Subscription Revenue
TL;DR How much does each fan spend on your music per year? What if you gave them the option to spend more? Let’s explore.
In music, subscription revenue has largely been the model for businesses rather than most individual artists; e.g. Spotify, Apple Music, Vinyl Me Please. Artists may have had subscription-style income in the form of fan clubs with annual dues, but in recent years new platforms have emerged that allow artists to generate more frequent recurring revenue in return for exclusive content. One of the most popular platforms for subscriptions is Patreon.
Patreon
Jack Conte, of indie-rock band Pomplamoose, founded Patreon to create a destination that gives fans access to exclusive content and perks in return for a monthly fee. Creators of different types of art (music, podcasts, videos, visual artists, and more) set up their pages with tiered membership levels, and, in so doing, foster more intimate connections with fans.
Patreon’s membership levels allow creators to make their subscription accessible to new fans with low-price tiers, and meaningful to hardcore fans with high-price tiers. Below are Pomplamoose’s membership levels.
Every month, Pomplamoose earns $11,568 from 2,520 patrons. That averages to $4.59 per fan. Clearly, Jack’s strategy with his own Patreon is to bring in as many people as possible, even if that means offering a low entry price.
Deciding what benefits to offer members of each tier and how to price each tier should come down to three considerations:
- Fan sentimental value for each benefit: Regardless of “retail value” of an item, how meaningful would a video about your songwriting process, weekly live stream, chat access, or other exclusive content be to your fans?
- Time and resources required to make the content: Even though many of the benefits offered to fans through Patreon are digital and don’t cost anything to manufacture or send, there are still time and creation costs. Some things you may already have (mp3 song demos), others take a nominal amount of time (weekly 30 minute live streams), and others require more substantial time and gear like creating a well-produced behind-the-scenes tour video series. Think carefully about the time and costs associated with the benefits that you are offering.
- Consistency: Set expectations appropriately. Fans expect these benefits monthly. By delivering on the benefits that fans sign up for and showing up every month, you will keep your fans happy, and they will be more likely to tell their friends. Failing to deliver content every month will end up eroding the trust you have built with fans and will decrease the amount of patrons that subscribe.
Patreon has recommended benefits for musicians, and you can check out the recommendations for other types of creators on the same page. Below are some more ideas for membership benefits:
- Behind-the-Scenes Photos and Videos: Give your fans an exclusive and unique insight into your creative process.
- Song Demos and Bootlegs: Many artists have hard drives full of demos, live recordings, and alternate mixes that they will never officially put out. While these recordings may not be suitable for the general public, your fans will love the opportunity to experience these. Remember, production quality is not important here, it’s the fact that these recordings are “rare” and unreleased that make them valuable.
- Behind The Music: Create videos in which you talk about the inspiration for a song, stories about the recording session, how-to’s on playing the song, and anything else that fans might find interesting.
- Exclusive Live Streams: Available to patrons only, these live streams could include more song requests and audience interaction by taking requests and fan questions ahead of time, playing deeper cuts, having themed streams (80s night, ballads-only, boy band covers), and saving the live stream for patrons to download and listen or watch at a later date.
- Merch Sales: Give patrons a 10% off merch code to use on your store or create merchandise that is available only to patron members. Member merch can be higher value items with more sentimental value, such as lyric sheets and personalized song videos.
Other Platforms
Patreon is not the only platform to offer subscription-style revenue. Below are similar platforms that each have a unique approach to monetizing fans.
Gumroad (https://gumroad.com/): In addition to subscriptions, Gumroad allows creators to offer digital and physical products for sale, broadening the sales opportunities for creators. Gumroad also offers a robust dashboard that provides insight into your sales and how fans are consuming your content.
Squarespace (https://www.squarespace.com/): As part of Squarespace’s Commerce Advanced plan, businesses that use Squarespace for website hosting can offer subscription products in their store. This integrates directly with your website and can be sold alongside your other merch products. By using this integration, you can embed all of the exclusive content in a private section of your Squarespace site. Learn more about Squarespace subscriptions here.
Shopify (https://www.shopify.com/): For larger creators who want a more customizable and branded experience, Shopify offers apps (such as Bold) that allow you to offer subscriptions from your Shopify ecommerce store. This is especially beneficial if you are offering physical goods as part of your subscription. However, this is much more expensive ($40/month) and involves a more complicated set up process.
