Written by Kyle Kraft of Krafty Entertainment
Krafty Entertainment is a music business development coaching company dedicated to providing guidance to musicians (and their teams) on how best to nurture supporters and profit from doing so. Krafty Entertainment’s founder Kyle Kraft has over 20 years experience in assisting both developing and established artists in substantially growing their net income from their music. Interested in working with us? Let’s talk!
Artists often focus on the wrong things to build their careers. They invest time and money into chasing exposure, without a firm plan on how to actually make substantial income with their music. Hopefully this article will help some get on the right track!
It takes money to make money
It unquestionably takes investing A LOT of money to create an audience for an artist's music, and even more to maintain engagement with that audience and continue growing it. Unless you are independently wealthy, having a plan to generate income from a very early stage of releasing music is a wise idea in order to make your goal of having a large support base a reality.
Artists need to own the fact that if they want their music to be more than a hobby that costs them money, they need to act like the entrepreneurs they need to be in order to build their careers. While ideally art shouldn't be created with a focus on generating income, when the artist isn't creating music (and in reality if you're not just a hobbyist only a small amount of the time you can spend on your music can actually be spent on creating it) they need to wear their entrepreneur hat and focus their resources on maximizing the income they can generate from their music in order to allow for it to reach more people. If you just want to treat your music as a hobby that’s fine (trying to build a business around your music is not for everyone), but if not read on!
While there are many paths artists can take to building income, as a general rule nurturing support for your music, and then finding means to monetizing that support should be the goal. Most artists have people who support them personally, and some also have people who support them primarily because they support their music. In either case the goal should be to monetize that support.
Why physical product sales should be a focus for artists
While streaming is the primary means of consuming music these days, that doesn't mean its the best path to artists maximizing income. Self-releasing artists make roughly $30 per 10,000 streams on Spotify (the largest audio-only streaming platform), or to put it another way you make about as much from selling a shirt as you make from 10,000 streams. With that being said it makes sense for artists at all levels to dedicate a substantial amount of their effort towards physical product sales.
Whether or not the artist is performing live (and selling physical products at their performances), there is still a healthy income stream to be built from selling physical products online. Established artists should be making a double digit percentage of their revenue from physical product sales if they’re doing things right, and artists with more developing audiences can easily make the majority of their income from physical product sales.
Getting to the point of being able to generate substantial income from supporters
In order to generate substantial income from your supporters you need to be able to nurture relationships with them from the point of initial introduction, to having them making connections with you and your music, to them becoming a customer (likely through them paying for physical products of yours or perhaps tickets to see you perform) and then a repeat customer.
That nurturing will likely come in form of a variety of consistently released content including not only your singles but also videos, social posts, and direct communication with them via email, SMS texting, and so on. In some cases that nurturing might only take days, in others it may take years before you're able to get their support to the point that they become a customer. In any case know that this nurturing is a process, not just an event.
Mailing list subscribers are easier and less expensive to communicate with than social media followers
Relying solely on audiences on social media platforms is not a good idea given that you have to continuing paying more to continue to reach most of the people that have already expressed an interest in your music via social media, and also given that your ability to continue communicating with your supporters is not in your control and could be changed or taken away by those platforms at any time.
You would be wise to set up an account with an email autoresponder provider (like best in class service Drip, as opposed to Mailchimp, Constant Contact, etc), and perhaps also with a SMS mobile phone texting platform (like those that Drip, Community, etc offer) if your audience is into receiving communication from you via text (definitely at least set up an email mailing list ASAP!). You should offer "lead magnets" like exclusive streamable content (free downloads of songs doesn't really work anymore!), early access to content and products, discounts on physical products, and so on to people via social media and other platforms where you communicate with listeners as incentives to sign up for your mailing list(s).
You should nurture your supporters by sending out messages to your mailing list (make them personal, not corporate!) frequently to build and maintain engagement. Ensure that most of the emails you send are focused on providing content and value as opposed to making too many sales offers, otherwise you're going to alienate people and get a lot of unsubscribes.
Maximize the income you generate per transaction
You should aim to maximize the revenue you generate per supporter by highlighting bundles with multiple products you’re offering, with a volume discount relative to the price you’re charging for each individual item (but still a healthy profit margin to allow you to continue investing in nurturing and growing your audience).
You can generate an average of over $100 per backer by running a crowdfunding campaign, which is more than most artists generate per transaction even from well-orchestrated presale campaigns, so if you're willing to put in the work necessary to make a campaign successful that may be your best option to maximizing your income.
Focus on selling more products to your existing customers
It is a well known marketing fact that it’s about ten times easier to sell something to someone who bought something from you in the past than it is to make a new customer, so it’s extremely important to be focused on maintaining direct communication with your customers, on continuing to nurture those relationships, and on offering new physical products to your supporters regularly. That can come in the form of different designs and colors of shirts, sweatshirts, hats, beanies, stickers, CDs (which still very much sell to core supporters), vinyl (if you can wait the half a year plus it takes for manufacturing at this point), and so on.
As you continue to nurture your core audience and release multiple physical products, you can start to develop some predictable momentum with your income as you make new sales offers. You should then use some of the proceeds of the income from making sales to your core audience to grow your audience, and move newly interested people "down the sales funnel" to create more customers. While many people aren't going to be repeat customers, if you are doing things right you should have a snowball effect in which your sales grow as you make more offers.
It takes money to keep the dream alive, so being focused on nurturing supporters and generating income is the path to ensure audience growth and longevity as an artist. Stray from that path at your peril!
This information was compiled by Kyle Kraft of Krafty Entertainment. Whether you are an artist who is in the early stages of building your career and have next to no money to invest into it looking for the best paths to generating income, are an artist that has established a following and are interested in getting assistance with securing tens of thousands of dollars in funding to further your career, or are an artist or collective with an extensive fan base that would like assistance with increasing the efficiency of your business development, we can help you.
Want to read more articles written by Kyle? You can do so here.
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