Bands Understand Relationship Marketing Better Than We Do

Matthew Creamer at Ad Age examines Radiohead’s bold “name your price for our new album” move.

The Radiohead news is a big reminder of the power of customer loyalty and how it extends even to crucial issues such as pricing. Other small-scale indicators also suggest that consumers, despite being depicted by record labels and movie studios as a thieving bunch of copyright violators, are willing to pay even when they don’t have to if they’re given some flexibility on price point and there’s a real relationship between consumer and content provider.
Exhibit A is Magnatune, a four-year-old download site for music by unsigned artists, which allows customers to pay between $5 and $18 for a record. The average price paid, a spokesman said in an e-mail, is between $8 and $9.
“Our customers report that they are willing to pay 20% over base cost because they know their money goes directly to support the artist and the company,” spokeswoman Teresa Marango said. “All Magnatune artists receive 50% of the sale price of each album or music licensing fee.”

About David Burn

Native Nebraskan seeking the perfect pale ale in the Pacific Northwest. Copywriter and brand strategist at Bonehook. Co-founder and editor of AdPulp. Contributor to The Content Strategist. Doer of the things written about herein.