Tip Jars and Serialization: Looking To Music for New Ideas

October 29th, 2007 · 3 Comments
by Kassia Krozser

Nothing like the first Monday after a lovely vacation to get the creative juices flowing. Hmm, that is so not true. The Monday after a lovely vacation is spent contemplating the possibility of the permanent vacation. Why, oh why, must we work to eat? Shouldn’t life be free?

It’s all about the mailing list.

Alas, life is not free. Do not see this as sad; see it as opportunity. Yeah, that’s taking it too far. Sorry. Still thinking mai tais and snorkeling. Let’s try again. In today’s world, artists and producers (writers and publishers) need to be creative about their business. Like it or not — and it seems most publishers, especially, are in the not column — consumer habits are changing. Thus business needs to change.

Right before the BS team hit the islands, major changes happened in the music industry. Radiohead, currently without a recording contract, self-released its new album and allowed customers to choose how much they would like to pay. One source pegs revenue at $10 million, with an average price per album of eight dollars. Not bad, considering that the cost of distribution of this product was very cheap — it’s all digital with no messy pick, pack, and ship associated with it. Okay, some ship, but why quibble.

Oasis, another reasonably popular band (though very much past their heyday), is also without a major label deal. So are Nine Inch Nails. Oh, and Madonna made it official: she’s getting big bucks from LiveNation and dumping Warner Brothers. The Madonna situation is very different from the others and is thrown into the mix just for fun. What is interesting is that the three bands have determined that they can cut the middleman.

The article noted above (here, for reference) compares the Radiohead experiment to the failed Stephen King experiment of a few years ago. As far as analogous situations, it’s probably the only one that comes close. I’ve never thought that Stephen King’s experiment was well-considered or well-executed. Good idea, needed refinement. He is one of the few authors who could pull a Radiohead and succeed. It would be hard, but he has the fan base necessary to make this work.

It is important to note that the $10 million that Radiohead earned went straight to the band. Though there are clearly fluctuations as some people paid more, some paid less, this means they moved over a million album units worldwide during their initial release. By way of comparison, Kanye West — a more mainstream (as defined by me based on ubiquity and airplay) artist — moved 957,000 units of his album in the first week. Most musicians don’t see numbers in that range. Like the publishing industry, the superstars sell lots and lots of product, but the majority of artists don’t.

Another key point to note is the average price paid by the consumers: eight dollars. Again, there are fluctuations that must be considered. Radiohead has a fairly rabid fan base, the kind who support their band like a religion, despite the lack of popular approval. Think about it: how much Radiohead do you hear on the radio? Yet this group, when given the choice, valued the media at a lower price point than most albums.

Part of this is the media. Fans weren’t getting a physical object, so why pay for the packaging and storage? Part of the calculation was the value of the music. Note that many of these fans will also see this band play live the next time they tour. The recorded music has a certain value to the fans, but the live performance has a different value. And the merchandise? Well, that also has value to the fans as well.

In addition to sales, Radiohead also did something really major. They added to what I imagine is a fairly impressive mailing list. As Kirk Biglione noted (over the aforementioned mai tais), they made a direct, ongoing connection with their customers. Sure, some of the sales were related to the novelty factor (Kirk’s, for example), but a percentage of those new-to-Radiohead customers will be buying the next release. The tours and merchandise will benefit from this experiment.

So where did Stephen King go wrong? Well, I imagine that he built up his mailing list via his experiment, so if he did that much, then it was surely worth the time and effort. Never underestimate the power of the mailing list. Since the model for his experiment was an online serial that would be published as long as a certain percentage of the audience paid into the system, that would be the fatal flaw. King should have set a minimum for access, especially since this serialized novel was a bonus for his readers. Let’s face facts: most readers prefer physical product to digital.

And making payment optional devalued the product somewhat. Creating a subscription model — you get this book, serialized over a period of time for this price — would have made for a far more interesting (and I’d wager, successful) experiment. Another benny? Offering the finished book as a physical product at the end of the serialization. Discount to the subscribers, full price to the new readers. Heck, throw in some autographs and you have fans and publicity all over the place.

And when it came to the finished book, King could have self-published (though he might not want to deal with the associated overhead) or gone through a traditional route. Unless I miss my guess, the sum total of King fans out there exceeds the number of fans who would participate in the serialization experiment. Publishers get the willies when they think they’re selling something that has already been exploited, but this is Stephen King. He’s going to make both immediate and long tail sales. Anyone not willing to take this risk is going to lose in the new media world.

Not every author is Stephen King, just as not every band is Radiohead. Musicians are seeing free downloads as a way to build a fan base. Even with the costs of touring, most make their money live than via album sales. Authors, naturally, don’t tour in the same way (this is a good thing, as you know if you’ve attended live readings; different skill set). So it’s time to be creative, even if it’s just baby steps.

Can you offer serialized content to readers? Why not? Are you going to get money for this content? Probably not. You can try, but my guess is that the money will flow for more established authors or publishers who employ this model. Advertising on your website might work, but you have to work long and hard to build up the numbers to support that approach.

But if you’re an author trying to build a readership, then giving it away for free might not be the worst idea. Yeah, I can see the look of fear thanks to the magic of the Internet. If you’re serializing and building a mailing list — and let’s face facts, you need to build a mailing list now, not later — then when you do sell that book, you’re way ahead of the game. Not only do you have a group of readers who like your stuff, but you have a way of communicating with them.

Like I said, it’s the mailing list, baby. It’s all about the mailing list.

[tags]stephen king, radiohead, oasis, madonna, writing, publishing, marketing[/tags]

File Under: Non-Traditional Publishing

3 responses so far ↓

  • Joseph Devon // Nov 2, 2007 at 11:01 am

    It’s funny. I’m doing all of this: free samples, book in serial form, slowly building an audience, experimenting with advertising. And I honestly can’t think of anything to add here. Apparently the next time I come up with a new writing project I should just ask you, Kassia, what you think. You’ve already got a lot more answers than I do and I’ve been at it for 4 months. 🙂

  • Simon Owens // Nov 6, 2007 at 4:32 pm

    I remember distinctly that King claimed that his “failed experiment” as you called it brought in $600,000. Also, he pronounced the experiment a success in a letter he submitted to the New York Times that was never published (but he published on his own site). I’d say that, if true, $600,000 is pretty successful. And let’s remember that Radio Head had a minimum payment of $1 or something like that, much different than the honor system King had. Also, back then the internet was a much different landscape than it is now. I can’t help but wonder: with the profusion of blogs today, would his experiment have been more successful?

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