So let’s get down to business. We’ve had lots of nice talk about how great it is for music and brands to work together on a creative level but now its time to talk money.
Today’s message was that while creativity is very important the simple facts are that brands need to sell products and artists need to make and sell records. This really is a key understanding for both sides to get their heads round.
First up there was the session deciding about brand partnerships being a major growth opportunity for the music industry. This was slightly enlightening as despite the big sign behind the speakers saying “Brands & Fans” there was very little talk about the fans and I started to wonder how long it would be before the first question an A&R department asks is “Would this artist appeal to a major brand?”.
Fans are the most important piece of the music and brand jigsaw, without them artists cannot make money from selling records or themselves. Music and brand partnerships are actually threesomes and each party needs to keep the other two happy otherwise everyone is going to bed early. Fans are crucial. Sure you can turn them into Big Data but if at any point you forget to respect their passion they will turn on you like pack of rabid 1 Directioners (to avoid any confusion and potential death threats – I love 1D and I think their fans are amazing, go Harry).
Then there was a quick session on who is investing in music. Now this was very interesting mainly because of one point made by Mike Tunnicliffe of GroupM/WPP and a question from Brett Hellerman of Wood Creek Capital. Firstly I’ll start with Mr Tunnicliffe’s point. The idea of brands using their financial power to fill the void left by the fading record labels is often suggested but while it may be fairly easy for a brand to replicate a small indie they have very little appetite for taking over from the majors. Why? Well as Mr Tunnicliffe pointed out they are in the business of selling products and such a move would be a fundamental shift in business strategy, the type of shift that would require executive board approval and that takes a lot of time and energy to achieve. I know this from experience as I once took a similar entertainment idea to a major mobile company and while the brand team loved the idea it quickly became apparent that the board would rather their staff focused on selling mobile contracts.
The finale for this session was a question from Mr Hellerman of Wood Creek Capital. I’ll paraphrase, “Why do record labels not value their own brands?”. There was a time when a record label’s brand meant something but now they seem to like their positioning as faceless corporations trying to make money from other’s creativity. I know that description is harsh but if the majors want to engage with brands more then maybe they should stop trying to mimic the corporations they are seeking to partner and instead revive their brands as the discoverers, developers and guardians of talent. I find it interesting that someone from the world of finance was able to spot this flaw in the majors’ business strategy but nobody in these creative hubs did.
So onto day 3, hopefully it will stop raining.