The Lefsetz Letter

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Idea
By Bob Lefsetz

The number one problem facing the record labels is not CD burning, or downloading. It's EXPOSURE!

Record labels release multiple albums per year. Some, multiple albums per WEEK! But most of these go unheard. Because there are limited outlets of exposure, and limited slots within each outlet.

Historically, the labels have dealt with this by trying to get an edge. By employing independent promoters. By giving away merchandise, trips. It was an inefficient costly system at best, but now it's turned AGAINST the labels. With radio stations in cahoots with indies to extract money from labels for virtually no services.

Pretty sad state of affairs.

But that's what happens when you don't control your own avenue of exposure.

Dell Computer realized the problem of being dependent on retailers to sell their merchandise. So, they decided not to sell via retailers AT ALL! At first Dell computers were sold over the phone. Now, almost all their sales are VIA THE INTERNET!

Yes, dell.com features ALL their computers. With detailed information with regard thereto. No retailer is going to stock all this equipment. And knowledgeable clerks? An oxymoron.

I haven't been beating up the record labels for sport. To make them look dumb, to make myself look smart. I've been trying to inform them of a CHANGED world and to drag them into this world.

Today I'm going to give them an idea worth millions of dollars, for free. For the benefit of both them and the public at large.

Each recording conglomerate should have its own Web page. Yup, a Sony page, a BMG page, a Universal page, a Warner page and an EMI page. And on that page there should be a track from every one of the artists they're hyping/selling. Downloadable for free. In MP3 format. Unrestricted. And st

reamable too, for those that might prefer that option.

FREE! We can't give the music away for FREE!

Well that's what you do with RADIO! See it as the same thing. The Web is the new radio, but BETTER! Because there are more slots, and the public gets to CHOOSE!

Draw them in with goodies. A live recording of Springsteen, Avril Lavigne, Eminem. SOMETHING YOU WEREN'T GOING TO SELL ANYWAY!

And then, once they're AT the site, they'll check out more music. Because they're MUSIC FANS!!!

But the key is not to sell the way you do now. With the hype, the bait and switch. The Web is about HONESTY! Yup, put up the track from your unheard of band and state clearly WHY you signed them. WHAT they sound like. VERY BRIEFLY! Oh, there can be a click-through to more info, but you CAN'T overload the potential downloader. Got to give it to them short and sweet. Once again, NOT like the bios you put out. Which make the act sound like the new Beatles. Rather, write it down the way one fan would speak to another.

Now, it's got to be a VERY SIMPLE Web page. NOT like mtv.com and vh1.com.

Yes, the labels are STILL pissed at the franchise they gave the video music channels. And now, while the labels are sleeping, these channels are establishing beachheads on the Web! But, the people who run them DON'T UNDERSTAND THE WEB! Don't understand that MOST of their viewers/surfers are doing so at 56k. And their sites run positively GLACIALLY at broadband speeds.

So, you AVOID their pitfalls. Don't build six million dollar sites in Java that crash computers. Just have the kind of Web page a KID could build. Hey, have it LOOK like a kid built it. That's how Napster looked, and its success was through the roof!

And once you've got the site...then you ADVERTISE IT!

Fuck the co-op ads, which go down the drain/are a profit center for the retailers. You end up being a one inch square amongst forty other one inch squares in a Sunday supplement. No, spend your money on the kind of advertising COKE does. Yup, sonymusic.com. Show kids listening to music on headphones in all SORTS of situations. On the bed, in the mountains, in the CLASSROOM! And at the end of the spot...all it says is: sonymusic.com.

And in those bus shelters. It just says: sonymusic.com. Maybe in the script of those Fillmore posters. Build the brand, generate excitement, make it HIP! THEN people will go to your site, and THEN they will be exposed to all your wares. And, if they're great, the albums will SELL!

Think about it. In the seventies, Warner Brothers exposed their artists by doing samplers. Two bucks for two records. There were no royalties, the label didn't make any money. Now you can do all of that essentially for free with no time lag! Go online and download all the stuff the LABEL thinks is hip!

And, it's not only good business, increasing your hit to stiff ratio, it's good for MUSIC! Since music that doesn't fit the narrow slots of radio and MTV will get a CHANCE!

Now, in the alternative, there could be one RIAA site. But that might cause too much static.

Or, there could be one RIAA site with just a couple of tracks from each label and then links to each conglomerate's site. But, that's a bit confusing too.

Still, in all these cases, there's ANOTHER benefit. The RIAA and the labels suddenly appear FRIENDLY to the consumer. Which they haven't FOR YEARS!

Now don't criticize my sophistication re co-op ads. I REALIZE you get price and positioning for that. But, eventually you're going to have to wean yourself from that. Because fewer sales will be via retail. More will be via the Web. Happens all the time in regular business. The model changes, and the little guy has more onerous terms. Want to sell the new car? Then you've got to build a bigger showroom. Many dealers could not sell the BMW X5 until they built new facilities...and that's a runaway success, one of the hottest machines OUT THERE! And, they were ALREADY BMW DEALERS! The LABELS should control retail, not vice versa. But that's how it is THROUGHOUT the music business. The label theoretically should have the power, having the PRODUCT, but EVERYBODY ELSE tells them what to do.

But no longer on the WEB! That's the BEAUTY of it!!!

I'd advise selling the music on the Web tomorrow. In an all you can eat mont hly subscription fee unprotected MP3 format. But that's WAY too much for the labels to get their heads around. But the above...it's a no-brainer. It only helps the labels. It should be done IMMEDIATELY!

Do it. And don't fuck it up. Call me. E-mail me right at this address and I'll guide you through it. Because navigating new waters without an expert is like...trying to get from one side of the lake to the other without knowing how to swim.


P.S.

I REALIZE most record labels presently have Web pages. But I'm NOT talking about those. Gaudy, hype-laden, "People" magazine sites. I'm talking down and dirty. Conglomerate-wide sites. With not just a couple of downloads, but twenty, thirty, as many as acts are being promoted. Maybe two per act.

And, I also realize that some companies are already using similar URLs to the ones I mentioned. (That's "Uniform Resource Locator". That's what the Web-savvy call a Web address.) So, a new, catchier one should be employed. Like sonydownloads.com. The beauty of a URL like this is it states EXACTLY WHAT IT IS!

 


Bob Lefsetz, Santa Monica-based industry legend, is the author of the e-mail newsletter, "The Lefsetz Letter". Famous for being beholden to no one, and speaking the truth, Lefsetz addresses the issues that are at the core of the music business: downloading, copy protection, pricing and the music itself.

His intense brilliance captivates readers from Steven Tyler to Rick Nielsen to Bryan Adams to Quincy Jones to music business honchos like Michael Rapino, Randy Phillips, Don Ienner, Cliff Burnstein, Irving Azoff and Tom Freston.

Never boring, always entertaining, Mr. Lefsetz's insights are fueled by his stint as an entertainment business attorney, majordomo of Sanctuary Music's American division and consultancies to major labels.

Bob has been a weekly contributor to CelebrityAccess and Encore since 2001, and we plan many more years of partnership with him. While we here at CelebrityAccess and Encore do not necessarily agree with all of Bob's opinions, we are proud to help share them with you.

 






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