Hard Rock Cafe Announces Boutique Label: Four Lucky Bands To Receive $25,000 And All The Money They Can Earn

from the philanthropy-and-overpriced-drink-'specials'-FTW dept

Of all the places you might expect philanthropy to flow to unknown musicians, the Hard Rock Cafe would seem to be one of the unlikeliest. Despite its name, the Hard Rock Cafe is known best for being a t-shirt an upscale chain restaurant whose hook is music memorabilia, rather than a forward-thinking music-inclined entity with a constant eye on the cutting edge . While plenty of artists have played their venues over the years, the chain seemed to be happier catering to the fans of music's past, rather than actively promoting new music.

Word comes via the Daily Swarm that the Hard Rock brand is now affixing itself to a boutique label. But this is a label without multi-page contracts or onerous royalty demands. Hard Rock Records is set up to lose money from day one, all in the interest of giving bands that catch its ear a leg up.
The brainchild of CMO John Galloway and A&R co-heads Blake Smith and James Buell, Hard Rock Records is only in its first year and thus far has just one act signed to its roster – the Gulfport, Mississippi roots-rock act Rosco Bandana. More interesting than its late entrance into the record label game is that Hard Rock Records is marking itself as an "altruistic" label, or a non-profit, so to speak.

"We had discussed different variations of a label a few years ago," Buell explains to Rolling Stone. "Everything was netting back to how were we going to make money. After we did our research, it just never seemed like a good idea."

Last year during Lollapalooza, where Chicago's Hard Rock Hotel is the annual ground zero for the fest's biggest after-parties, Galloway approached the two and told them to move forward with the label. "He said, 'No, that's the thing, that's the catch – we're NOT going to make any money," explains Buell.
This is another example of content as advertising. There's little doubt the Hard Rock logo will be displayed prominently wherever these bands play, but in exchange, they'll get tour support and be able to take advantage of Hard Rock's promotional skills and reach. And since there's no catch, each of the four bands signed will be able to keep all the money they've earned and walk away free and clear after 12 months. Not a bad deal at all.
"It's kind of like music philanthropy," adds Smith. "We want to find bands that need a leg up. We take them for a year, make a record with them, give them video money, give them a van, get a booking agent to help them get on the road, and hopefully find them another label that is going to house and better build them for the long-term. We do all this with them, and they keep every penny of everything and they walk after 12 months."
Hard Rock has this built into its advertising budget, which is probably the best P&L line to put it on. A band receiving $25,000 with no strings attached and nothing to recoup is going to find it very hard not to talk up the Hard Rock brand. If nothing else, it will be mentioned every time someone asks the band, well, pretty much anything, really. It might be tough to gauge the ROI from this, but as it's set up now, no one seems to be too concerned. It certainly generates a ton of goodwill for Hard Rock, which usually translates to brand loyalty. 

I don't imagine this experiment will find itself leading a bandwagon, though. There aren't many companies willing to invest $100K into something as ethereal as "karma." But it does add another wrinkle to the music business, bringing back the concept of patronage and treating your artistic investment as some sort of loss leader. Hard Rock does have itself set up to take advantage of any additional business this might drum up. Syncing up new bands and a promotional tour will be frictionless with its existing venues and sponsored festivals. The question isn't how much money the band might make, but how much Hard Rock will see added to its bottom line from dipping its toe into the music industry. Setting the expectation at $0 for the trial run is probably wise, as it makes it nearly impossible to undershoot the goal, as it were.

It's not a business plan by any stretch of the imagination and it's certainly not going to bring about a brave new world of artistic patronage, but it's hard to knock a bit of altruism for its own sake (corporate advertising opportunities, notwithstanding). It's also great news for four bands, who'll get a $25K kickstart and year of worry-free money making. 

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  • icon
    Ragaboo (profile), 14 Aug 2012 @ 3:18pm

    I hope you're right

    I hope this is actually as awesome as it sounds, but this gives me a tiny bit of pause:
    ...hopefully find them another label that is going to house and better build them for the long-term.

    If there truly are no contracts, then it's not a big deal, but if there's any contract at all, have you seen it? Because that quote leaves the chance that Hard Rock could essentially sell the rights to the band to a major label, thus hopefully recouping their losses and denying the band the opportunity to go label-free (which they usually should be able to after a year of high-profile promotion).

    Just saying, there might be something more restrictive behind the scenes, and I'd think most bands still would love this opportunity (because it's a great one), but I suspect something else at play.

    reply to this | link to this | view in chronology ]

    • icon
      Capitalist Lion Tamer (profile), 14 Aug 2012 @ 4:22pm

      Re: I hope you're right

      I see your point.

      Right now, they don't seem to have a lot of info or much of a plan beyond "let's go spend some money." (I don't believe any sort of contract has been made public.) Of course, the line you quote could just be some sort of "old school" thinking/talk that still thinks all bands are working towards signing with a label, rather than being an indication of Hard Rock's desire to turn into a regular label with associated royalty demands, catalog control, etc.

      But it is a good thing to keep an eye as this develops.

      reply to this | link to this | view in chronology ]

      • icon
        Ragaboo (profile), 14 Aug 2012 @ 4:47pm

        Re: Re: I hope you're right

        To be clear, I'm not saying that I think Hard Rock is trying to turn into a for-profit label based on that quote, I'm saying that they might be trying to build up these bands to in turn "sell" them to a major label after doing the footwork to make them valuable (they could work out a deal with labels and hammer out a finder's fee for the handover). It's like building a website with the intention of selling it off as soon as you make it semi-valuable (and then just repeating that process over and over).

        Again, this is only a bad thing for the band if they end up somehow being contractually obligated to go to a major label if Hard Rock finds one for them. I doubt that's the case, but it gives me pause.

        Otherwise, this is amazing. Twelve months of free promotion and tour support and then help getting on a label if you want to. Just being a pessimist, I suppose.

        reply to this | link to this | view in chronology ]

  • icon
    That Anonymous Coward (profile), 14 Aug 2012 @ 5:12pm

    A bit more transparency please...

    I would like to see more of the actual details of the agreement. They talk about getting them a van, a booking agent, money for the record, money for a video, but the only number we've seen is $25,000. Now its nothing to sneeze at, but it would be very helpful for slightly more transparency in how it is meant to play out.

    If the van, video, agent, are all paid for out of the $25,000 and are selected by Hard Rock its not so much giving them $25,000 as it is going to be "cash and prizes" valued at up to $25,000. MSRP on many things is stupidly high and no one pays that actual price.

    I think this is a huge step forward for the music industry, finding "value" in something other that cold hard cash.
    That building brand loyalty, actually supporting artists, and not being evil parasites will play well in the current atmosphere.

    The devil is always in the details, and the more you put the details out into the light the better off you are.

    Its def better than the old system, and part of my concern is because of the old system where they buried clauses and deals to benefit themselves at the expense of the artists.

    reply to this | link to this | view in chronology ]

  • icon
    Michael Ward (profile), 14 Aug 2012 @ 8:46pm

    Hard Rock

    Gee, $25,000 is mouse nuts to an advertising budget like they run. So is $100,000, which is same order as a color ad page in the San Jose Mercury-News.

    Furthermore, if you aren't extracting revenue from the contract, you don't have to spend much on accounting, program management, or insurance. It's all the Band's problem.

    And it bids fair to bring in street word-of-mouth that money simply can't buy. Who needs fake Twitter, if you have real Facebook?

    reply to this | link to this | view in chronology ]

  • icon
    Ninja (profile), 15 Aug 2012 @ 4:03am

    Well, if it was the MAFIAA the bands would end the first year owing $1 gazillion dollars due to breakage levies. Hard Rock clearly doesn't have a clue. Think of the broken vinyls =/

    reply to this | link to this | view in chronology ]

  • icon
    Hankster (profile), 15 Aug 2012 @ 5:53am

    May be a new way of thinking. Remember that Hard Rock is owned by the Seminole Indian Tribe of Florida. Are they doing this on their own or have they brought in some old school record exec to run it?

    reply to this | link to this | view in chronology ]

  • identicon
    Lord Binky, 15 Aug 2012 @ 7:34am

    My experience is that the Hard Rock Casino in vegas hosted more smaller independent musicians than their large name bands by far. I could see this being a testing run for a larger scale effort at the cafe's.

    reply to this | link to this | view in chronology ]

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