The Modern Record Label Post COVID-19 and Navigating The Recession

Last week, FastFWD enlisted Mark E Stewart, CEO and Partner at RZ3 Recordings (formally Red Zone Entertainment) and Jesse Kirshbaum, CEO of NUE Agency, LLC to discuss what the record label post-COVID-19 will look like. 

By Amanda Montgomery, Associate at CAD Management 

In this conversation, the panelists discussed how record labels are managing the risk of economic uncertainty, planning their releases, and thinking about marketing and developing talent.  Some highlights:

Artists Should Be Releasing New Content 

Mark E Stewart, CEO and Partner of RZ3 Records explains how the end game for an artist is to be on the road. With touring unlikely to return in the near future, the focus for all artists should be building awareness, building a fanbase, and superserving their audience with content. Jesse Kirshbaum, CEO of NUE Agency, LLC mirrored that thought, saying that artists can not sit on their music, but should come up with a strategy to put content out during this quarantine because music has a shelf life. Since fans are starving for content, artists have the opportunity to make a big impact.

Kirshbaum references le’Roy Benros, manager of Lion Babe, who coordinated a virtual tour via each venue’s Instagram live. Although there isn’t necessarily revenue in that, there is exposure, brand awareness, and good will involved. It is about building a connection with your fanbase that you can later go back and benefit from when the pandemic subsides. 

Highlights

Industry Professionals Must Pivot Their Business Strategies With Full Force

When a business is trying to figure out how to rebrand, there must be a strong team around them that can successfully facilitate a pivot. Kirshbaum references Nue Agency’s, “measure twice, cut once” strategy which informed their pivot from artist management to representing brands. He noted that this quick shift will certainly impact record labels, talent agencies, and more as COVID-19 changes consumer sentiment and habits in ways that we have never seen. 

Kirshbaum goes on to say that tour marketing will be a very digitized process in the future and companies should not wait to transition, rather go for it full force. Once you have a plan, go for it – Test, measure, and then double down on what works. 

With Labels Holding Off On Releases, Independent Artists Have The Opportunity To Walk Through The Door. 

Mark E. Stewart stated that at first he thought artists should wait on the releases, but came to realize that nobody knows what the future holds. He goes on to say that if labels take the approach of holding off on major releases, they are creating opportunity for other artists to walk through the door. Kids are not going to wait to find new things to listen to and new artists to plug in with, so space is opening up for people who are interested in pushing out content.

“Young artists do not see limitations where we see limitations, they just see opportunity. There is a young artist somewhere doing something really incredible right now that is going to change the game” Stewart states. This is the new normal, and new ideas arising in response to COVID-19 will become a part of how we do business in the future.

Jesse Kirshbaum adds that albums that were made in advance are not speaking to the times. “Do you want to hear a fun loving pop record when the world is suffering? Probably not. It’s a delicate balance.” Kirshbaum says, adding that we are going to see certain artists go into the studio to create content that is more relevant to right now, however we have not really seen that connection yet. 

Remote Collaboration Is Not A New Concept For Many Artists and Producers

Mark E. Stewart explains how before COVID-19, collaboration was happening virtually anyways, sending files back and forth for each person to work on. Songwriting becomes more difficult, however Stewart states that once you have the concept, making the record, getting the feature, and adding parts from people who may live in different states, or even different countries, is easier with the technology. He states that there’s tech evolving all the time to help this process, referencing Kuk Harrell, a vocal producer, who has the capability of cutting vocals in real time on both ends with no latency or delay. 

Brands Have The Opportunity To Step Up And Support The Arts

With venues no longer throwing events to support artists, Jesse Kirshbaum states that brands are now the patrons of the arts, with opportunities to give artists exposure and enable the creative process. By supporting the arts, brands have the opportunity to build goodwill in the artist community that can be beneficial for the brand and industry moving forward. Kirshbaum goes on to reference several brands, such as Levi’s, who is using their platform to provide daily online concerts via their Instagram LIVE.

The Dip in Streaming Will Likely Be Temporary

Billboard reported that streaming as a whole since the United States has been down between 7% -10% since lockdown began. Despite streaming representing 60% -70% of record labels revenue, Jesse Kirshbaum believes this streaming dip is temporary and there is no need to worry. People are no longer streaming when they’re at the gym, commuting, or walking in and out of stores, so there was a little bit of a hit, however over time this is correcting. Kirshbaum goes on to add that record labels were doing extremely well, making a million dollars an hour in streaming money. We live in a streaming world, and COVID-19 is only making it more so.

Watch The Full Discussion

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