Jed Carlson is explaining a new advertising strategy for Microsoft Windows when, suddenly, he pauses: "So, of all the people who took the download, how many times did they end up playing it on their iPod? Excuse me," the affable, sporty Carlson was saying before interrupting himself, realizing the seriousness of his mistake. "Scratch that. No, seriously, scratch that. Microsoft Zune, iPod, other portable MP3 device or phone."
Carlson doesn't work for Windows, but he is the co-founder of Reverb Nation, a Durham company that three years ago formed to help musicians turn emerging online technology into marketing tools, fanbase monitors and, ultimately, money makers. Last week, Reverb Nation launched a program called Sponsored Songs, in which it distributes a lump sum of cash from a large advertiser—in this trial run, $125,000 from Microsoft Windows—to the 1,000 bands that do best on Reverb Nation and speak to, as Carlson puts it, a "demographic of 18- to 34-year-olds, primarily in the United States." So, two days after launch, Carlson had better speak Windows.
With Sponsored Songs, Reverb Nation splits the money into unequal, predetermined shares among the acts, about three dozen of which are from North Carolina. Every time someone downloads a song (www.myspace.com/windows), the band that recorded it receives 50 cents until it reaches the contracted maximum payout, which ranges from $50 to, in limited cases, several thousand dollars. Each time the song plays (in the wildly unsuccessful Zune, of course), a small banner that reads "Because we love music as much as you do: Windows" drapes over the lower quarter of the album cover. The words "Microsoft Windows Sponsored Songs" consume the space that once displayed the name of the album.
The program is the latest in a series of variably successful attempts by large companies to use independent music to reach a new audience. And, as these things go, it's a subtle, almost artful form of advertising. If Sponsored Songs is to be a long-term strategy, though, many say it must form a stronger bond between the bands and brands it links.
It's common knowledge that most musicians make less money by selling records than they might have in the past. Through early March, for example, album sales in the United States were down nearly 12 percent from last year, a number that's consistent with the downward industry trend over the second half of the decade. The pattern holds for most musicians, from the biggest stars to the local independents: This year, U2, Dave Matthews Band and Kelly Clarkson sold significantly fewer copies of new albums than they did with previous efforts during the week after their release.
Adam Eckhardt, frontman of Raleigh quintet (and Sponsored Songs participant) A Rooster for the Masses, says the trend applies to his band, too. Sales of its recent debut LP, Broken Era, are much lower than those of a five-song EP Rooster released in 2006, despite increased touring. So, bands have to start somewhere.
"We were never eager to join this program," says James Hepler, the drummer in Durham's I Was Totally Destroying It, "but we always speak about how we figure this stuff out—being a band—knowing that bands don't sell records anymore."
Other opportunities exist, like selling rights to a song for a commercial or television show or lending a song to a lifestyle marketing campaign like Sponsored Songs. Only a decade ago, such a move—taking money from one of the world's biggest companies in exchange for using something you might have created in your bedroom—would have likely been anathema. But that ascetic aesthetic is old hat in a marketplace where a song you're seeking is at the other end of a Google search. Indeed, as the industry has withered, so have the means for introducing a band and making a profit.
As Reid Johnson of Chapel Hill's Schooner says, the 7-inch single—such a crucial and cheap building block of the indie-rock scene that emerged in Chapel Hill and elsewhere in the '90s—has been increasingly relegated to small markets. The CD single's eulogy has long been written, too. Sponsored Songs offers bands a new avenue of access to potential fans while earning the band a pittance, at least.
"It's not about making money," says Johnson, who received $75 from the program. "It's about having avenues of access to people."
But Glenn Peoples, a senior editorial analyst at Billboard magazine who has long run the music industry analysis site coolfer.net, suggests artists should show more self-respect. Bands could put the song on iTunes or another digital distribution service themselves and make about 70 cents per download. To an extent, this program guarantees bands downloads and payment.
But only three days into a 90-day program, Schooner, A Rooster for the Masses and I Was Totally Destroying It had all reached their download and money limit. Their songs remain in the program until the end, though, serving as advertising assets for Windows.
"After the cap, you obviously want people to listen to your music, but you're not going to get anything out of it. That's a raw deal for the musicians, but bands are in a position to want to take about anything now," says Peoples. "It really results in a race to the bottom, with the companies sponsoring these things really getting much more value than the bands."
Indeed, if Sponsored Songs has an undermining philosophical flaw, it's a three-way lack of commitment among the sponsor, the bands and the listeners, or between the pockets that are empty and those that are deep. The selection of music for the program emphasizes quantity over quality and fails to present a unified message about Windows: Despite the intended demographic, there's plenty of music here that doesn't seem too fresh, hip or young. Instead, Windows offers a lottery of links and luck.
The bands were picked based upon three quantitative criteria: their Band Equity Score, a number assigned to artists by Reverb Nation that, like a quarterback rating, reflects real-time statistics about that act's online impact; whether their fans fit the desired Windows demographic; and whether they fall into one of seven very broad genres, like hip-hop, electronica/dance or rock. If you listen to a lot of music, you'll have heard maybe a tenth of the bands. If you're a casual listener, maybe just Warren G (not dead!), The Lemonheads (back together!), Slightly Stoopid (weed jokes!) and whatever locals with whom you keep up.
The music was then screened for content, too: Monitors at Reverb Nation dismissed some songs due to profanity, overly strong drug and sexual references, and low production value. The criteria, says Carlson, were more selective than those generally in place at radio.
Such a high number of bands and qualifiers diffuse any message Windows might be hoping to communicate other than that, as senior marketing officer Marty Collins says, "We're interested in the music community. They're just one of many of the large, engaged communities we're interested in talking to across the Web."
Jon Cohen runs the New York-based firm Cornerstone Promotion, an edgy, highly successful, niche-oriented lifestyle-marketing agency that links brands seeking a younger demographic and bands looking to find a bigger audience. He believes this is the wrong look for Microsoft.
"We want to know one of two things at Cornerstone: What's going to own a niche or what will dominate that niche early on, and how do we take that to a wide audience. Or what's going to be mass and completely hit a lot of people," says Cohen. His company has helped launch or reinvigorate the careers of stars like Kanye West and Pharrell Williams and boost the image of brands like Southern Comfort, Mountain Dew and Levi's. The best of these strategies, Cohen suggests, connect two entities that believe that they can help each other. The music can lead the brand into new markets, and vice versa. That bond attracts a core of consumers. This program likely won't do that. "Looking at Reverb Nation's [Sponsored Songs], it's broad. At some point, they're going to need to hold the hand of their target and say, 'OK, here's what we're featuring.' You run the risk of not connecting with anyone."
The bands recognize this, too: Locals Schooner, I Was Totally Destroying It and A Rooster for the Masses all admit to being ambivalent toward the program and Windows. Johnson even sent an announcement to Schooner's mailing list boasting that this was a chance for musicians to rip off Windows and that the song, the dreamy "Feel Better," was for available for free download elsewhere, a direct violation of Windows' only requirement for the song. After all, if it ruffles some feathers, he reckons he's only out $75, or, as he calls it, "chump change" in the Windows world.