The question is almost as eternal as the evolution of its answer: just how does the music industry work? Whether you’re a somewhat established artist yourself or you aspire to one day work in music, it’s not always easy to grasp all the complexities that make up the music industry. In the recording industry, there are a ton of different players involved at every stage of the production process of a single, EP, or album.
To understand how the music industry works, we first need to identify all the steps that separate the creation of a work from its marketing:
1. Creation and Production
Creation is when the artist is literally shaping their musical work. This is the moment when the song is born, when the lyrics (if any) are written, and when the melody is composed.
Production is when the work becomes a specific recording. This step involves a producer. They own the means of production and therefore produce the album or single recording, become the owner, and collect earnings. Profits from the sales of the recording they produced are therefore paid to them. After they get paid, they then pay royalties to the artist. The producer and the artist can be the same person.
Beyond that, a music publisher can come into play. Their purpose will be to generate revenue through this musical work (and to control it). They will try to broadcast the title as widely as possible (plays on radio and as background music in films, TV, and commercials, for example). This also helps the artist to popularize their music. To do this, the publisher is paid a percentage of the copyright that the artist will receive, which can be up to 50%.
Marketing a project makes it possible to connect the producer to the consumers and allow the project to be sold. This ranges from the design of the music videos, to the album cover, to the merchandising, etc.
This phase is often managed by music labels who are responsible for associating a product with its image, supporting a musical project on the market and helping the artist to develop their musical career (labels can help shape the image of the artist, and in these cases, often take over artistic direction). This is a crucial phase because it determines the commercial success of the project.
The retail sector (once dominated by giants like FNAC and Virgin) has evolved a lot in the last 20 years. When the Internet and streaming arrived, they considerably reduced distribution costs and barriers to entry (once, you could never hope to be sold on record store shelves without signing with a label, for example). The 1998 creation in of CD Baby, which initially focused on large-scale distribution of physical records and which, a few years later, focused on streaming platforms, allowed all artists to have their music distributed internationally, at very low cost.
The distributor, of course, took a percentage of the artist’s sales in exchange for the service rendered. Today, this is no longer the case: companies like TuneCore and Distrokid allow all artists to be distributed while retaining 100% of their royalties.
4. Music Promotion
This is the final step and probably the most important if you want to get your music out of the shadows and into the light. Musical promotion means trying to make your project known to the largest extent possible and ensure that it generates as many sales/streams as possible. You have to contact the media (TV/radio, print, online press), contact playlists, gain visibility on social networks, and try to get your music shared and broadcast as much as possible.
Good news: today, an artist can handle music promotion by themselves, greatly facilitated by music promotion social networks and platforms like Groover, which allow artists to directly contact media, playlists, radios and music pros with the guarantee of being listened to and receiving a response in less than 7 days.
Later, with a more advanced musical project and more resources (perhaps after signing with a label, for example) the artist will be able to make use of a PR representative.