, look up http://www.eatnoise.com – it’s only just begun but it looks great so far!! A great alternative to facebook and just for working bands.

  6. Who needs another choice when you have Bandcamp. They are doing it right and have been for years now. Plus, you already get high quality FLAC at Bandcamp for no additional charge.

  7. Sure, but did you have a look at the site? See what it does? Do that before you cast judgement.
    Then, if you don’t like or don’t care – don’t do it!
    Bandcamp doesn’t do live shows either. Both sites mention do.

  8. Major labels make money from minimum guarantees, and by ensuring minimums they also ensure they get at least a certain number of features and plays depending on the service (download / streaming). Bandcamp doesn’t fit into their system until bc are willing to play the minimum guarantee game. Which is not going to happen I think

  9. Emily is usually a pretty good thinker, but she may be ignoring the math here: bandcamp doesn’t have the audience to compete with those other retailers.
    For example, bandcamp is paying out about $1,000,000 per month right now to the artists, by their own disclosures. Sounds awesome. Except that they have 750,000 artists on the platform. so the average payout is about $1.25 per month per artist. Even assuming the 80/20 rule here means that the ‘successful’ artists number only 150,000 and reap in $800,000, or $5.33 per month each. Let’s go even further and take that to a 95/5 rule and you get 37,500 artists reaping in $950,000 a month or $25.33 each. Still not enough? Okay let’s do 98/2 rule and we get 15,000 artists pulling in $980,000 a month which equates to only $65 a month per *successful* artist (not to mention that that would indict the idea that bandcamp *works* for all artists).
    On the other hand, Apple iTunes has credit cards on file for over 700,000 consumers (and probably closer to a million), and they sold a total of about $2 Billion in music in the last 12 months. In other words, Apple’s iTunes sells about 166X more than BandCamp.
    This post feels really forced, and probably has to do with the fact that bandcamp is out trying to raise money right now for what amounts to be a failed business model (though their customers love them, and why not? They price the service way below market).
    Please tell me which Venture Capitalists are going to get behind a company that, after 6 years of operation, is turning in $150,000 in revenue per month (15% of the $1Million per month)?
    In order to get an exit value of say, $100 Million, at a bare minimum BandCamp would need to achieve say, $16MM in annual revenue. Put another way, they would need to grow their business by 8X. Last I checked, it wasn’t that easy to go from 750,000 artists on a platform to 6,000,000 (8X) – are there even that many worthy artists in the world? Furthermore, its highly likely that Bandcamp already has most of the early adopters that are worth more than the average band. So, its an uphill battle to say the least for them. I would be surprised to see any VC back this company unless they believed that the e-commerce engine they’ve built is worth 50x more than the cost of a big company building it themselves (unlikely).
    Shower Bandcamp with love. I get it. They have underpriced their service to the benefit of the artist (and the possible detriment of the labels, which is another issue). But unfortunately for them, they can’t make up these low margins on volume. There just aren’t enough bands in the world, and the willingness to pay for music continues to fall.
    Now enter streaming. The more it takes off, the more headwinds for Bandcamp.
    No matter how big fan you are of BandCamp, the business model just isn’t there and they are going to struggle to raise the capital they need to get really big really fast. The capital is all going to streaming, which is probably why soundcloud and, to a lesser extent, bandcamp, are setting their sites on this. But streaming is looking less and less like a game worth winning as well.
    The major labels don’t need yet another company to bet on in the streaming space, so there is likely no strategic money available to them, either. Otherwise they would have bet on Rdio, Songza, etc. And they just recently appear to be on the verge of considering a bet on soundcloud (thought don’t count on that according to my sources), despite difficult negotiations and a much bigger music audience there.
    While we all love Bandcamp, the evidence suggests that it isn’t going to be more than a lifestyle business for Ethan and company, not matter how much indie love they get.
    Don’t get me wrong, I’m a fan. But as a business, it has no future. Artists who can use it to their advantage should do so. But a call to arms to back Bandcamp is a fool’s errand imo. There is no *there* there.

  10. Great post Emily!
    It seems to me that some people are missing the point: it isn’t an either/or proposition. Putting your music on Bandcamp doesn’t mean it can’t be on iTunes, just as creating a profile on Twitter doesn’t mean you can’t be on Facebook.
    Bandcamp has been my primary sales outlet for years, and will most likely continue to be. While they certainly don’t have the biggest audience, plenty of fans discover me through Bandcamp, and are much more likely to pay for music then fans who discover me elsewhere.

  11. Actually putting your release on it does impact your potential for a DigitalDistributionDeal.com . As well when a retailer that is still selling the majority of the releases see something on this site as well as their online or physical store shelves they get pissed and tend to send releases back because they go unsold. Bandcamp is not a distributor and bands that want to be in the music business need to get a distro deal. END Of STORY.

  12. I’ve long wondered why more bands and labels don’t use Bandcamp preferentially or exclusively. And I hate when bands I love pull their music off Bandcamp once they get bigger, either because their new label doesn’t understand Bandcamp or they’re playing the “minimum guarantee game” that Amyt mentioned. Lame!!
    @reality check: according to their home page Bandcamp currently pays out >$3MM/month, not $1MM/month.
    Also, starting with an 80/20 analysis and then pushing that to 98/2 to prove your point seems misleading. Does anyone really think that 2 out of every 100 aspiring musicians — including all those prepubescent kids, fat old guys in their basements, church organists, etc. — are successful, or even should be successful in the music business?? I think in the real world, maybe 1 in 1,000 people who create tracks actually “make it” as musicians; the rest can barely cover the cost of the gas in the van. So how about a 999/1 analysis of Bandcamp? For all we know, Bandcamp has 750 artists pulling down an average of $4,130/month, and the rest are earning pennies or giving away their music for free. What if Bandcamp’s top 0.1% artists are making ~$50,000/year? That’d be respectable! And of course, nothing’s stopping a true mega-star from blowing up on Bandcamp and making much, much, much more than that.
    Also, why suggest that Bandcamp can only be successful if they increase the number of artists who use it to sell music? They could also increase the number of fans who use it to BUY music. By your math, increasing the number of fans on Bandcamp by 8x — a vastly more plausible prospect than increasing the number of artists 8x — would lead to the same $100MM valuation, right? If enough people start using the Bandcamp app as their go-to music player/sharer/discoverer/store (as I do) then who knows?
    @nelson: distro deals for what? CDs? Really? If bands still need to get “distro deals” in 2017, please kill me.

  13. Most dont understand what huge administration it would take to sell a labels music on Bandcamp. Theres a reason everything is hooked up almost automatic on iTunes and Spotify both for distribution and for revenue. For Bandcamp it would be a mess, unless you’re a single artist or a very small label.
    Bandcamp is good because its a simple solution for the smaller bands, but it would not work in a bigger scale.

  14. It’s an excellent service. They should change the name. Too limiting and does not sound serious. Sounds like “GarageBand”. It also suggests that it’s only for rock bands.

  15. According to their Terms of use you can not be signed to any performing rights organization/collecting society and/or music publisher if you want to publish your songs on Bandcamp:
    “you represent and warrant that, to the extent you are the songwriter of any or all of the Musical Works embodied in your Sound Recordings or Music Videos, whether in whole or in part (e.g., as a co-writer), you have the full right, power, and authority to grant the rights set forth in this Agreement notwithstanding the provisions of any agreement you may have entered into with any performing rights organization (“PRO”), whether based in the United States (e.g., ASCAP, BMI or SESAC) or elsewhere, or any music publisher, and that you are solely responsible for taking all steps necessary to inform such PRO or music publisher of your grant of a royalty free license to Company for the public performances and communications to the public of your Musical Works, and that no fees or payments of any kind whatsoever shall be due to any PRO or music publisher for the public performance or communication to the public of your Musical Works.”

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