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Selling out ain't what it used to be. What indie music can learn from major labels.

Here’s a sneak peek at the Aug. 19 issue of Marketing

Selling out ain’t what it used to be. What indie music can learn from major labels

When three separate crowds of young Canadian tastemakers filed into Samsung’s regional Galaxy S4 launch parties last April, they weren’t entirely sure what to expect.

An invitation promised live music performances at each event, simultaneously thrown in Toronto, Montreal and Vancouver, and a “special technological experience” featuring celebrated indie darling Feist.

Through the magic of holographic projection—and the money of Samsung—Feist was beamed into all three parties at once without actually being at any of them. Partygoers tripped over themselves to snag a good Instagram of Canada’s most beloved indie-singer performing as a hologram at a corporate party, though it wasn’t her first. Music fans have labelled Feist a sell-out for much less. But selling out isn’t what it used to be. Feist was among the earliest crop of indie artists to have music licensed to Apple for its series of iPod Nano commercials in the mid-2000s. Sales on her quirky hit “1, 2, 3, 4” more than doubled after the spot aired, earning the singer and her record label, Toronto indie mainstay Arts & Crafts, both a boat-load of money and a good helping of scorn, the latter from those who felt selling the song meant she’d sold out completely. That was in 2007. Today, the conversation around selling out is virtually non-existent, and the shame that once followed musicians for accepting mega-money from corporations is an antiquated mindset, no longer a tough “should I or shouldn’t I?” conundrum.

Partnerships between bands and brands are increasing in the wake of the music industry’s fight to survive in a post-MP3 universe, and other creative sector marketers have begun to take note. Some of the most innovative ideas in music today are happening not in the music itself but through the way it is marketed and released. Likewise, some of the smartest marketing of this generation is happening alongside the music industry as bands and businesses join forces to make money through making art.

At one extreme are moguls of the upper echelons of popular music, such as Lady Gaga and Jay Z. During Lady Gaga’s last press cycle, the singer used Skype, her official tour partner, to chat with fans around the world in livestreamed video chat sessions. Skype also set up video booths at her concerts so that fans could record messages for the beloved pop star. This summer, Jay Z announced that his new album would launch exclusively to the first million fans that downloaded his app to their Samsung devices, three days ahead of the album’s global release. (The Wall Street Journal reported that Samsung paid $5 a piece for the deal.) According to preliminary Nielsen SoundScan data, the album moved about 527,000 units in its first week. Samsung ended up with 21% more Twitter followers and a 324% boost in its YouTube channel views thanks to the deal’s promotional video.

But these kinds of transactions are no longer reserved for pop’s most powerful people. For years, brands like Mountain Dew and Scion have held down a visible presence at indie-driven music festivals like Austin’s South By South West, where unsigned bands play to masses of raucous millennials not interested in major label giants. This demographic—a young and savvy creative culture that socks away coolness like currency—tends to be more skeptical toward traditional advertising methods. If brands want to invade their space and not be laughed out of the party, they have to know how to fit in. Red Bull, for one, knows how to do this. It has firmly planted itself not adjacent to, but directly inside, music culture with its own record label, regular sponsorship deals and its Red Bull Sound Selects concert series which focuses on propping up local music scenes.

With its Red Bull Music Academy program, up-and-coming DJs and producers are mentored by the industry’s top talent. Red Bull doesn’t just go to an event and string up a banner with its logo across the front—it curates, hosts, teaches and participates. This purposeful integration has earned the brand a secure place among music’s in-crowd.

At Osheaga, Canada’s premiere music festival, which takes place each August and has sold out its entire 40,000 ticket-per-day capacity for the second year in a row, Red Bull will sponsor an air-conditioned area where fans can get out of the sweltering summer heat.

“It comes down to what the sponsor can bring to the site,” says Eric Nadeau, director of corporate sales and sponsorship at Osheaga. “How can they enhance the fan’s experience?” Nadeau is quick to point out that attendees at Osheaga are never solicited by brands, and the only thing for sale, other than food and beverages, is band and festival merchandise in the designated merch area.

This year, H&M will make its first appearance at Osheaga, also with an air-conditioned tent, where fans can model the brand’s clothes to customize their “ultimate festival look,” touch up their makeup, and charge their devices while using the tent’s free wifi. The brands who succeed at reaching festival-goers are the ones who give them what they want after they’ve been standing in the heat all day—air conditioning, wifi, a place to charge their phones, an aesthetic touch up. “It’s unrealistic to think that we could just have a few sponsors,” says Nadeau, with regards to how heavily sponsored the festival is. “But we try to be as integrated as possible. We’re not going to go with any brand just to get a cheque; it has to make sense.”

Janice Price, CEO of Toronto-based multidisciplinary arts festival Luminato, echoes this philosophy as she describes Luminato’s mandate around partnerships. “I think the consumer is sophisticated enough to say ‘oh, this is probably a free concert because there’s a Kia car sitting there.’ The public knows somebody has to pay for this,” she says. Price estimates that about 70% of Luminato’s programming is free, due largely in part to its roster of sponsors.

Price, formerly the vice-president and executive director of New York City’s Lincoln Center, says scoffing at the idea of mixing art and commerce is counter-productive, and that her goal is to reach as wide an audience as possible in service of the theatre, music, visual and performance art showcased at Luminato.

“Don’t we all have the same goal of trying to get our work out to the most people?” she says. “What is that magic tipping point where suddenly it’s no longer real art? When you’re in the mainstream? As long as what’s being created and produced is authentic and is done with integrity, I don’t think there should be any [sponsorship] boundaries at all…We have to stop feeling that we are not true artists if we describe what we do, sometimes, as product.”

Creating an effective product, however, can get tricky—eyes and ears are expensive. And while enthusiasm abounds for new branded music possibilities, there are still limitations to what even the most business-minded clients and companies, on either end, will go for.

As one example, many festivals refuse lucrative stage-naming propositions because they see it as being too branded. Chicago’s Pitchfork and Tennessee’s Bonnaroo, both landmark American festivals with the same demographic as Osheaga, do not let brands sponsor its stages. Osheaga, on the other hand, does.

In an interview with Advertising Age, Pitchfork Media’s vice-president of advertising, Matt Frampton, said “Stage sponsorships are a big moneymaker, but our position has been that when you get 20,000 people in a field and they’re looking at brand marketing, they’re not focused on the editorial experience of the festival—the music.”

Nadeau, who has sold this year’s Osheaga stages to Virgin Mobile, Molson Canadian and Sennheiser, says ensuring the brand’s logo is integrated in a natural way will resolve any issues around the fan’s attention. “The corporate [presence] is really to help create the magnitude of event that we do,” says Nadeau. “We’re careful about doing it in a tasteful way and not bothering anyone while they’re having fun. The most successful sponsors will be the ones that are best integrated.” Nadeau says Osheaga’s headlining acts cost “hundreds of thousands” of dollars each, and that even the lesser known acts—the ones at the bottom of the bill—cost a few thousand, all of which adds up to a multi-million dollar operating cost. Perhaps one day Osheaga will join its contemporaries in taking its stages off the market, but much like that Samsung or Apple money was too good for Feist to pass up, Osheaga needs those logos on its stages in order to even have them.

Speaking about his own deal with Samsung, Jay Z told news and culture website Life and Times, which he curates and owns, that his mission was to find a new revenue model for the music industry. “First of all we’re in a dying business, everyone sees that,” he said. “So what am I supposed to do? Just wait and sit here until it reverses, wait until it gets to zero before I do something?…If you’re not with the changing times, you’re irrelevant to me. I’m gonna move on.” It sounds a little brash, but the innovation at the core of his defense is one that’s also trickled into the indie realm.

In June, Arts & Crafts (Feist’s label) threw a daylong music festival in Toronto to commemorate its 10th anniversary. In advance of the event, the label partnered with clothing designer Jeremy Laing and Hudson’s Bay on a T-shirt line, hosted a photo exhibit on Queen West and partnered with online homemade goods retailer Etsy to create a video series. They also partnered with The Drake Hotel, taxi app Uber, Scion, Absolut Vodka, Amsterdam Brewery, The Toronto Underground Market and AutoShare. For an indie label celebrating the fact that it started from the bottom and scrounged its way up, some found it peculiar that so many branded partnerships, albeit carefully selected ones, would occur around the event. But those branded partnerships are why a label like Arts & Crafts could afford to throw a festival of this kind; it’s not selling out, it’s savvy.

“To put artists in that dogmatic box is not appropriate and not realistic,” says Price, of the prevalent assumption that art and money are antithetical to one another. “I don’t see any inherent conflict.”

Once upon a time, taking sponsor money was seen as detrimental to a musician’s mystique. Bands with corporate sponsorships, artistic endeavors underwritten by businesses and events hosted by brands were as unheard of—or as uncool—as riding to a party in the passenger seat of your mother’s minivan. With brands like Red Bull now hosting the party themselves (literally), and as more brands and artists get comfortable with collaborations that reconcile art and commerce, those in the creative sector no longer have to be ashamed of how they got to the party, or who drove them.

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