There is a common belief that the music industry does not adhere to the principles of supply and demand. Many people believe that entertainment can be consumed in unlimited quantities, and because art is subjective, there is a market for everyone.
While there is some truth to this belief, the success and influence of major players in the music industry rely heavily on a popularity hierarchy (demand) and the streams and sales of music. Major labels play a crucial role in establishing and controlling “formulas” that not only shape but also reflect culture, ultimately impacting the broader music market.
To put it simply, while there may be one fan out there for everyone, if you want to have a significant enough following to make a living with music, there are creative rules you will have to follow. Additionally, there are trends and phases that markets go through, which determine the popularity of your music.
Acknowledging the need to capture some of the major label’s market share is not an approach that most people would consider. In the music industry, there is a prevalent mentality of “there’s plenty to go around,” but the major labels do not share this mindset. They focus on the attention economy and take every possible measure to control the attention of their target markets. These target markets are the same ones you need to capture the attention of, so you are in direct competition with the major labels. It is important to start acting accordingly!
How streaming saturation and AI will effect music industry market share
Over the past two decades, there have been significant disruptions to the music attention economy that are worth considering. These include:
- Licensed music streaming platforms
- Short-form trending/viral video platforms
- AI music
You may have noticed that major labels were quick to embrace these technologies and involve themselves in various aspects of them. They obtained early shares in Spotify, took the lead in licensing races on TikTok, and have been involved in regulating AI music.
You may ask why AI music is relevant to the attention economy. Well, the faster turnover of music creation results in more music being available in the marketplace, which further saturates it. Major companies do not want this saturation to divert attention from the marketplaces they invest billions in each year to stay relevant.
The combination of streaming saturation and AI will provide new insights into the idea that “art is subjective.” These technologies will showcase how specific formulas and patterns can dominate the market and generate profits for a certain period, only to decline in popularity due to overexposure.
This realisation will help us develop effective strategies, such as identifying the optimal time to capitalise on a successful genre before taking artistic risks, or knowing when to limit social media posts to prevent exhausting our fanbase through overexposure. If we’re observant of what the majors are doing, we can replicate some of their tried-and-tested moves to our own benefit.
How music market share analysis can help independents compete with major labels
Market share in the music industry is crucial for independent artists, labels, and music tech startups. To say you have “market share” means you are generating revenue from music fans.
Understanding market share helps independent artists and labels to compete with major labels by giving them an indication of how well independent music is performing against its major competition and what kind of attention they can expect compared to independent peers.
Market share insights can help music tech startups identify gaps in the market and develop solutions that cater to the needs of independent artists and labels.
Article about how to analyse the music market coming soon
How music industry market share impacts independent artists, labels, and music tech startups
The market share of the music industry is a crucial metric for independent artists, labels, and music tech startups.
For artists and labels, it represents direct sales and attention.
For music tech startups, analysing market share data and understanding the needs of independent artists and labels is essential for developing products and services that provide value to these stakeholders. For music tech platforms, it involves disrupting the channels currently controlled by major labels, empowering independent artists, and offering alternative options that consumers love.
Analysing the market share of the music industry provides valuable insights into its performance, growth, and sustainability. By understanding market share and utilising insights from it, stakeholders can develop successful strategies that generate real revenue.
If you’re looking for a coach or consultant to help you navigate and grow your music industry market share, book a consultation call today.