One of the online sales techniques I’ve been advocating in my online courses is for artists to create different physical and digital products and make them available on their own site at tiered price points. The idea is that you can offer something for all of your fans – the hard core fans might be interested in something from you that is a little more personalized and rare, and newer fans might be able to get something from you that wont break the bank. All the while you have the ability to offer something that cannot be purchased at traditional retail, which makes the experience of purchasing off of your site more rewarding for your fans. Here’s an example from the Yim Yames site:

Determining what you offer – and at what price point – is an art that takes into account a number of factors. For example, if the goal of your campaign is to expose your music to as many folks as possible, you’ll want to price some of your items lower and take a lower margin per unit. You’ll also want to take into account what unique items your specific psychographic would respond to the best. If you’ve determined that one of the psychographic traits your community shares with you is a love for vegetarian food, you might want to create a downloadable PDF vegetarian cookbook for your fans as a value add (similar to what Jonsi and Alex did for their fans).

Another important factor in creating an effective product and pricing plan is to use data to determine what options might create the best result for you; which brings me to the point of my post.

John Grubber turned me onto a fantastic post written a few weeks ago by Craig Mod, describing how he and Ashley Rawlings used the fundraising website Kickstarter to self publish a book by generating $24,000 in 30 days. The entire post is well worth reading, and although Craig and Ashley’s goal was to generate funding for their book, I think there’s a lot of similarities between his execution on Kickstarter and the execution of a successful music-focused DTF sales campaign on your own site.

Once Craig and Ashley had determined the overall goal of their campaign – to sell enough books to generate a return substantial enough to further expand their existing or similar publishing endeavors – their next step was to figure out what their strategy would be for the pledge tier offerings. WIth Kickstarter, people pledge a pre-determined amount of money towards a project on a tiered basis, and get something tangible in return, once the project is funded. Kickstarter’s tiered pledge functionality is not dissimilar to what a musician would offer for sale on their own site to their fans.

What was really interesting to me about what Craig and Ashley did for their book project was that they looked at the top 30 grossing Kickstarter campaign to determine the most successful tiers of pledges. This provided Craig with data that he could use, in his words, to “look for a balance between number of pledges and overall percentage contribution of funds.” Take a look at his graph below:

Chris’ analysis of this data is spot in, and I’d like to quote his thoughts from his blog, here:

This data is, of course, hardly perfect (for example, not every project I looked at used the same tiers). But it’s good enough to give us a sense of what price ranges people are comfortable with.

The $50 tier dominates, bringing in almost 25% of all earning. Surprisingly, $100 is a not too distant second at 16%. $25 brings in a healthy chunk too, but the overwhelming conclusion from this data is that people don’t mind paying $50 or more for a project they love.

It’s also worth contemplating going well beyond $100 into the $250 and $500 tiers: they scored relatively high pledging rates compared to other expensive tiers.

The lower tiers — less than $25 — are so statistically insignificant (barely bringing in a combined 5% of all pledges) that I recommend avoiding them. Of course this depends on your project — perhaps there’s a very good reason for a $5 tier. More importantly, this data shows that people like paying $25.

Having too many tiers is very likely to put off supporters. I’ve seen projects with dozens of tiers. Please don’t do this. People want to give you money. Don’t place them in a paradox of choice scenario! Keep it simple. I’d say that anything more than five realistic tiers is too many.

The overall results that Craig outlines above are generally similar for musicians who offer a range of products at tiered pricing levels on their own site. While I do think that offerings of less than $25 do make sense for most musicians, Craig’s overall idea of not providing too many low cost items make sense. For example, I’ve spoken to a number of my students and other artists that are interested in offering $1.00 singles off of their site. While this is possible to do, providing a lower revenue option like that tends to incentivize potential curious fans downward, as opposed to incentivizing folks to purchase a higher priced option.

Based on the data that Craig obtained from past Kickstarter campaigns, he created the following pledge tiers:

Lastly, Craig and Ashley engaged in a wonderful online promotional campaign that focused on their permission based social medial digital touchpoints, as well as key design blogs and magazine sites that were completely in target with their psychographic and demographic. They focused their messaging campaign using Twitter and Facebook (their messaging was relevant and minimal, too), as well as their own mailing list.
Craig and Ashley had build up an extensive mailing list of design and art world over the past 6 years, which they leveraged nicely. Take a look at the timing of their targeted email campaigns, and the results:

Example of the artwork that was used for the email:

Perhaps most impressive was Craig’s outreach strategy to the blogs that he felt were a laser shot target for what he was doing with this project, and his method of communication to them. He was not focused on quantity of external outreach – he was more interested in the quality of the blogs he did focus on. Again, this is fundamental marketing strategy that all artists could use to their benefit. Again, in Craig’s words:

“I’m writing to blogs that I’ve been reading for years, so for me, referencing older posts of theirs and personalizing these emails is trivial, and fun. Whatever you do, don’t send scattershot emails to media outlets. Be thoughtful. The goal is to appeal to editors and public voices of communities that may have an interest in your work, not spam every big-name blog. A single post from the right blog is 1000% more useful than ten posts from high-traffic but off-topic blogs. You want engaged users, not just eyeballs!”

Here’s were his PR results on his project:

While we’re not talking apples to apples between what Craig and Ashley did with their book campaign and an online DTF music campaign, many of the best practices that Craig and Ashely employed in this campaign, from the data analysis they used, to their communication techniques are exactly what independent musicians should be focused on when they engage in online direct to fan sales and marketing campaigns.

I wrote a course for Berkleemusic called Online Music Marketing with Topspin, which starts this Monday, June 28.

My friend Peter Brambl at Topspin put together a post that details a few examples of the work some of the course graduates have been involved in. Take a look:


Crush Luther

Sheila Hash has been using Topspin to set up what she calls “The Living Room Sessions” for artist Crush Luther.  “Basically, you can request the band play your living room,” says Shelia.  “You need to send pictures of the space and guarantee that at least 20 people will show up. We set up a private ticket link on Topspin and every ticket purchase gets a hard copy of the album upon arrival to the show. It’s been highly successful and the band is booked at various houses throughout the summer. They love it because it’s much more intimate and interactive than a regular show. “
http://www.crushluther.com/


Jonesez

Annmarie McMath is kickstarting a fan acquisition project for artist Jonesez.  “The course was instrumental in not only honing my online marketing skills but educating my artist on best practices for social media marketing and direct-to-fan initiatives,” says Annmarie.  “We have had a steady intake of sign ups, and social media interaction is increasing. We have received a stack of great feedback from fans, musicians and others in the industry..and of course the widgets and music players have been a hit too. Thanks Topspin & Berklee.”
http://www.jonesez.com.au


Brandon Hines

Dan Conway is applying his marketing skills to student projects at Drexel University as well as his own record imprint:  “With our latest release on Drexel’s student run record label (called MAD Dragon Records), we utilized Topspin in creating a new website for the band (streaming player, mailing list, store functionality, etc.) as well as marketing the album using techniques covered in the course. Next year, I plan on incorporating Topspin into the everyday classroom through courses like Marketing and Promotion in the Music Industry and E-commerce in the Music Industry. I will also use it as our direct to fan platform for every Drexel released artist.  Along with my work at the university, I have applied the knowledge at my own record label, Revel Music Group. We used Topspin to release a free promotional “mixtape” for an R&B artist, Brandon Hines, that we have signed. We were able to grow his mailing list from 0 to over 5,300 in a few months (and still acquiring an additional 100 per week) using the email for media widget to exchange 10 free tracks for an email address. We continue to view Topspin as a large piece of the puzzle in both our distribution and marketing strategy and plan to incorporate it into all future releases.
http://maddragon.ning.com/
http://brandonhinesmusic.com/


Soul Mekanik

Ian Clifford is applying the best practices from the course to the marketing of online stores for artist Soul Mekanik. “I had some internet marketing experience already, but I had never applied it in an indie basis,” says Ian. “I learned about the process from the course. In six weeks we have added 600 fans to the email list.”
http://www.soulmekanik.com

Sign up for Online Music Marketing with Topspin, get your own hands dirty with the tools, and send me your success stories to feature next term!

Stefan Lessard is the bass player and a founding member of the Dave Matthews Band. He’s also taking courses at Berkleemusic.com. I caught up with Stefan when DMB played at the Comcast Center outside of Boston. The interview below is part of a larger piece, which we’ll be putting out soon.

Mike King: You’ve been playing with the Dave Matthews Band for 20 years. How did you go from playing small clubs in Virginia to this?

Stefan Lessard: This band, for a while, took every single gig that we were offered. We played every party, every rooftop party, every fraternity; we never said no, we just played everything. I think the most that we played was three gigs in one day and each one of those where about two and a half hours long. So we just worked ourselves silly for four years and when things started growing, we got on the Horde tour. And back when we started, taping was huge. We let people tape our shows and those tapes started getting everywhere and after a few years, we thought, “well, we should probably release a professional sounding live album for our first record.” So we did and we threw a few studio numbers on there but it was mostly just a live show and people loved it because all they had of us was these crappy sounding mix tapes. So finally there was this quality representation of who we were and what we did. It just really grew from there and it was a steady increase. After our first studio record, it really shot up to some sort of success.

Our business model was a lot different back then from most bands at that time, too. For a lot of bands, who are just struggling to play and keep afloat, a record company comes to them and says “We like you guys. We think we can make something out of you. Here’s X amount of dollars upfront and when you are done, we’ll give you X amount more and we’ll give you this amount for tour and give you this percent of merchandise.” What the bands didn’t realize is that the record company was pretty much taking control of the full aspect of things, like the merchandise and the booking and the touring and everything. Once you are theirs, everything went through record companies.

We had such a machine already happening by the time the record companies all got hip to who we were, that they were like, “Well, what do we do with this band? They’re already kind of doing it.” RCA was the first company that came out and saw what we did and said, “This is great! They have their touring and merch down, all we have to do is help them make a great studio record.” They signed us with that sort of freedom and we’ve had a lot of freedom from the start and only have been given more freedom throughout the years. It’s helped us not have to repay so much. It’s really helped us look at the future and move forward.

MK: Was Coran [Coran Capshaw, DMB Manager; founder of Red Light Management; co-founder of ATO Records] helping you set up your infrastructure at the beginning stage?

SL: Well, we were incorporated as a band, which was another thing that a lot of bands did not do, where the lead singer kind of owned the whole thing or the guitar player or whatever, but we came together, and incorporated. The merchandise thing…we just made t-shirts one day and just started selling the t-shirts and people loved them so we just kept doing that. Coran came around because he ran a club that we played at, and we started playing there every Tuesday and he became pretty interested in what we were doing because he saw that there was a lot of momentum. So when he came into it, there was already a lot of momentum, but he definitely helped sculpt the business model that we have used throughout our career. He’s a pretty powerful force when it comes to the business side of the music.

MK: I know you are active on Twitter and Facebook. Can you talk about how you are engaging your fans online?

SL: Our band has always tried to be at the forefront of cutting edge technology when it came to the fan site. When we first started, a fan site was more or less just a mailing list where you would sign a piece of paper and send it to a P.O. box and then maybe you got a t-shirt or a couple stickers or something. There wasn’t really too much incentive to be a fan member. So we created an online fan site and it just took off and that kind of became the model for every band after that.

I have started thinking about a solo record. It’s one of those things, in the history of music, most people that do that, their solo record isn’t something that carries because everyone sees it as project from the bass player for the Dave Matthews Band. So I decided that I would start a website – a platform that I could express myself, so people could see me outside of being the Dave Matthews Band bass player. So it worked and for a little while, people were signing up and talking and I would do little blogs on stuff. MySpace came up and it completely obliterated my whole concept because my concept was MySpace. All of the sudden, I signed up for an account to MySpace and I had 400 more people becoming my friends on Myspace than on my own site. I sort of left my site to the side and I went to MySpace and then from there, I went to Facebook and then from there, I went to Twitter. Next thing I know, I had a voice with the fans. Now it’s gotten to the point where I have to be really careful about what I say because people can take it one way or the other. Sometimes I like that because I don’t mind a little bit of controversy, other times, I want to go out there and squash the rumors. There are a lot of people pretending to be us online. If I find out I’ll go straight to the source, ask BT [Boyd Tinsley, violinist for DMB] if he had a Twitter account and he’d say, “what’s Twitter?” and I was like “Alright guys, FAKE! Don’t talk to him! He’s pretending to be BT”. I think I gained a sort of trust inside the community. Now its just fun and it’s a promotional thing for me. If something happens like the Grand Canyon Adventure [Stefan co-wrote the original music for Grand Canyon Adventure: River at Risk], I can just start talking about it. I’m taking courses at Berkleemusic, and fans love hearing about the homework I’m doing. I’ve been posting about homework and I think people are starting to think I’m crazy because it’s 4 in the morning and I’m like “still working!” and they’re like “When do you sleep?” It’s been a lot of fun for me and I think the fans enjoy it, so it is something that I’ll keep doing.

I was a huge fan of Kick back in the day, and seeing Berklee’s Annie Clark (aka St. Vincent) cover “Need You Tonight” for Beck’s Record Club series makes me want to revisit the record.

Record Club: INXS “Need You Tonight” from Beck Hansen on Vimeo.

Also: is it just me or is this bass line borrowing from Sly Stone’s “Thank You For Talkin’ to Me Africa?”

More from Beck’s Record Club (including the Velvet Underground!) here.

As I’ve discussed at length on this blog, live events are crucial for developing musicians in acquiring new fans, building a buzz, and getting to the stage where they can monetize what they are doing effectively. For artists just starting off, smaller non-traditional outlets like open mic performances at coffee shops, church or library events, etc can be a good place to make this first plunge into the live performance arena. And for these non-traditional outlets (which are not solely focused on music), hosting live music can bring in some additional traffic, as well as provide a way to support local arts. It’s a symbiotic relationship, which helps musicians to hone their live performance chops, and smaller businesses to engage with their community.

Copyright law dictates that any venue that hosts live music is required to have a performance license, and pay the associated annual licensing fee. As Joan Anderman points out in her Boston Globe piece this morning, the Performance Rights Organizations (who are tasked with collecting these licensing fees and distributing the proceeds to their members) are aggressively pursing these smaller “venues,” many of which make little or no money from the music they present. As such, many of these smaller business owners are eliminating live music from their schedule. As Anderman points out:

Among them is Magret Gudmundsson, who until recently hosted a monthly acoustic open mike in her Middleborough, MA cafe, Coffee Milano. “I like having it here, but we’re not making any money from it and they wanted $332 a year,’’ Gudmundsson said. “The town really needs something like this. They ruined it.”

The PROs counter that the music provided by these artists is adding value to these businesses, and they should pay for this value in the same way they pay for other utilities. There is no doubt that music has value, but if tiny outlets truly are not generating enough revenue from these performances to cover the costs of the license, is it more beneficial for the artists (whom the PROs are representing) to consider these outlets as a way to get their live chops down and hopefully start their local following, as opposed to an income generating vehicle? Are the PROs, as my friend Milan might say, killing an ox for a pound of meat?

I’m all for artists collecting money for their work. But if the end result of PRO field agents (who get paid a commission based on the fees they collect) working coffee shops for a license fee means that there are fewer small outlets for developing artists to perform at and perfect their craft, I’m not sure the ends justify the means.

Take a look at Joan Anderman’s Globe piece here

Check out a thought-provoking TED presentation from Johanna Blakley on how low IP industries like fashion outperform high IP industries (music/books) in both innovation and sales (thanks @guilhermeviotti).

Check out a fun video from Austin-based The Bright Light Social Hour promoting their recording fundraising effort.

More here

Thanks to Ihor Gowda for the tip!

Even with all the buzz around online Direct To Fan marketing tools and techniques, I still firmly believe that live events are one of the best ways to connect directly with fans in a meaningful way. Similar to how DTF initiatives have expanded the relationship between artist and fan as it pertains to retail, it’s encouraging to see artists expanding the boundaries of what constitutes a “tour” (such as David Bazan’s “living room” show series) as well.

Artists are becoming more adept at using technological tools and third party partners to bring the spirit and energy of a live event to folks that are unable to attend in person. Sheila Hash, a former Online Music Marketing with Topspin student, is engaging in a wonderful “take-away show” initiative with her band Crush Luther, which provides their hard core fans with an opportunity to check out a unique and personal acoustic performance, and perhaps more importantly, also works as a compelling introduction for casual and potential fans. Take a look at an example, here:

no plan 8 #132. “slowdance anywhere i go” from Justin Borja on Vimeo.

In terms of music marketing, videos events like this can also help to extend the life cycle of a band’s release by providing serialized content well past release date, which is crucial in keeping fans engaged with your band.

Of course traditional live club events still provide an opportunity for artists to establish long-term fan relationships, and Christopher Grant Ward from The Elk (another former student in my Online Music Marketing with Topspin course) has created a wonderful data-driven analysis on the techniques he used to promote his show, with a focus on increasing his number of fans (in this case, defined as permission-based email contacts) and maximizing traffic at the event. While data analysis is key to guiding a successful online music marketing campaign, it’s rare to see an artist go into such detail around a live event. I think what Christopher created is a valuable case study, and I’m psyched to be able to present the details:

Overview:

* Campaign duration: 40 days (02/10 – 03/31)
* Goals:
1) Maximize audience turn-out for the “Rock The Pink Slip” concert
2) Grow the band’s permission-based email list.

Data Analysis of Campaign

(click to enlarge)

Campaign Details

Site Visibility, Pricing, and Acquisition Techniques

A month out from the event, Christopher implemented a tiered approach to selling tickets to the show on his own Website. As mentioned above, the goal of this campaign was focused on increasing the draw to the show and acquiring new fans (as opposed to focusing strictly on monetization), and as such Christopher offered the tickets at extremely reasonable prices: 1 ticket cost $4.00, 2 tickets cost $7, and 4 cost for $10. Because Christopher was using Topspin to facilitate the ticket sales, he was able to collect the email addresses of everyone that purchased from him (thus capturing the fan relationship). PDFs of the tickets were created, and all purchasers were put on a list that the bouncer checked at the door.

Advertising

14 days prior to the event, a small online ad campaign was initiated on Facebook and Google AdWords. Christopher experimented with several sets of ads over the course of the campaign, which correlated to two periods of high click rates (see graph above). The 1st of these high periods targeted a larger, more broad audience and directly promoted the show. This ad yielded the highest click rates but had no conversions.

The 2nd of these periods targeted smaller audiences and promoted the band’s music. These ads yielded somewhat fewer clicks but a significantly higher lift in plays (via a Topspin widget) and emails collected. Messages that directly promoted the show yielded significantly fewer visits, plays and emails collected.

Facebook Video Share Initiative

One month out from the event, Christopher released a video on Facebook, with prominent calls to action and direct links to the ticket offer information on his site. While the video was responsible for the largest spike in plays (Christopher was also using Topspin’s Email for Media and streaming player widgets) during the live event campaign, the video was ineffective at driving traffic or ticket sales.

Campaign Results

Again, as this campaign was focused on growing the band’s permission-based email list, the fan relationship statistics were the main gauge of success.

* Concert Attendees: 211
* # of New Email Addresses: 83. This translated into a 94% increase in the band’s email list.
* Unique Visits to band site: 1384 (based on Google Analytics data from 02/10 – 03/31)
* Total Page Views: 2910 (based on Google Analytics data from 02/10 – 03/31)

While revenue was not the main focus of the campaign, the band didn’t want to lose money, either. Details on expenses and sales for the event:

Ticket Breakdown:

Average ticket price: $5.46
# of $8 (door) tickets sold: 98 ($784)
# of $4 tickets sold: 46 ($184)
# of $3.50 tickets sold: 18 ($66)
# of $2.50 tickets sold: 48 ($120)

Gross Earnings: $1154
less advertising expenses: $325
less club take: $235
================
Net Earnings: $594

Cost Analysis of Emails Collected

It’s difficult to estimate the lifetime value of an email address. Christopher took a stab at estimating the cost of acquiring the 83 emails by dividing the money left on the table if the band did not discount the tickets by the amount of emails collected to come up with a cost of $3.54 per email. The math looks like this:

The band made $370 on tickets sold through direct sales on the site.
If those tickets were sold at full cost (assuming they got the
same number of concertgoers) they would have earned $664 on that same
segment. The money left on the table was $294. Divided by 83 emails, the cost
of each email collected could be calculated as $3.54.

This number was valuable to the band in estimating how they should price their
products and to help them gauge what expenses are cost-effective to building their
Network.

Post-Show Campaign and Analysis

About 30% of total visits to the site and 10% of emails collected occurred *after* the show. The band prepped an HTML page and Topspin widget before the concert. At the show, they used a photographer, videographer and audio engineer to capture live content from the show, and by the time the fans got up the next morning after the show, they had live audio and photos from the show in their inbox. The following weekend, the band released live video of the concert as well, paired with an album purchase offer. Following up with fans after gigs was a great way to continue driving traffic and getting new play and email conversions.

Here’s the video that was sent out post-show:

Further Analysis and Findings

1. Club ticket sales are time sensitive. Sales of concert tickets on the site were quite low until right before the show. In fact, 95% of ticket sales occurred less than 48 hours before show time (a spike in emails collected on show night can be attributed to these sales.) Even during the band’s largest spike in visits (200+) on March 17th, the band yielded fewer than $10 in sales. Overall, it is impossible to tell how many of these prior visitors may have returned to purchase tickets. Most people probably decide to see a club show within three days of gig night, especially when there is no stated limit on ticket sales.

2. Advertising data showed a lift in the number of visits to the band’s site, but few conversions. The good news is that targeted ads drove traffic, even for an unknown band and small club events. The bad news is that it was impossible to correlate ad clicks to returning visitors who purchased tickets.

3. Christopher’s targeted campaign more than doubled his permission based email list, and created dozens of new fan connections which he can use for re-marketing down the line, for free (as opposed to starting over with his next marketing campaign).

I’d like to thank Christopher for sharing this fantastic data. Follow up with him and The Elk, here.

I recently had the pleasure of chatting with Hypebot’s Kyle Bylin (@kbylin) about online music marketing and my Berkleemusic Topspin online course. The interview originally ran on Hypebot in two parts, both of which are below.

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Kyle Bylin: Over the course of the last ten weeks, I’ve had the pleasure of taking Online Music Marketing with Topspin through Berkleemusic with Mike King (@atomzooey) as my instructor. Though, to be sure, I’m likely to a biased opinion of the course — for some reasons I can account for and others that I’m not as obvious to – I have to honestly say that I’ve thoroughly enjoyed the class and have thus far gained deeper understanding of online music marketing. Being that much of my work consists of exploring the more ‘theoretical constructs’ of the music industries, it has been great to gain actionable insights into the landscape before us.

I have had nothing but a positive experience with the online course, and although I do encourage you to take my perspective with as many grains of salt as you’d like, in my humble opinion Berkleemusic and Topspin have come together, synthesized a wealth of information, and made it accessible to people across various backgrounds, goals, and experience, which is no easy task. That said I do believe that the course achieves this very difficult task of both communicating this knowledge and making it so that it’s relevant and actionable to musicians, business people, and even minor media theorists like myself.

Since the semester is winding down and starting up again on April 5, and no doubt many you probably have questions regarding the course and about Topspin in general, it felt appropriate to speak with Mike King and open up the dialog on this subject. If anyone has more specific questions about the course for Mike or myself, please post them in the comments, and we’ll both do our best to respond. In the meantime though, do enjoy this interview with Mike (after the jump), and I hope, like I anticipate — that it’s of great interest to you.

For those of you who may not be familiar, Mike (@atomzooey) is Associate Director of Marketing at Berkleemusic, Berklee College of Music’s online school and author of Music Marketing: Press, Promotion, Distribution, and Retail, which you can get a free chapter of here.

Mike, one of the things we talked quite a bit about is ‘the curse of knowledge,’ which is, as brothers Chip and Dan Heath of Made to Stick have explained it, what happens when we know something, and it becomes hard for us to imagine not knowing it. In co-authoring a course like this one, how does ‘the curse of knowledge’ come into play, why is it so easy to take for granted what we know, and how did you overcome it, without oversimplifying the course material?

Mike King: That’s a good question. I’ve been working at Berkleemusic for seven years and teaching here for the past three, and it’s been really interesting to see the change in perspective from students. Early on, I’d see a certain percentage of students that were more focused on the old business model, like how to get on commercial radio, what do they have to do to get a record deal, how do they get coverage in Rolling Stone, and so on. I do think it’s based on what folks have grown up with and what they know. Back in the day, there were limited options for visibility; it was primarily TV or radio, and the record label was the necessary vehicle for getting this visibility. In a way, from an outside perspective, I can see that it is somewhat comforting to break up music marketing in these easy to understand segments, but the reality is that the options that worked for years—such as retail visibility via a co-op campaign, a national radio campaign, and print advertising—are not really viable options for most artists.

Over the past year or so, I have seen fewer and fewer students coming into the online classes focused on moving their career forward via those old school methods. There are folks out there— like Ian Rogers, Dave Allen, Jed Carlson, Mike Masnick, Seth Godin, Gary Vaynerchuk, Hugh McLeod, Dave Kusek, Patrick Faucher, Bruce Houghton, and yourself—driving home the fact that there are new and alternative ways to advance your career, which has really helped to enlighten a large subset of artists.

In terms of the Topspin course, I start off by presenting a sort of a “state of the union” of the record / music industry and let the facts speak on their own. For example, the top seven physical chain retailers accounted for 44% of music sales in 2008, and the fact is it’s getting harder and harder for the labels to work with these outlets. Last year, Circuit City—which was the 9th largest music retailer in 2008—ceased operations and Virgin Megastore began closing all of their U.S. stores. Borders (the 6th largest retailer of music) has cut back in-store floor space by 30% to 7% of total floor space. Transworld has been hemorrhaging money, too. Similar changes have occurred throughout other segments of the traditional music industry, too.

I don’t assume too much in terms of what folks know or what they don’t. I’m more interested in talking about facts and data, and presenting a toolset that musicians and managers can use to acquire more fans, create an optimized Website with an effective offer page, determine what the proper offerings should be for your specific tribe, and create an overall online sales and marketing plan that works for a student’s particular situation.

Out of ignorance, or maybe just plain excitement, some people in the marketing advice business tend to write off traditional institutions, in favor of the shiny new things that the Internet has come to offer, whereas you’ve taken a stand — even written a book I hear — empathizing the importance of the roles that they still play. Why is it crucial to have a dynamic marketing mix, on- and offline, and how does a platform like Topspin play into this equation?

Mike King: I think you have to engage in all marketing activities that apply to you. I have students that are at completely different stages in their careers, students that are focused on completely different genres, and students that are touring consistently and those who are not. It’s not right to tell someone to focus exclusively on digital if that person is selling CDs consistently on the road or if that person is creating music for a genre or psychographic that still wants CDs. For example, I’ve been working with a fantastic children’s music band called Debbie and Friends, and once you look at the demographic and psychographic of her fans (and the parents of those fans!), you can see why some traditional options — like the creation of CDs — make sense for her.

Certainly touring and a solid merch plan, both traditional marketing initiatives, make sense to engage in. And there are still examples of developing bands that have emerged from indie physical retail. Physical retail and distribution are much more convoluted than online retail and distribution from a process standpoint, primarily due to co-op and the returns process. But again, I think that retail still makes sense for a subset of artists at a certain stage of their career. Of course distribution follows marketing and it does not make sense to look for a distribution deal prior to demand for your product, but if there is demand and you are not fulfilling it, I think you are leaving money on the table.

I think it comes down to the fact that the Internet has provided much more choice and an opportunity for musicians to participate in the process where in the past they might have been left out. But I don’t think it’s a best practice to completely omit physical marketing from your overall campaign strategy if you are at the right stage in your career for it, or if your psychographic dictates that you engage with them in that way.

In terms of Topspin, I think the major benefit of the software in terms of creating a dynamic mix of online and offline strategies is multifaceted. First, there’s rich data pulled in from a number of sources right into the platform. You can see in real time what folks are saying about you on blogs and on Twitter, and engage with these folks immediately. You can see spikes in activity on Last.fm, Facebook, and MySpace, and use that information in whatever way you want to help focus and direct your campaign. You can also see how your fanbase is interacting with your content, both in terms of sales from your site, as well as with any widgets that you have released in the wild. From a physical standpoint, I think the data that you gather from Topspin can help you to more effectively nurture the artist/fan relationship, too. For example, you can sort your list of fans in any number of different ways, including by geography or by rank in terms of sales. So as an example, if my band is touring in San Francisco, I can sort my fans by those that live in the area, and then cut that list into those that have purchased from me in the past. I could then provide these super fans with free tickets to the show, or any other value-add to help nurture the relationship. Also, because all of the Topspin widgets are trackable, you can also set up content sharing contests, and reward your core influencers with something of value, or encourage them to take their online support offline per market. It’s a really robust and customizable tool, and Topspin supports creativity with its use.

More importantly, what segments of an artist’s marketing strategy doesn’t Topspin replace? And, why do you think it’s important to clarify that Topspin isn’t — at least not anytime soon — the music marketing equivalent of the Ronco Showtime Rotisserie Oven, you don’t just “Set it, and forget it!!” There will be countless hours (still) spent thinking, planning, testing, succeeding, failing, and trying the process all over again — with the exception that, for the most part, your efforts will be contained under one umbrella — that’s driven by data.

Mike King: I think Topspin is not a cure-all for the industry, nor is it the only tool that you should be using to put together an effective marketing campaign. There is no doubt in my mind that it is a great tool, and will benefit artists tremendously. But I think anyone who claims that they you can use their service to “set it and forget it,” as you say, is being disingenuous. There are truly so many variables and outlets that you need to think about and keep track of when you pull off your marketing campaign. For example, one thing that Topspin doesn’t do is distribute to third party online retail outlets like iTunes. Certainly the best practice for artists is to direct fans to their own site where they can provide tiered product offerings that are specifically geared to their fanbase, but the fact is that many fans are set in their ways and will continue to only look for you on iTunes or wherever else they routinely shop for music. I interviewed Derek Sivers for my book awhile back, and he had a really succinct thought on this topic: “There are millions of people who get all of their music from Rhapsody. If they search for you on Rhapsody, and you’re not there, they’ll forget you and move on. Same with eMusic. Same with iTunes. Same with Napster, etc. So make sure you’re available on all of these services. You are not hurting your iTunes sales by being on Rhapsody; you are only adding to your income.” I think this is accurate, and extends to direct-to-fan sales as well. While an artist’s sales margin can certainly be greater when selling direct to fan, the volume of sales an artist can see from established third-party outlets can outpace DTF sales, particularly for established artists. I would not recommend directing folks to a third party retailer from your site, but at the same point, you’d likely be losing sales if you do not have your music available on third party retail sites.

You also mention data in your question. Topspin is tremendous with data and analytics, but it’s not the only tool you should be using, in my opinion. Google Analytics is a fantastic tool for musicians (and Topspin integrates with it well). I also think Duncan Freeman is doing some really interesting things with Band Metrics, and there are dozens of other tools out there that help with analyzing other verticals like Twitter. I think that Topspin is a fantastic tool, but not the only tool you should consider.

Now, to maintain a certain degree of objectivity here and, at the same time, address an issue that’s sure to be brought up in the comments, I have to talk about the price tag on the course. It’s rather expensive. Blah, Blah, musicians don’t have that much money. But, to frame this differently, as put forth by Randy Pausch in The Last Lecture, “Brick walls are there for a reason. They give us a chance to show how badly we want something.” Why do you think there are there brick walls, like this and others, surrounding Topspin Media? What purpose do they serve? Are they there for a reason?

Mike King: I really think the course can be considered an investment in your future. I don’t see it as all that different than an artist investing in a new guitar or amp to improve their sound, or investing in Pro Tools to produce their music themselves. Along with super-serving your existing fanbase, a big part of direct-to-fan marketing is to use certain tools and techniques to acquire new fans that you can continue to communicate with for years to come. I don’t think it is unrealistic to think that the course is an expense that musicians can recoup down the line.

The course is three months long, and over that period we’re doing a dozen hour-long chats covering all aspects of online marketing in near real time, on top of the extensive written content and multimedia content. To be honest, the course would make a 250 page book if I was to print it all out, and it took about a year to write. The course was written by myself and Shamal, with input from multiple people at Topspin, including Ian, Gary Brotman (who runs the artist services side of Topspin), Adam Bates (who is the Director of Marketing and R&D), and many others. Also, I’m inviting many of the Topspin folks to our weekly video/audio chats, so you have the opportunity to interact on a one-on-one basis with them (and me) directly. I’ve also got a ton of media throughout the course, including exclusive videos with Ian, Adam, Peter Brambl, and Shamal covering general best marketing practices as well as presenting an in-depth view of everything you need to know about the software.

Plus, I’ve also got some top-notch instructors teaching the course, like Jason Feinberg, Jason Kadlec, and Jeff Straw, who are all living online music marketing and Topspin everyday. They are incredible resources. Lastly, there is no other course out there that teaches this stuff. I feel really proud of the content that we’ve created, and I legitimately feel it’s beneficial for all artists/managers that want to understand Topspin in-depth, and gain a professional level understanding of online marketing. In terms of the criteria that Topspin has set up for artists to use their software directly, I’m probably not the best person to ask. It’s public knowledge that Topspin’s business plan is fundamentally different than other services, which charge artists a fee, no matter how many sales they generate using their software. Topspin only makes money when the artist does.

From what I understand, part of the reason for the brick walls surrounding Topspin Media is to ensure that “best practices” are being used. For the most part, because of how radically they are intertwined with the degree of success that one might hope for when using the service. It’s sort of a “preventative measure.” To ‘prevent’ people who don’t know ‘best practices’ from using the service, from not getting the results they were expecting, and from getting upset with the service because it didn’t work like they thought it would. Why are best practices so important? How have you integrated them into the course material? And, why do they have such an impact on results?

Mike King: Certainly with any service—be it ReverbNation, Topspin, Nimbit, Bandcamp, or any others—it’s in everyone’s best interest that folks are properly trained on using the software, as well as properly trained on overall best marketing practices. You don’t want folks out there unhappy with the service when, in reality, it was a lack of understanding of marketing principles and best practices that is the core reason they are not seeing growth in their acquisition or sales numbers. All these services are just tools, basically, and like any tool, if you are not using it properly your results will not be fantastic. The course is filled with best practices, from proper optimization techniques to help with search visibility (which along with direct traffic is usually one of the highest converting areas), to ways you can help identify your psychographic, best practices with third party social media outlets and other acquisition focused techniques. We also go in-depth on forecasting models designed to help you estimate how much income you might see from your digital touch points.

As a side note, there are real numbers and strategies presented in this course from several artists that have been kind enough to provide a look under the hood of their campaign. So when we talk about best practices with landing pages and offer pages, or when we talk about the importance of upselling, we can see exactly what other bands have done, and what the results were. I think it’s very helpful to take this information out of the theoretical and bring it all into real life, which we do in most all of the lessons throughout the course. Overall, I think the course helps to provide a road map for best practices in one of the only growth areas in marketing, and in terms of results, because Topspin has been so open with sharing their data, you can see exactly what happens when best practices are not followed, too.

This, of course, brings up another important question… How would an artist or their manager for that matter, know if they are at the point in their career where an investment like this is justifiable. When you have conversations like this, as I imagine you have—countless times—what do you tell people? How do you go about determining if they would benefit from TopSpin Media, and whether or not they are capable of taking things to the next level?

Mike King: On the core level, I think you shouldn’t be marketing yourself unless there is a demand for what you do. This also goes back to your question on integrating physical and digital marketing. Let’s look at live events as an example. If you are playing in your local area, and you are not gaining traction, folks are not blown away by your show, there is little momentum with the fans, and your permission-based sign up list is not growing, then it probably makes sense to hit the woodshed and work on your music first. Topspin will not make your music good, and without amazing music and a killer live show, it does not make sense to spend the money on a marketing campaign. There are millions of bands out there, and your your music has to connect with folks in a way that 99% of the music out there does not. Once you start generating a real following, have demand for your product, and you can effectively identify your psychographic—this is when you should start marketing yourself. So I think you have to look at what is happening with your music and the response to it. Start small with your marketing efforts and, as you grow, think how a tool like Topspin or others can help amplify your existing efforts. Marketing tools are good at amplifying your efforts, but you have to have something there to work with first.

To sort of cap this off, what has your experience been like teaching a course like this for the first time? What are some of the biggest challenges you had to overcome—beyond “the curse of knowledge”—in writing this course? And, now that you and the other teachers have seen students interact with and learn the material, what are some of the realizations you’ve had, in trying to make your insights are as actionable as possible for everyone in the course?

Mike King: Writing and teaching this course has been deeply fulfilling for me. I was just at SXSW and met up with some of my students down there, including LJ Scott, Anthony Erickson from a band called Fulton Reed, and Susie Codd. We’re in week eleven in the course, and these folks are putting the best practices to use right now, and it’s just amazing to see the stuff we have been talking about for three months being implemented in a way that positively effects these musicians. I think all of us are looking for the way forward in the new music business landscape, and I feel grateful to present real information to artists, based on data and real world examples, that actually helps musicians to navigate their careers in a positive way.

In terms of challenges, some of this stuff is not easy to grasp the first time through. I’ve created flash animations, use videos, and have some audio in the course to help explain some of the more difficult concepts we discuss, such as the product pricing and forecasting documents that we go through. It was also challenging to present everything in a way that folks who are less familiar with the concepts could easily understand it, while also presenting the material in a dynamic way for students who are more advanced. Also, Topspin is developing new initiatives so quickly, that it has been challenging to keep up with them! The great part about the online course is that I can update this information on the fly—it is a living, breathing entity that I can adjust as necessary as new features are released by Topspin, as new third party entities are unveiled, and as some of the best practices that exist today change tomorrow. It’s definitely been interesting to see how the students have interacted with the material that we have written, and I’m sure we’ll make some adjustments based on the feedback.

The best part of this instructional video is that James Brown is dancing to James Brown music. What else is he going to dance to?

via Pathway To Unknown Worlds