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How To Make More Money For Each Album Sold

by John Oszajca on August 26, 2012

A stack of CD'sJust a little catch up first for anyone who is new here and still unclear about what makes the marketing strategy we focus on at MMM a bit different from what musicians typically do…

Music Marketing Manifesto is based on a strategy that is known in marketing circles as “direct response marketing”. Instead of simply setting up a Reverb Nation page and an itunes account and waiting for hordes of fans to start magically pouring in and buying our albums (which doesn’t happen by the way), we go out and use proven selling strategies to drive traffic, capture leads, build an authentic relationship with our subscribers and then occasionally use “sales triggers” to motivate our subscribers to get off the fence and become BUYERS. Once they have bought our music it becomes our goal (at least from a marketing perspective) to increase our customer value by selling additional items to our fans.

This is commonly referred to as an “upsell” and it can take place in the form of..

1. An “order option” that a customer sees before checking out.
2. An after purchase “one time offer”.
3. An offer that a customer would be exposed to a little down the line in the form of a real time promotion or a “limited time offer”.

Now just to address what is sure to be a common question… This is easy to set up if you are taking orders on your own site. You simply redirect customers to an offer page after they complete their purchase. You can do this with Paypal or just about any other shopping cart solution.

It’s trickier to do with sites like CD Baby and BandCamp but not at all impossible. To do this with third party sites like those, you simply need to remind people to pass on their email address during the order (the process is a tad different with each platform) and then you can manually import that person into your customer list where you could then send them the upsell offer, whenever appropriate.

For sites like Amazon and itunes you would need to offer a free bonus incentive to anyone who emails in their receipt or order ID.

Typically (but not necessarily), the idea behind the upsell is to offer your paying customers a deal that is better than what the general public can get and to do so while their wallets are out and they are in a “buying mood”.

There is a psychological process at play here…

A person goes through a natural process of resistance before making a purchase. The sheer fact that they have ordered says that they have had had the internal debate as to whether or not your product was worth the money, and they have decided that it was.
So for example, lets say that you have just convinced a customer that your 10-song album was worth $10. Then, just after completing the process you offer them a box set of 50 songs for a mere $20 more. In order for that customer to reject the offer (assuming they can physically afford it), they need to make an internal argument that works against the logic that they just applied to the initial purchase.

Saying no to the upsell is like admitting to one’s self that the initial purchase was a bad idea to begin with. It’s hard for a person to come to such a conclusion. For good reason. The reality is that a properly structured upsell usually IS a great value for the consumer.

And that’s the idea. It’s a win for your fans, and a win for you. They get a bargain that is not available to the general public and you increase your bottom line by making a sale that you would have not likely made otherwise.

Now… Why is this so important?

Incorporating an upsell into your sales funnel is important simply because you can increase your customer value dramatically. In other words, you get more money for the same amount of work. Maximizing customer value is a major focus in most industries and it needs to be for independent musicians as well.

money graphWhy? Because music has a notoriously LOW price point. With only $10 or less in profit on each album sold it becomes very difficult to see a positive ROI from advertising. Just about every successful business in the world is based on advertising. Without it, we do not have the ability to expand.

Without advertising an independent artist is forced to either tour for the rest of their lives or to work each and every day at driving traffic manually (which gets old fast).

Because whether you want to realize it or not, the name of the game is TRAFFIC. Simply setting up an itunes account and spamming everyone on Twitter who has mentioned a band you sound like in one of their tweets, is not going to get you where you want to be.

And while paid advertising is not the first place I’d start (manually driving traffic online is), it is absolutely part of the end game for any independent artist who is hoping they can avoid touring for the next 30 years in order to make even a so-so living.

Here Are A Few Numbers To Consider…

Typically a subscriber can cost anywhere from .50 cents – $2 to acquire. Sometimes more, sometimes less.

If you have a well-oiled autoresponder series in place (pre-written email campaign), you should be able to convert subscribers into customers between 1 – 10% of the time. 4 – 5% being around average.

If you spend $1 to acquire a subscriber, and you convert subscribers into customers at 5%… That means that you will spend $200 to generate 200 subscribers which will convert into $100 in revenue (assuming you profit $10 on each album).

Here’s a breakdown of that math:

$1 X 200 = 200 subscribers.
200 subs / 5% = 10 sales
10 sales X $10 = $100

Money spent: $200
Revenue: $100

Income: Negative $100.

Yikes! That’s not gonna work.

HOWEVER, if you offer a $40 upsell and 30% of your customers take you up on that (30% is often sited as an industry average), you will then see $220 for your $200

Here’s the new math:

$1 X 200 = 200 subscribers.
200 subs / 5% = 10 sales
10 sales X $10 = $100
30% Upsell rate = 3 sales for $120
Money spent: $200
Revenue: $220

Income: $20

Now we’re getting somewhere.

And the profit potential doesn’t stop there. When your focus is on generating, communicating with, and selling to, your list, then you have the ability to profit over and over again. You will be consistently upping your customer value and increasing your ability to afford new advertising channels.

Add live shows, or better yet, house concerts to the mix and you’ll see a serious spike in customer value as you bring in those big ticket conversions.

This is when the infamous “1000 true fans” model actually works.

Just to address the inevitable…

At Music Marketing Manifesto we discuss music marketing strategy. And we make no apologies for doing it, nor do we couch it with a bunch of feel good crap that doesn’t serve anyone.

But in doing so it sometimes depersonalizes a process that is ultimately about passion, heart, and soul. We did not learn to play our instruments and spend years dedicated to the craft of music so that we could one day have a strong “conversion rate”. We play music to touch the hearts and minds of our fans and even grow and heal as individuals.

We are NOT trying to manipulate people against their will. Rather, our goal is to understand how consumers think and present ourselves in a way that is conducive to getting the response we want.

I hope it goes without saying that if you are benefiting more than your fans are from the transaction, then something is off and you need to make a few changes to your business model.

And now with the touchy feely stuff out of the way…

So what if I don’t have anything else to sell?

One of the most common reactions I get to the “upsell” concept is that often musicians feel that they don’t have anything more to offer their fans, aside from some way-to-expensive t-shirt that, let’s face it, no one really wants anyway unless they are a die-hard fan. And most customers, especially the new ones, are not die-hards.

Not to fear, there are a ton of ways you can monetize your list that take very little effort and/or money to create.

In a few days, I will follow up with part two in this series and offer a number of different ways that you can make infinitely MORE MONEY for each album sold.

Stay tuned for part two…

And while you guys wait, I’d love to hear your experience. I know many of you at least offer product options and upgrades. What percentages of your customers order more than just the album?

Have any creative upsell ideas that you guys would like to share?

Leave a comment below and let me know. I’d love to hear your thoughts on this.

{ 33 comments… read them below or add one }

Christopher Scum October 1, 2012 at 11:12 am

Most of our sales have been while touring,T-Shirts believe it or not We can’t even keep in stock,CDs out of 1,000 made in 06 I think there close to 200 left.We put out another CD since but only made a couple hundred copies and are selling mostly MP3’s.
My acoustic album fifty acres of pain is only available on CDBABY MP3s. I can’t afford to make CDs that no one wants anymore.2006 was not that long agobut a lot has changed.If and when I get some Money I am joining this, because you’re right on,the music world is changing and I don’t understand it any more!
Christopher Scum-The DIRTY WORKS Knoxville TN

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Michael Knight September 24, 2012 at 4:54 pm

I realized this point early on in my recording career but thought at some point it would reverse, that I wouldn’t have to do as much advertising because of building a brand. That didn’t happen – I should have concentrated on selling more to the customers I already had.

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John Oszajca September 24, 2012 at 10:24 pm

Hey Michael,

Yeah, it’s a common misconception. It’s infinitely easier to sell something to someone who has already bout from you then it is to convert a new person into a buyer. And the more we can generate off of each lead, the more we can afford to acquire new ones. Thanks for the comment.

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Rick September 17, 2012 at 2:08 am

I have a new single and video near completion. In your opinion, how could I maximize sales? Post the song on itunes first, then use the video to drive itunes sales?

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John Oszajca September 17, 2012 at 9:41 pm

Hi Rick,

Great question.

You certainly can use itunes as your checkout/ payment solution, however I don’t recommend using the video to drive them to itunes. The reason is that if for some reason they don’t buy, you’ll have lost the ability to follow up with people.

That being said, I recommend you drive traffic to what’s known as a “squeeze page”. A squeeze page simply offers people a free track or two, simply for signing up to a newsletter list. That way you can follow up with people and build a relationship with them before you ask them to buy.

It sounds like you’ll really benefit from my music marketing blueprint video. It will give you a good overview of the strategy I use and recommend, plus it’s free.

You can get it here:
http://musicmarketingmanifesto.com/music-marketing-blueprint.html

Let me know if I can ever help with anything else.

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Jessie Torrisi September 5, 2012 at 4:43 pm

The way I see it, the problem is that music is so devalued as to be free, 99cents, or socially acceptable to steal.

So the question is: what can we sell that can not be digitally devalued or shared, but that still puts the focus on art??

T-shirts, hats are cool, but they’re not really about the experience unless you bought them at a show. There must be more… and things that young artists can do before they have a huge catalog of music to drawn on.

There’s a lot of advice to record/create more content and rush it out… but that almost always leads to worse quality, either in the song/performance, or production. And then you’re lumped in with the mediocre masses. I prefer to do less & make it stellar, but that does create a conundrum of what to upsell with. Thanks, John.

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John Oszajca September 6, 2012 at 3:28 am

Hey Jessie,

I hear ya and you’re definitely not alone in feeling that way. But I see it a little differently. I don’t think that people care about music any less, and the music industry on the whole is actually generating MORE money that ever, despite the fact that the traditional “recording industry” is down. What I’m advocating for independent artists is a switch to the direct response marketing model. That is a marketing model that focuses on much more intimate communication with a smaller number of loyal fans. When you market in this way I people really do buy music, and they do so pretty eagerly. Regardless of whether or not it’s digital, or physical. And if you offer additional items as suggested above they typically are eager to spend more with you on additional items. It all comes down to your ability to communicate and connect with your fans in a medium other than just your music. I know that many purists are disheartened by this because we all just want to create art and let the world discover us. But I tried it that way and it didn’t work. I learned direct marketing and finally saw results. That’s my two cents anyway. But i do totally get the fact that things can feel pretty disheartening in a .99 cent world.

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Will September 4, 2012 at 9:24 pm

Great post and a much needed one, at that.

Far too many artists are still stuck in the “if you build it they will come” mentality. This is a great reality check, that at its core, the business of selling music is no different from other businesses.

You need a target market. You need a plan to reach out to them. You need to keep in touch with them.

And as you’ve brilliantly pointed out here, you need to find ways to give them more value, if you want to increase your income as a musician. Keep up the good work!

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John Oszajca September 6, 2012 at 3:21 am

Hi Will,

Thanks for commenting. Really glad to hear that you not only agree with the post, but that it seems to resonate with you. Not everyone agrees, but I’m glad you can see the potential of offering more to fans, while they are already buying your music.

Get in touch if I can ever help with anything.

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Kat Parsons September 2, 2012 at 5:03 pm

As always, love the post. After my LTO, I do a One Time Offer of my previous album at a major discount. And as far as upsells, I offer different bundles:
CD & T (at a discount)
“Superfan” Pack – 5 cds (at a discount)
Hope this helps!

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John Oszajca September 6, 2012 at 3:29 am

Thanks for sharing the info Kat.

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mark Pinkus August 29, 2012 at 8:17 pm

HI John, just wondering if you got my comments I left on this post the other day and If you plan to post it to share with others. thanks JOhn, till next time, Mark

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John Oszajca August 30, 2012 at 7:29 pm

Hi Mark,

Unfortunately we don’t have a comment from you on this post previously. Very sorry. The only thing I can think of is that it just didn’t post when you submitted it, otherwise I definitely would have responded. If you’d care to re-submit it, I’d love to hear your take on this for sure.

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Lucas August 27, 2012 at 5:38 pm

Hey, John,
Thought-provoking as always. I’ve been trying the MMM method with rather limited success; it’s costing more than it’s making right now. I admit that I have not been staying on top of it as I should but I do believe that CDs are just dead in the water. I’m a children’s artist and the librarian at one school I went to told me that she had to explain to the children what a CD was and how to use it! The download generation has officially arrived.

Downloads are also changing. More and more, people are finding plenty of ways to hear the music they want to hear for free or for a very small charge (Spotify, e.g.). There has to be some ADDITIONAL way to generate money besides selling the actual music. I used to sell 3000 CDs per year and it’s down to about 800-1000 now. Download sales are probably $50 or less per month so that’s definitely not picking up the slack.

It is time for a new business model and I think that is up to everyone’s individual creativity to figure it out. We all have to figure out a way to make our own situations work. Your blog and MMM are great for keeping folks thinking and talking about what’s next. I look forward to your next installment.

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John Oszajca August 27, 2012 at 10:52 pm

Thanks for the kind words about what I’m doing Lucas. I really appreciate it.

I hear the same concern about CD sales a lot. While it’s true that nationally speaking CD sales are plummeting. And free download consumption is changing the way people purchase music as well. It’s just not something that effects the direct response model much in my experience as the buying triggers are very different.

When you leave it to the consumer to go out and buy your music on their own terms they will turn to the sites that they are most familiar with and those usually aren’t very good for you as the artist. However when you create incentives to buy directly from you and offer a much richer experience than a consumer can get from itunes, it’s really not hard to sell CDs. Heck, I even see vinyl doing very well with the direct response model for exactly the reasons I just mentioned.

But you say you’re only experiencing limited success… usually when I hear this there is a good reason for it. Why don’t you post or email me the link to your squeeze page and the most recent promotional pitch page you have used. I’ll see if I can spot the problem. I’d definitely like to see if we can improve things for you.

Thanks for the comment.

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Lucas September 3, 2012 at 3:50 am

Wow, thanks so much for being willing to take a look. My squeeze page is at http://www.singingzoologist.com. I’ll send you a copy of my pitch page separately.

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John Oszajca September 6, 2012 at 5:27 am

Hi Lucas,

I just took a look at the page and I don’t see too much that should be causing you problems when it comes to converting subscribers…

However, here’s a few thing that might improve your results.

1. Your headline – perhaps adding a line or two about “Get free crazy-fun science music every month, that you and your kids can enjoy together!” Or some other item that really drives home the “benefit” the subscriber will experience as apposed to just a download.

Chances are it’s the parents who will be reading the page and it’s important that your headline promises a benefit to them as well. But you could go any number of ways with this.

2. You might want some small text inside of your form box that explicitly explains the offer… “Simply enter your details below and be instantly sent 2 free songs PLUS 1 more each and every month.”

3. You might want to use some color to draw people’s eyes over to the form box. Red borders generally do well.

4. Perhaps an arrow that directs people back up to the form, after they read your reviews.

As you page currently is, you should be getting consistent sign-ups, even if the conversions are low. How many visitors are you getting per month to this page and what system are you using to track that traffic?

This approach to marketing is pretty proven and it really does work. With that said, it takes some dialing in. There are only a few places you can go wrong.

1. You might not be getting enough quality traffic.
2. You might be getting the traffic but your copy and site layout is not converting well.
3. Your email series is not doing the job of building interest and desire.
4. Your actual order page/platform is not closing the sale well.

It’s just about identifying the problem and then tweaking until you get your conversions up. I’m seeing music actually outperform most industries online when this is done well, I think because it is such an honest and personality driven product. So hang in there and see if you can spot where the problem is in the chain for you.

Get in touch if I can ever help with anything.

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TOMOKO August 28, 2012 at 1:30 am

I totally agree with you in ever sense.

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Bill Madison August 27, 2012 at 3:59 pm

Hi John – Thanks again for such great insight. I have tried the two for one sale and it has not worked – nobody is buying CD’s these days it seems. I am going to try the upsell thing – saying like – “if you buy now, for a limited time, you can buy 4 more CD’s from my catalog for $30!” And that would come after the original buy one get one free offer. What do you think? I’ll let you know how it works out. Looking forward to your next post on this. Thanks again, Bill

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John Oszajca August 27, 2012 at 11:21 pm

Hey Bill,

Sorry to hear you’ve been having a little trouble. I definitely find that a discount or a bundle works better than two of the same CD for the same price. But regardless, I do usually see any limited time offer get pretty decent results.

Usually when you are not getting the results you need something is wrong with the system. Typically when someone isn’t seeing sales it’s either because there is not enough traffic, the email and sales copy needs work, or the offer itself is not strong enough. I’m yet to see a troubled campaign where I cannot spot a pretty obvious problem once I take a look. Please post your squeeze page link and we can start there. Feel free to email me as well.

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dave haertel August 27, 2012 at 3:18 pm

Stephen,

I am sure John will agree, you and I and all the other songwriters,MUST create a NIche for our work..Mine being more meditative I am focusing on landing pages that explain how to get a better nights sleep. Sleeping more sound would be the Niche,relaxing more focus.etc

One thing I found out for sure in the last year and a half is.. Songwriters hate defining what they do.. Reasoning is because they feel others will Limit them.. But if you do your homework and create a product that fullfil the needs of the clients then you will sell your work,But you have to go out and find out what people need and then either create music to address that,or better what do you already do well? and create a niche around that.

Hope this helps and I hope Jhon didn’t mind me chiming in.

Dave

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John Oszajca August 27, 2012 at 11:23 pm

Not at all Dave, thanks for adding your thoughts.

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dave haertel August 27, 2012 at 3:07 pm

Hey John,
Perfect timing,I am settong up my personal and media download site all over,shouldn’t take to long,this confirms for me anyway,

buy one piece,get 5 other for half price.. I am focusing on downloads etc.. The wish list prompt is a very cool thing also. Just explaining to members why there work is being sold for less money every once in a while gets a little nerve racking :)

Dave

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John Oszajca August 27, 2012 at 11:02 pm

Hey Dave,

Glad you liked the post. Good luck with your promo and let me know how it goes.

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Stephen Monroe August 27, 2012 at 2:46 pm

John,
Insiteful as usual and in an area my mind is deficient. But as a song writer that writes from all over the place, I was thinking on this up sale thing, I have a few songs in VERY different mentalities….there are a few that are on the semi-twisted funny side and then there are the songs I wrote for church and are religious in nature. There are like 3 to5 of each type of song. Ok there is the idea for say “up sell” but with so few songs that if they were on Itunes etc would be able to be uploaded for $.99 each, any ideas on a way to package those items in an up sell mode? I think its brilliant to offer another piece after the initial sell…something special for someone special is great.. now to get the whole thing in place..
Keep on it brother….you make people think…that’s huge in this deluge

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John Oszajca August 27, 2012 at 11:14 pm

Hi Stephen,

Thanks for the kind words. Glad you enjoyed the article.

I my opinion it doesn’t really matter if they are on itunes as long as you offer them at a better price. I like to try and knock at least 50% off if I’m trying to really entice someone. Another option is to just avoid releasing the special offer tracks on itunes. At least for now. I think there is a great argument to be made for holding your album back from the digital distributors until well after the initial promotional period is over. That way you can control everything, create maximum desire, and make maximum profit.

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pat August 27, 2012 at 2:36 pm

Hey John,

Awesome blog post. Thanks so much for sharing this. We all really appreciate it as your skills are so practical and genius at the same time.
I found “digibilly” and am using it to help market my moms campaign. They have a one click upsell option that automates the delivery of digital albums.
Our initial offer is two cd’s for one, and the upsell that pops up before they even get to their cart is two more albums for the price of one.
So the customer is getting all four of my moms albums for the price of two. We’re seeing about 50% sales of the upsell.
But yes, our goal is to automate things as much as possible to not have to send the digital bonus files ourself every time.
Our sales funnel is working really well thanks to your guidance. Our next step is really driving traffic with advertising.
My mom is a world music artist and I’ve yet to find the best way and place to drop our ads. This has been fun and exciting though and we have been really appreciating your guidance.
Thanks again,
Pat

ps. I like your house concert idea as another upsell and am looking forward to hearing more ideas how to get the most value of the customers we already have.
Sidenote, Bandcamp is also working on automating a bonus album delivery which would be awesome.

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John Oszajca August 27, 2012 at 11:18 pm

Thanks Pat. That’s awesome to hear. Just illustrates how well this stuff works when you have a good system in place? Mind if I use part of that on the testimonials page? I love to share people’s quotes regarding numbers. Shows everyone else that this stuff really isn’t so impossible. It gets hard to hear “no one buys music” over and over again when as we both know, that’s simply not true :-)

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Pp August 28, 2012 at 7:50 am

Of course, feel free to use the testimonial. Also, maybe it’d be helpful if I gave you the exact numbers. We used a sample of 190 of my moms subscribers, (most of whom already had her new album). She told me things like, “Most of these people already have the album. Nobody’s going to buy it.” She gave the album out early to her fans who supported her on KickStarter.

Still after getting through our sales funnel emails, 5 people bought the new album (We’re only focusing on digital sales with our funnel) and 3 out of the five bought the upsell. I was pretty impressed by this and happy that our first sales funnel ever was working.

People seem to be genuinely excited about getting the extra albums for the price of one. One lady even emailed us saying I “My credit card isn’t working right now, can I still get this special next week?” And she followed through and bought it. The follow through has been great even with the initial issues with our upsell page not adding to cart properly. Peeps still came back to pick up the special which I was surprised by.

Mind you and your readers that these were all people who have been fans of hers for at least a year. We’ve yet to test it on the general public. We will try some advertising in a couple of weeks, but I feel confident in the tightness of our sales funnel thus far as it really is geared towards giving a lot of value and heart warming story before ever asking for the sale. (Vulnerability in the blog posts is a totally new thing for both of us, but it really is helping).

We give away about 4 songs total for free from various albums so they have something to look forward to when the albums are presented. AND ITS WORKING! People are leaving blog comments and really getting involved. We did have a couple people unsubscribe when they received our call to action emails, but they weren’t real fans anyway, apparently ;).

The limited time offer really has been getting people on the ball ready to buy, even though our offer page just stays up there as we’ve not yet figured out how to make an expiring page after the allotted time. This kinda feels like lying, maybe you could help us with getting an expiring page set up. Any suggestions would be much appreciated.

And our upsell page is super basic and simple, with just small pictures of each album snagged from bandcamp. It is straight forward.

Anyway, thanks again John.
We’ve been really adopting a whole new way of selling music and it feels good to be backed up by a system that has worked for 100 years. (It was awesome to read the history of the sales funnel).

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Robert Woodward August 27, 2012 at 2:18 pm

I signed up for the Music Marketing Blueprint video, but never received it. Could you please send me the video, now? Thank you.

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John Oszajca August 27, 2012 at 11:19 pm

Hey Robert. Sounds like it got blocked by your spam filter settings. Please email support@musicmarketingmanifesto.com and we’ll hook you up with the link.

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Eric C August 26, 2012 at 11:57 pm

Hey John, this was awesome. I’ve been following what you’ve been saying about the sales funnel for a while now but when I hear it laid out like that it always gets me excited. Thanks for giving us stuff that isn’t just more of the same. Looking forward to the next post on this.

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John Oszajca August 27, 2012 at 11:19 pm

Thanks Eric. I really appreciate it.

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