Know Your True Fans: The Echo Nest’s Advice To Music Services Works For Musicians Too
Yesterday The Echo Nest released a White Paper detailing their ability to apply predictive models to user behavior on streaming music services in order to identify users of free ad-supported services that are likely to be of highest value for a particular service. While such a report might seem a bit distant from the concerns of a working musician, the Echo Nest approach ultimately boils down to identifying the most supportive fans of a particular offering and embracing that support.
The white paper from The Echo Nest is titled "How Music Services Can Acquire, Engage, and Monetize High-Value Listeners."
Their announcement cites a "report from MIDiA Consulting" suggesting that "60-80 percent of ad-supported accounts on services like Spotify, Pandora, and Deezer are effectively inactive."
While music services, like any business, can profile users and customers over time and eventually identify who's inactive and who's in their base of support, The Echo Nest claims that they can identify and predict which free service users are going to become "high-value listeners" over time.
The paper describes two ways music taste is used:
Step 1: Identify the music artists correlated with high-value
users on the service
Step 2: Identify the type of music taste that best predicts a
user’s value on the service
The Echo Nest says different services benefit from different groups of users and so they offer more than the ability to build profiles and predict relevant behavior. They're also offering approaches to retaining higher value users by providing tailored services and monetizing those users via improved ad targeting that includes predictive features.
Clearly what's described would be of great value to any music service but how is this of relevance to musicians?
The Echo Nest advocates identifying one's most active and engaged fans, understanding their value and monetizing that value. Which fans are most valuable and how that value can be realized will be a bit different for each musical act.
This approach can be applied in as loose or as rigorous a manner as one wishes.
One band might simply note that they make more money on the road and so will begin to emphasize touring and explore different revenue streams from selling merch to teaching on tour.
Another band might create profiles of customers of different offerings, from viewers on YouTube to streaming music listeners to live fans, and then begin to shape each offering to the needs of its highest value users and/or customers.
But a band that thinks only in term of "monetizing a fan's worth" or "extracting value" will miss out on the power of identifying one's strongest fans in order to deepen one's relationship with those fans.
Perhaps music services could take a tip from musicians who are showing that building the relationship is how one can go beyond monetizing "high-value listeners" to tapping into the power of Super Fans.
- Tech N9ne And The Power Of A Base Of Superfans
- Instead Of Building A Fake Following On Twitter, Why Not Build A Fanbase?
- Music Think Tank: 1000 True Fans
Hypebot Senior Contributor Clyde Smith (@fluxresearch/@crowdfundingm) also blogs at Flux Research and Crowdfunding For Musicians. To suggest topics for Hypebot, contact: clyde(at)fluxresearch(dot)com.