December 22, 2004: Connecting Artists and Fans Online

An ecommerce company aids the music industry with direct access to album and concert ticket buyers.

A Charlottesville, VA-based company is helping major recording artists to not only run their fan clubs, but also generate new sales for their latest CDs, concerts or promotional merchandise.

Musictoday®, established in 1996, is a privately held ecommerce and fulfillment company with 250 employees. The company operates from a 20-acre complex that includes dedicated office buildings for ticketing, information technology, client services, a call center, ISP and more than 100,000 square feet of warehouse/fulfillment space.

The company's client roster reads like a 'Who's Who' of recording artists -- the Rolling Stones, Eminem, Dave Matthews Band, Metallica, Dixie Chicks, Grateful Dead, O.A.R., Particle and Jason Mraz. About 700 artists utilize the company's Web store services, which include construction and hosting of their client 'stores,' call-center customer support, and various fulfillment operations. Musictoday also claims to be the first company to launch direct artist-to-fan Web ticketing -- the company designs and hosts the Web ticketing site, processes the ticket orders, prints the tickets and provides ticket buyers with telephone and email customer service.

"We developed a system for fans to deal directly with the artist, and no brand is imposed between artists and fans," says James Warnock, director of List Management Services for Musictoday. "The artist owns the customer relationship. The email and customer data collected is owned by the artist, which empowers them to manage their fan base as they please."

Musictoday's online fan clubs provide a platform for artists to connect directly with fans. Fans can opt-in to Musictoday's database of artist and industry lists through a number of different collection points, including fan clubs, directly from a client's official site, or through store and ticket sites, with or without a purchase.

The Dave Matthews Fan Club, for example, offers a wide variety of services and helps create new revenue streams for the band. These include:

Opportunities to purchase tickets in advance of public on-sale
Contests for merchandise, ticket giveaways, ticket upgrades, travel packages to shows, opportunities to photograph live performances
Members-only Web site with news, photos, audio and video clips, message board, store and live chat room
Annual membership packages
Gallery of members' works
Ticket giveaways and purchase offerings for special engagements including concerts, radio performances, TV tapings and intimate showcases

Musictoday's email marketing software product, known as Accucast, was created by Atlanta-based Socketware, Inc. According to Socketware Marketing Communications Manager Dana Ellison, the software program has helped Musictoday launch permission-based email campaigns that are generating high response rates. Various tracking and reporting features enable Musictoday to analyze results in real-time to determine the effectiveness of campaigns.

As an example, the real-time reports allow clients to receive immediate feedback on the status of campaigns, click-through responses, bounced messages (these are messages that bounce back due to outdated addresses), viral forwards (commonly known as 'forward-to-a-friend') and subscribe/unsubscribe requests. Clients can compare any number of campaigns to see how each message performed over time or which end users consistently opened or clicked through messages. Graphs and charts are included to create a visual understanding of each communication.

"We work with hundreds of artists and have a fan base of 5.5 million," says Warnock. "There are two of us using Accucast now and each of us can build and implement a campaign in about an hour."

The results have been dramatic. Warnock says deliverability (see eMarketer, Inc. chart below along with brief definitions of key industry terms) is a hot issue of e-marketers.

"Sometimes ISPs will blacklist your campaigns if they don't fit a certain criteria for legitimate email (in other words, you will be labeled a spammer, even if your subscribers opted-in to your campaigns)," Warnock says. "ISPs can block messages based on any number of triggers, such as wording (e.g., 'sale' or 'free' are triggers), HTML design (too many graphics) and other criteria."

Warnock adds that Musictoday uses Accucast to develop ISP relationships by white listing and sending campaigns that don't trigger these filters.

Deliverability = How many messages reach the subscriber's inbox
Opt-Out Rates = Unsubscribes
Open rates = How many people opened the email after receiving it
Click-through Rates = How many people answered the call for action by clicking through to the site to view merchandise or make a purchase

For retail, Musictoday claims to be well above the industry average:

Musictoday Average

Deliverability: Up to 98% 84%

Open Rates: Up to 75% 30%

Click-Through: Up to 50% 11%

Warnock says about 150 campaigns are being managed each month at Musictoday, which range from 1,000 recipients to more than 450,000. The company uses Accucast's personalization features to include member identification numbers, live events per geographic region and special one-time use coupons or special discounts.

Campaigns include store and ticketing newsletters and digital downloads. Recent store newsletter campaign examples were implemented for Blue Man Group, Dave Matthews Band, 50 Cent, Madonna, AC/DC and Patty Griffin. The current Blue Man Group store newsletter provides detailed information on the group's first-ever live DVD entitled, The Complex Rock Tour Live. Fans can preorder the DVD; the newsletter also provides detailed pricing information and track names for each sketch. The 50 Cent store newsletter home page hawks everything from G-Unit T-shirts at $20 a pop, to CDs to posters. Viewers can also enter a special promotion offering a chance to win $50,000 in diamonds.

Musictoday developed recent ticketing newsletter campaigns for Britney Spears, the Georgia Theatre and Starr Hill Music Hall. Click on the ticketing newsletter link for Britney Spears and you can buy tickets for the pop diva's In the Zone tour (you'll need to click on another link to get to her fan club site to actually order the tickets), get a complete concert schedule and more.

One current digital download campaign is for Welsh singer Jem. Viewers can download selected tracks from two of her CDs -- They and Finally Woken.

Warnock says digital download campaigns allow artists to offer audio and video downloads for sale directly through their official Web store.

"We create a secure digital content delivery and commerce platform for artists, giving them the power to tailor a digital product by customizing security, file type and fidelity," he says.

Warnock adds that the service integrates into an existing Web store, allowing artists to provide digital content on demand directly to their fans. The digital download service also enables fans to visit an artist's site to buy music or video in digital format directly from the artist.

"The artist provides Musictoday with the content, price, the file format and file security desired," says Warnock. "Musictoday encodes the content, integrates it into the artist's Web store alongside other merchandise, completes order transactions, fulfills orders, handles customer service and support, and provides a sales report and settlement check in conjunction with other merchandise sales each month."

Warnock says the email campaigns are the most cost-effective marketing tool Musictoday has in its arsenal.

"The music industry is just beginning to understand the value of using the Internet to communicate with fans," he says. "We're able to demonstrate to our clients that we understand customer behavior across styles of music, age groups and other differentiators, avoid redundancies and ensure that campaigns are timely and relevant."

Neal Leavitt is president of Leavitt Communications, an international marketing communications company with affiliates in Paris, France; Hamburg, Germany; London, United Kingdom; Bangalore, India; Hong Kong, China; and Sao Paulo, Brazil. He writes frequently on Internet and other technology-related issues.

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	Musictoday	Average
Deliverability:	Up to 98%	84%
Open Rates:	Up to 75%	30%
Click-Through:	Up to 50%	11%