Will.i.am: Business Genius in the Music Industry

Thought Leaders, Uncategorized

Will.I.Am - apparently dressing weird is a 'genius' requirement Will.i.am front man for pop sensation Black Eyed Peas is a business genius.

Its forgone that he’s a creative genius, having transitioned his group’s brand from a feel good hip hop group to a full blown pop sensation. Along the way he’s developed a production resume that ranges from the Yes We Can Obama campaign video, to urban radio, to pop hits.

But his business prowess has been unheralded. While Pharell of Neptunes and N.E.R.D. was listed by FastCompany as the 36 of 100 Most Creative People in business. Will.i.am’s Yes We Can video not only took celebri-roots activism to a new level, it also launched his unknown project [dipdive] to the tune of millions of views (the site has since beta launched as a ‘lifestyle engine’).

What’s Dipdive? That’s Will’s own social-networking site, what he calls a “lifestyle engine”. He invented it, employs 25 computer-code writers to keep the technology ahead of the curve, and currently spends $150,000 a month developing it into a proper entertainment network. “This is Twitter times a billion,” he says. “Twitter is, like, a picture and 140 letters. This is video, MP3s, blogs…”

via Independent.co.uk

While spending $150K a month on a startup is unsustainable and a sure way to burn through cash – I still give him points for creativity.

His full prowess really shines through in his business model for the new Black Eyed Peas album E.N.D. via Billboad:

Group leader will.i.am tells Billboard.com that “The END” stands for “The Energy Never Dies,” which describes his model for a project that will be living and frequently updated throughout its designated cycle.

“It’s a diary … of music that at any given time, depending on the inspiration, you can add to it,” the artist/producer/songwriter explains. “When it comes out, there’ll be 12 songs on it, but the next day there could be 100 songs, 50 sketches, 1,000 blogs all (online) around ‘The End,’ so the energy really, truly never dies.

As I summarized in my previous music post covering why people buy vs. pirate music, the connection with the artist is key. I think this continuous model of looking at an album beyond shrink rap is an important mental step forward for an industry in search of a business model.

The other key component the study found was: music listeners want to re-experience. With, Boom Boom Pow, their first single off of The End, a No. 1 hit and a Boom Boom Pow remix EP of six remixes featuring everyone from up and coming artist Kid Cudi to billboard heavy weight 50 cent, will.i.am has proven that not only is the music experience well covered, but he’s also ensuring the Energy truly Never Dies.

Study: To SELL music you need more than Good Music

Analysis, Uncategorized

As I noted in an earlier post, my posts will be semi-deep dives into under represented analysis or data points in business. As a music aficionado, looking at the media space in my daily role, figuring out what was going on in the music industry seemed like a natural first dive.

The good news is there are ways to influence whether or not consumers purchase music or download illegally… simply make good music that has replay value, that listeners would enjoy with friends, oh and identify with your listener. Sounds simple enough? Lets explore the study…

In a 2007 (that not surprisingly wasn’t covered by the blogosphere) Journal of Consumer Behavior, Jean-Francois Ouelle published a paper entitled; “The purchase versus illegal download of music by consumers: The Influence of Consumer Response towards the Artist and Music.

The three part study looked at why consumers (college students were studied) decide to acquire music, and second what drives their decision to acquire it legally or illegally. The study was written sometime in late 2003 or early 2004 but as with most peer reviewed studies should present lasting implications. Bear in mind before there was illegal download, there was always some form of illegal acquisition – such as burning a CD from a friend, or dubbing a tape.

The study focused on two things: the listener’s response to the music, and the listener’s response to the artist. A response to listening to good music is the need to re-experience the music. Think of it this way – you hear a song, and the reason you want to download or purchase it – is you want to re-experience/listen to it again.

Study Findings:

  • The music itself is the only proven determinant of whether or not someone will want to ‘re-experience’ the music. Meaning whether or not a consumer liked an artist – had no proven effect on whether or not they want to listen to it or ‘re-experience’ it again
  • Consumers acquire music because they want to re-experience it. If you increase how much someone wants to re-experience music by 1 point you increase their likelihood of acquiring music 2.5 fold; consumers response to the artist did not have a statistically significant impact – meaning whether or not a listener liked the artist didn’t affect whether they wanted to re-experience (listen ot it again) the song.
  • Whether or not someone wants to re-experience music, is the most important response to music. Essentially – Do you want to listen to it again?
  • The consumer’s response to the artist, not the music, impacts whether consumers acquire it legally or illegally. A one point increase in the individuals response to the artist results in a 1.729 fold increase in the likelihood of acquiring music in question legally. So if a listener likes an artist they are much more likely to purchase it.

What this means for artists and record labels:

You need people to listen to your music.
This study finds that in general people decide to acquire music based on their need to ‘re-experience’ it. Of course, to make a decision about whether they want to re-experience it consumers have to experience the music first.

This is the problem with rap and the mixtape. Consumers have to make a decision to acquire the mixtape before they have actually experienced it. In theory this could work when one person acquires  mixtape  and plays it for others. But someone in the network has to make a decision to acquire the music before actually experiencing it. And the fact is that person in the network is more than likely experiencing a lot of music – because they are actively going out and acquiring music without having listened to it. So therefore your mixtape is one of many fighting for promotion among music mavens in a social network (and if your free mixtape is good enough to win this battle, it probably should be available for purchase).

Taking that a step further, , the sociability response (would a friend like to hear this) is the primary music response that leads to whether consumers acquire music legally or not, it also influences music acquisition. So not only do mixtape artists have to make good music notable enough for music mavens to listen – it needs to have traits that appeal to the non-music mavens in the network. And this is just to get a mixtape heard – no purchase has been earned yet.

A better model – is one that focuses on recording good music and making it available for purchase. Focusing on how to get people to hear it. This is why the radio and DJs are so important to recording artists. But perhaps instead of artists trying to woo sites that distribute and aggregate mixtapes, its most important to have your recorded songs (mixtape and otherwise) distributed through services such as LaLa, Last.fm and Pandora. This would allow your music to be experienced by groups beyond the most avid music aficionados. This allows consumers to make a decision to acquire it.

Perhaps there is an unmet need by Pandora’s and Last.fms here.

Record labels would be behooved to focus on understanding the characteristics of music that friends play around each other – as sociability responses are key drivers. Why do consumers choose to play one song or CD around friends vs. others? What impacts this decision?

A whole generation of consumers – don’t have an easy ‘acquire legally’ option.
Young people listen to and buy a lot of music. In its hey day if you wanted to score well on TRL – you catered to 12 year old girls. I assume these purchases were driven through some combination of tweeners spending their allowance as well as begging parents for a purchase at the point of retail (while at the store).

Today these consumers have a very convenient way to acquire your music illegally (P2P) but because they don’t have credit cards – they don’t have the most convenient way of buying your music legally. The record industry needs to place some thought here – about how to make legally acquiring music an easy to do thing here. Advertising campaign for parents gear around music allowance or family subscription plans.

Artists: Whether or not people like you, only matters if you make good music.
Only after you successfully created music people want to re-experience (preferably with friends) does artist response play a role. Artist response impacts whether people illegally download your music, or purchase it legally. As the study shows there are more factors that play into this than just artist likeability.

Most artist consider touring as the keys to building a fan base. This evidence supports that – but consider that as only the beginning. Every concert needs an audience interaction point either before or post the show where the artist can actually interact with the concert goers. For example a session before the concert where the artist talks about their recording process, mandatory autograph sessions after the concert. Pre-submitting questions and answering them during a section of the concert.

The key assumption here is that the artist is likeable. For every point an artist lacks in charisma – the artist’s music has to be that much better.

Lastly artists should focus their interactions with consumers on three things (in order) establishing confidence in their quality of music, identifying with your target audience (things you have in common with the consumer), and conveying likeable qualities (how well consumers feel they like you as a person).

Overall the study should be encouraging as it shows there is a formula that exists for how music is experienced, emotionally/mentally processed, and if successful purchased.