Reports: Superfans

Fandom is becoming the music industry’s golden goose, with labels focusing on building and monetising superfan bases for their top artists. However, superfan behaviours are changing in response to oversaturation and hyper-fragmentation. What once worked for measuring and monetising fandom will not work the same in the future.

The music merchandise market has transformed, with significantly more artists selling merch and more product variety than ever before. The traditional line between “hard” and “soft” merch is blurring as new generations buy vinyl as a collectible keepsake, rather than a consumption format.

Streaming is buckling under the weight of new music being released every day, listenership is fragmenting, and artificial intelligence is poised to intensify these challenges. The music industry’s next era of growth lies in monetising fandom, not consumption.

The debate over a new streaming royalties regime is capturing attention, but economics will not fix the underlying paradigm shifts that are the true cause for streaming’s problems: there is not enough money to go around for the ballooning amount of music on streaming services, and passive consumption is the new norm.

Music streaming has helped the music industry return to growth over the past decade, but many creators feel left behind. The streaming economy has reached a point where the creator remuneration gap can no longer be ignored. It is no secret that many music artists are dissatisfied with the relationship between the consumption of their music on streaming platforms and the income they receive from it.

As the barriers to music creation continue to lower, more creators enter the field, yet it is becoming harder than ever to earn a living through music, with a finite amount of revenue being split ever more ways. The majority of professional music creators do not earn meaningful income through their craft and must cobble together income from a diverse mix of sources to make ends meet.

As streaming subscriptions rise and music increasingly competes with other forms of media for consumers’ limited attention spans, lean-back listening activities are taking precedence over those which are lean-forward. But the full picture is far more varied.

Fandom is entertainment’s growth currency, yet it remains both under-valued and poorly understood. While other entertainment currencies can be accurately measured (number of streams, number of sales, number of views, etc.) it is only the effects of fandom that can be quantified (number of likes / shares, merchandise sales, etc.

In April 2020 Travis Scott’s Fortnite event pulled in 27 million players. While this was happening, the global artist community was scrambling to plug the income and engagement gap caused by COVID-19’s cessation of live music, by turning to live streaming.