Distribution 101 - Part 4

So what is the best course of action for independent artists to take going forward? It depends on who you ask. Now that we’ve explored distribution, major label deals and the like over the course of the last three installments of the series, I’ll offer my vision of the future for success as an independent artist or label.

There’s no doubt the indie revolution is upon us. It was recently announced that 194 of the total 387 total non-producer nominations for the 54th Annual Grammy Awards were given to independent artists/labels. That’s half of all the nominations and a far cry from the dominance of the majors not uncommon only a few years ago! So that means virtually every independent artist/label now has a shot, right? Wrong. Only independent artists/labels which operate at a high level will ever have a shot at “winning the prize.”

The stark reality is that success normally doesn’t just happen by accident. Success is usually planned and almost always earned. In “The 7 Habits of Highly Effective People” by Stephen R. Covey, the author stresses the premise that long-term success is a fruit which springs forth from good character – a collection of habits formed by the intersection of knowledge, skill and desire. Individually as independents, we must pursue knowledge and the level of skill relative to our craft if we wish to succeed. This is where desire, the third element of character, comes into play. Desire (also known as a “strong work ethic”) is the element in the equation which transforms knowledge and skill into material success. Knowledge and skill, without desire, will often bring nothing more than broken dreams. As independent label executive Troy Edwards from 3HP Records often says, “we must seek to work in excellence.” In other words, we must combine knowledge, skill and desire if we are to succeed in virtually any endeavor. After all, Isaac Newtons’ First Law (the Law of Intertia) states that an object at rest tends to stay at rest. But what does this all mean practically? Why am I quoting authors and physicist in an article about music distribution?

Fundamentally, there are certain elements which must be in place to lay the groundwork for success. Under the new indie paradigm, the common understanding seems to be that indie artists/labels must move from dependence (relying on others) to independence (self-sufficiency / self-support). But that is a short-sighted position and can be highly counter-productive. In reality, the independent artist/label must move from dependence to interdependence (a state of cooperation with others in pursuit of a common goal). Major labels have played an important role in the music industry for many years. Even though they’re often seen as the “evil overlord,” there are many aspects of the major label structure which can be implemented within the emerging indie model. We don’t need to throw the baby out with the bathwater. Many major label opponents on the far end of the spectrum advocate the downfall of any intermediary between the artist and the fan. On the other end of the spectrum, there are those who wish to maintain the antiquated structure of yesteryear at any cost. But I believe the best solution is to be found somewhere in the middle through which we can embrace the industry’s wild, new frontier while maintaining respect for some of the key proven realities of the old model. Most importantly, marketing is essential in creating success.

Given the fact that the two scarcest elements within the independent scene are knowledge and finances, it’s unreasonable to assume that the average indie musician or label has the capacity to achieve great things without entering into interdependent relationships with others who possess that which is lacking. Entrepreneurs are rushing to fill the void created by the faltering major label structure. Sites like Kickstarter and Slice of the Pie have been developed to provide a way for artists/labels to fund upcoming projects. And there are a host of great knowledge-based sites out there like Hypebot and Music Think Tank dedicated to providing solid information on key aspects of the emerging independent music industry. Finally, there are online independent communities like the CCM Indie site, We Are Indie Christian Community and Jesus Wired popping up all over the internet where independent artists/labels can come together to learn more about the industry, share ideas and support one another.

At CLG, our goal as an independent distributor is to educate and equip artists/labels so they may take the knowledge we provide and use it to further their music ministries. We exist to help those who are willing to help themselves by developing the level of work-ethic and character necessary for success in a very competitive industry. In my years of experience I’ve come across many artists who simply want to “show up and sing.” If that’s your mindset and you intend to pursue a career in music as an independent you might want to consider another career choice. The prize will ultimately go to those who have taken the time and effort to become properly motivated, skilled and educated. So it is in your best interest to form a good, solid team, work toward establishing a specific set of goals and then take bold and informed actions toward meeting those ends. Use proven industry service providers (radio promoters, publicity agents, etc.) if and when you can afford to do so. Book as many shows as possible even if you have to perform for free at first.

Finally, I will state that, as usual, the Christian industry lags behind the trends being set in the secular industry. As previously mentioned, half of the Grammy nominations this year were awarded to independents. Unfortunately, the same can’t be said for Dove Award nominations. The majors still have a bit of a choke hold on the Christian industry and scant few indies are being nominated. But you can’t stop progress. The trends will infiltrate the Christian industry more fully and independents will begin to receive the recognition they deserve. Ultimately, if you perform for an Audience of One, you’ll never fall short anyway. But keep this in mind: “and let us not be weary in well doing: for in due season we shall reap, if we faint not.” (Galatians 6:9)

 Copyright 2011 David C. Coleman

To read more from David, click HERE.

Distribution 101 - Part 3

Independence is defined as a state of being free from outside control and authority. For the independent musician, remaining independent can be incredibly liberating and extraordinarily burdensome – all at the same time. For those with a fierce work ethic and independent mindset, they wouldn’t change it for the world. These free spirits embrace this model of distribution and attack the task with vigor. But what are the advantages and disadvantages for independent musicians contemplating a proper course of action for their next album release?

First, I’ll focus on the advantages in remaining totally independent and free from entanglement with the industry establishment. On the upside, virtually every step of the process is controlled by the artist and, as a result, the artist maintains complete creative control. Of course, this can bring about results ranging from sheer brilliance to unmitigated disaster depending upon the competency of the individual at the helm. For virtually any musician, the lure of maintaining full control over the songwriting, production, instrumentation and marketing is certainly enticing and, ultimately, cost-effective. If successful, the payout per unit will often dwarf that of label artists. In recent years, “DIY” artists have come up with some very creative ways to compete in the marketplace, from “seeding the field” by giving away free music to allowing the consumer to name his or her own price. These tactics and many others have been used to successfully market and promote independent music and create sustainable careers. But, as always, the key to breaking through at any level is to create music that translates with the public. Proverbs 10:4 states “poor is he who works with a negligent hand, but the hand of the diligent makes rich.” Great music coupled with an unrelenting drive to succeed will ultimately find an audience.

That being said, there is a huge downside to remaining totally independent. Record labels and traditional distributors exist for a reason and have historically served an essential role by providing two crucial elements: (1) financial resources and (2) the knowledge to develop and implement an effective marketing plan. Most independent artists are not well-funded, well-informed or accomplished enough in key facets of the business to create meaningful success for the long-term. Producers, songwriters, radio promoters, publicity agents and other crucial service providers often take a rough stone and polish it into a marketable gem for public consumption. As music fans, we often don’t realize or simply dismiss the relevance of the various team members who contribute to the success of our favorite artists. We tend to assume the brilliance resides solely with the artist. But, much like the musician who spends hours upon hours mastering a musical instrument, these industry professionals spend entire lives perfecting their craft and often have a monumental impact on the final outcome. The point here is that virtually any successful artist needs to build a competent team in order to prosper. Proverbs 11:14 states “in an abundance of counselors there is safety.” An effective team can take the raw talent of an artist and refine it into something exceptional.

For those who are savvy and persistent enough to stick with self-distribution, the efforts can pay off immensely. But very few artists are able to properly engage all facets of the creation, marketing and promotion of their music, and scant few have historically broken through pursuing this course. If you plan on remaining independent, it is wise to work toward assembling a competent team that can help refine your craft and market your content to as broad an audience as possible. Never underestimate the power of marketing. And never underestimate the power of teamwork.

Copyright 2011 David C. Coleman

To read more from David, click HERE.

Distribution 101 - Part 2

Last month I discussed two distinctly different types of physical music distribution – “traditional” and “one-stop.” This month I will delve a little deeper into some of the various deals potentially offered by traditional distributors. While it remains true that opportunity has never been greater for the average indie musician or label, a traditional distribution deal is still very hard to come by. A general rule of thumb indicates that an artist or label typically surrenders control and profitability in direct proportion to the amount of outside investment agreed upon and/or required to record, market and promote an album. For the purpose of this segment on distribution, the terms “distributor” and “record label” are often used interchangeably.

In a “packaging and distribution deal” (sometimes referred to as a “P&D deal”), the artist or label maintains more control over a project since the distributor is only fronting the costs for manufacturing. Due to the limited exposure, the distributor allows more freedom to the artist/label since the risk for marketing and promoting the album is assumed by the artist or label.

Under a “profit-sharing” model, more of the burden is assumed by the distributor. The artist or label will typically enter the agreement with a finished project in-hand and maintain ownership of the master recording. The distributor agrees to invest in the marketing and promotion of the project and profits are then shared between distributor and artist/label.

In a “license deal,” the artist or label licenses the rights to exploit the content to a distributor or label while retaining ownership of the master recording and songwriting revenues. Once the license term concludes, the rights then revert to the artist or label. This model can be very advantageous if the artist/label is able to properly market and promote the title independently.

The next model is what most people would be familiar with when discussing a “major label deal.” In this model, the label/distributor funds virtually every aspect of the recording and marketing process and, as such, inherits a great deal of influence over each and every aspect of the recording and marketing processes. One of the hot-button issues for many past, present and future recording artists operating under this model is the ownership of the publishing rights and copyright of the master recording. Most deals under this model require that the artist or label surrender ownership of the master recording and, often, the publishing rights as well. If and when this occurs the distributor will maintain ownership indefinitely for all aspects of the master recording.

One of the newest models in vogue is the “360 deal.” Under this model, the artist is basically “branded” by a team consisting of artist management, producers, promoters and a marketing team. The team assumes “ownership” of the brand and work together to create success on behalf of the artist. At this level, virtually any and all merchandise branded with the artist’s name or likeness becomes a profit center for the label. This model involves the most financial investment by the label/distributor and, proportionately, the least amount of creative control for the artist.

Next month I will discuss self-distribution and the truly independent artist.

Copyright 2011 - David C. Coleman

Distribution 101 - Part 1

by David C. Coleman

In business, there's usually more than one model by which to conduct business in any given field. When it comes to physical music distribution, there are basically two distinctly different types of distribution models - "traditional" and "one-stop." Both traditional and one-stop distributors "distribute" product. They simply have a different methodology behind their business practices. And, within the traditional model, there are various types of deals which can be offered. Two additional models for music distribution which have become popular over the last decade or so include digital distribution and self-distribution. This month I’ll be discussing the differences between traditional and one-stop distribution.

A traditional distribution deal (sometimes referred to as a “standard” distribution deal) is very hard to come by for the average indie musician or label. In reality, it’s almost an impossible task unless you’ve already made a name for yourself and can clearly demonstrate substantial momentum for yourself or your band. These deals are funded by the distribution company which, in the most “traditional” of traditional deals, maintains the primary responsibility of handling the recording and manufacturing processes, as well as distribution, merchandising, publicity and promotion. As you can see, a traditional distribution deal requires considerable investment by the distribution company.

One-stop distributors are sometimes referred to as “wholesalers” or “fulfillment centers.” A one-stop assembles music content from many different sources (labels, distributors, etc.) under one roof in order to provide a “one-stop” shopping destination for music retailers. This type of deal is much easier to obtain, either directly or indirectly, primarily because the distributor is simply buying and reselling product. The risk is reduced substantially once the requirement or expectation of investment by the distributor is removed. But even a one-stop deal is not necessarily “easy” to obtain. Most of the larger one-stops have sales parameters which must be met before they’ll consider a direct relationship. In these instances, a label or artist can work through a middle-man as growth occurs in this regard.

Both types of distributors help facilitate placement in retail stores, but one-stops tend to be somewhat less pro-active in doing so. Both normally provide access to marketing opportunities with chain retailers as well. “Co-op” programs provide the opportunity to feature product in prominent locations for a pre-defined period of time. These prime locations are typically located in highly visible areas of the store where customer traffic is high. Examples might include a “New Release” wall or an “end-cap” located at the end of an aisle.

At the end of the day, the significant difference between a traditional distribution deal and a one-stop deal is most often defined by the source of the marketing funds being invested and the sense of "ownership" the company maintains in backing a project. A traditional distribution will typically assume a greater level of responsibility in ensuring proper marketing and promotion is being conducted on behalf of the project. But, as mentioned earlier, there are variances in deals which normally fall under the umbrella of the traditional deal, so not all deals offered by traditional distribution companies will be identical. Variations can include "360" deals, licensing deals, packaging and distribution deals and profit-sharing deals. The appropriate distribution deal for you will mainly depend upon your ability to create and maintain forward momentum by building an ever-expanding fan base and touring presence.

Copyright 2011 - David C. Coleman