Photo Credit: Walt Disney Television
By Nick Holmsten
We should raise a toast to Olivia Rodrigo. The eighteen-year-old singer-songwriter’s single “Drivers License” recently achieved the most Spotify streams in a single day for a non-holiday song, most streams in a single week with 65 million, and fastest to 100 million streams in just eight days. These are all major accomplishments, but it’s the future ahead of her, for other artists, that excites me. Rodrigo’s success spotlights a new paradigm for creators alike that is already reshaping the entertainment industry.
To understand this new framework, look no further than Rodrigo’s existing influence on TikTok. As Craig Jenkins notes in Vulture, this type of catapulted success hasn’t been seen since the early days of American Idol with winners like Fantasia Barrino, Clay Aiken, Carrie Underwood, and Taylor Hicks. The apt comparison not only spotlights the shift of consumer music discovery from broadcast channels to social media but also points to the impact reality television (and its digital extension, social media) has on building fandom — and an individual’s brand. Rodrigo is not the first artist to find success leveraging Tiktok (Lil Nas X, Jason Derulo, Drake, Doja Cat, etc.), nor will she be the last.
The internet’s role — and more recently social media’s — on restructuring the music industry is well documented. Plenty of great articles like Jenkins’ have discussed social media’s role (most recently focusing on TikTok) in giving back control to artists from record labels. While social media has provided artists control of their marketing, the more comprehensive chronicles of the industry’s changes have also cited the decreasing costs in production, changing distribution methods (e.g. streaming), and waning influence of traditional broadcast channels as contributing factors to this rebalancing of power in the music industry. (Stuart Dredge has done a fantastic job over the years covering the big picture of shifts and is worth reading.)
What this all means for the record industry at large is now under scrutiny amidst labels’ public offerings. Today, many of the biggest stars in the music industry like Rodrigo control and own most of their rights including recordings, publishing, touring, merchandise, etc. For major record labels like Universal Music Group (UMG), Sony Music, and Warner Music Group, their model is now focusing on licensing (which gives top artists even more leverage). But this business framework long-term is tenuous, as the growing catalogue of independent music will eventually exceed that of major labels.
Attention is a resource, like time — a person has only so much of it. Attention is today’s leading currency. This new world is the Attention Economy.
While I was at Spotify, we all thought that once The Beatles discography came on the platform the number of plays would over time catch up with other greats on the service. Today, their top song based on streams, “Here Comes the Sun,” has just shy of 600 million plays. Meanwhile, Cardi B’s recent hit “WAP” released just six months ago already has over 600 million streams.
Underlying this success of an adult entertainer turned megastar is the scalable and compounding reach that the internet provides creators with high-value content. Artists can garner attention using their own platforms so long as they continue to provide and generate valuable content.
If we unpack this discovery, we see something that’s very encouraging for labels. Gen-Z and Millennials stream music at an exponentially higher frequency than their older (+50) counterparts whose listening frequency remains largely unchanged since music’s digital streaming transference. This helps explain why a contemporary artist like Cardi B’s streams will significantly outpace that of The Beatles. But when legacy artists have gotten the attention of the younger generation — such as the recent viral sensation of Fleetwood Mac’s “Dreams” — the numbers are equal to the most popular artists of today.
So what does the future for artists and labels look like?
Influence x Value = $$$
Seizing upon Nathan Apodaca’s (aka 420Doggface208) viral video, where he drinks a jug of Ocean Spray Cran-Raspberry juice while longboarding and listening to Fleetwood Mac’s “Dreams,” the beverage brand sent the rising star a truck and loadful of juice as a gift. A brand representative noted an uptick in physical sales stemming from the social sensation; and, the company’s stock price soared in parallel with the rising attention. While Ocean Spray did a good job of seizing this spotlight moment, it still was all reactionary. What if it was prompted?
Consumer attention, once controlled by an oligopoly of publishers and broadcasters, is now a democratized good available to whoever can seize it. YouTube, Spotify, TikTok, Instagram, and the like have provided creators the ability to broadcast at scale to anyone in the world — and thereby stimulate a massive increase in ready to watch, read, or listen to content. Cutting through the overstimulation of online information is extremely difficult for anyone.
Not long ago brands could easily pay for a slot (and outbid a competitor) on a primary broadcast channel (television or radio) and usually have good results. Those days are generally numbered. The online fragmentation of consumer attention across channels and creators means every brand is aggressively competing for consumers’ attention. (They’re also competing with creators — which I’ll discuss in more detail later.)
Today, creators — from athletes to musicians to film stars to models — carry the torch in this new economy because of their reach and valued content. This is where the Olivia Rodrigos of the world now have growing power. As of Dec 2020, the top five most isfollowed individuals on Instagram were:
• Cristiano Ronaldo (Soccer Player) 250 Million
• Ariana Grande (Artist) 210 Million
• Dwayne Johnson (Actor) 207 Million
• Kylie Jenner (Celebrity) 204 Million
• Selena Gomez (Artist) 197 Million
Their reach exponentially extends the impact of their content online — and offline. Businesses have taken notice.
Over the last five years, TV and film industry superstars like Dwayne Johnson, realizing the value of their online reach, have leveraged their digital influence to climb the film industry ladder. These actors negotiated and became co-producers in upcoming movies. Many of them, like Leonardo DiCaprio, Will Smith, Kerry Washington, Dwayne Johnson, and Reese Witherspoon owns their own large production companies and are responsible for some of the biggest movies and TV shows.
If what has happened in the film industry is any indicator, it’s only a matter of time until all of the top musicians seize upon their newfound platforms to create new revenue streams. While most artists will never mirror Rodrigo’s overnight success and scale of reach, there are still plenty of opportunities for them to diversify their revenue models within the Attention Economy.
Already we’re seeing musicians using their platforms and reach to create and sell new merchandise. Rihanna’s Fenty Beauty brand netted $600M in 15 months; she’s also expanded beyond just beauty products with her “Savage x Fenty” inclusive and affordable lingerie brand (now valued at $1B) which premiered through runway shows streamed via Amazon Prime.
The biggest model for success lies in the South Korean boy band supergroup, BTS — who lead Big Hit Entertainment and its valuation of over $8B. I won’t over-index on all the diversified revenue streams (read this), but simply note that underlying their success, as is the case with the aforementioned creators, is a huge fandom built around BTS’ social media presence.
Let’s return to the original question posed earlier: how can brands or labels proactively break through the noise or create value in the Attention Economy? Much of this article has focused on the digital influence of creators that carries over into the physical world of sales (tickets, merchandise, etc.).
But of course, the physical world also influences the digital world. With his Super Bowl performance, The Weeknd saw a 220% increase in streams on Spotify. The Museum of Ice Cream — an art installation crafted with Instagram in mind — saw unimaginable success as visitors flocked to the exhibit (quickly selling out the tour) for the experience and to contribute to the 66,000 branded hashtag photos on Instagram. Creating these in real-life experiences are not cheap, but brands’ and labels’ pocketbooks run much deeper than most creators.
What excites me most about Rodrigo’s success is the fact that it furthers this shift of power to artists — and in turn, is pushing entertainment brands to rethink their business models. I firmly believe the Attention Economy will give more artists a larger seat at the table, and consequently, music labels will need to innovate (and deliver better real-life consumer experiences) to match creators’ values. What brands and creators do is anyone’s guess — but I’ve got a hunch, it will be entertaining.