When it comes to downloading digital music, there is free and then there is legal, but seldom can you have both from the same site, and make money too. Noisetrade.com has been doing this for the past three years.
Certainly, there are lots of other music download sites, and we have written most recently about Soundcloud, as one example. But it is worth looking at what Noisetrade is doing to see what could be the ideal small-business content download site.
The site has more than 300,000 albums downloaded per month, covering mostly indie artists. Every track is free, once you enter your email address and zip code. You can pay via an online "tip jar" (the range of donation is from $1 to $100), but you don't have to. You are emailed a link to a ZIP file of the album that expires in a few days, and that is about as easy as it gets. You can also recommend a particular album to your social network contacts too, but again, this is purely optional.
Noisetrade hasn't gotten much publicity but is making money, in the "few" hundreds of thousands of dollars annually, according to various press reports. Derek Webb, David McCollum, Mark Nicholas, Brannon McAllister (who is the CEO and based in New York City) and Joe Kirk started the site in 2008. Six months in, they had a million downloads.
Webb has been interviewed here last month, where he espoused his basic philosophy:
"If I can sell 20,000 records at 10 bucks that's short-term money. Somebody comes to iTunes and buys my record for 10 bucks, that may be the only transaction I have with that person. ... I don't know who they are, I don't know how to find them again, I have no way to interact with that person again beyond that one transaction. I would rather give them the record, something that has perceived value: $10 on iTunes, (though) by the time the money comes to me, I make more like a dollar."
Here are some other lessons learned from the experience, and something to keep in mind if you are considering your own digital content offering:
- It is about building communities of interest. As Webb is quoted above, the goal isn't just to sell tracks, but track the buyers and be back in touch with them when the artist is appearing live in their area or has something new to offer. He found 2,500 fans in Los Angeles, and mined these names to provide two small concerts at the Knitting Factory. He had to turn away paying customers.
- Involve your community too. Webb will ask fans to vote on their favorite cover song, getting their feedback and buy-in the process.
- Don't forget non-traditional audiences. Noisetrade got started in the Christian and church music sector and branched out. But that experience guided them to make it easy for indie artists to upload their songs. "We want someone to take a song and play it in their local church," aid Stephen Brewster, the pastor for a Cross Point Church in Tennessee and quoted in The Tennessean over the weekend.
- Small can be beautiful. Webb and his wife will travel west to do a series of "living room concerts" to 50 or so fans later this month. They know this is a great way to build up rapport and a lasting relationship with their fans. Sure, there are still plenty of arena concerts, but these lower-scale events are important too.
- Make the payments optional. By asking for a "tip jar" instead of pricing the tracks or the album specifically, you place the onus on the purchaser to determine its value, and you also make it easier for people to discover new artists. Given the site's focus on the indie music world, there are going to be lots of bands that you never heard of. Nosietrade takes 20% of the tip jar, which is similar to the commissions that Apple and Amazon make on their music sales. Given how much dough they are collecting, it is something to keep in mind.
- Go beyond what the competition offers. Unlike Soundcloud, Webb is actually promoting the remixes of his tracks, and sells higher-quality audio files too.
- Be a good marketing partner to your content creators. Webb tells his artists to put as much effort into marketing their music as they do in its creation, to help build awareness and a fan base. Noisetrade makes it easier to do this with its sharing features. Any artist needs to find their core group of supporters who will then promote the music to others.
Webb says: "It doesn't take a million records for you to make a living. The folks who are selling in the 2,000 to 10,000 range are the ones making the best living and probably are the most artistically satisfied because they have the least commercial pressure on them." He calls this market segment a really good blue-collar lifestyle or the music middle class.