The consumer model has seen major changes over the last few years. You may have expected to find physical gifts in your Christmas stocking back when you opened it up. As those products became digitalized, you may have started to get a lot of gift cards that can be used online. We’ve witnessed another consumer shift this year. This time, it’s toward subscriptions. Everything today, from Netflix to Spotify, Pro Tools, to Microsoft Office, seems to run on a subscription model. While major record labels aren’t yet able to crack this subscription code, there are many tools that independent artists can use to make the subscription model work. These are the top three options for musicians looking to make a steady, predictable income that is not dependent on one-off gigs or sales.
1. Patreon
Patreon is the best place to start generating ongoing income as an artist. It was specifically designed for that purpose. Although Patreon is often mistaken for IndieGoGo or Kickstarter, it is actually something completely different. Jack Conte, the founder of Patreon (of Pomplamoose), describes Patreon as a platform that allows fans to become patrons of their favorite artists. This idea was a relic of the Renaissance when musicians relied on wealthy patrons to continue creating art. Patreon is different because you don’t need to rely on one wealthy person to fund your career. Instead, you rely on small, recurring donations from many of your fans.
Patreon works in that people agree to pay you a set amount for every new thing you create. You can upload a song, music video, or instructional video. Fans who pledge different amounts (which is why the Kickstarter comparison comes in).
You’ll see examples of artists such as Pentatonix making upwards of $19K per music video that they release through Patreon. However, the average artist earning on Patreon is somewhere between $100 and $300 each month. This will keep you playing new instruments, but it won’t be enough to make a career. Patreon is a great way to make a solid connection with your fans and build a steady source of income. Many artists make upwards of $1,000 per new release on Patreon.
2. YouTube
YouTube is the most popular place for music fans to search these days. However, many musicians have a love/hate relationship with YouTube. The low payout rates of the video streaming site are what has caused most of this frustration. According to Forbes, Molly Lewis, a singer and songwriter, earned $28 for a video with over 14,000 views. Thom Yorke compared YouTube’s payment system with “what the Nazis did during World War II.” YouTube has made efforts to improve this situation.
YouTube has launched YouTube Red and YouTube Music fan subscriptions. With these services, YouTube is changing the way it pays creators. YouTube Red and YouTube Music are new subscriptions that can make YouTube more like Spotify or Apple Music. Instead of waiting for advertisers to pay, creators can earn money from their videos based on how many people have watched them. This money comes from monthly subscription fees that fans pay.
Although it’s unclear what kind of payments this new model will bring to artists, YouTube is moving toward a subscription model, which offers another avenue for artists to make a steady income.
3. Licensing Libraries
YouTube and Patreon tend to be geared towards artists with a natural talent for building relationships with their fans. However, another option is available to artists who don’t feel inclined to communicate with their fans as often. You can earn recurring income by licensing sync music by being part of a music licensing program that is specifically targeted at indie artists, such as Community Tree Music in Canada or The Music Bed in the U.S.
Although the most lucrative sync licensing deals involve having your song featured on a Superbowl commercial or network TV, smaller placements such as wedding videos and social media ads can make you a lot of money. If you are an artist who releases new music frequently and has a sound compatible with these videos, the right licensing library can help you create a reliable stream of income from your music.
This model has a downside. It’s not subscription-based, so you don’t get the same income every month. Most of these services pay quarterly and biannually. However, once songs are placed through a licensing program, it can often have a multiplier effect. More placements equal more exposure. Artists who have established a following through the licensing library can often count on their library placements for income on a predictable basis.
You might find one that is better suited for your music and your sharing preferences. Patreon might be the right choice for you if you can release new material regularly and build a relationship with your followers. YouTube’s new subscription-based model might be a better option if you depend more on video streams to generate income. A licensing library might be the best option if your music is more suited for accompanying videos made by others. We have many platforms to choose from, so not every artist can succeed on each platform. Artists should have multiple streams of ongoing income. This is ideal. When you combine these income streams and earnings from other sources like streaming revenue, digital downloads, or touring, you can see an increase in your annual earnings.