"Connect With Fans (Cwf) + Reason To Buy (Rtb) = The Business Model ($$$$)
Summary of video presentation by Mike Masnick
http://www.techdirt.com/articles/20090201/1408273588.shtml
- This presentation is a case study on how Trent Reznor (artist of Nine Inch Nails) represents the future of the music business.
- Masnick's company works with various companies helping them to understand new media and social media trends and how to connect with various communities. In this presentation, he claims how he believes Reznor has figured out how to connect with fans (Cwf) and given them a reason to buy (Rtb) his products with a successful business model that has made money by doing various things even when signed to a major record label
- Before releasing his first album, while signed to a record label, Reznor used Internet Scavenger Hunt/Alternative Reality Game by using a top which in code spelt out his website iamtryingtobelieve.com. This connected with fans beyond music and attracted a wide audience. Reznor also left USB sticks that included new music of his in bathrooms at gigs for fans to find a leak to his fans as well as many other things.
- After his first album, he was no longer signed to a record label. However, this didn't matter to him as he knew his business model worked.
- Rtb = added features, such as free download of 9 out of the 36 songs of his next album. The album itself was only $5 (a lot cheaper than iTunes) and what made his music really stand out was that he was selling deluxe edition packages for $75 and and ultra deluxe limited edition package for $300. As a result, the limited edition (only 2500 were made and all personally signed) were sold out in under 38hours. This added value to Reznor's music and gave the audience a reason to buy his songs.
- In addition, in the first week $1.6 million were made with NO record label and music virtually selling for FREE. This is a key example of how price isn't an issue when creating a promotional package, it's all about giving a reason for the audience to buy the product.
- Reznor sold his third album entirely for free: all fans had to do was put their email address in and they received good quality music. What made Reznor earn money as a result of this was the fact that CD limited versions were being sold at the same time as well as concert tickets (concert listing was shown at the same time as album being released). This was a very successful marketing approach for Reznor as fans wanted to hear the music live that they were listening to for the first time: they were excited.
- Reznor's (Nine Inch Nails) concerts also included big screens and other bands (their music was also available to the fans to hear on the CD's), which made their concerts more entertaining and fun compared to many other artists. Fans were able to watch a variety of things at their concert: Reznor's concerts were worth the money fans had to pay, especially considering the fact that most of his albums he released for free/leaked to his fans.
- Reznor's website was another way of connecting with his fans and giving them a reason to buy his product: it is an ongoing connection by using forums, chats etc. This site doesn't involve lawsuits or any payment, which influences me in my ideas for creating my own promotional package. If I choose to create a website homepage for a band or artist, I could use Reznor's ideas, by getting fans more involved using the internet: a cheap and easy way of marketing a product.
TO CONCLUDE
Reznor's business model is something I can take into account when producing my own products as it uses simple, free and easy ways to connect with fans and give them a reason to buy the product. In other words, it's a way of earning lots of money and popularity without having to worry about the problems of piracy or being a 'plastic pop star'.
You DON'T need licensing/copyright/lawsuits and therefore it works for big and small artists.
IT'S THE FUTURE OF THE MUSIC BUSINESS
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