You're Reading :: Blogs :: Wesley Verhoeve

Don Van Cleave of the Coalition of Independent Music Stores speaks some truth on radio and how it’s modern incarnation has been very destructive to the music business. He also gives props to KEXP for being everything most stations are not, and they’re thriving because of it. I’d also like to add KCRW, WOXY, WFUV and a few other stations to that list.

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

Everyone needs to watch this video of Derek Sivers narrating the famous video of one crazy dancing guy inspiring a huge crowd. Great insights on what it takes to start a movement. Taken from his TED Talk yesterday. Find the transcription here.

Key take away points:

• Remember the importance of nurturing your first few followers as equals, making everything clearly about the movement, not you.
• Be public. Be easy to follow!
• It was the first follower that transformed a lone nut into a leader.

(For another recent talk shared by TED recently, check out JK Rowlings’ commencement address at Harvard on “The Fringe Benefits of Failure, and the Importance of Imagination”.)

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

One of the more frustrating aspects of the traditional music business is PR. Every artist, manager and label wants to have that New York Times piece, that Pitchfork review, and all the other usual suspects. Whether it be as validation for their ego that what they do is important, or straight up to spread the word and increase the fan base. PR is a fickle animal, extremely challenging, and quite a pricey endeavour. Your average serious indie pr company will charge you upwards from $2000 per month, with no guarantees of any coverage. If you’re not careful you can end up spending more on your PR campaign than on recording your album, again with no guarantees of anything happening. In the spirit of taking a step back to see if the traditional ways still make sense, I present to you a graph of web traffic for two of the top indie music websites in comparison to the traffic Urban Outfitters gets. Urban Outfitters is not a traditional press outlet, not do they focus in any way on music aside from some vinyl sales. But it’s a clothing store largely targeting the same exact audience as the one we’re after in Indie Rock land. As you can see they have much more traffic, yet I never see them on a target list for the traditional PR campaign. Why not? Are we focused on the wrong things?

On a related note, in a week or so Family Records will be teaming up with the amazing lifestyle accessory company Hard Graft for a cross-promotional campaign. Each Hard Graft customer will receive an exclusive free digital Family Records mixtape automatically with their order of a Hard Graft product. Both companies will highlight this campaign on our websites, twitters, mailing lists, etc. and promote each other to our own audiences. Be sure to check them out. If you’re a fan of the FR aesthetic, you will also love Hard Graft, even though they sell a very different product from music.

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

Pricing strategies for music are always in flux and tend to not provide a lot of clarity for customers. For a while iTunes made it pretty clear that one track would retail for $0.99, and an album would typically cost $9.99, but the majors pushed their way into more flexible pricing, and more and more other digital and physical retailers started exploring other ways to price music. I believe that simplicity and a limited amount of choices for the customer provides them with a more pleasant buying experience and an incentive to develop a long-term relationship where they know what they can expect.

At Family Records we’ve made the choice to be a relationship-driven company. (To read about what this means, and what the opposite choice would imply read my earlier post on the Maney Continuum.) This choice influences our pricing strategy and the way we can deliver music to our audience. An example of an upcoming release where our strategic choices influenced the way we will price and deliver the product is Casey Shea’s upcoming album “Love Is Here To Stay”, which will be release in April. This is still subject to change, but looking solid.

1. Love Is Here To Stay (Standard Edition) – $5 – This edition is digitally delivered to fans as a set of all 9 songs as high-resolution MP3s (320 kbs) and a PDF version of the artwork and credits. It can be bought at shows as a download card, or via the Family Records web store. The price is cheap to facilitate new fans wanting to take a chance on checking out Casey’s music.

2. Love Is Here To Stay (Deluxe Edition) – $14.99 – This edition of the album is limited to 500 copies, includes a 7″ vinyl featuring the title track and an exclusive b-side not to be found on the album. It also comes with a CD featuring the full album and a digital bonus EP featuring 4 additional tracks. All 14 tracks mentioned will be digitally delivered instantaneously upon purchase, while the physical package is shipped the next day.

We will also be delivering third option:

3. Love Is Here To Stay (T-Shirt Edition) – $11.99 – This package includes a t-shirt featuring the title track’s main message and comes with a digital download of the 9 album tracks as high-resolution MP3s (320 kbs) and a PDF version of the artwork and credits.

In our original plans there were many more configurations, other options, but in the end it just seemed that it would be confusing and stressful for people to make a decision. We cut down the options, and decided to provide a premium product for the inner circle of hardcore fans, while also offering a step-in low-risk option for new fans. In addition to this, the standard edition will still be available on iTunes, Amazon and the other usual suspects, to capture the searching customer’s business as well.

Thoughts?

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

The Maney Continuum states that successful companies always make a strategic choice between providing convenience and fidelity. Domino’s Pizza and Amazon deliver convenience, Le Bernardin and Strand deliver fidelity. There is a significant different in how you can price your product or service based in which direction you pursue.

Another way to look at this is is to determine whether your company is a transaction-driven business, or a relationship-driven business, and again you have to make a choice. One could argue the Dave Matthews Band operates a relationship-driven business, whereas Rihanna is more of a transaction-driven artist. Either model is a valid one and gives you a certain edge the other side cannot offer, but you have to choose which one you want to be in because it alters the way you do business, the way you determine your price, and the way you deliver your product.

The transaction-driven business has the ability to act and grow/fail fast, whereas the relationship-driven business is a slower animal that needs to develop for a while before one can reap the benefits. Price is more flexible in the relationship-driven market where a premium price will be accepted, versus the constant pressure to lower prices in the convenience and transaction-driven markets.

Examples:

Rihanna needs convenience on her side, as it facilitates an easy transaction, which is necessary in her business model as a pop/r&b singer. Her music needs to be available up front and center at every retail location people might look for it. Big box retailers, iTunes, Rhapsody, Verizon, etc. Her tickets need to be sold on Ticketmaster. Her label pays for premium placement at all of these locations, because it contributes to the necessary convenience.

Dave Matthews offers a wide range of products only through their fan club and their own website, to compliment their major label album releases every few years. They have developed close relationship with their customers over the course of many years and conditioned them to know that they can purchase directly from the band. It’s not convenient to the mainstream, but it provides a high amount of fidelity to those that are tuned in at the core of the fan community.

The nature of your genre and style of music is a factor in determining which model works best for you, but in the end it’s still your choice. There are examples of rock bands in the transaction/convenience business (Matchbox 20, The Killers), and pop/r&b singers in the relationship-driven/fidelity business (Sade, Maxwell).

Question:

Did you make a choice to focus your business model, or are you trying to be everything to everyone?

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

Jason Fried was interviewed by Big Think on his software company 37Signals and the way they operate their business. As you may know I have a bit of a business crush on 37Signals and am an enthused user of their Basecamp product. Below I’ve noted down some points I found useful and translated them for the music industry. Watch the full interview here.

Free samples make sense, only if there is also something to sell.

Don’t give away all your music. Or if you do, make sure you have amazing merch for sale, or a lyric book, or limited edition packages, etc. Think like a bakery or a drug dealer. Give people a sample of your product, and have the quality of the sample do your sales work.

Putting a price on something forces you to make it worth paying for.

Just because you can record a crappy demo in Garageband and put it up as a free download, doesn’t mean that’s a sustainable business model. Invest in the quality of your product and make it worth purchasing.

Bootstrap vs Major Funding: Not having money forces you to make good decisions and really think things through.

I’ve seen some serious money wasted at well-funded indies or major labels that could’ve been used so much more wisely if only there would’ve been more urgency. Having money makes you think you have to spend it. “Well, I’m funded for a million dollars, I guess I should get a fancy office space!”

On Ad-Supported Business Models

Displaying ads only make sense if your core business function facilitates search and discovery. You can build a better business if the people that use your product are also the people that pay for the product. In the ad supported business, who are you trying to please? The users or the advertisers who pay you and keep the service around? There is a disconnect there. Examples includes news paper websites, radio stations, even Spotify. One of my major pet peeves is major label websites displaying google ads. So tacky, so pointless.

On The Modern Workplace

The modern work place is set up badly and optimized for interruptions. Interruptions include meetings, phone calls, people walking around, people asking you questions, etc. and they are the enemy of creativity and productivity. Establish ground rules in your work environment that enable people to focus for long stretches of time and know that most anything you think of as ‘very urgent’ is probably not so urgent that it can’t wait an hour or two.

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

At the famed TED conference psychologist Barry Schwartz analyses the effect of the freedom of choice on people’s happiness and estimates that choice has made us not freer but more paralyzed, not happier but more dissatisfied. Something that always comes to mind when I think of the incredible over-saturation of the music market, particularly since MySpace and Tunecore made it possible for everyone to release music. Fascinating lecture.

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

Via Scout.

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

I’m a voracious reader and would read all day if I could, but then I’d get nothing done. My RSS Reader goes through a constant flow of me adding and deleting subscriptions in an effort to not return to overloading myself with materials to read. I might add a subscription based on excellent post I run into on twitter, but if they don’t live up to that level of quality I will have to remove it again after a week or two. There are a few constants though, that stand the test of time and end up being little strongholds of inspiration and education. I have listed ten blogs below that belong in that category for me.

1. Signal vs. Noise – I have a biz-crush on 37Signals, and this is their blog full of interesting post on a bunch of different topics.
2. Seth Godin’s Blog – The Michael Jordan of marketing. Almost every post he writes has the potential to change or enhance the way we think about doing business with customers. He also writes books, including his new one Linchpin: Are You Indispensable?.
3. HarvardBusiness.org – Pretty decent business school. High frequency posting, with a good chunk of it being great.
4. Tim Ferriss’s Blog – Author of The 4-Hour Workweek, a book that has changed how I thought about work. His blog infrequently updates, but it’s typically interesting.
5. Derek Siver’s Blog – Former CEO of CDBaby, and a real thinker. Insightful posts about mostly music related thoughts.
6. TED Blog – TED is a conference I cannot afford to go to, but I can watch their lecture online until I can. In one word amazing. In a second, inspiring. It’s my goal to attend in the next five years.
7. Fred Wilson’s Blog A VC – Fred is a venture capital guy based in NYC and responsible for a fascinating company that has made some very good investment decisions. Especially interesting for biz nerds.
8. TuneCorner – TuneCore is somewhat of a disruptor in the music business and this is their blog. They’re awesome.
9. Jake Lodwick’s Tumblr – The odd one out in this list perhaps since it has a more personal angle. Jake co-founded Vimeo and has a few other interesting ventures going. It’s sometimes odd, but always inspiring due to the interesting way Jake’s brain works.
10. Scott Adams’ Blog – Scott Adams created Dilbert and writes about all kinds of stuff on his blog. Politics, free will, evolution, etc. Sometimes funny, sometimes thought provoking.

There ya go. I’d highly recommend checking these out and adding them to your RSS reader. (Note: I purposely didn’t include blogs written by my personal friends that are also great, because the list would get too long and seem compromised, but also check out Spencer Fry and Mike Karnjanaprakorn.)

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »

My good friend Seth just let me borrow his copy of Danny Meyer’s book Setting the Table: The Transforming Power of Hospitality in Business. Meyer is a entrepreneur-restaurateur that runs a bunch of different restaurants in NYC, and an inspiration to me as far as he runs his businesses. I’m only a few pages in, but already came across something I had to share, and relate to the music business.

Hospitality is the foundation of my business philosophy. Virtually nothing else is as important as how one is made to feel in any business transaction. Hospitality exists when you believe the other person is on your side. The converse is just as true. Hospitality is present when something happens for you. It is absent when something happens to you. Those two simple prepositions – for and to – express it all.

It’s incredible how true this rings not only for the restaurant business, but for any other, and perhaps even particularly for the music business. When was the last time you bought a major label release and felt they were on the receiving end of hospitality? The big FBI warning on the back doesn’t really contribute positively, neither does the standardized packaging, the lawsuits, the one good song bundled with nine mediocre ones, the overpriced retail experience, and I could keep going.

Music is a powerful medium that is very much based on hospitality. It’s there for you, to help you relate to your fellow humans and feel less alone, to bring you joy or education, to share with friends and have a communal experience to. We can once again create a culture of hospitality around this power, but we’ll have to destroy before we rebuild. We have to re-examine which parts of the current transaction model contribute positively to the hospitality experience surrounding our art, and perhaps make some tough choices that will be written off as ‘foolish’ by industry ‘experts’. We should building the new experience right away, transitioning there while we take advantage of the elements in the current model that can help us get there.

One thing we need to do is bring our customers closer to the artist and its surrounding community. Once again show them we’re speaking to them, and we’re only there because they support us. We need to show appreciation. You get back what you put in. And when you make a sale, and the attention you gave it comes back to you, trust me, it feels really really good. Below is a tweet from Family Records superfan Heidi, which I read after a grueling 18 hour day of work last night, and it made it worth it.

Related Post: What If Danny Meyer Worked In The Music Business.

Posted in Wesley Verhoeve | No Comments Yet. Add Yours. »