Mariah Carey Showing How The New Music Business Model Works For Megastars

Culture

from the reasons-to-buy-on-a-massive-scale dept

A couple people sent in this rather interesting story from the Times Online about how Mariah Carey is reinventing the music business model. Well, that’s basically what the article suggests. What’s more accurate is that she’s more or less scaled up the “connecting with fans” and “reasons to buy” to mega-superstar levels. She’s working closely with various brands to help fund the business model. She’s selling other product lines such as makeup. But, she’s also come up with some unique “reasons to buy.” For example, she got the magazine Elle to produce an entire issue dedicated to her — but the only way to get it is to buy her new CD. In other words, she’s giving people a reason to buy the CD. And… even better, she (or, her people) sold the ads that are in the magazine and gets to keep all of that money. It’s the superstar blend of recognizing that content and advertising have really become the same thing.

She’s also connecting with fans more and more using the internet — even with such a huge following. So, for example, her people are carefully “leaking” her schedule and appearances to very targeted groups of fans online, so when she shows up places, there’s a good number of fans, who feel special, rather than tremendous mobs.

And, no, of course this isn’t the model for everyone. None of these models are — but they all follow the same framework. She’s working hard to come up with reasons for people to buy stuff, all of which is made more valuable by her music and her celebrity. And she points out that the record label execs should have embraced the internet ages ago:

“A lot of big powerful music-industry executives made a giant mistake,” she says. “They gave the music business away on the internet. If they had just sat back and said, ‘Maybe let’s figure this internet thing out, it could be something cool,’ we could have found a way to distribute music online on our own terms, not somebody else’s. Prince had already shown them the way. He was so far ahead of the curve, putting out his own records on the web. Everyone else was stupid.”

Indeed. While Prince eventually stumbled, his early efforts were incredibly instructive for the industry, but every time folks like us mentioned them, we were told it could only work for Prince and that it was a terrible model. Except it worked — and, to be honest, every model we see these days is really a more modern reflection of what Prince started doing years ago.

But, once again, despite the naysayers, we’re seeing that this basic economic concept of using the infinite goods of music and celebrity to sell scarce goods can work no matter how big or small the artist may be.

Filed Under: business models, mariah carey, music