The purpose of an artist manager is to increase an artist’s fan base and income transparently so that the artistic expression remains in tact (see point #10). Through this blog we hope to explore many methods for developing an artist keeping this idea in mind. Before diving into these ideas it seems right to first define the stages of development within the marketplace. When I look across the music landscape I see (tens, maybe hundreds of) thousands of artist businesses that fit into 3 categories of income: baby bands, middle class and upper echelon.
Imagine a graph with the vertical axis being ‘annual gross income’ and the horizontal axis being ‘number of bands.’ On this graph let’s place all of the artist businesses in the US market. On the left you would see a small number of bands that make most of the money generated within the market and on the far right you would see a long tail of artists that make a decreasingly small amount of annual income. As you probably know, this is a classic business concept called the Pareto principle. Essentially, this principle states that 20% of your [artists] generate 80% of the income of all [artists] within the market. Image of the graph here: http://en.wikipedia.org/wiki/File:Long_tail.svg
Looking toward the far right end of the graph we see the baby bands. On the graph image above, the line would continue far off to the right with thousands of bands making just a few hundred dollars per year. These artists are just starting out. They do not yet have a significant fan base or income and have probably not toured beyond the immediate region. There are more bands at this level than any other since it just takes an idea and income of $.01 to step onto the graph. Based on our observations of the marketplace, we see that artists making less than $100k annually to fall into this category.
Note: Obviously if it is a solo artist making this amount then that person is in a much better position than a 6-piece band making that amount. The financial cut off points serve to provide a general definition.
Sliding left along the scale we see an enormous piece of our artist marketplace. These are the artists that are grossing between $100k – $1m dollars annually. I have often heard these artists referred to as “Developing Acts” but I don’t feel that this term does the whole segment justice. In the current landscape I have met many artists who are happily in this category, grossing $500-600k per year with no concerns about breaking into a higher level. In other words, an artist could be in this category and not necessarily “developing” per se but rather sustaining themselves. Somewhere in this category most solo or group artists are able to become professional – meaning that they can support themselves with their art form.
I’d say artists grossing $1 million+ annually are in this category. At this point the artist business is making great money and each individual member of the group is making a good, comfortable income. Obviously there are countless ways to grow an artist past this level. I also think there could be defined categories of development beyond $1m but generally speaking this is a safe definition of success in the business.
Considering these general definitions, a number of questions arise for either a manager or an artist/business owner.
From the perspective of management:
- At what income level does good management come into an artist’s life?
- How do you want to position your management company in this landscape? Do you manage artists in all three income categories or do you just focus on one area?
- If I am interested in working with bands at the smallest levels, how do I generate enough income from it to make it worth my while?
- How do I effectively grow an artist from one category to the next?
From the artist/business owner perspective:
- At what point do I want to bring a manager on board? How important is it for me to learn about running my own business before hiring someone to help me with it?
Take the time to consider these questions as you think about your business and how to grow it.