We continue our 4QFor (Four Questions For) Series with Micheal Dorenberg, the CEO of music community and artist services site ReverbNation. Also, check out recent 4Q4's with imeem's Dalton Caldwell and Nimbit's Patrick Faucher.
Q1: What major changes in the music industry do you foresee over the next year?
It sounds kind of obvious, but there will finally be a recognition that the true asset Artist's have is the relationship they have with their fan base, in terms of breadth (numbers of fans) and depth (strength of the influence) and duration (how the influence endures). The music, branding, cache, and all other pieces of the "product" are means to that end.
The implications are twofold: Artists and those that represent them (labels, managers, promoters, etc) will begin to seek ways to measure the value of those relationships and they will begin to monetize them beyond selling digital downloads and concert tickets. As advertising and other methods of leveraging those relationships become available, accepted, and more important, the understanding of "engagement" with the fans will supersede old metrics like the sheer numbers of fans. Companies like ComScore and Facebook are already shifting the value metric of websites and applications to engagement, and the paradigm will hold for Artists as well.
Q2. How are you and your company preparing to benefit from these changes?
ReverbNation believes that an Artist must be present everywhere their fans might be, and that those interactions must be designed to maximize the value for the artist. We help artists efficiently deliver their content to fans in the places they live like MySpace, Facebook, IM's and Blogs, and ensure that every interaction encourages fans to spread the content , is carefully tracked, and will benefit the artist to the fullest extent possible.
We give artists a "Home Base" with the tools and information they need to move fans down the "value funnel" from casual listener to customer, to "promoter". We are preparing to...
...introduce new metrics that give artists visibility into the value of
their cumulative fan relationships using our "Band Equity*TM"
measurement system. We will offer them tools and recommendations on
how to increase that value based upon their particular profile (genre,
fan demo, geography) and the best practices of other similar artists.
Most importantly, we will be introducing sponsorship opportunities for
artists that will allow them to opt-in and match with companies that
are willing to pay them in exchange for carrying a message to their
Q3: What excites you?
In other industries, smaller companies have been able to assert much greater influence as a result of technological change. In the coming months and years, artists will enjoy this same benefit. Their collective influence will become highly sought after as technology will offer an efficient way to engage with them. We have spent the last year building the capability to make this happen. Bringing this to the artist and putting the choice in their hands will be a monumental shift in control. Artists will finally be able to dictate the terms they do business.
Q4: What's next?
We will continue to focus on educating the artists and industry about how they can improve the "business" part of the music business, and strive to provide the solutions required to meet their needs. New and interesting models are popping up everyday. There are a plethora of companies trying to provide solutions in this chaotic world, and one of the best parts of this business is having a front row seat to see how it all unfolds. Pass the popcorn, please.