Band Background:
In 2012, five high school friends decided to start a band for no other reason than they wanted to be cool amongst their friends. There were no aspirations of being professional musicians, no dreams of selling out stadiums. They just wanted to have fun doing what they loved. With their unique blend of hip-hop and rock, local New York bars and clubs offered opportunities to play live. Lead guitarist Daisy Spencer (2017) recalls “catch[ing] the bug of performing. It was like a drug. We got addicted to the adrenaline of performing.” In 2013, the group played at South by Southwest in Austin, Texas where Rick Rubin, a recording producer, and his team noticed them (Spencer 2017). They were signed with Republic Records the next day and The Skins were officially born.
Business Model:
Since signing with Republic Records, The Skins have quit their day jobs and focused on the band for their career. Like many musicians, The Skins’ main priority is producing sound and music that make people happy and “make them want to dance” (Spencer 2017). But with more money, comes more problems. Spencer and her band mates intended to cease the opportunity of being signed with a big label like Republic, a division of Universal Music Group. “It’s a lot of give and take,” Spencer said. “You show them you’re willing to work with them and they’re more willing to help you out” (Spencer 2017). Working with them, in this case, meant tweaking their sound to have a more pop feel. Republic records represents some of the biggest names in popular music today such as Ariana Grande and DNCE (Republic Records). A different sound wasn’t the only new aspect to their creative process. With tighter deadlines, melodies and lyrics had to be churned out much faster as well. Outside songwriters have been brought in to help the band’s lyrical creation. “It’s been really helpful to work with some of these guys,” says Spencer. “Getting all five of us to agree on lyrics just takes too long” (Spencer 2017).
The Skins spend months upon months in the recording studio producing music to appease eager fans and attract new followings. A great way to gain new followers is to feature an already established artist on a song. Last year, The Skins’ single “Bury Me” featured rap star D.R.A.M. and “saw a spike in our YouTube views” (Spencer 2017). They plan to bring on other talent this coming year to gain more recognition through already established followings.
Revenue Model:
The music industry has moved to primarily digital. According to Shackleford (2016), “By 2014, physical [music sales] had plummeted to 34 percent of total sales… with digital 66 percent of that amount.” So, what does this mean for our friends, The Skins? Almost nothing. Streaming and digital downloads are known as the business of pennies. According to Dredge (2015), “Spotify says that its average payout for a stream to labels and publishers is between $0.006 and $0.0084 but the average payment to an artist from the label portion of that is $0.001128.” Streaming only benefits the big players revenue wise. The Skins would need 887 streams of their songs to make just one dollar from Spotify, yet you can find their songs on Spotify as well as YouTube, Pandora, iTunes, Amazon, and Google Play. “It all comes back to accessibility,” Spencer insists. “Do you want people searching all over the web for your music or do you want it available on every platform?”
Almost all T
he Skins revenue comes from concert sales. When they sell out small New York venues, they’re able to keep almost all the profit. A large part of their marketing comes from social media posts and information provided on their website, so they save on costs to ensure a larger net profit. Even when they grow in popularity, concerts and tours will be their main source of revenue, though those digital pennies will start to turn more into digital dollars. For now, it’s not enough for this emerging band to look at their revenue today. They’re smart to put plans into play that will help grow their revenue the more popular they get.
Assets:
Due to their contract with Republic, The Skins don’t outright own much. Republic owns the copyright on their logo, a certain percentage of their songs, a percentage on any merchandise they sell. Tracks written with outside song writers also have ownership divvied up. They do own the copyright on “The Skins,” which means they “own a particular corner of the web” (Spencer 2017). Other bands could name themselves “The Skins” but would be unable to own websites and other entities bearing that name. The most important assets they have are themselves. At the end of the day, after all the contracts, revenue, and business talk, the band members are the ones capable of creating invaluable intellectual property. Without them, there are no record labels, concerts, or music business. They are the most important aspect in everyone’s success in the music industry. It all truly hinges on their creativity, and that’s the most important asset to have.
References
Billboard Staff. (2015, June 19). How Much Do Artists Make? A Comprehensive Look – From Cover Bands to Mariah’s Vegas Residency. Retrieved September 24, 2017, from http://www.billboard.com/articles/business/6605326/how-much-do-artists-make-music-industry-earnings
Dredge, S. (2015, April 03). How much do musicians really make from Spotify, iTunes and YouTube? Retrieved September 11, 2017, from https://www.theguardian.com/technology/2015/apr/03/how-much-musicians-make-spotify-itunes-youtube
Republic Records. (n.d.). Retrieved September 11, 2017, from http://www.universalmusic.com/label/republic-records/
Shackleford, T. (2016, October 25). Interview: The Skins talk growing into the band they were meant to be ahead of the release of new single. Retrieved September 12, 2017, from https://www.axs.com/interview-the-skins-talk-growing-into-the-band-they-were-meant-to-be-a-108822
Spencer, D. (2017, September 12). Phone interview.
The Skins. (2017, April 12). Retrieved September 11, 2017, from http://www.republicrecords.com/artists/skins
The Skins | Official Site. (2016, December 16). Retrieved September 11, 2017, from http://www.theskins.com/
Turow, J. (2017). Media today: mass communication in a converging world (6th ed.). London: Routledge, Taylor and Francis Group.