Interview: Chris Vinson & David Dufresne, Founder/CTO & CEO Of Bandzoogle (Pt. 3)

(UPDATED)

Kyle Bylin: This new economy for music won't be just about the music itself, but about music as art. From the perspective of urban studies theorist Richard Florida, "Music was one of the first industries to experience the brutal effects of the digital transition, and it's clear that the ability to make money has shifted—even for the most established acts—from selling albums, CDs, and even digital downloads to live performance and, designing experiences." Read Part One & Part Two.

David, you've said, "music as art gains value when put into context."  How do new technologies help artists create different and innovative contexts in which their music can gain value, tangible and intangible?

David Dufresne:  I often use the analogy of a painting that you really like. If you see that painting for the first time at an opening in an art gallery (think fancy and pretentious…), you like the painting, you like the image, the colors, etc.

It would look awesome in your living room. You have a chat with the artist where she explains the concept behind the painting, the materials used.  She tells a bit of her life story, and how and why she became a painter.  You have a glass of wine; you discuss the painting with more people.  They also like it.

"At that moment, the image, on that wall, that you like so much might be worth hundreds of dollars to you. Maybe even thousands.  If you wanted it for yourself, that’s what you would have to pay, and you know it."

But, if the first time you saw the exact same image was on a wall at Ikea, on a busy Saturday morning, surrounded by shopping carts. And there are 22 frames of that same image, lined up in a bin, below it.  You might still think the image would look great on your living room wall.  But at that moment, it’s probably only worth $30 to you. Or whatever the price tag says.  Or maybe you don’t ever want Ikea frames on your walls, so for you it’s worth $0, even though you really like the image!  Your wall real estate is worth more than the frame.

So ask yourself, how can you explain the difference in perceived value for the same image at the gallery opening and at Ikea? Many answers here; the perceived scarcity (only one available at the gallery, and others might want it too), the personal connection with the artist, the setting (fancy gallery, the free wine), the narrative attached to the art, the materials (the original vs. the copy), the branding (maybe for you Ikea = cheap), etc… The list could go on.  That’s the context.  The artistic content (the image) has little value by itself.  But, put into context, it can be worth a lot, or it can be worth little.

Music isn’t different.  The song you’ve just written wouldn’t have the same value if your name was Dave Matthews or Kanye and you wrote the exact same song.  Before anyone else has engaged emotionally with it, it’s only worth something to you.  Think how your music can be valued, in terms of narrative, personal connections, perceived scarcity, branding, etc.  The new technologies can help, by helping you create a narrative and a branding on your website (your bio, your design, your pictures) that make fans interested to hear more of your music.

Streaming services like Pandora can help create contexts where new fans will discover your music.  Communicating with your fans using your mailing list, Facebook and Twitter help create personal connections that make your fans attach even more value to your music.  You create great context when you put on an amazing live performance, and promote it using online and offline tools.  So, you need to be creative in making art, but also in creating contexts, and letting others create many and diverse contexts in which this art can be enjoyed.

"Put more simply, it’s not your music on its own
that will earn you revenue. It’s someone enjoying
your music that’s worth something."

The role of technology tools is to help you multiply those contexts, and monetize them when you can.  The tools are still very imperfect, and the laws and licensing schemes are archaic in many respects.  But it’s all evolving very quickly.

KB: Industry pundit and analyst Andrew Dubber has famously said that, "If you want to make the music that moves you, that will hopefully create meaning for people, and that will perhaps earn you a sustainable living, then you have chosen risk, and you will have to be as smart with the entrepreneurship as you are with the music if you want to survive and thrive." This means that you can't make things that fans will not pay for, start insisting they should, and then complain that their morals to blame—if and when fans file-share your music.

By thinking of themselves as musical entrepreneurs, how does that change the way artists think about the music that they create, the context that they interject into it, and the overall direction of their career?

Chris Vinson:  I really like the entrepreneur’s analogy.  Heck, you can easily use Bandzoogle as an analogy.  We only earn revenue when members decide to sign up for a paid plan. We earn sustainable revenue when they remain members for a long time.  But before we can make that happen, we must first drive traffic to our website, we have to get exposure, spend on marketing, make sure that musicians hear about us.  Then we offer them our content (our platform and tools) for free, for a certain period.  A small number of those people that came to our website will like what they see from our home page enough to try our content for free.  Then, an even smaller number of those will find enough value in our product, at a price they like (they have 3 price options right now, and they can pay monthly or annually). So they eventually become members, and earn us revenue.  But the percentage of visitors that become paid members is relatively very small compared to everyone that comes to the site.

"It’s the same for artists.  Stop thinking that
everyone should pay for your content."

Make it available as easily as possible, let people enjoy it and find out if they like it, and then try to convert a (probably) small number of them into fans that will gladly pay for something.  That something might be a ticket for your next gig, it might be your CD, for the nice artwork and liner notes that come with it, might be a t-shirt, poster, etc.  Hey, they might just give you a contribution, to thank you, and to motivate you to keep making music.  All of this can happen if you make them like your music, and if you make them like you, as an artist and as a person.

KB: In The Great Reset, Florida argues that Great Resets are "broad and fundamental transformations of the economic and social order and involve much more than strictly economic and financial events. "They are the great transformative moments when new technologies and technological systems arise, when the economy is recast and society remade, and when the places where we work and live and work change to suit new needs."

Do you think that the record and music industries, and artists alike, are experiencing a Great Reset of their own, where new technologies and technological systems are arising, the industry is being recast?

David Dufresne:  I am not too familiar with Richard Florida’s writings, but the Internet and the democratization of access to powerful hardware, software and high speed, low latency bandwidth are definitely disruptive forces for all industries based on “digitize-able” content.  I’m not sure I would call it a reset, because I think that implies a hard stop and re-start.  But…

"we are clearly seeing an accelerated shift
in how the music industry needs to define its
business practices. The music industry defined as
the record industry is clearly in trouble."

But other industries are thriving, often because of music.  Consumers spend more on iPods/Phones/Pads, and quality headphones, than they do on the music themselves.  I see great opportunities in the streaming and recommendations spaces, too.  With so much music available at the click of a mouse, fans need help in finding what they’ll like.

It’s also a great time for companies that will power those new types of economic relationships between fans and artists (from social networks, digital distributors, direct-to-fan marketing tools, to ticketing and on-demand merchandising).  But since a lot of the wealth that was created by the record industry was often created thanks to artificial market limitations and inflated prices of mass distributed goods, and since a lot of that wealth was retained by service providers that do not add as much value today, the global music economy might never get back to the level it was 10 or 15 years ago.

Chris Vinson: I agree, but if we get to a point where a majority of artists that have the talent and skills to create and perform good music – that people enjoy – also have a decent shot at making an honest living out of it, I think we’ll call that an improvement.  To get there, we need to keep building that toolbox for them, teach them how to use it, and we all need to keep innovating by building different models to help artists and fans connect.  Those connections need to be sustainable, emotionally and financially.

Read Part One & Part Two.