Our 5 Figure Music Mistake

Posted: August 4, 2013 in Helpful Tips, Music Business, News
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Since starting to work in music full time, Krissy and I have made many mistakes.  All of them, we’ll probably share with you over time.  But, we want to share one mistake that cost us thousands of dollars and lots of wasted time.  This mistake was made about 6 years ago, but we are still reminded of this mistake today every time we walk into our basement.  Want to take a guess what it is?

We decided to distribute a CD nationally much too early in the release of an album.

In 2006, Krissy and I recorded her third independent album called Downpour.  We were really excited about this recording.  We felt like we really recorded her best songs to date and created a new sound for her on the album – a little more edgy and current than her previous album, Thank Him.

So, after we finished recording the album, after we finished the photo shoot, after we finished packaging the album, it came time to decide how many of these CDs we were going to press.  At the same time, we were deciding which of the songs we were going to promote on Christian radio and who we were going to use to distribute our album.  We had lots of decisions to make.  (This was a mistake too because we should have decided all of our marketing and who our audience was way before we started recording or even writing, but that’s another post for another time)

We had received great response from many of our trusted friends in the music industry and Christian radio promoter about a song called “Outrageous Love” on the album.  So, we decided to press only 1000 CDs initially on the first print run to have for our live performances and giveaways.  Then, we would see how the single fared on radio and manufacture more should it “take off”.  Well, in Christian radio terms, it took off.  We were on our way to a Top 10 radio single with that song.

Our distributor recommended we get more CDs into the marketplace by buying into a national retail positioning and promotion campaign in Christian retail stores.  So, we spent $5000 in advertising money to buy prominent positioning in 2 national retail chains.  And, we also printed up an additional 2500 CDs with a special sticker promoting the song on the outside.  It was a gamble, but a poorly thought out one at best.

So, we got them into all the stores, via our distributor and we waited to see.  It was perfect timing, we thought.  The single was just peaking and the CDs were prominently positioned in about 350 stores across the country.

Then, we waited, hoped and prayed.

Every week or so we would visit our local Christian retail store here in town that carried the CDs and participated in our positioning program.  The first week, there were 30 CDs stacked neatly and positioned nicely on the shelf at almost eye level – great positioning!  I remember thinking that first week they were promoted: “WOW, 30 CDs sure fills up more space than I imagined in my head.”

The next week, we visited the store again.  Still 30 CDs stacked nice and neat.  We checked Soundscan (distributors can monitor national consumer sales in retail stores – and can break it down by region) after the first week of sales and we sold something like 3 CDs around the country.  Gulp!

The second week, we maybe sold another 4 units across the US.  Most of the sales, I remember, were in Western Michigan where Krissy’s family is.  And, it’s where we spent our greatest amount of time singing and touring.

Week 3 didn’t look much better.   As the weeks went on, our heads sunk lower and lower into the sand because we only showed Soundscan sales of maybe 50 units after the promotion had ended at retail.

After 3 months passed, the single had peaked and was now in recurrent at most of the Christian radio stations.  We had finished all of our radio interviews and promotions.  The distributor started receiving calls from the retailers asking to return the CDs.  So, we took all but about 250 CDs back at the end.  Then, 6 months later, we took back the rest and ended our distribution deal.

We had over 2500 CDs sitting in our garage for many years reminding us of our biggest music mistake. A year ago, I gave over a thousand CDs away to a non-profit ministry that sells CDs to coastal third world countries via medical cruise ships.

So, let’s tally up our stupid tax (our life tax for being stupid):

  • Printed 3500 CDs – Cost to manufacture and ship: $4500
  • Radio Promotion – $3000
  • Retail Advertising – $5000
  • Plus, hundreds of hours trying to promote and distribute our CD nationally.

It was more than just a $12,500 mistake!  Not only was it a waste of money, it was a waste of time.  I seriously feel the pain of our mistake every time I tell this story.

What should we have done?  Looking back, if we could give ourselves some coaching, I would have advised the following:

  1. Before making any big financial decisions, ask your team around you if this is a good idea.  Be honest with yourself and others.
  2. Start small.  Get your music on iTunes and any of the other online digital outlets selling music first.  Monitor the sales and see if printing a smaller print run (500 to start) is the next best step.
  3. Pick a distributor that protects you from buying into large national retail positioning promotions when you’re not ready.  A distributor is one of your important team members.  They should be for you.  The relationship should be win-win.  If they are, they’ll give you better advice and that will greatly reduce the chances of incurring stupid tax.
  4. 4. If you’re going to do a major national radio promotion, understand that, for an independent artist, radio helps open doors to touring opportunities more than it helps with music sales.  Major radio stations don’t play too many indies.  Stations, largely only play music from the major record labels or ones that are distributed by major record labels in Christian music.  Your best chance in Christian music is to promote to Inspirational radio formats or niche formats outside of the mainstream Christian radio stations in the US.  Network with those smaller/niche stations – build relationships, do interviews, visit them.
  5. Radio should not be your only marketing plan.  You should be playing live, recording videos and promoting them on YouTube, performing on local TV station programs, participate in benefit concerts, blogging, interacting with/growing your audience on social networks, giving your music away for promotional purposes, building your email list and countless other things to promote your music.  Any way that you can grow your fanbase, that’s what you should be doing in addition to any radio you do.
  6. Think regionally before you think nationally.  Grow your exposure and market penetration in your local 50 mile radius at radio, retail and live performances.  Play often, promote often, get product in stores regionally first.  I would advise going national if you have a credible team around you such as a reputable record label and booking on tours nationally.
  7. Try not to get too emotional and play the movie forward when making decisions.  Looking back, we were just too excited about the opportunity and didn’t consider the financial risks we are taking.

Any of these things would have helped us to make a better decision in the end.  We learned a great deal from the mistake, but wish we didn’t have to spend 5 figures to learn it.  We hope you don’t have to either.

Learn more at…The Music Coaches

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