Marketing with DataJanuary 27, 2010

Shamal RanasingheCofounder, Topspin

MIDEM Academy

Focus on Data

•More revenue, more fans

•Right offers in front of the right audience

•Measurement frameworks

•Specific steps

• Hypothesize and collect data

• Test and measure

• Analyzing and Optimizing

Opportunity is real

• Internet levels the playing field

• Particularly true when it comes to both granularity and accessibility of data

• Direct to fan response can be quantitatively tracked and improved online

• Historical ways of releasing music for the “industry” meant getting measured by Soundscan, Billboard, BDS radio spins, but now artists can make music for their fans and measure that response accordingly

• Empowered artists need to pay attention to different key metrics

Better Business

• Let the data determine how to invest in new artist products

• Fans pay more: >$20 average revenue / transaction, $50 with branded artists

• More Margin: 85% vs. 70% -20% in your direct channel vs. others

• Own your fan and super-serve them

• Use fanbase data to segment and target for higher conversion

• Save on remarketing costs

• Success stories abound

• Michael Masnick’s presentations at MIDEM and NARM discuss Trent Reznor’s approach and offer several great artist examples

• Case studies: Fanfarlo, Jonathan Coulton, Metric, David Byrne

Think in terms of a Funnel

Steps to take

1. Establish goals

2. Craft offers to meet goals

3. Collect data

4. Test and Measure

5. Optimize

6. Repeat, iterate, experiment

1. Set Direct to Fan Data Goals

REACH My widget on 100+ sites this year50,000 unique visitors this month

ENGAGEMENT Single played 10,000 times on the webFans to share my video 2,500 times

ACQUISITION5,000 email addresses by JanuarySell out the Mercury Lounge in NYC (capacity 250)

MONETIZATION

Make $60,000 from a series of DTF offersAverage fan revenue is $50 per year across all offers

2. Craft Your Offer

• Authentically connect with your fans

• Do not focus on topline revenue of one product

• Artist as a brand with many products

• Variety of offers to serve a wide spectrum of fans

• Emerging artists prioritize on fan acquisition through low friction, low cost offers

• Established artists benefit from fans wanting collectibles and higher-value experiences

• All should include tiered premium offers vs. leaving major revenue and margin on the table

Impact of Physical Goods in Offers

*Source: Topspin direct to fan campaigns

Consider Premium Offers

• 50% of transactions occur at under $10, but account for less than 18% of Revenue

• Greater than 50% of revenue is earned at price points over $25

*Source: Topspin direct to fan campaigns

Plot and Serve Your Demand Curve

3. Collect Data

• Once you’ve crafted your offers, project demand

• Calculate weighted average transaction value based on product mix and expected distribution

• Multiply average revenue & margin by conversion rates from channel

• Get a handle on accessible channels

• Number of emails in your list (ensure freshness for optimal conversion)

• Traffic to primary and secondary sites measured in visits

• Search volume (Google’s search term tool)

• Social network reach in friends or followers: Facebook, MySpace, Twitter, Last.FM, YouTube, iLike, etc.

Google Analytics – Required

Topspin Conversion Averages

CHANNEL CONSERVATIVE NORMAL AGGRESSIVE

Email• Visits (clicks)• Sales from visits

10%4%

15%8%

20%12%

Traffic to Primary Site• Visits• Sales• Email acquisition

100%2.4%7%

100%4.8%15%

100%8%20%

Traffic to Secondary Sites• Visits • Sales• Emails

8%2%

3.2%

16%3.2%6.4%

24%5.6%8%

Search• Visits• Sales• Emails

2.4%1.6%3.2%

4%3.2%7.2%

5.6%4.8%

11.2%

Source: Topspin Direct to Fan Averages

Topspin Conversion Averages

CHANNEL CONSERVATIVE NORMAL AGGRESSIVE

Facebook• Visits• Sales• Emails

0.8%1.6%2.8%

2.4%2.8%3.6%

4%4.4%7.2%

MySpace• Visits• Sales• Emails

0.8%1.2%2.4%

2.4%2.4%3.2%

4%4%

6.4%

Twitter• Visits• Sales• Emails

2.4%1.6%2.4%

4.8%2.8%3.2%

7.2%4.4%6.4%

YouTube• Visits• Sales• Emails

2%1.2%2.4%

3.2%2%

3.6%

4.8%3.2%4.8%

Source: Topspin Direct to Fan Averages

Compare Funnel Conversions

Source: Topspin Live Artist Example

Essential Lessons

• Learn and master Google Analytics

• Simple to put into footer of website, blog, CMS

• It’s free and a universal standard

• Third party integration, i.e., Topspin purchase flow

• Premium offers = more revenue

• Include physical goods to generate demand

• Service fans who want more and are willing to pay

• Understand conversion rates project demand

4. Test + Measure = ROI

• What was the before and after of your marketing?

• Compare and contrast how different channels drive traffic, fan acquisition, and revenue

• Benchmark and improve each fan touch-point sales conversion

• Web page views and click-throughs

• Email open-rates, click-throughs, unsubscribes

• Widget loads, plays, shares

• Purchase points: impressions, acquired fans

Revenue by Channel

Website Traffic

• Identify major sources of traffic to your site

• Topspin Knowledge Base instructions

• Assess ecommerce and conversion by source to reinforce and reward high-performing channels

• For each source, uniquely track traffic and commerce by tagging the URLs: Google URL Builder

• Topspin Knowledge Base instructions

• Advanced users can develop unique landing pages for each source of traffic

• Bit.ly and Awe.sm URL shortners provide tracking and metrics

Social Network Data Platforms

Analyze social network metrics and engage fans periodically with new media and posts

Third Party Metrics Providers

5. Optimize

•Initial direct marketing is an investment in data and benchmarking

•SEO

•Landing pages

•Email

•New metrics for the new business

SEO• Imperative that primary site is ranked highest

• SEO Advice and Tips:

• Search Engine Traffic #2-#3 source of artist’s traffic and revenue during releases

• Ensure release and artist specific key words are resulting in top placement for your site

• Rank Checker:

SEO• Can you tell below when this artist’s primary site fell

out of top placement in search rankings?

• Drop in traffic = drop in revenue

• Requires continual monitoring or setting up data alerts

Landing Pages

Landing Page Data Lessons• Your offer should never be more than one click away

• Why? only 15-30% of visitors follow the link to the offer page

• Compare:

• Offer page is one click away: 30% click and 10% buy = 3% total conversion

• Offer page is two clicks away: 30% click once, 30% click again, 10% buy = 0.9%

• Assume 10,000 visitors and $20 avg sale: this is $6,000 vs. $1,800

• Emails should drive fans direct to offer page

• Integrate offer page into homepage

• Advanced users A/B landing pages for high conversions

• Google Webpage Optimizer

David Byrne Email Marketing

• Strongest revenue channel

• 3,000 to 30,000 in two weeks

• 28% CTR

• 13% purchased

• Tip: Streaming players or widget images in emails have highest CTR

Metrics for the New Music Business

MEASURE EXAMPLES

Play to Purchase Ratio Byrne and Eno: 20%

Fans Acquired per 1000Viral impressions Fanfarlo: 49/1000

Fans Acquired per 1000 Paid impressions Average: 0.7/1000

Dispersion David Byrne: 160 sitesFanfarlo: 248 sites

Shares to Sales Ratio Fanfarlo: 1.1

6. Repeat, Iterate, Experiment

• Promotional effectiveness has short half-life so emulate successful methods quickly and measure constantly

• Investing in data intelligence enables better remarketing

• Experiment with limited fan sets

• Plot your own demand curves and determine price elasticities

• A/B test for incremental gains on all fan touchpoints

• Future of artist marketing is based on your creative ideas

• Tools will allow easier implementation and more immediate measurement

• Actively engage with audience to sustain and grow fanbase KPIs

Some (More) Creative Campaigns

•Fanfarlo case study

•The Elk

•Get Busy Committee

•Joe Pug

•Golden Filter

•Ambling Alp

Further Resources

• shamal@topspinmedia.com

• Twitter: @shamalman

• Skype: shamal_topspin

• Topspin Green Room

• Topspin Knowledge Base

• Google Analytics: Conversion University

• Berklee College of Music

• Course: Online Music Marketing with Topspin

• Certificate program: Topspin-Certified Marketer Specialist

• Copyblogger

Thank you.