Fan Funding Is Dead, Long Live Fan Funding! (1)
Music BusinessPublished May 22, 2010 at 00:13 No CommentsSellaBand filed for bankruptcy in February this year, ForMyBand, a German competitor, is in liquidation since 1st January 2010. Is this the end of the fan funding hype?
Wired named a few reasons why it went wrong for SellaBand: the reliance on CD and album, the lack of promoting and marketing the music, no effectiveness in album production and the lack of quality management. Believers have more than once discussed these things on SellaBand forum long time ago. But why didn’t management listen to the community? Why are fans degraded to payers? Why don’t these platforms involve fans from minute one, as stated in many of their advertising slogans?
Suzanne Lainson, Research Director of Brands Plus Music, identifies some more issues SellaBand had to deal with: „Having to raise $50,000 was too much and few bands were going to be able to do that. There weren’t ways for bands to personalize what they were offering. They couldn’t offer unique goods and services for different levels of sponsorship. There weren’t clear benefits to bands in going through SellaBand versus doing on their own.“ The first two issues SellaBand has solved at the end of 2009, obviously too late.
On the other hand the reasons Wired mentioned may be relevant from a music business view and of course they seem to be right superficially. But if you look at it from the customer perspective, you will maybe come to different results. I would understand fans and musicians as customers in this case. And if you take that in you will see that running a fan funding platform only as a payment platform will definitely be doomed.
So what are the main points for success in fan funding business? According to Sascha Pallenberg’s „8 Cs of Monetizing Blogs“* I would define the „8 Cs of Fan Funding Platforms“. Besides, I think these are crucial and basic requirements for every online business.
Community
Fan funding is nothing without a community. Music is a very emotional topic for the most of us. If you want to have success in fan funding don’t try to sell music or parts only – create emotions and memories with music. Most of the fan funding platforms are very businesslike in my opinion. SellaBand managed to create a community feeling in its early days – there were Sellabration, a number of Believer activities and a lot more. But they didn’t manage to constantly support and continue these activities. So the community fell to pieces finally.
Another aspect is how fan funding platforms learn from the community. I don’t believe there is this so called „wisdom of crowds“. But in every community there are loads of specialists and experts and volunteers. You should use this source of knowledge.
Content
Content for me is the equivalent of quality. This is one of the things Wired mentioned as a reason for SellaBand’s failing. I guess everyone should know about the importance of quality. No one will buy amateurish music.
On the other hand there is a selection problem of finding high quality music. Suzanne Lainson points out this problem as follows: „As more bands go the crowdfunding route, it will be harder for each one of them to stand out. Fans are going to get burned out if they are hit with crowdfunding requests from hundreds of bands.“
Consistency
This principle SellaBand infringed again and again with all the website relaunches and new eras. I guess with this they asked too much of the community.
Creative Commons
I know that copyright is the most controversial topic of music industry. But, if you are an unsigned artist you should use every channel and way to spread and promote your music. And you should think about how your fans could use your music. Maybe the idea of giving music away under creative commons goes too far. But who knows …
Fan funding platforms could control the compliance with the rights much more effective than a single artist could do it.
To be continued …
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