Making and Marketing an Artist Streaming Rewrites the Rules, Again

Our clients have full access to all of our reports. Clients can log in to read this report. Click here to become a client or, you can purchase this individual report.
The 20,000 Foot View: Marketing is one of the core competencies of record labels. The rise of the internet and social media transformed label marketing strategies. Now streaming is turning everything upside down again. The new challenge this time round is that streaming is both a marketing tool and a revenue source. In the old world, there was a very clear delineation between radio and retail, streaming brings the two together, which can lead to conflicting objectives. For example, labels widely recognise that the streams that free users generate can be crucial in building momentum for a track.
Key findings
- Labels not having uniquely identifiable information (UII) from streaming services is the underlying challenge for measuring marketing ROI for streaming
- Consumers are increasingly shunning ads: skip video ads (rising to of streaming music users and use desktop ad blockers)
- Some big ad agencies have overcharged advertisers for programmatic ad campaigns, pocketing the difference via rebates from media owners
- Labels spend around of their revenue on marketing, compared to an average of for blue chip companies
- Generally, most campaigns are still album campaigns or at the very least built around a group of tracks
- Major labels are building extensive marketing data capabilities to complement their already comprehensive streaming data resources
- Record labels spent a total of billion on marketing in 2017 with of that billion) being spent by majors million) was spent on traditional advertising across TV, Radio, Outdoor and Magazine
- Labels spent of digital marketing spend on YouTube in 2017, totalling million
- In 2016, labels spent on YouTube marketing for every of video streams revenue
- In 2018 label marketing spend will tip over to digital, up from million) in 2017
- Warner Music Group’s 2017 artist and repertoire costs were million while royalties to be recouped within one year were million
- For an illustrative major label artist that generates million in revenue, artist advance would be production costs and artist royalties
- The forthcoming European GDPR regulations are the storm on the horizon for marketing data for any company with European customers
Companies and brands mentioned in this report: ADA, Apple Music, AppsFlyer, AWAL, BMG, Chartmetric, Facebook, Instagram, Kobalt, Pandora, Platoon, Pledge Music, Spotify, Stormzy, United Masters, Warner Music Group, YouTube