How Digitization is Transforming the Music Industry

Haris Krijestorac

October 4, 2010

Twitter: @hariskr

The Early Music Industry:A ‘Perfect’ Business

Limited Storage Space Market of Hits

Music goes Digital:Everything that made it the perfect business changes

• Supply

• Creation

• Discovery

From Niches to Riches…

70% of revenue comes from the long tail

Success Strategies for the Music Industry

Strategy #1: ‘Pay What You Want’

• ‘You can’t stop piracy, you have to learn to compete with it’ - Steve Jobs

• Create an Efficient Market– 100% of demand is captured– Consumers pay their WTP

Strategy #2: Add Value

Add value to Physical Package

Strategy #2:Add Value

Add value through Website and Social Media

Strategy #2:Add Value

Add value through Concert Experience

Spreading the music used to be the SALE

… now it’s the MARKETING

The Challenge: Creating Sustainable Strategies

Sustaining ‘Add Value’

• Record companies: – design tailored digital marketing strategies

• Artists:– Just create art

Sustaining ‘Pay What You Want’

• Record companies must build cult followings around artists

• Even more important for new artists, since the main goal is to spread their music

Music industry is still ‘The Perfect Business’

…. And record companies can survive if they adopt new roles

4 Tips

for record companies of the future

Tip #1:Find Artists for Niches, not Masses

Tip #2:Help digitally spread music,

don’t physically sell it

Tip #3:Deepen artists’ fan base,don’t broaden it

Tip #4:Tailor physical

product to niche,not masses

Thank you

I like to share my opinions on marketing,

media, and technology on twitter

If you liked this presentation, follow me up!

www.twitter/com/hariskr