Tania Aldous, Andrei Hogea, Tirdad Kiamanesh, Jenna Petersen, Jingwen Yang
James Russell ( 7 weeks class )
Overview of the project
In this project, we are challenging the traditional business model of record labels. We believe that in the digital era the role of the record labels in the music industry will change and the current model will outdated. We find opportunity in bringing fans, artists, and producer together to create a unique experience for everyone. Pitch is a community to rally behind for fans, funding and risk mitigating platform for artists, and stability and creative control for producers.
Methods & Activities
10 Type of Innovation
Secondary Research, Orthodoxies, Interview, Synthesis the Interviews, UX Design, Storytelling, Graphic, Wireframe, Visualization, Business Plan.
" Anyone who's an executive at a record label does not understand what the Internet is, how it works, how people use it, how fans and consumers interact - no idea. I'm surprised they know how to use e-mail. "
- Trent Reznor
Age of independent artists
Independent artists have grown 600% from 2003-2012. Because of online streaming service and social media, artists are not limited to the labels to distribute their music or reach out and increase their fans.
In the same period, the market has shrunk. It means more people are getting a smaller share of the revenue. The music industry has rebounded in the last year. Break-even point reaches the growth of streaming services.
In the Physical era, the only way to enter the market was controlled by labels.
The graph above shows the risk of the investment for labels. They averagely spent $15k on each album and 90% of times the album couldn't return their investment.
Despite the high risk, label record companies invest more than any other companies in R&D.
Labels grew artists over time - through funding, marketing, services. They developed relationships with artists, and they were a necessity to make a label.
Also, labels were tastemakers for the fans. They curated artists, for a unique sound.
" The Internet was a saving grace for promoting and exposing and even creating. It's a parallel world to the music industry that already exists, and I'm glad to be a part of it. "
- Chuck D
The shift in the power in digital era
In the digital age, the label still assumes high risk but no longer has exclusivity. Artists can publish their art through social media and streaming services. If they can cut the noise, they do not need labels anymore.
- The value chain is shrinking. Distributors are being forced out with the move to digital downloads.
- Artist’s have more bargaining power with fans. New contracts are negotiated where artists retain rights.
- Startups like amuse are looking to empower the artist.
- Outside of the “Big 3”, Labels are becoming small and niche
" In the digital era, Record Labels aren't built to support Fans or Artists."
“The best model is smaller labels developing artists, given a moderate number of funding.”
“I don’t think I can name a single label….
… maybe one?”
“I would like to support my favorite artists but
I do not have any channel to do it now.”
" Labels who are focused on a specific type of music are more successful than those who focus on local musicians, they can connect local musician with the same genre of music and have a concert together "
Illustrations attributes: (vecteezy, insanity100) , (freepik)
"I've had big record label presidents look me in the face and say, 'Your music sucks, you don't know who you are, your music is all over the place, and we don't know how to market this stuff. Pick a lane and come back to us."
- Bruno Mars
Pitch brings Fans, Artists, and Producers together in an ecosystem to create unique experiences for everyone. We provide a community to rally behind for fans, funding and risk mitigating platform for artists, and stability and creative control for producers.
We realized that producers have a significant impact on the music industry. They mentor artists and have good knowledge about consumer taste. Producers are the center of this concept. We are going to bring them out of the backstage and give them a voice.
How does it make money
The label facilitates a new music-making and music-consuming community of artists, fans, and producers. By amortizing risk across a large group of passionate fans who believe in an artist, the label is free to invest more.
Artists don’t have to worry about recouping to the label and losing money on their art. They also gain valuable mentorship from their producer. Producers get steady work and more predictable income with no risk of losing money from an unprofitable artist
How does it make money
UI / UX design for web and mobile