A revenue strategy for emerging acts
A revenue strategy for emerging acts
It makes sense to create a sense of belonging from day one and to monetise it.
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Let’s dive into today’s topic:
A revenue strategy for emerging acts
Sell merchandise, play shows, and streaming royalties: Artists have plenty of opportunities to create revenue streams. However, most of these tactics lack a strategy: They’re only effective for acts with a larger fan base. And building a fan base doesn’t come for free. Therefore, let’s discuss a revenue strategy that could work from day one.
Why it matters
Choosing art as a profession is almost equal to choosing life as an entrepreneur. Aspiring artists should have an entrepreneurial mindset and know how to value their products.
How it works
As a thinking exercise, I tried to come up with a revenue strategy that could work from day one:
Generate revenue through membership from day one
David Spinks defines membership as either “the feeling of belonging” or “the feeling of sharing a sense of personal relatedness”. Membership contributes to a sense of community and includes five attributes: boundaries, emotional safety, identification, investment, and a common symbolic system. It makes sense to create a sense of belonging from day one and to monetise it. Some examples of monetising membership are:
Sell subscriptions
There are many tools to let people pay to remove a boundary to enter. Most of them focus on a single platform. Take Bandcamp Subscriptions, where fans receive all new music and more for a monthly or annual fee, for example. Artists could start with this on day one and offer their fans to follow their growth closely. A great example is Alpha Tracks, who uses Bandcamp Subscriptions for a project where subscribers will receive a track every Thursday throughout the whole year of 2023.
Sell web3 tokens
Web3 is a niche community around decentralisation and ownership. Web3 involves terms like cryptocurrency, tokens and (music) NFTs, so the monetisation factor is easy to understand. More importantly, web3 provides many tools and frameworks for community building. To generate funding from day one, artists could start by building a web3 community, possibly even next to building their non-web3 fan base.
Black Dave is an artist who sells Black Dave Tokens. He’s trying to collect 250 ETH by selling one million tokens for 0.00025 ETH per token. At the time of writing, that’s about the same as trying to collect €410.000 by selling one million items for €0,41. Already 167 holders invested more than 3 ETH in total by purchasing more than 13.000 tokens (Etherscan). Besides funding, the token approach provides Black Dave with many opportunities for community building.
Sell a symbol
A common symbol system immediately identifies members. Creating a common symbol system is an opportunity for emerging acts to monetise membership. The trick here is to come up with something better than a t-shirt. Football scarves are a great example, but The Grateful Dead taught us that fans can create their own merchandise. So why not start by selling patches?
Pros and cons of this strategy
Pro: Artists always have the members club offer to fall back to in their communication with fans. The membership is the endpoint in the fan journey, all roads lead to a revenue-generating concept.
Pro: Revenue is an important metric for success. It benefits artists’ strategic choices when that metric is available from day one.
Con: The membership’s success will grow with the act’s success, which means that in the beginning, there won’t be that many members. Without traction, it could be difficult to maintain the strategy.
Yes but..
A strategy should be tailor-made, so this strategy might not work for everyone. Also, the list of examples is far from complete: There are much more membership tactics for emerging acts that could work from day one.
Take action now
Think of a project you’re working on: How to create a sense of belonging, and make money out of it?
Further reading
Extend your fan journey to monetization in 30 minutes (Artist Lockdown Challenge)
The Business of Belonging (David Spinks)
Where do Web2 fanbases fit in Web3? (MUSICX)
Marketing Lessons from the Grateful Dead: What Every Business Can Learn from the Most Iconic Band in History (David Meerman Scott & Brian Halligan)