Preparing a solid strategy

Ever wanted to make some money from music?

Those associated with business are well aware that there is no clear-cut formula to succeed and while every other person in the street has a business idea, only one in a hundred make an attempt to become an entrepreneur as many people are afraid to take a risk or are not willing to part with their monthly salary. To succeed in business, there needs to be a desire to break away from the crowd and to muster the courage to make use of your idea.

History has repeatedly demonstrated that a brilliant idea alone will not guarantee success in business and in order to set yourself up to succeed, your idea must adapt to present day needs.

Case study

Our case in point is an organisation that emerged from humble origins derived from a collaboration of expertise by two entrepreneurs with varied backgrounds. The first was an individual who had specialist knowledge of the arts and entertainment industry applied to delivering high profile national government campaigns aligned with youth social marketing and the second is a gifted music composer and record producer for movies, documentaries and advertisements.

In this instance, the dream was to become the most successful promoter of independent Australian recording artists on the world wide stage showcasing all forms of music genres inclusive of rock, country, indigenous rap, soul and classical – an ambitious proposal that was launched at the height of the current world economic crisis.

The business plan prepared by these entrepreneurs contained four key elements – to build, launch, globalise and exit an entertainment business that has embraced the digital revolution sweeping the music industry.

There were four basic assumptions:

1. The traditional multinational CD delivery industry era is progressively being replaced by a model that embraces the digital landscape.

2. Artists seek a label-publishing-management company that integrates its business divisions in a manner that maximises the returns to artists and shareholders alike.

3. Ensure the terms and conditions of the Austrade Export Market Development Grant were strictly adhered to, then take advantage of the financial assistance being offered by the Australian Government to aspiring and current exporters

4. Use the backdrop of the Export Market Development Grant to build a local record label with an overseas licensing model that will allow a start up entity to offset all initial overseas promotional costs inclusive of touring, promotion, web development and other similar costs.

Given the nature of the entertainment industry, it was critical to be adaptive to new trends and to be flexible when approaching key elements of this industry. Our client clearly recognised and understood that traditionally, any recording studio had the ability to record, publish and manage artists of exceptional talent. The point of difference in this business opportunity was to connect their artists through new business models that emphasise authenticity, community and belonging.

With a background in youth social marketing, it was understood that media based prevention programs have long been employed as tools to address risk behaviours, namely drug, alcohol and tobacco use. Therefore, the selection of music delivered to the audience had to depict real life stories with an emotional appeal that portrayed the negative consequences associated with the every-day challenges that face all adolescents. It was this formula that facilitated the ability to emphasise authenticity, community and belonging through music.

With a tag line “Serving the Song” each musical piece was designed to entertain, inspire, uplift and transform the listener.

The business plan called for an adherence to the terms and conditions of the Austrade Export Market Development Grant. To be eligible for a rebate, the claimant must be the owner or exclusive licensee of copyright in either the sound recording or musical work. The key to the rebate is to ensure that the expenditure claimed is directly related to the rights being promoted. By following the terms and conditions, an application has been made for a rebate associated with the following expenses – airfares and other travel expenses, overseas market development, advertising and promotion, trade fairs and in-store promotions, marketing consultants, communication expenses, product samples and running an overseas office.

Without the ability to obtain assistance from the Australian Government, the task of promoting Australian products would have taken far longer and been considerably more expensive.

The final step in this journey of success required the promotion of the finished product to an international market. In this instance a major American
music festival served as a backdrop to showcase the musical talents of the Australian artists on the roster of our entrepreneur clients.

While still in its infancy, there has been a considerable degree of success in the delivery of the project. With the build, launch and globalise stages well progressed, only the exit strategy remains.

The critical lesson from this case study is the need to set yourself up from the outset to succeed in any venture.  Our entrepreneurs were prepared to answer any question from an interested party about the business and by responding in every instance with a solid answer there was comfort they were on the right track and bound to succeed in this venture.