Music Business

A Pandora Listener, Facebook Like And Twitter Follower All Walk Into A Bar – The Impact Of Pandora Artist Stations

2Although some may be quick to dismiss Pandora as simply another streaming platform, some recent numbers show that many of Pandora's top artists have more station followers and better, more economical fan reach than many social media outlets.


Guest Post by Glenn Peoples on Medium

Key takeaways:

· A third of the top 1,000 Pandora artists have more artist stations than Facebook followers. It’s more than a third domestically since artist stations primarily exist in the U.S. while social followings are global.

· Facebook posts achieve about 10 percent organic reach. Extra impressions will cost money. Pandora artist stations cost nothing to reach listeners.

Pandora artist station, a Facebook like and a Twitter follower all have the ability to reach music fans and provide an opportunity to make money. But one of these platforms’ reach might surprise you. One-third (33.4 percent) of the top 1,000 artists on Pandora have more artist stations than Facebook likes. A slightly smaller fraction, 31.5 percent, has more artist stations than either Facebook, Twitter or Instagram followers.

However, Pandora artist stations compare more favorably then they might seem. These artist stations can almost entirely be attributed only to the United States. Small, undisclosed numbers of listeners and amounts of revenue comes from Australia and New Zealand. In contrast, social media platforms have global followings. Artists like Drake and Eminem have social media followers around the world.

Considering the global nature of the music business — 51 percent of digital and 80 percent of total recorded music revenues came from outside of the U.S. last year (IFPI, 2016)  –  the difference between a domestic following and a global following is critical. Drake might have fans throughout the world, but fans in North America are more valuable than fans in, say, Central America. For spreading news of new singles, upcoming tours and available tickets (Pandora’s AMPcast can do them all), North American fans are going to get the priority.

Put simply, reach matters when achieved sensibly. Reach means revenue. And reach often means costs. Pandora, Facebook, Twitter and Instagram all provide connections to fans but artists will find they have different costs to reach many of those fans.

In my previous post (about Gucci Mane) I discussed the important role played by artist stations, those Pandora stations that use an artist’s music as a jumping off point for a listening experience. The important thing to remember is artist stations correlate with that artist’s streaming activity. If fans create more Drake stations, for example, Drake will get spins as a result. The relationship goes the other way, too. Listeners may create a Drake station after hearing his music, which in turn helps ensure they hear more Drake music.

11Artist stations provide an artist with reach. Drake’s 60 million artist stations (I’ll continue using Drake as an example since he’s the current king of music streaming) are an indication of how many listeners he can reach on Pandora. Because 60 million people have a Drake station, there are at least 60 million listeners Drake can potentially reach. In reality, though, Pandora offers Drake far more ways to get heard, from a station of current hits to a Kevin Gates artist station (due to the artists’ musical similarities). But at the very least 60 million stations provide Drake with at least 60 million connection points.

Whether or not an artist can maximize reach comes often down to costs. Ever since the launch of AMPcast, Pandora’s tool for recording and playing short audio messages to listeners, an artist can reach out to say hello or thank you, direct fans to an iTunes pre-order page, or alert listeners to upcoming tour dates. And as I’ve mentioned before, AMPcast is being made available to artists for free.

In the future, once Pandora listening and ticket purchasing are integrated, audio messages will become more valuable—and they’ll still be free. That’s good news for artists and especially for mid-tier artists in need of a cost-effective way to sell tickets. Compared to consumers as a whole, Pandora listeners are about one-third more likely to attend bar and club concerts and will spend about one-third more doing so (MusicWatch, 2016). It’s a group worth targeting.

Social media is ostensibly a free marketing tool. Take Facebook. The average post to an artist’s page might get impression rate in the 10 percent range of Facebook followers. That is to say, the average Facebook post might be seen by about 10 in 100 followers. Native videos — videos uploaded to Facebook, not YouTube embeds — would perform better. A post with just text would probably perform worse.

But social isn’t exactly free. This has chafed artists, labels and managers. They spend time and resources to accumulate their Facebook followers but can’t reach them all. A popular artist can expect to pay thousands of dollars to expand the reach by a reasonable amount. Because of this, the number of an artist’s Facebook followers should be adjusted to reflect the actual number of expected Facebook impressions. Call it “adjusted Facebook followers,” those fans an artist can reach for free and within the constraints of the Facebook display algorithm. At a 10-percent impression rate, 97 percent of the top 1,000 artists have more artist stations than adjusted Facebook followers (compared to just 33 percent before the adjustment).

Here’s another way to look at these platform’s value proposition. Two-thirds of the top 1,000 Pandora artists have more Facebook followers than Pandora artist stations. One hundred percent of them would need to pay money to reach 100 percent of their Facebook followers. That’s no joking matter.

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