Most general Joe Bloggs people-on-yer-street aren’t sure what record labels do – other than notoriously take advantage of, and screw over, artists. Music is a complex industry, but the very core is record labels. The original labels (of which the original original is Columbia) began as gramophone manufacturers – selling the accompanying vinyl and distributing throughout America before growing into Europe. For the nerdier among you, we’ll do a history of the recording industry in another blog, but for now here’s what all record labels (major and independent) do as part of their day-to-day in the modern industry.
Most of what a label offers can be summed up as money and a network. A bit like a glorified loan shark with a LOT of friends in the right places.
Well, there’s the obvious starting point: making music. Paying for (and organising) studio time, producers, musicians. Overseeing and providing finance for the whole process – right through from writing sessions (or working with the artist in selecting songs to cover) to mix and final mastering. Whoever organises and pays for the recording sessions legally owns the recording copyright (i.e. the final recordings, a.k.a the master recordings or ‘masters’), so this is normally cemented in the recording contract between label and artist.
Labels can use their extensive network to partner an artist with the best producer for the project (and pay them for it). The artist-producer relationship is key for making a record, and a good producer will be able to serve the project (and songs) whatever that might require. Super-producer Rick Rubin embodies this superlatively – at times controversially leaving artists on their own, knowing the best thing to do for the project is empower them and get out of the way: “I’m helping them through this discovery process and questioning whether this is their best work.”
Cheaper, more widely available production tools and the rise of the ‘bedroom producer’ have made producing a quality record significantly more affordable throughout the last decade. A well-produced album, however, can never trump good songs – music projects rise and fall on the quality of songwriting and how that connects with an audience. However well it is dressed up by production, you can’t disguise the songwriting. It needs to be a dedicated art crafted over years of honing – art that can’t be bought or conjured from nothing. Of all the unsolicited submissions to Bespoke this is the single biggest pitfall and what we tell people to concentrate most on when starting a new project. It’s also something a record label can’t directly do for an artist – though they should aid and encourage their development in it (especially in partnership with a publisher). It’s all about the power of the song (… another Rubin-ism).
DELIVERING A RECORD TO MARKET
A label will typically take care of the next step: turning the finished music into a marketable package and deciding the mechanics of the release. This involves paying for – and organising – artwork, then sorting the track listing and record packaging to finish the product, which the label subsequently delivers to market. The label responsibility is to pull together all the strands for the wider release campaign: release dates (singles, videos, album, tour), press and radio promotion, touring, manufacture (and in which mediums) and distribution.
Organising and paying for (sensing a theme…?) manufacture of CDs/vinyl and getting these into physical stores (and promoted therein) is a key role for a label. In the 1920s-40s the labels with the largest or most efficient distribution networks thrived, and licensing (beginning initially each way across the Atlantic) birthed the global industry before the Internet was even conceived. Nowadays distribution is as much digital as it is physical – labels have direct relationship with online stores such as iTunes, Amazon and Spotify and leverage this to have their products featured on these services’ front pages (which can represent a significant bump in revenue). Unsigned artists can reach all these stores through an ‘aggregator’ such as Tunecore, but labels with direct store relationships can certainly push more effectively for promotion: banners, features, appearing on popular playlists, etc. This is where those ‘friends in the right places’ comes in handy – labels have built up huge networks of industry professionals to push their music to that unsigned acts simply can’t access. There’s even a wealth of websites providing physical manufacture for unsigned artists, though – again – a label comes in handy to push the product through physical shops, which in some countries is still a larger revenue stream than digital (including France and Germany).
One option is for artists to pay for the recording themselves, and with masters in hand approach a label to handle the promotion, distribution and other typical label things – a licence deal. The artist can retain ownership of the recordings but licence them to a bigger entity and utilise their network/marketing machine for a cut of the sales. A pared down version of this is a distribution deal, where a label will only take on getting the record into stores (physical, digital or both) but nothing else for a smaller cut. This can be a great option for artists who can afford to make their own music but aren’t sure how to get it out to a wider market and develop new fans.
MARKETING & PROMOTION
This is where deep pockets and having lots of friends in the right places really come into their own. The marketing muscle of a major, or even independent, label is significant, and can make all the difference to artists finding new fans and exploring avenues they couldn’t reach beforehand- resulting in more sales.
Using their radio plugger gets an artist’s music into the ears of a significant chunk of fans they might not have reached out to before (as well as PPL and PRS income for the artist and songwriter respectively). DJs don’t just play anyone’s music- it’s a dedicated job of someone (the plugger) to recommend tracks for them to play. It’s literally all about who you know.
Press interviews – in print and/or radio – go a long way to reaching a new demographic and helping convert listening ears into purchases as well as increasing an artist’s profile. Even traditional marketing techniques (magazine and newspaper space, billboards, TV and online adverts) as well as new media tricks (FB/Twitter/Instagram sponsored posts/campaigns, Google AdWords) have a big impact but require very deep pockets. Or friends in the right places for mates-rates. Either way you start to see how a label excels at marketing.
Labels send music off to influencers, actually have them hear it and more importantly talk about/share it. Again, because of their direct relationships with blogs, magazines or even celebrities, labels can increase an artist’s sphere and the quantity of people whose ears they invade. Labels create press packs (or electronic press packs (EPKs)) to send out to their network mentioning good reviews, stats on the artist and any upcoming gigs or showcases.
Video is a vital partner for music in the current, Internet-driven market. Labels pay for high-quality videos (and have them VEVO approved), often for every song on a record.
Touring has always been a vital building block of any artist’s success, and is even predicted to become the greatest revenue stream for some artists as sales income continues to take a nose-dive. Labels have clocked this and will throw money (known as tour support) into getting an artist out on the road – where ticket revenue, physical sales and other merchandise (another area a label looks after) with great margins provide a strong return on investment. Labels can also invite their network to a showcase gig they put on for an artist – particularly helpful in the run up to a new release.
Labels will also sort neighbouring rights such as PPL (a royalty due when the recording is played publicly on radio, TV or in shops) and chasing down synchronisation opportunities – getting the recording onto TV adverts or placed into films. These can prove very lucrative but, again, require a network of sync agents or direct relationship with advert, TV or film producers. Labels exert a lot of energy to cultivate such networks – it’s what makes them worth their salt.
WOAH. So labels do quite a lot really
…but you can see how most of it can be boiled down to organising and writing the cheque for things on behalf of an artist and using their network to promote any releases. There’s a lot an artist can do on their own, but the culmination of services a label adds can often trump the loss in income and ownership when an artist is signed. Their marketing machine, endless contacts in radio, TV, digital and physical stores, press, blogs, magazines and sheer financial muscle can make a huge impact on an artist’s career – but only if they choose it to. Is it worthwhile signing to any old label? Or one that has bigger fish to fry? Probably not, as labels are mostly interested in one thing: money. If another act earns them more they’ll focus their energy and resources there, even if they’ve poured some money into you they might not capitalise on it with their attention elsewhere.
Labels make their money back by taking a significant portion of all the revenue streams they touch – often 75-80% – giving the artist a small royalty slice of the pie. But then a small cut of a big pie is better than 100% of nothing. The global industry in 2014’s revenue was split into 46% physical sales, 46% digital sales, 6% performance income (such as neighbouring rights) and 2% syncronisation – labels will give the lion’s share of their time to increasing sales.
In summary, a label’s job role includes:
Music production (studios, mix, master)
Packagaing (track listing, artwork, selecting mediums)
Marketing & promotion
Tour support and showcases
One further option open to artists (if this all feels a bit doom and gloom) is to find a label services company. These are like pix ’n’ mix labels – you can pick from any of the above categories that you need help on but do the rest yourself, and save some revenue in the process. This is becoming more prevalent as the Internet age brings much of the above list within the grasp of artists.
Whatever you think of labels, for good or bad they certainly know their stuff and have the resources to make a creative’s dream a commercial reality. The beauty of the modern industry is artists can get a long way (or with careful thought and dedication all the way) on their own, but having to split their brains between business and creativity can make both suffer. It’s all a careful balancing act (and a slight roll of the dice) – but good songs and people who believe in them will always travel far.
There are (nowadays) only three major labels: Warner, Sony and Universal. They’ve gobbled up any of the other larger entities including Parlophone, Columbia, Virgin, Island, Atlantic, Capitol, EMI, Decca… the list goes on. What makes a major? We’ll do another blog to explore this one – this one’s been long enough!
A little further reading, if you’re a glutton for punishment