Topspin Shows That Premium Offerings Get Sales: People Will Pay For Value Beyond The Music
from the a-reason-to-buy dept
It’s really been great over the past year or so to see more and more bands adopting business models that involve tiered “premium” options that add real value for fans — the key to creating a real reason to buy, as discussed in my MidemNet presentation a couple months ago. We’ve seen all different variations on the tiered theme from Trent Reznor to Kristin Hersh to Jill Sobule to John Wesley Harding and many others. Personally, I still think that the most creative of the bunch is Josh Freese’s tiers that go from just fun to ridiculous (one option lets you keep his car — after you drop him off at home).
One of the companies that’s doing a good job helping some musicians make this model work is TopSpin, who we’ve discussed before. In fact, TopSpin has helped Reznor and Freese with their offerings (as well as the Beastie Boys, who recently launched something similar, as well). With TopSpin’s platform coming out of beta this week, the company has released some data on its success so far, and it’s impressive — especially for those of you who keep insisting that fans these days just want music for free and are unwilling to pay for anything.
- Its campaigns have certainly helped bands grow their audience and improved ways to connect with fans. One of its first major projects was the release of David Byrne’s latest album, and it increased his email list by 3000%. (Update: Originally we said 37%, but that was wrong. It’s actually 30x, or 3000% as per Topspin).
- The various projects have shown that people are quite willing to pay if they’re provided with real value and given a real (rather than artificial) reason to buy. The average transaction price is $22 — significantly more than what people are paying for “just the music” and even more than what an average CD costs.
- Perhaps the most appealing stat: on a recent project 84% of the orders were premium offers above the lowest tier. People will pay more for being given real value, rather than just being forced to pay for the music.
This is great news. Unfortunately, TopSpin is still rather limited right now to bigger name artists (they pick and choose who they work with). I think the world is open for another player to come in and disrupt the market by making such systems available for anyone. Also, in the various projects that TopSpin has run so far, I still think the pricing is a little off (Reznor’s was the exception, and he only used TopSpin’s backend, rather than its whole program). Also, it seems pretty rare for artists using TopSpin to offer a free option, which limits opportunity greatly (and drives folks to file sharing, rather than opening up a better relationship with those fans, and maybe gaining an email contact and the ability to create sales later). This is (I hope?) an issue from the musicians’ side, rather than TopSpin’s.
It’s also worth noting that the company has also announced a program with Berklee College of Music to teach courses to musicians in how to leverage TopSpin for better business models. Hopefully at least some of that class will include an explanation of how using free as a part of your business model can extend it even further.