It is every artists goal once they start making music to generate enough income through their music to create and sustain a life and lifestyle they are comfortable living. This is, as we all know, incredibly difficult to do, and in most cases can and will take years to do so. Even with the advancement of technology, the rise of the digital streaming platforms and the ubiquity of social media, making money solely from your music is not always a sustainable income stream. As an artist, (unless you are well established or have a large fanbase to draw from, and even when you have both of those) a majority of your income will not come from releasing your songs (excluding artists like Russ) but rather come from different avenues related to you as an artist and your brand. So what are some of those different avenues to generate an income stream? How do you go about using those avenues to generate enough of an income stream to have your music career be sustainable monetarily for your lifestyle?
Here are a few of the major avenues you as an artist can use to create an income stream using your music, your brand and your influence.
1. DIGITAL STREAMING REVENUE
Digital streaming is behind the biggest rise in sales for two decades. Spotify pays an average of 0.00437 per stream, meaning if you get 1 million streams you’ll receive just over $4,000. This may not sound like a huge amount of money, but Spotify is an easy way to gain exposure and springboard you into other opportunities to gain money. Spotify generated $40million+ in tickets sales in 2017, showing that it is an effective gateway to a variety other income streams. To really start seeing money come in from Spotify, pitch your music to user curated Spotify playlists, share your Spotify on socials and blogs and in time the Spotify algorithm will pick up that your streams are increasing, that you’re getting added to playlists and what bands may be similar to you, meaning you appear on Official Spotify playlists. With the new Spotify submission tool allowing you to submit your upcoming material to Spotify officials, Spotify promotion is a lot easier to do yourself. You may find yourself on a major playlist, generating a large number of streams in no time. People sometimes complain about the royalties they receive from Spotify but besides paying a distributor to have it uploaded, the platform is free for your music to be on.
2. LIVE PERFORMANCE
Gigging is one of the most profitable parts of the music industry, (touring is where artists will generally make a majority of their income) with estimates that live music industry will be worth $31 billion worldwide in 2022. (these numbers were generated before the pandemic, and now due to the halt in touring for at least the rest of this year, these numbers will be skewed) Chances are you’ll be making money from the tickets sold online, bought at the door or an agreed percentage of sales from your promotor/venue owner. However, there’s also two other ways to start bringing money from live events.
FESTIVALS
Alongside gigs, there’s also festivals which pay well. Festivals bring in the chance to play alongside bigger bands, receive music promotion and also collect an audience which wouldn’t be possible at a gig. All of these lead to different income sources also.
LIVE ROYALTIES
You can easily start to collect copyright royalties for performing. If you’re signed up to PRO and perform a song that you’ve written that is PRO registered, they will pay you for this performance. (read my previous article on PRO affiliation for more information on these companies and how to sign up with them) Every venue has a PR) license (well they should) to cover the costs of paying out these royalties, so make sure you do your research and take advantage of this.
3. MERCHANDISE
Tying in nicely to live shows is merchandise. If people are at your live shows, they’re going to be fans of your music and this means they’re proud to say they listen to your music, so surely, they’d be proud to wear your merchandise, right? Wrong, they won’t be proud to wear a poorly designed, cheaply made t-shirt with just your band name plastered across their chest. Be creative with your designs. Create a design that not only represents you as an artist but is a design that people would wear even if they didn’t know your music. (it doesn’t have to be elaborate, the duo Emotional Oranges produced shirts that simply say “Emotional” in small orange print and sold a massive amount) At the end of the day, merchandise is something that can be very profitable so don’t cheap out on it, perhaps hire a graphic designer to jump on board or buy more expensive t-shirts than you’ve done in the past. If you make something that is visually pleasing, good quality and overall a strong product, you can end up charging more and people will still happily invest. (be aware of your budget though, buying in bulk will cost less than buying a smaller amount, but the better quality and the more intricate the design, especially if it is in color, the more it will cost to produce)
4. YOUTUBE REVENUE
Years ago, artists who wanted to get discovered would have to send heir demo tapes to the labels and then sit and hope they get signed. (or that the A&R would even listen to the demo at all) In today’s digital age, you can use so many more innovative ways to get your music out there. One platform that works perfectly for this is YouTube. (SoundCloud is a good option as well, but at the current moment just about any digital streaming platform works if you promote and work it correctly) YouTube works with artists across the world to generate revenue and help the musician earn more. (look at the numbers from the Indian music market, as this market has the greatest number of YouTube views and streams, head and shoulders above any other genre and demographic in the world) Artists that put their music through third-party distributors who can submit your music to YouTube and can collect money from ads and YouTube premium.(however your video has to have a certain amount of views before you can place an ad on it for monetary value) Additionally, distributors who use YouTube’s Content ID system can collect revenue from other YouTube videos such as vloggers who may use your music. Another way to make money via YouTube is to actually start creating content yourself. You don’t actually make money based on the amount of views you get, you make the money based on people’s engagement with the ad before or during your video. Therefore, creating high quality content which engages a large audience, will start to bring in money for you. Easy ways to start doing this as a musician is creating tour diaries, vlogging your day to day life as a band or even doing Q&As from questions submitted by your fans. Be imaginative with your content and you will be rewarded with a loyal fan base and soon an income. In the case of collecting Content ID revenue from YouTubers who use your track and have a large subscriber base, we always suggest not collecting the revenue as the promotion from a YouTuber with over 1 million subscribers is a lot more beneficially than the amount of money you’d receive. Getting your name out there as an emerging artist is a lot stronger and will reward you financially in the long term.
5. CROWDFUNDING
Crowdfunding is basically generating a small amount of money from a large amount of people. In the situation of a musician, this means fans donating a small amount of money each, with the end goal to collect a large amount. Your fans want to support you and your musical career, so crowdfunding is a fantastic way to collect money, whilst connecting and giving back to your fans. So how do you do it? Firstly, you need to establish the platform you want to use to crowdfund. There are many to choose from, but Kickstarter and Patreon are the most established and easiest to use. You set a goal of how much you’d like to achieve and a deadline. If you meet your goal in time, you’ll receive all the money you managed to collect (Kickstarter and Patreon take 5%). However, if you don’t meet your goal in time, every donation made by your fanbase is completely refunded. So, don’t be unrealistic and set a target of $1 million but also don’t be stingy and set a target of $100 so you can make money quick. Prove to your fans that you want to work together to do something and set a challenge that you can achieve together. One thing to really think about is why should a fan give you money. If someone randomly came up to you on the street and asked for $5,000 to create their next EP, would you give it to them? The answer is most probably no, and your fans will react similarly unless you’re offering them something in return. Be imaginative and work with your fans to see what they want. Perhaps anyone that donates over $10 gets a recorded message sent to them saying thank you. Anyone that sends over $50 gets a song sung especially for them. Anyone that donates over $100 gets a live session performed at their house. It’s easy to set up a crowdfunding page but it’s not easy to get the donations, so prove you’re working for it and that you’re thankful for every penny coming through.
6. SPONSORSHIP/BRAND COLLABORATIONS
Start with your local area. Identify local brands that fit with your style, image and lifestyle. If you’re a surf rock band from Australia, perhaps you introduce yourself to your local surf shop. If you’re a large indie rock band from the UK, maybe you approach a clothing line, such as P&Co who have recently collaborated with The Hunna to release exclusive merchandise. Call people, email or DM on Instagram offering them something they cannot resist. Whether that is social media posts that will increase their following or wearing their clothing at gigs, which will grow their overall brand. Work with the brand to agree on a deal that works for both parties. The larger your following, the more interested brands will be when you reach out to them. Personally when I have reached out to brands for the artists I work with I have created partnerships because of the following the artist has through social media, however, I have also been turned down by brands because they artists didn’t have a large enough following yet. Be realistic with who you approach. If you’re a new artist with 1,000 followers trying to partner with Nike is unrealistic, trying to partner with smaller up start and local brands would be a better approach. However, I will say that most brands are looking to partner with artist that have a minimum of 10,000 followers, but some brands want you to have at least 50,000-75,000 or they won’t talk to you.
7. CREATE VALUE
Music sales isn’t the problem for independent artists, it’s obscurity. No one really knows or currently cares about who you are so won’t pay for your music. Instead, treat your music as a marketing tool, rather than a form of income. If your entire business model for your music is to sell albums, your model is old-fashioned. (because most people are streaming and a larger portion of those same people no longer have a way to play physical discs) Instead, make your music available to everyone and then you can focus on creating value. Think about the long term. If you charge people for music that they’ve never heard, it won’t get bought but if you create a dedicated fan base, giving them as much music as you can, your product will soon be in demand, meaning you can start thinking about sales. (look at how Russ was able to do this, he started releasing one song every week for years, and releasing albums every few months before his fanbase grew to the point it is at now where he is making millions of dollars per song off streaming alone) If you make something valuable enough, people will pay for it and this works exactly the same with your music.
If you as an artist use these different avenues to your advantage you will have multiple streams of income through your music and artistry. It is not enough anymore to rely solely on music sales to have a sustainable income for your music career. Even the major label artists make a majority of their money off merchandise, touring and brand partnerships. Because of the rise in digital streaming platforms and the way they pay out royalties you need to utilize all these avenues in order to have a sustainable career in music.
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