Brand advertising 2.0 for the music industry

I really like Spotify, so much so that I give them 100 quid a year to be able to listen to the service on my iPod and in Switzerland. I also like thinking about metrics and measurement. Which is why this whole kafuffle about Spotify not paying artists enough or how the creative industries needs to be protected against file sharing and piracy is a bit of bunk.

Let me explain. I hear of a new artist, let’s call her Lady Gaga Queen Mo Mo for interest sake. She get’s a couple of plays on MTV but I’m never home to watch her videos so I don’t really get to know Queen Momo ‘s songs. I don’t really listen to the radio, I prefer listening to on my PC and discovery through radio and video doesn’t happen as much as it used to for me personally. I discover music through services like Hype Machine and Spotify. Lucky for me Queen Momo has a lot of music on Hype Machine and on Spotify, I listen to a bunch of tracks and quickly become a fan. I check out her videos for her songs like Mobile Phone and her duet with Kelly Roland called Voice mail and I like her so much so that when she’s in town I buy tickets for me and the Bee for £50 each to see her when she’s in town. Not only that but I share music of her’s that I’m listening to on Twitter and Facebook and lead to three other people discovering her, one buys a CD, one goes to see her in concert and one downloads her album on iTunes.

So Queen Momo didn’t make a lot out of all the different streams or videos that I listened to or watched, but she made 100 quid directly from me when I went to see her in concert and a whole lot more from my sharing my interest in her. Just me, one customer. She also made more out of me as I then went on to buy her next album so the Bee could have it on her iPod. Here’s the thing though, would I have discovered her and become a fan had I not listened to her on Spotify and Hype Machine, maybe but probably not.

Okay so the “hypothetical example” is over and it’s actually pretty close to what the Independent’s written about Spotify and Lady Gaga. But, while it’s easy to track payments from one service and say it doesn’t contribute fairly as the Independent and various unions have done with the Lady Gaga example. What this doesn’t track is how many users discovered Lady Gaga or listened to Lady Gaga on Spotify or worse yet on file sharing sites in the UK and then went and saw her at the O2 or actually bought her CD. Studies have shown that users who use filesharing sites actually buy more music than people who don’t.

The point is that just because we can’t clearly attribute contribution from different channels doesn’t mean they don’t contribute positively to an artists overall income. File sharing and Spotify need to be treated as the new form of brand advertising in that they help artists (brands) build a reputation that then leads to sales. Shutting down or trying poorly scripted laws to protect the industries is as harmful as saying to artists radio or posters promoting your music is illegal.