In the past 10 years one of the most recent developments in record deals is the 360-degree deal. A 360-degree deal involves artists sharing every type of income avenue they generate, which includes live performances, record sales, merchandising, sponsorship and endorsements. Essentially this deal works with the application of turning an artist into an entertainment brand.
One of the major benefits of a 360-degree deal is that they provide new opportunities for artists to maximize income from publishing, merchandise and sponsorship, therefore providing new revenue streams. It also helps record companies to sign bands that might not sell many records but have the potential to sell merchandise to their loyal fan base. Record companies also commit to bands for a longer period of time, as they are constantly sourcing new opportunities for them. It also creates better relationships between record companies and specialist music companies in artist management, marketing and online networking, because those specialist companies can provide cross-platform opportunities to artists.
However, this is type of deal isn't without it's drawback. The record company may take a large share of the artist's overall revenue because they are finding and monetizing so many different opportunities for them. The artist may feel that this is worthwhile for the amount of revenue streams they are getting. Some artists may not want to endorse themselves to a particular product or service that undermines their image. There is also great risk with this strategy. An artist may not recoup the cost of their own music with their other streams of income, which is bad for the record company and the artist. It's a case of going to the extreme and therefore creating the highest risk.
There is no doubt that a 360-degree deal can propel an artist into superstardom, provided that it's well strategized. If it isn't, this method could prove to be extremely unsustainable.
No comments:
Post a Comment