Artists Made $150 Million Using Bandcamp Since 2008
We take a closer look at what this means for independent artists making most of their money from streaming and touring.
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Online music streaming and sales platform, Bandcamp, announced the total amount of money artists have made from the site since its founding in 2008. They say fans have paid artists over $150 million dollars, including $4.3 million in just the last 30 days.
Unlike most other platforms, Bandcamp's business model is set up to benefit artists relatively generously, by industry standards. For digital items, artists get 85 percent of sales, and for physical items they get 90 percent. If an artist or label makes $5,000 worth of annual sales, then they are able to get 90 percent of the profit from digital sales, too. Considering that the average payout-per-stream for signed artists on Spotify is $0.001128, according to the Guardian, Bandcamp's cumulative sales figure seems pretty heartening.
The problem, however, said media analyst Mark Mulligan of UK company MIDiA Research, is that "only a small percent [of music fans] are the superfans who will buy from DIY sites or crowdfunding." In fact, according to him, less than 5 percent of people pay artists money on platforms like Bandcamp or Kickstarter.
"This is where it becomes really challenging for your average artist: those artists who are likely to be using something like Bandcamp are not your superstars," he explained. "Now, your superstars are doing pretty well out of streaming because the numbers are just so big, and if you have a hit, a hit is an even bigger hit on streaming than it would be anywhere else."
But if you're a smaller artist, you tend to make more money from sales than from streaming, so sites like Bandcamp turn out to be quite important. Touring is in many cases necessary for career sustainability: "These DIY and crowdfunding sites like Bandcamp could well be the difference between you being able to carry on being a full time artist versus giving it up and going back to a dayjob, but it's not going to be enough on its own" says Mulligan. "These sorts of sites become super important, [but] you still have to make up the majority of your money from touring."
A PwC report found that global total live music revenue will grow from around $26 billion in 2014 to nearly $30 billion in 2019, as recorded music revenue will fall from almost $20 billion to around $18 billion in the same time period.
Jesse Cannon, author of Get More Fans: The DIY Guide To The New Music Business, said that Bandcamp is vital for how it connects independent artists with their fans. He says it's the only streaming service that lets musicians get a fan's email address and zip code, which turn out to be extremely important, especially when it comes to getting people to come see you on tour.
"If you're a touring band [or producer] in a more niche crowd, having an email address that you're able to use to contact really enthused music fans ... is literally the difference between building a career and not building a career," he explained. "The biggest difference between which musicians make it and which don't is whether you actually grow those relationships and do the best practices to make sure that happens."
Cannon acknowledges that touring is extremely important, but insists that "it's not going to do you well unless you're getting people to download your music, and then be able to have communication with them. Bandcamp is a way to enable you to do better with touring revenue."
Chicago footwork producer DJ Earl's experience of Bandcamp fits Cannon's analysis in that, for him, it has mostly "been a platform for me to promote what I'm doing and get more booking." He explained, "I've definitely made money over time, but Bandcamp has been more of a platform for me personally to promote my sounds and get me touring and exposure."
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