Manage for Success: A&R Wake-up Call, Newsletter #31, November 2003


"Manage for Success" is a free monthly newsletter for record label executives who want to operate their companies efficiently and successfully. It's published by Keith Holzman of Solutions Unlimited, a management consultant, troubleshooter, and trusted advisor, and is based on his many years as a senior executive in the music industry.


Copyright 2003 by Keith Holzman, Solutions Unlimited. All rights reserved.




This month's message is somewhat shorter than usual because I'm spending much of my time getting my book ready for publication. "The Complete Guide to Starting a Record Company" is the title and I hope to have it available for on-line sale before the end of the year.




A recent front-page article in the New York Times struck me as a wake up call to record industry executives and A&R and marketing people. Titled "At Sea With MP3's, Boomers Buoy the Struggling Record Industry", it deals with the increasing success of older artists and those artists whose music appeals to older music lovers, and those with "less cutting-edge tastes."


A growing market exists for people who actually buy their music rather than downloading for free what they want to hear. (I guess that's how the term "freeloading" came about!) It may seem to be a novel idea, but aging boomers are in the habit of paying for what they want to hear.


In 2002, the Times states, "shoppers over the age of 40, who tend to gravitate to graying artists, bought more than 35 percent of all units sold according to the Record Industry Association of America. Ten years ago they accounted for 22.6 percent of all sales." That's an increase of 55 percent -- a fascinating statistic!


Additionally, a Forrester Research report found that "while one-half of consumers ages 22 and younger use file-sharing software, only one in nine people ages 23 years and older do so." I suspect even fewer people over 30 participate in online theft.


More interesting is that 11 of the top 50 spots on the Billboard album chart for the week the Times article appeared were for artists who were older than 40. And it's almost the same for the most recent issue. These are artists such as Rod Stewart, Van Morrison, Barbra Streisand, Bette Midler, Elvis Presley, Simon and Garfunkle, and Sting. And at the same time there were almost as many younger artists who appeal to the boomer generation. Overall then, 40 percent of the top 50 artists have strong appeal to an older audience.


Many of the marketing successes of these artists were due to television exposure or tv advertising campaigns. However, most indie labels can't afford to spend the enormous amounts of money for TV ads as the majors do, despite the majors' rampant budget cutting, trimming of artist rosters, and paring of employees.


I know from personal experience that a lot of the audience for older-skewing music no longer feels comfortable in many record stores and tend to buy their music in other ways. When I've attempted to find CDs at large record chain stores, by artists that might just be slightly off the beaten path, I've usually exited empty-handed. The stores didn't have them, or they were filed in bins of the wrong genre, or the clerks who were asked for help were totally clueless. I eventually purchased them on-line.


So how will you as label managers deal with this eye-opening information? Will you continue doing the same-old, same-old -- no matter what type of music you release -- or will you take a fresh look at the artists you sign and the music you release?




I don't consider myself an A&R or marketing guru, but I sure know how to help record industry executives manage their businesses more effectively. I've been doing it successfully for my clients for many years, so enlist my assistance if you need counseling in management or administrative responsibilities. As a trusted advisor to many companies, I treat all clients and all assignments confidentially. Call me if you'd like to see how I can help you.




This doesn't mean that there's no room for great rock or rap or other music by young artists, or for that matter, any other kind of music you like and want to release. I'm simply saying you should take a closer look at what's actually selling in the marketplace. If your own tastes skew older as you yourself notice gray hairs starting to sprout on you head, consider what others of your age, background, and taste might enjoy.


If your preferences are for music that appeals to a young audience, you should do your utmost to release the best music of that type that you can. Know your customers and market your music to them in the most effective manner.


You might also consider increasing funds for marketing using methods other than expensive co-op advertising to obtain price and positioning in big chain record retailers.


How do you market to your customer? First, you might consider increasing your publicity budget in an attempt to get more articles printed about your artists and their music. Try to get artist interviews on such national broadcast news magazines as "Morning Edition", "All Things Considered", and "Day by Day", or on some of the on-line forums. Increase your effort in getting airplay on important, trend-setting community and NPR affiliate radio stations such as KCRW in my back yard of Santa Monica.


If you have artists who are well known, consider taking targeted ads in magazines or papers that the artist's fans are likely to read.


Most important, see that your artists spend a good part of the year performing in front of the public. And be sure they have CDs available to sell at their gigs, and that you report these venue sales to SoundScan. Every little bit helps.


Note that none of this has to be very expensive. It just requires a renewed emphasis on your A&R and marketing.



If you're interested in my book "The Complete Guide to Starting a Record Company", and would like to be notified when it becomes available for sale, please send me a message.


As soon as it's published I'll send you an email providing information as to where you can buy it in both downloadable eBook form, or as a printed, spiral-bound book.




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Copyright 2003 by Keith Holzman, Solutions Unlimited. All rights reserved.