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BUILD YOUR OWN GROUPON
By Music Ally, Published in Sandbox
Recent months have seen a huge buzz around companies offering daily deals and group buying services, like Groupon and LivingSocial. Now there are startups looking to do the same thing for music, including GroopEase, Fipster and RCRD Deals. But if you’re an artist, manager or label with a decent mailing list, you can learn from the likes of Groupon for your own promotions.
We’ll start by explaining the key facets of the big players in this space: they’re daily, local and intrinsically social. People signing up to a service like Groupon are offered a daily deal from a business or retailer in their locality, with the proviso that a specified number of people must sign up for the deal before it’s available to everybody – Groupon is a shortened version of ‘group coupon’, reflecting its encouragement for users to share the deal details with friends.
In November 2010, Groupon ran its first music deal, launching something called the Grouponicus Store to sell digital products at a discount. Rihanna’s ‘Loud’ album was the first promotion, and was sold for $5. It should be noted that the daily deals idea has already been used for music, most notably by Amazon, which famously rattled Apple with its MP3 deals, promoted on Twitter.
Also in November, Sony Music Entertainment launched its own Groupon-style site, called PopMarket. There, the idea was a members-only site with a daily deal on physical music and merchandise, including albums, box-sets and memorabilia. It came out of Sony’s catalogue division Legacy, and is still going: this week, deals are on offer for Elvis Presley, Neil Diamond, Journey, Iggy & The Stooges and Roy Orbison.
In February this year, UK startup Fipster launched its own site focused on music. The brainchild of a pair of former HMV executives, the site sells a mixture of merchandise, gig tickets and music – both physical and digital albums.
“We are looking at the whole spectrum from indie bands, chart, to metal supergroups,” said co-founder Pete Chapman at the time. Fipster’s deals have flexible time limits rather than being strictly daily, but it uses the group-buying model – when a specified minimum number of orders is reached, the deal is ‘tipped’ and goes through.
In March, music marketing firm Topspin teamed up with digital music startup RCRD LBL to announce a site called RCRD Deals, which aims to bundle rare or high-value music content and products together – so marrying time-limited deals with the idea of bundling box sets, merchandise, vinyl and festival passes together. “We're really looking at premium products only,” said boss Josh Deutsch at the time. “What we don't want to do is offer something that is in-market and already available.”
The latest startup to enter the fray – this month – was US firm GroopEase. It’s focusing on independent bands, selling albums for up to 75% discounts in time-limited promotions, while donating a portion of the proceeds to charity. As an example, people paying $5 for The Filthy Violets’ album ‘Lackluster Blvd’ will see 5% of that price going to charity The Empower Nepali Girls Foundation. Fipster, RCRD Deals and GroopEase are all currently either in private beta or invite-only, as the companies behind them tweak the mechanics of their offers.
We wouldn’t want to put anyone off talking to these companies about using their services, but we think there’s another way artists, managers and labels can benefit from Groupon-style models. If you’ve put the work in to build a thriving community of fans on Facebook and Twitter, and/or have a clean mailing list database, you can run your own offers.
Examples? Offering back catalogue albums for a one-day cheap price, or targeting fans in a specific town with a group-buying discount on tickets for an upcoming gig are obvious ones. There are already startups like GigsWiz and Music Glue tapping into fan location data to promote gigs, but adding discounted tickets into the mix is the next logical step.
If an artist has stocks of unreleased tracks, they might also be good for tapping into the group dynamic – if enough fans Like a promotion on Facebook, they get access to an exclusive song. And what the likes of Fipster and GroopEase are planning to do with merchandise can arguably be done better by individual artists who know that the people being presented with the offer are definitely into the music.
The hype around Groupon shows no signs of diminishing, but when its key aspects are applied to music at a more focused level, they have the potential to boost revenues while also bolstering the artist-fan relationship.
More information:
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