What you need to know
With CD sales falling and digital piracy eroding traditional revenue streams, artists are increasingly turning to their audience for funding, convincing fans to contribute towards the release of an album or securing the services of a radio plugger or PR.
Selling one-off products and experiences to fans is now common practice. Playing live in a fan’s living room, writing a bespoke song or selling an appearance on your next album are now all potentially valuable revenue-raisers.
Crowdfunding platforms such as PledgeMusic or Kickstarter formalise the fan-funding process. Through the artist’s website and social media presence, fans are asked to contribute to the project. Musicians retain their rights and the website charges a commission once the agreed target has been raised.
As fan funding is usually managed through social networks, musicians should aim to build their fanbase online.
Crowdfunding is an effective way of releasing albums as it allows artists to check that there’s sufficient demand for their music before they commit to releasing it.
Artists set a campaign goal (the amount of money that they need to record and manufacture the album) and then encourage their fans to pre-order the album - If enough fans do so, the project reaches its target and the artist records, manufactures and distributes the album within the pre-determined timeframe. If the goal is not reached, artists are not required to produce the album.
Crowdfunding platforms are also used by artists who have already financed an album, but who want to utilise the goal-setting and marketing tools in order to optimise support from fans.
MU members can seek the advice of their Regional Office in relation to crowdfunding agreements.
If you’re considering releasing an album via a crowdfunding platform, it is worth considering the following:
- Research which is the best site for you and your music: Talk to other artists that have released albums via crowdfunding and also look at the different sites to see whose campaigns have worked well and what you like about the different platforms.
- How much support do you need? Whilst one site may offer a project manager who can help you to build your profile, price your items and plan social media activity for your campaign, others may not offer anything by way of a personal or bespoke service. If you find the process daunting or administratively challenging, choose a platform with a good support service.
- Rates of Commission: These vary greatly, as do the timescales for payments to artists. Weigh up the rate of commission against the service provided. Also take time to understand how and when you will be paid - It’s often the case that some of the money is only paid once you have fulfilled all of your orders.
- Finding the right time: Give yourself plenty of time to launch the campaign and subsequently record and manufacture the album (if you haven’t already done so), and subsequently fulfil the orders. Most artists allow their campaigns to run for 2-3 months.
- What can I sell in addition to my album? Crowdfunding sites encourage artists to sell a wide range of merchandise in order to attract as many pledges and purchases as possible. Artists often take the opportunity to sell their back-catalogue as well as artwork, handwritten lyric sheets, private gigs and the opportunity to be mentioned within the album’s credits. It’s important to remember that you will most likely pay a commission on all items sold, whereas you might currently sell some of these items, without paying commission, within your own websites/online stores.
- Pricing your albums and merchandise: It’s important to take into consideration the amount of money that you’d like to make from each item and also the prices being charged by other artists of a similar standing on the same platform. You also need to take the commission fees into account.
- Spreading the word: In order to meet your target you will need to ensure that you generate enough traffic to your campaign page. Most sites encourage you to sync your social media platforms in order that automatic updates can be posted across your pages However, be sure to use other means of communication such as e-mails to your database.
- Repeating the message: As most campaigns run for 2 or 3 months, you will need to tell your fans several times about your campaign. An initial announcement will generally result in the most sales in a short period of time, but telling fans around the end of the month (when a lot of people get paid) is an effective time to share your news.
- You may also find that your fanbase like to pledge/purchase when your campaign is just about to reach a landmark figure – fans like to feel responsible for helping artists reach a milestone.