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Tuesday, September 26, 2017

Do The Math: Indie vs Major – A Rap Breakdown

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A question for rappers….

Would you PERSONALLY give away 75,000 CD singles over a 100 day period in 75 cities in order to sell 7,500 iTunes album downloads & do 40 shows for $2,500???

This is the math for distributing the free single or sampler CD:

Screen Shot 2014-11-09 at 11.42.38 AM

 

 

Below is the math behind the sales that the above legwork can generate when coupled with a consistent digital content release plan and social media promotional schedule. To add radio to the above plan would cost an additional $40-50,000, yet is still feasible once the numbers are evaluated.

 

Screen Shot 2014-11-09 at 11.42.56 AM

 

 

So your time and a $57,250 investment stands to generate close to $175,000 – more than triple the money spent. As the artist in this example, all that’s required of you is to be hands on in passing out and placing the promo material. Whether it’s in a major city at a venue of 5,000 or on a street corner in a small town flagging cars down to share your music. You’ve got to be motivated enough to work daily meeting fans personally, and consistent in following up with those who reach out to you via social media or other means. An outgoing & accessible aspiring artist soon finds success through consistent work & effort. It can be done – but this path isn’t virtual or strictly digital – this path is hands on & grassroots. This is the path that creates careers vs the path that creates one hit wonders.

 

Before I go farther, I’ll be honest and say that, in order to make these kinda numbers realistic you need to hire a consultant.

A consultant will plan your market tour and add in extensive REAL terrestrial radio play as well as thorough internet coverage which will boost both your sales and shows.

But my point is that without the personal outreach of the artist – this kind of return isn’t likely.

Too many times aspiring rappers see the artists with major label deals who seemingly don’t have to do their own hand to hand promo. This leads the unsigned artist in to mistakenly thinking that face to face interaction with fans is unnecessary. The majority of unsigned artists believe that the formula for success is:

  • good internet numbers;
  • major label artist features;
  • radio play; and
  • tour dates opening up for bigger acts

 

If the above were true – then every artist with some money and a lil sense would be successful. However, we who work with music everyday know that this is far from true. I’m sure that most people reading this know artists and/or indie labels who’ve spent millions to put the above pieces in place – yet never see any success or get a real return on investment.

This is the reason a consultant is NECESSARY for properly funded indie labels & artists. Trying to mimic or copy the major label formula leads to failure for indies, because major labels invest so much more money into each release than an indie. What appears to be successful in breaking most major label artists is smoke and mirrors – an illusion to the general public – backed by the deep pockets of the billion dollar labels these artists are signed to and executed in a way that appears “viral” or “natural”. In the digital world, the WorldStarHipHop banners and DatPiff takeovers and blanketed blog coverage all come at a pretty penny that the majors can afford to spend, but the indies have to do on a much smaller scale.

For the sake of those who don’t understand, allow me to show you the basic differences in the monetary breakdowns for campaigns of indies vs. those of major labels.

The biggest difference between the major artists and you as an indie – is that an indie artist gets to keep a fair share (if not the majority) of the money made from their project. A major artist will be lucky to make a nickel offa every dollar from sales. But even an indie artist who partners with an investor to fund the promo expense is likely to keep close to 50% of every dollar they generate from sales.

I’m going to give a rough example of the money generated vs the money made by major label & indie artists. The examples are not all-inclusive – but are very realistic.

Let’s look at the major vs indie record-breaking expense and monetary breakdown.

 

 

Major Label Artist Example

Major label artist goes Gold – selling 500,000 iTunes album downloads at $13.99. iTunes takes 30% of that off top, leaving a gross of $9.793 each download. (In this example – I’m gonna keep it simple by saying that all the sales were via iTunes.) So 500,000 copies x $9.973 = $4,986,500

Artist deal is 10%   ———   10% of $4.9 million is $498,650.00

Now the artist doesn’t get a check for that amount of money. First off, the artist has to pay the major label back for all the money it invested for the artist to sell this many copies. So, lets look at what the label (claims to have) spent promoting this project:

major label pie chart

Total expenses $545,000

Artist OWES $46,350 after selling $5,000,000.00 worth of music.

Also, keep in mind that this doesn’t include the advance that the artist got when signing to the major label, which is ALSO recoupable and must be paid back. I kept this spending breakdown as simple as possible, but the money spent by major labels on new releases can easily exceed a million dollars.

 

Now lets look at the breakdown for an indie artist signed to a properly funded indie label.

 

Indie Artist Example

Indie artist with investor sells 50,000 downloads at $13.99. Remember that iTunes takes 30% of that off top, leaving a gross of $9.793 each download. (Once again, I’m gonna keep it simple by saying that all the sales were via iTunes.) So 50,000 copies x $9.973 = $498,650

Artist has 50/50 split on sales with investor- 50% of 498k = $249,325

 

As in the major label example, the artist has to pay the investor back all the money invested in this project. So, lets look at what the label (claims to have) spent promoting this project:

 

indie label pie chart

 

Total expenses $170,000.

Artist EARNS $79,325 after selling $500,000 worth of music AND paying back investor.

 

 

Summary

The indie artist who sells 1/10th of the music that a major label artist sells is STILL in position to make much more money from music sales. Will the indie artist become internationally known and famous for selling 50,000 copies? No, not immediately. Will the indie artist perform at the Grammy’s, AMA’s, VMA’s, BET awards, etc? No. Will the indie artist become a pop music phenomenon?? It’s possible, eventually. Just don’t let the popularity of a major label artist confuse you into believing you need a major label deal. The examples I gave today didn’t even include merchandising online or money from website hits and youtube views. An indie artist with the proper drive and determination can make millions from their craft without the major label machine. If you work your career correctly, and then choose to sign to a major, you should first gain the leverage to actually get a great deal. “Leverage” is a different subject for a different time tho.

My next entry will be a live show breakdown of major label vs indie artists.

Being on a major label gets you high show prices and allows you to make much more money right? That’s the perception and belief of the aspiring indie artist. In a few weeks I’ll be shedding some light on the truth and showing you that the perception and belief about the riches found in show money aren’t always correct.

Thanks for the time you’ve taken to read this entry. Hopefully you’ve enjoyed reading it as much as I’ve enjoyed writing it. Much success in your future endeavors, whatever they may be.

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Tony Guidry is Senior Marketing Manager for A Scratchy Throat. A Scratchy Throat – the brainchild of music industry mainstay Wendy Day – provides professional social media marketing specifically designed for today’s aspiring artists. Tony is also owner of Authentic Artists Alliance and exclusive booking contact for Trouble (Duct Tape Ent/2 Tru Ent), O.Z. Mr. 28 Grams (Fratt Boi Muzic Group) and Racked Up Ready (Bow Ent). For digital marketing services or booking inquiries email: OGTonyG@gmail.com or Tony@aScratchyThroat.com

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The Big Business of Music Industry Scams (Especially for Urban Artists)

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Do music industry scams make money?

The music industry generated 15.7 BILLION dollars last year….
Music Industry Scams
That doesn’t count the money spent on music industry scams by unknowing artists.
I guesstimate there is at least an extra BILLION dollars earned by scammers in the URBAN industry alone.
Music Industry Scams
 
The math:
 
Each state has at least 100 dudes with decent money backing their own rap or R&B label – who spend their budget with fuckboys. If each of those 100 guys spends 100k in a year on their music dreams – that’s 100 x 50 states x $100,000 = $500,000,000
 
Each state has at least 500 artists who scramble up bread to support their music dreams – then spend it with fuckboys. If each of those artists spend $10,000-20,000 a year, that’s 500 x 50 states x $15,000 (avg) = $375,000,000
 
Each state has at least 1,000 “struggling artists” who try a buncha shortcuts and pay for play. They spend around $5,000 on their music dreams with fuckboys. 1,000 x 50 states x $5,000 = $250,000,000
 
Added up, that’s easily over a BILLION.

Music Industry Scams

 
Add in the feature & show scams. The “label meeting” scams. The beat selling scams. The video placement scams. Digital marketing scams. Social media marketing scams. Purchases of fake followers, friends, likes, views, etc. and we closin in on 1.5 or even 2 BILLION dollars on the music industry scams!
21 Savage Music Industry Scams
Sadly, even more money is wasted on fruitless efforts and outdated tactics by people who just don’t know and refuse to learn……

Music Industry Scams

The artist is often the consumer in the business of music. Especially when they’re just starting out, tryna build a fanbase and create a buzz for themselves while figuring out how to get heard.
 
Unfortunately too many fall victim to music industry scams because of their lack of knowledge and refusal to accept the importance of learning how the music business actually works.
 
Don’t let your hard earned dollars be a come-up to some con artist. Do your research and learn as much as you can about this business before spending a dime.
Hint: Nobody is gonna “put you on” without YOU doing 99.9% of the work. For every tenth of a point they lessen your workload, they’re likely robbing you of 5 points of income from your music…..so the best case scenario is that someone “puts you on” after you do 98.1% of the work – for their 1.9% they just keep all the money since you didn’t know any better.
Music Industry Scams
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In Today’s Music Industry, Streaming is Everything (Almost)

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BuzzAngle’s midyear report on the music industry was released last month, revealing some pleasant (& not so pleasant) surprises concerning music, the way that it’s listened to, and the revenue it generates.

If you’ve been keeping up with the latest developments about music and how it’s enjoyed by fans, then it’s not a secret or surprise to you that audio streaming has surpassed every form of music consumption. For the first time ever, audio streams have surpassed video streams. Yes, the likes of Spotify & Apple Music have surpassed YouTube, Vevo, etc as the number one way that music is streamed. Despite the fact that video streams increased by 23% to 95 billion; on-demand audio streams accounted for 114 billion of the 209.4 billion streams of the first half of 2016. Yes, you read that right! There were 209.4 billion songs streamed on-demand in the first 6 months of 2016.

Overall streaming improved 58%, but audio streams grew 108%. That’s more than double the number of streams for the same period of 2015. Just in case you didn’t know, 150 streams = 1 song sale; and 1500 streams = 10 song sales or 1 album sale. So streams also count towards RIAA certifications.

music industry
Buzzangle Audio Streaming Graphic

Digital song sales are diminishing faster than digital album sales. Song sales are down 24% in the first half of the year. Digital album sales are also down nearly 18%. Even though single sales are down nearly 1/4th, on the digital side singles still outsell albums 9-1.

Of the 86 million album sales of the first half of 2016. 37 million were cd sales. This marks an 11% drop in the sale of the dying medium BUT depending on genre and fanbase, cd sales still matter. Adele

’s “25” has sold 1.25 million units, over 812,000 of those sales are actual physical CDs. Overall, CD’s accounted for 43% of sales in the first 6 months of 2016.

The growth of streaming and steady lowering cost of cd duplication is a great combination for independent artists. With the right strategies and properly structured budget, an indie artist can target potential fans using pinpoint demographics AND follow up with a combined sales/promo strategy for CDs.

I can’t easily explain all of the methods used to grow a streaming base, but to put it in simplest terms – an artist can include streaming links on all physical promotional items like posters, flyers, business cards, cd inserts, etc. thus allowing potential fans to access the music at their leisure on their favorite platform. Using a grassroots campaign to fuel streaming is a cost effective method for independent artists to build their streaming numbers into actual income. Of course, we know, that in the music industry, we need income.

streaming

The combination of an aggressive street team, consistent release of fresh content and placing the artists themselves in as many markets of the region as possible to meet and woo potential fans will result in a significant growth in physical interest as well as a boost in streaming numbers. Repeating this process while streamlining costs and adding relevant members to the network is the foundation for growth that can place an indie artist in the position to step up to the next level.

This level may include adding a financial partner for investment opportunities or expanding the team to grow & exploit earnings potential in a way that increases the artist’s fanbase. Independent artists must build a fanbase large enough to finance a bigger push that reaches more cities with more promo material, continuing the cycle of elevation until the artist reaches national awareness, or has an international presence or whatever the goals of the team may be.

I know that it seems like I got off subject, but really I used the “streaming” buzzword to get your attention so that I could preach the grassroots guerilla marketing gospel to you about today’s music industry. I hope that you found some insight here and that if you did, you’ll share with your friends. I appreciate you taking the time to read these words. My intention is that we all find success, this is why I share this entertainment industry information with you. It really works! Put it to use!!

Tony Guidry is the owner of A Scratchy Throat – the brainchild of music industry mainstay Wendy Day – A Scratchy Throat provides professional digital marketing specifically designed for today’s aspiring artists & indie labels. Tony is also the owner of Authentic Artists Alliance and manager of rap artist Trouble (Duct Tape Ent/2 Tru Ent). For digital marketing services or artist inquiries email: Tony@aScratchyThroat.com or Tony@AuthenticBooking.com

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The Real Deal About “HomeGrown” Rap

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I originally wrote this about the rap scene in and around my hometown in Louisiana, but as I’ve traveled more and more I find that artists, especially those who rap or produce rap music have identical complaints no matter the city. This is what led me to share my thoughts with you on the challenge of becoming more than a local joker who raps. The transition into professional musicianship takes time, effort & consistency. Most want microwave (instant) success….but there is no overnight or instant success in the business of music. Music promotion done properly takes time, effort, research, dedication, consistency and (yes) a significant budget.

Problems

One of the biggest problems that artists have is understanding how the business of music works. Different people believe different things & it really seems like nobody does any research or has any desire to truly learn why they’re not getting the results they seek. Most artists & indie labels just do what the next person is doing in hopes of getting different results. Twitter has been around for NINE years & everyday thousands of unknown rappers send tweets to @diddy & @russellsimmons & @drdre & countless others asking for deals or to be heard – not even realizing that the music industry doesn’t work this way and isn’t talent based.

Yes, young artists, it’s a myth – a lie – basically bullshit –  that a person’s talent is gonna get them noticed online & signed to a deal that makes them rich & famous. Sorry, don’t mean to bust any bubbles, but it doesn’t work that way

Another thing I’ve noticed are the major misconceptions about “unity” in other markets – and the appearance that it’s easier in any other city than the one where the struggling artist currently resides. An Atlanta artist wants to go to New York or LA (where the labels at) – a San Antonio rapper wants to go to Houston (where they show love) – all across the country, artists wanna go to Atlanta (where it’s easy to get on). The truth of the matter is that if an artist can’t dominate in their local market, then it’s highly unlikely that a change of location will alter their fortunes overnight. Too many rappers want to expand their reach before they have a name in their own city. An artist can use “home” as a test market and learn how to master proper promotion & marketing tactics – instead of running to a strange place, getting promised the world, then ending up being raped by a conman. It’s not the city – it’s YOU.

There are many more problems that exist when trying to establish an artist in the business of music – but nothing that an educated, hard working, persistent person can’t overcome.

Breaking a record is not easy….establishing yourself as an artist is not simple….it’s not done overnight. Becoming successful as a rapper or music artist is somewhat complicated and definitely time consuming. There is no quick fix or shortcut that you can buy or pay for that will eliminate the hard work it takes to become an artist who gets paid for their craft. You will need money to promote and market yourself and your music – but money doesn’t replace the need for consistent work. Money is the companion to consistent work & effort.

Solutions

To speak on solutions……one of the FIRST things an aspiring artist has to accept is that NOBODY owes you a chance or a listen….NOBODY cares but your closest friends & family (& they might not care). Other than a very few ppl who are close to you – none of the rest of us give a fuck about your music or your flow or your style or none of that….we’re not hating….we just DON’T CARE. When you chose to become a rapper/singer/producer or whatever – you chose the job of winning us over. You’ve got to start that long journey of winning us over by being consistent & persistent.

There are 10,000 of you rap niggaz running around any given city – why should I listen to you? What does it benefit me to listen to you? Why should I waste my time listening to you? Why should I give you a chance? Why should I stop listening to my favorite artist to listen to you?

^^^^^^^^^^^^^ That’s the attitude of the average person that you approach with your music. There are too many rappers to take all of y’all serious. Everybody is a rapper or producer or manager or own a record label – blah blah blah blah.

In order for anyone to take you serious you need to be CONSISTENT. You’ve got to reach out to multiple people EVERYDAY – not just on the days you feel like it….and not just online. As an aspiring artist – everywhere you go is a promo opportunity. If you’re pumpin’ gas & see someone in the age range of people who like the kinda music u make – approach em. (Don’t lie to yourself that your music appeals to “everybody” – each kind of music has a target demographic – find yours and market to those people).

I can’t stress enough the necessity of being CONSISTENT. Jf you consistently approach 30-50 ppl per day every day for 1 month, you’ve directly exposed at least 1,000 people to your brand & music career. Going to malls, college campuses, car washes, barber shops, hair salons, hood stores, gas stations, quick marts, parks, projects, apartment complexes, sporting events, concerts etc. will allow you to easily run across 150-250 people a day. When promoting a single I set a goal for myself, the artist and each team member to pass out 100 singles a day hand to hand. Don’t believe that physical cd’s are worth your trouble as a promo tool? Read this: Physical Music Sales Dead? CDs & Vinyl say “Not Quite Yet”!! (If you’re a super cd hater who denies the numbers in that article — look at Taylor Swift — the ONLY artist to go platinum in 2014 — sold 1.3 million copies her first week & over 400,000 of them were CD’s!)

 The promotion of music is a numbers game. You’ve got to reach enough people with your music in order for it to start to resonate.

It takes MONTHS to break a record to the people and win them over. You’re going to live thru many rejections – be forced to accept the fact that not everybody is going to like your music or vibe with you. You gotta jump over the hurdles and thru the hoops to separate yourself from the rest of the lazy, babified, wack, heartless, spineless, coward, playtime rappers.

Everybody ain’t built for this business…..the business of music is for the self-motivated, self-inspired, super hustling, never say quit type of person. Most rappers are just attention seeking lames who feel the world owes them something…..but the truth of the matter is that as a rapper – YOU owe the people consistently jamming music that you consistently push & promote & market. If you’re not out there head first behind your own musical career then you can’t expect to have real fans. If you’re not physically meeting people every day of your life trying to expand your brand, then you can’t expect to have a career in music. The business of music requires more work than 99.99% of you realize.

You’ve got to win the people over BEFORE you get played in the clubs….BEFORE you run and try to get on the radio…..you gotta start with the PEOPLE…..when the PEOPLE in the club start asking the DJ for your music back to back to back to back – bugging him to play your music — then he’s GOTTA give u a spin……then when there are 20, 30, 40 or 100+ ppl in the club that know the lyrics because they have been jamming your music for weeks — the DJ notices…..he knows now that you’ve been puttin in major work behind that song…..he also knows that if he plays that song it’s gonna get the club turnt up…..and he’s gonna play it on the regular — because a DJ’s job has nothing to do with breaking YOUR record. A DJ’s job is to keep the people in the venue dancing. They’re not gonna dance to a song they never heard before and so the DJ isn’t gonna play your song that nobody has heard before…….your new & unfamiliar song kills the vibe of the crowd. The DJ ain’t hating on you – you just need to give him a reason to play your music – this requires WORK!

It’s YOUR job to make your music familiar to as many people as possible….whether they hate or refuse to listen or whatever excuse you try to make for yourself….if you stay at it, you’ll start to convince people to give you a listen — and that’s when your music gotta resonate and speak for you……..if you’ve got great music and a solid work ethic, there are no limits to what you can accomplish in music. To win over fans you gotta be consistent…..

The last thing that I”ma say to struggling rappers is this……..shit that magnet out….don’t act like you don’t understand – shit out that magnet shoved deep in ya ass that won’t let you go over 30-45 minutes from home. Unless you live in one of the 10-15 biggest cites in America, the population of your city isn’t big enough to get you the buzz and accolades you seek.

When you’re buzzing locally – you’re NOT getting more than $2,000 a show…..you can’t garner significant sales JUST in your local area. Quit trying to be the king of your hood and expand and branch out – but only AFTER you dominate your immediate area. Once you have momentum begin to travel….beyond 25 miles…..beyond 50 miles…..beyond 250 miles.

Rappers are quick to say that artists from a certain city make all the money in their area. 99 times out of 100 that’s because they travel and promote themselves….just like they go different places building their followings……you gotta GO to the places where you wanna be hot and put that work in. It starts from block to block, neighborhood to neighborhood, city to city, town to town – working, establishing a following, meeting people, networking, growing…..over and over and farther and farther.

At the end of the day – the problem with “homegrown” rap is the rappers. If you wanted to succeed as bad as you claim to, you wouldn’t have time to complain and gripe and cry about how hard it is to win support, or get dj play, or get shows, etc. If you are a rapper reading this – there is no excuse for your lack of success except the person you look at in the mirror. You are SOLELY responsible for ALLLLLLLLLL your losses. You’re not about to give anybody credit for helping you win – so when you’re losing, run straight to the mirror and point at the person you see. That person in the mirror is the reason your song not catching on – that person in the mirror is the reason everybody hate on you – that person in the mirror is the reason no promoter wanna book you —- everything negative that happens to you in the music business is the fault of the person in the mirror……because they’re not working hard enough & smart enough & strong enough & long enough to make your dreams come true.

B.G. said it on a album….and the saying was so true that he needed 2 volumes to remind you: IT’S ALL ON YOU

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Tony Guidry is Senior Marketing Manager for A Scratchy ThroatA Scratchy Throat – the brainchild of music industry mainstay Wendy Day – provides professional digital marketing specifically designed for today’s aspiring artists & indie labels. Tony is also owner of Authentic Artists Alliance and exclusive booking contact for Trouble (Duct Tape Ent/2 Tru Ent)O.Z. Mr. 28 Grams (Fratt Boi Muzic Group) and Racked Up Ready (Bow Ent). For digital marketing services or booking inquiries email: OGTonyG@gmail.com or Tony@aScratchyThroat.com

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Tony’s Two Cents on Major Label Record Deals

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To a major label artist 1 $12.99 iTunes album sale MIGHT make them 60 cents (after they recoup).

To an independent artist 1 $12.99 iTunes album sale world make them roughly $10.00 (iTunes keeps 30% of everything they sell)

The major label artist gotta go gold (sell 500,000) to hopefully make $30,000. The indie artist can make $30,000 with 3,000 sales.

So ask yourself why you’re obsessed with getting a major label record deal.

Is being on 106 & Park or MTVJAMS that important that you’d let yourself be RAPED for the opportunity?? Are you so thirsty for attention that you don’t care about the money long as U get recognized?? Cool.

At the end of the day – U gotta do the same amount of work to get a major label deal as you have to do to become successful as an independent.

A major label record deal doesn’t save you from working. It just makes U a sharecropper instead of a landowner. Is that your vision for yourself??

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Tony Guidry is Senior Marketing Manager for A Scratchy Throat. A Scratchy Throat – the brainchild of music industry mainstay Wendy Day – provides professional social media marketing specifically designed for today’s aspiring artists. Tony is also owner of Authentic Artists Alliance and exclusive booking contact for Trouble (Duct Tape Ent/2 Tru Ent), O.Z. Mr. 28 Grams (Fratt Boi Muzic Group) and Racked Up Ready (Bow Ent). For digital marketing services or booking inquiries email: OGTonyG@gmail.com or Tony@aScratchyThroat.com

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