The world of the record label is, from the outside, in a precarious position. With so many independent artists opting to self-fund their releases and the major label artists cleaning up the charts, but with labels like Decca still making a massive profit in the era of streaming and downloading, someone might think twice about setting up a record label. However, it’s not a futile task, and in fact, there are many record labels that have started from modest beginnings and have nurtured some of the greatest artists of all time.
For many, the world of a record label still holds that allure of a simpler time before streaming, that independent entity, but so what does it take for an individual to set up an independent record label that doesn’t struggle to stay afloat but is a foundation for new exciting artists?
Learning the Essential Stuff First
A record label is, first and foremost, a business, and this is why you’ve got to know what you are getting yourself in for first. This is why the legal components are so critical, whether you are setting up a limited company or operating as a solo business. This is a very big leap, and many people can find it takes the fun out of the equation, but if you can stick to your guns while also understanding the legal stuff, you are setting yourself up for a far better foundation.
It’s something that no one really wants to get to grips with, and would rather enjoy the music, but the vast majority of running a record label is about the business side of things.
Understanding the Distribution Differences
The modern music environment is not just about vinyl, CDs, or streaming and digital distribution, but a combination of all of these factors. Digital distribution requires a placement on a number of playlists and storefronts, but physical distribution involves buying physical albums on platforms such as Amazon or small retailers.
When you understand the differences between them can help tailor your approach to getting your artists out there. When we talk about getting music out there, it is, first and foremost, a game about advertising and marketing. Many passionate musicians look to set up a record label as a vessel for their own work, but they greatly underestimate the impact that marketing and advertising have.
Ultimately, if you cannot generate a buzz around your artist through social media or promoting live events, this will prove to be a damp squib. Marketing music is such a major part of the industry and the placement of a song on an ad campaign has been shown countless times to be the cash cow for somebody else. So many artists have made a name for themselves purely through advertising deals, and if you, as the record label head, are thinking that you want to do it through an organic grassroots approach, away from the lure of advertising, you may find yourself at a loss, especially if you yearn for the simple days of record labels.
The reality is that making money through music is tough, and advertising deals are a very critical component. When you look at artists like Bob Dylan who sold his entire back catalogue, it is clear to see that even the artists that have been around for half a century are recognising that it’s not enough to earn from recording anymore.
Defining Your Goals
A record label that is innovative and sustainable might be two of your intentions, but you must look at these components and define why you want to get music out there because this will help to focus your passions, and it will ensure that you stay the course, especially when things get really tough.
Because a record label is like a business, you’ve got to conduct a business plan and you need to dig deep into the goals of what you’d like to accomplish. Think about the genre of music, how you plan on working with artists, but also how you plan on scaling this if you get major success with the right artist.
The way to keep a record label sustainable is through touring and advertising, rather than recordings. Therefore, you must clearly define your goals in relation to the markets, but also define your audience, because if you start pressing expensive vinyl without understanding who is going to buy them, you may find a lot of your efforts are in vain.
The right audience is about demographics and how they find new music. One of the ways people find music these days is not through just scanning the internet, but by hearing a well-placed song in a show, a commercial, or a video game.
You may be someone that is trying to find album-oriented fans, but the world of streaming has completely done away with the notion of an album from beginning to end, with very few people opting for this type of experience. In fact, many of those who are looking for album bands tend to go back to the musicians who are constantly breaking up, reforming, or doing anniversary tours. Modern music is certainly more fickle, and this is something that you must bear in mind.
Defining Your Brand
You are a conduit for your artist, but you must also create a brand which is the visual representation of your label. It is a way to represent your core values and the way you present yourself in combination with the artist you represent, which should be a beacon to potential artists to ensure that you are a safe pair of hands.
There are many niche record labels specialising in unique genres, but when you are creating a brand, you’ve got to remember that it will benefit you to stick with your passions, rather than what will earn more money. Creating a brand is not just about the iconography, but it expands into a variety of other components, for example, your social media messaging and your merchandise.
Ultimately, the bands or artists you sign are going to be the advertisement for your label. Finding an artist that is creating exciting music and is being nominated for awards is the best way to gain publicity for your brand. Record labels like Domino have had a reputation for signing independent artists who have a singular vision and as a result, this label has become the benchmark for independent artists in the early 21st century. But as more artists become more independently minded, it’s critical to think that the record label is not the be-all and end-all when it comes to managing an artist’s affairs.
There have been many stories over the years of record labels taking advantage of artists, and naturally, after enough time has passed since the days of record labels screwing over their artists, new musicians are always going to think twice before signing their life away. This is why your brand is not just about how you put yourself out into the world, but how you can gain the trust of the musicians.
Use the Data, but Maintain the Passion
The world of music is driven by data, from social media demographics to streaming consumption and playlists. There’s a lot to bear in mind, and if you get to grips with it, it can help you in so many different ways. It’s essential that you get into the habit of using the data to inform your decisions. It’s important that we understand how our artists are doing because one promising streaming figure may mean that we focus on promoting that track on different platforms, so it’s important that we have a grasp of this.
However, we must not let this dominate our lives. The reality of starting a record label is that you will find a number of artists that you have a passion for. There are going to be musicians along the way that takes you back to your childhood, and arguably, this is why people set up a record label in the first place. However, it’s important that while we are hankering for a profit, the importance of starting an independent record label is, for many people, about the statement.
It’s a statement of intent that they want to champion and nurture artists from all over that have not had the exposure they deserve. As a small record label, you may have to come to terms with the fact that there will be years of chipping away and finding your groove that doesn’t just suit your way of doing business, but also appeals to the artists in question.
Many people start record labels with a great fire inside them, intending to fly the face of the mainstream, and the reality is that the world of independent music is not an “us vs them” attitude anymore. The biggest artists in the world have a massive slice of the pie and then it’s down to the rest to fight it out. An independent record label should, first and foremost, be a labour of love, but if you want to separate yourself from the rest, it is critical to learn your professionalism at the same time.
