Why You Don't Need A Label

Everyone seems to be talking about the increasing irrelevance of the Major Record Labels. It’s understandable given their blatant last-ditch attempts at control (see: suing your customers) and the total realignment of the distribution system. Industry abhors a vacuum, however, and some entity must emerge to take on the responsibilities that made the labels in the first place.

Here’s my take on the future of the music business.

The Artist¹ As A Corporation

Any artist who wants to earn a living had better treat themselves like a business. Like any functioning business, there are different departments covered by different team members:

• Production: Someone has to BE the product… in this case, the artist and her recordings. Often a professional Producer will make a project happen, such as an album.
• Marketing: Someone has to get the artist into the venues and get people to come pay money to watch her. Someone also has to sell physical merchandise like CD’s and shirts.
• Management: Once the business becomes more than the artist can handle, a trusted friend or professional takes over so the artist can focus on music. Beyond that, there are managers for specific tours, specific shows, and other business ventures where a specialist is needed.

This is just a simplified version of an artist’s business, but the idea is that an artist has departments and divisions like any other business. If you ever wondered why some artists fail, even those on major labels, it’s because they often don’t see themselves as a CEO.

The Record Label As A Corporation

So did you see the record label somewhere in that model? No? It’s in there, kind of. The traditional record label is a marketing department. Their sole purpose (ostensibly) is to sell albums. That’s it. They don’t “make” an artist, they just make round things that play music. Of course, keeping the artist famous helps to sell those round things, but their sole purpose is to sell albums.

At their essence, record labels really only serve a few functions:

• Marketing: They connect a stack of round plastic with a group of buyers. The entire concept of “artist development” usually means “making an artist’s product fit into a pre-existing marketing scheme”.²
• Publicity: Again, it’s all about selling product. The more you see the artist in Rolling Stone, your local paper, or even America’s Most Wanted, the more likely you are to buy the round thing with their music on it.
• Rolodex: The label’s prestige and reputation can open doors to possibilities that the artist alone couldn’t muster. However, as I’ve said enough already, it’s all about selling the product. If the connection won’t move round plastic, it won’t happen.
• Bankroll: A major label has money, giving them the power to buy studio time, advertising, and huge amounts of swag to send to promoters and program directors.

So What Went Wrong³?

Major Labels used to function as development houses, and their name stood for a level of quality. An artist, once signed to a label, was treated like an investment that would grow, mature, and eventually generate sufficient business on their name alone.

Like the corporate world, though, the artists became as disposable as any other laborer. For every artist that couldn’t recoup costs, a thousand more stood in line behind them to try. Or after easily recouping their costs on a lucky artist’s smash-hit debut, the label can shelve the less-impressive sophomore album⁴ and move on to the next act.

That arrangement might even be acceptable… if the artist made a dime off of any of their debut album sales. For much better, much more experienced details on how that plays out, read The Problem With Music by Steve Albini⁵. This article, however, is about the new makeup of a musician’s team.

Expanding The Company

Without a big, bloated label on their back, the questions are whether an artist can command their own corporate divisions and whether everyone can earn money at the end of the day. If an artist has a CEO mentality, chances are good she’ll be able to handle team management adequately enough. Here’s who I think the team will be:

• Booking Agent: They get the artist on the stage. They make 10-15% of whatever venue fee the artist receives.
• Promotion: A promoter will often be the one advertising locally and handling ticket sales, taking a percentage of the tickets and merchandise.
• Management: This one’s a little vague as the manager can be a band member (oddly enough, usually the drummer) or some professional agent that knows the business world well enough. I’m not sure what percentage of what assets the manager would take since it depends on their level of involvement.
• Attorney: A record label has a team of them on call 24/7, but an artist can just hire one as needed.
• Publicist: Radio/Podcast servicing, getting reviews and write-ups in prominent publications, etc. There may be a lot of overlap between publicity and marketing, so the marketer may shoulder both burdens, but this kind of work is typically done on a fee-per-campaign basis.
• Marketer: This is what replaces the record label. Unfortunately, there are only two ways I can see a marketer making a fair paycheck from an artist-
  1. Taking a percentage on a project-by-project basis. Like a PR campaign, they would try to sell a particular product (an album, for example) and keep a percentage of the returns that product (maybe 10-15% of revenue for album sales, track downloads, etc.)
  2. An exclusive arrangement with a percentage of ALL revenue. An artist agrees to make a marketer (or agency) their exclusive mouthpiece in exchange for best efforts⁶ to sell ALL things that artist represents- CD’s, digital sales, shirts, tickets, speaking engagements, you name it. Anything the marketer can sell, they get a percentage of.

The concept of a Marketing Agent or Agency may not be new, but it certainly seems to be in the independent music scene. I would personally like to see someone with real connections and experience take on the mantle of “music marketer” and try this model out. I’ve already seen “digital music marketing” done for indie artists, but I have yet to encounter a real savvy marketing agent or agency that believes in a music product enough to run with it.

Still, if this model can work, then what used to be a “label” simply becomes part of an artist’s identity. And, honestly, isn’t that how music should be sold? As a product of the person actually making it?

Footnotes

1 – For the sake of clarity, I’m going to use “artist” synonymously with “band” since the concept is the same.
2 – Actual development might take place, granted, but for the most part the label acts more like a matchmaker between existing demographic groups and an artist’s sound. I can’t fault them for that, either, but it tends to homogenize a lot of the music on their label.
3 – I know, I know, I could write a thousand entries to answer that question. Why don’t you write some for yourself in the comments here?
4 – An assumption that’s somewhat grounded in reality- Often an artist’s debut album is the result of years of writing, performing, and refining. The sophomore album is usually put out a mere 12 to 18 months later after the record label’s kept them busy all year with radio interviews and opening for <insert current flave-of-the-month band name> to help promote their album. And then the A&R guys wonder why the writing isn’t nearly as good.
5 – Steve Albini is an independent and corporate rock record producer most widely known for having produced Nirvana’s In Utero. Read his article or look up Steve Albini on Wikipedia for more info.
6 – Yes, I know “best efforts” is a legal term. That’s why I used it. Are you tired of these footnotes yet?

[tags]Matthew Ebel, Piano Rock, record labels, Steve Albini, marketing, music, music business[/tags]

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